Trade Dispute

Trade Dispute

Legal Definition of Trade Dispute

The term “labor dispute”is a broad one and can refer to, at least, two different groups of conflicts. The first one includes any controversy concerning terms or conditions of employment, or concerning the association or representation of persons in negotiating, fixing, maintaining, changing, or seeking to arrange terms or conditions of employment, regardless of whether or not the disputants stand in the proximate relation of employer or employee. In a second meaning, it refers to a discrepance (argument) between countries in a context of international trade commitments. In both cases, it may be necessary to bring a third party (for example, the World Trade Organization dispute arises when a WTO’s member government believes another member country is violating an agreement that it has made in the WTO) in order to reach a resolution.

Learn more about the definition of trade dispute here.

Labor disputes

“The term “labor dispute”and may be properly applied to any controversy which is reasonably related to employment and to the purpose of collective bargaining. It is broader than “strike”(employees refuse to work until there is a formal negotation or their demands are met) “lockout”, and the existence of a trade dispute is not dependent upon the stoppage of work. Depending on the dispute and the size of the company or entity, Trade unions participate in the trade dispute, acting on behalf of workers.

Learn more about the definition of labor disputes here.

Accordingly, the following factors must be present in the (in some countries, official “declaration of”) the existence of a (labor) trade dispute:

  • A controversy concerning terms and conditions of employment.
  • A union or group of employees involved in a concerted action against an employer due to the controversy.

The presence of pickets and/or a walkout does not necessarily indicate there is a labor trade dispute. It is not uncommon for unions to establish “informational”picket lines. An “informational”picket line is established for the purpose of advising the public the employer does not have a union contract or is selling goods produced by a struck or nonunion employer. There are no negotiations between the union and the employer concerning terms and conditions of work. The union has not presented demands to the employer. An “informational”picket line, by itself, would be an insufficient basis to conclude there is a trade dispute. Accordingly, if a claimant refuses to cross an “informational”picket line, the claimant’s leaving of his/her job would be resolved under the applicable labor legislation.

When a trade dispute involves industries vital to the national economy, the government may have a stake in the trade dispute.

International trade disputes

Most international trade disputes (for example, because one country disagrees with new tariffs or policy changes a trading partner has made) are resolved by arbitration if the parties themselves are unable to reach an agreement.

If the parties need a mediator, several International trade organizations can supply representatives to try to find a solution or settle the dispute. The countries involved in the dispute may also take their case to court, arguing a violation of the terms of international law or existing trade agreements.

WTO International trade disputes

An increasing number of international trade disputes are settled through the WTO dispute settlement procedure. They are, therefore, heard in the WTO panel and Appellate Body proceedings.

Disputes in the World Trade Organization are “essentially about broken promises. WTO members have agreed that if they believe fellow-members are violating trade rules, they will use the multilateral system of settling disputes instead of taking action unilaterally. That means abiding by the agreed procedures, and respecting judgements.

A dispute arises when one country adopts a trade policy measure or takes some action that one or more fellow-WTO members considers to be breaking the WTO agreements, or to be a failure to live up to obligations. A third group of countries can declare that they have an interest in the case and enjoy some rights.

A procedure for settling disputes existed under the old GATT, but it had no fixed timetables, rulings were easier to block, and many cases dragged on for a long time inconclusively. The Uruguay Round agreement introduced a more structured process with more clearly defined stages in the procedure. It introduced greater discipline for the length of time a case should take to be settled, with flexible deadlines set in various stages of the procedure. The agreement emphasizes that prompt settlement is essential if the WTO is to function effectively. It sets out in considerable detail the procedures and the timetable to be followed in resolving disputes. If a case runs its full course to a first ruling, it should not normally take more than about one year – 15 months if the case is appealed. The agreed time limits are flexible, and if the case is considered urgent (e.g. if perishable goods are involved), it is accelerated as much as possible.

The Uruguay Round agreement also made it impossible for the country losing a case to block the adoption of the ruling. Under the previous GATT procedure, rulings could only be adopted by consensus, meaning that a single objection could block the ruling. Now, rulings are automatically adopted unless there is a consensus to reject a ruling – any country wanting to block a ruling has to persuade all other WTO members (including its adversary in the case) to share its view.

Although much of the procedure does resemble a court or tribunal, the preferred solution is for the countries concerned to discuss their problems and settle the dispute by themselves. The first stage is therefore consultations between the governments concerned, and even when the case has progressed to other stages, consultation and mediation are still always possible.”


See Also

International Trade and Commercial Relations resources
General Agreement on Tariffs and Trade
Trade law
World Trade Organization
Theory of Agency
International Trade
Labor Dispute
Dispute Mediation
Dispute Settlement Understanding
Discimination (in international commerce)
Anti-Dumping Laws
Trade Balance
International Trade Commission
Dispute Settlement Body
Restraint of Trade

Hierarchical Display of Trade dispute

Trade > International trade > Trade relations
Law > Justice > Judicial proceedings > Arbitration
Law > Justice > Judicial proceedings > Alternative dispute resolution
International Organisations > World organisations > World organisation > World Trade Organisation > Dispute Settlement Body
Trade > Trade policy > Commercial law > Commercial arbitration

Trade dispute

Concept of Trade dispute

See the dictionary definition of Trade dispute.

Characteristics of Trade dispute

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Translation of Trade dispute

Thesaurus of Trade dispute

Trade > International trade > Trade relations > Trade dispute
Law > Justice > Judicial proceedings > Arbitration > Trade dispute
Law > Justice > Judicial proceedings > Alternative dispute resolution > Trade dispute
International Organisations > World organisations > World organisation > World Trade Organisation > Dispute Settlement Body > Trade dispute
Trade > Trade policy > Commercial law > Commercial arbitration > Trade dispute

See also

  • Trade conflict