CPI Antitrust Chronicle: What is wrong with the WTO discipline on subsidies?

Academic Affiliate Damien Neven authored an article for Competition Policy International's Antitrust Chronicle alongside Petros C. Mavroidis, exploring the complexities of modern global trade regulations. The paper provides an analysis of the regulation of subsidies within the World Trade Organization (WTO), highlighting several issues with the current framework.

This article was originally published by Competition Policy International here. The views expressed in this paper are the sole responsibility of the authors and cannot be attributed to Compass Lexecon or any other parties.

Abstract

The regulation of subsidies in the WTO leaves a lot to be desired. It is outdated, as it was negotiated before the advent of global value chains. It does not allow for public policy justifications and is un-informed by economic analysis. Finally, there is a lingering uncertainty (following the completion of the original contract through case law) regarding the appropriate counterfactual against which the subsidies need to be assessed. A re-negotiation is warranted. For otherwise, even assuming the current crisis of the judiciary of the WTO were to be overcome, adjudicators would be called to enforce an outdated, unsuitable contract. That risks deepening the current crisis even further.

Read the full article here