Building capacity to help Africa trade better

How will Rulings regarding AfCFTA Disputes be implemented?


How will Rulings regarding AfCFTA Disputes be implemented?

How will Rulings regarding AfCFTA Disputes be implemented?

Disputes declared in terms of the AfCFTA Dispute Settlement Protocol can be settled during the consultation phase, which comes first and is compulsory. Article 7 of the AfCFTA Dispute Settlement Protocol provides that “in the course of consultations and before resorting to further action under this Protocol, State Parties shall attempt to obtain a satisfactory settlement of the dispute”. The Parties involved in successful consultations will also decide how their settlement will be implemented and only they are bound by the terms of settlement agreed upon by them; it will not create a precedent for others.

If the matter is not settled through consultations, the dispute typically moves to the next phase, when the Complaining Party shall, in writing refer the matter to the DSB and request for the establishment of a Panel.[1] The Panel shall be constituted within ten days of the relevant DSB meeting.[2] The Panel shall make an objective assessment of the matter before it, including of the facts of the case and the applicability of and conformity with the relevant provisions of the Agreement and make findings to assist the DSB in making recommendations and rulings.[3]

A Panel must also consider the rebuttal submissions and arguments of the Parties to a dispute and issue a draft report, to which the Parties to a dispute shall submit their written comments.[4] A final Panel report is then circulated. It shall be considered, adopted, and signed at a meeting of the DSB convened for that purpose, unless a Party to the dispute formally notifies the DSB of its decision to appeal, or the DSB decides by consensus not to adopt the report.[5] (This is an example of reverse consensus rule.)

In the final phase the matter will be heard by the Appellate Body (AB). Appeals are limited to issues of law covered in the Panel Report and legal interpretations developed by a Panel.[6] An AB report shall be adopted by the DSB and unconditionally accepted by the Parties to the dispute unless the DSB decides by consensus not to adopt the AB report within thirty days following its circulation to the State Parties.[7] (Another manifestation of reverse consensus.)

Where the Panel or the AB concludes that a measure complained of is inconsistent with the AfCFTA Agreement, it shall recommend that the State Party concerned bring the measure into conformity with the Agreement. This is the actual remedy. The basic objective is for the Dispute Settlement Mechanism of the AfCFTA to “preserve the rights and obligations of the State Parties under the Agreement[8] by applying and clarifying the applicable legal provisions in light of the facts of a particular case.

In addition to its recommendations, the Panel or the AB may suggest ways in which the State Party concerned could implement the recommendations.[9] The State Parties shall promptly comply with the subsequent recommendations and rulings of the DSB.

The Dispute Settlement Protocol contains detailed provisions on the surveillance of measures taken to implement recommendations and rulings. A State Party concerned shall inform the DSB of its intentions in respect of the implementation of the recommendations and rulings of the DSB. When a State Party finds it impracticable to comply immediately, it shall be granted a reasonable period in which to comply, or a period mutually agreed by the Parties to the dispute. In the absence of such agreement, a period of time determined through binding arbitration.[10]

Where the Parties to the dispute disagree as to whether the measures taken comply with the recommendations and rulings, such disagreement shall be decided through recourse to the same dispute settlement procedures, including wherever possible resort to the original Panel.[11] The DSB shall keep the implementation of adopted recommendations or rulings under surveillance.

It is the duty of the State Parties to fully implement the recommendations and rulings of the DSB. Compensation and the suspension of concessions or other obligations are temporary measures available to the aggrieved Party in the event that the accepted recommendations and rulings of the DSB are not implemented within a reasonable period of time.

The suspension of concessions or other obligations shall be temporary and shall only be applied in as far as it is consistent with the AfCFTA Agreement. This state of affairs shall only apply “until such a time as the inconsistency with the Agreement, or any other determined breach is removed, or that the State Party implements recommendations, or provides a solution to the injury caused, or occasioned by the non-compliance, or that a mutual satisfactory solution is reached”.[12]

In the event that the rulings and recommendations of the DSB are not implemented within a reasonable period of time, the aggrieved Party may request the DSB to impose temporary measures which include compensation and the suspension of concessions.

If the State Party concerned fails to bring its measure found to be inconsistent with the Agreement into compliance therewith or otherwise comply with the decisions and rulings within a reasonable period of time, the Parties shall enter into negotiations with a view to developing mutually acceptable compensation. If no satisfactory compensation has been agreed upon within twenty days, a Complaining Party may request authorisation from the DSB to suspend the application to the State Party concerned of concessions or other obligations under the Agreement.

Ultimately the matter can be referred to arbitration. The Parties to a dispute shall accept the arbitrator’s decision as final and the parties concerned shall not seek a second arbitration. The DSB shall be informed promptly of the decision of the arbitrator and shall upon request, grant authorisation to suspend concessions or other obligations where the request is consistent with the decision of the arbitrator, unless the DSB decides by consensus to reject the request.[13]

[1] Art 9 (1). (All references are to provisions in the AfCFTA Dispute Settlement Protocol.)

[2] Art 9 (5).

[3] Art 12.

[4] Art 18.

[5] Art 19(4).

[6] Art 21 (4).

[7] Art 22(9).

[8] Art 4(1).

[9] Art 23.

[10] Art 24(4).

[11] Art 24(7).

[12] Art 25(2).

[13] Art 25 (9).

About the Author(s)

Gerhard Erasmus

Gerhard Erasmus is a founder of tralac and Professor Emeritus (Law Faculty), University of Stellenbosch. He holds degrees from the University of the Free State, Bloemfontein (B.Iuris, LL.B), Leiden in the Netherlands (LLD) and a Master’s from the Fletcher School of Law and Diplomacy. He has consulted for governments, the private sector and regional organisations in southern Africa. He has also been involved in the drafting of the South African and Namibian constitutions. He grew up in Namibia.

Leave a comment

The Trade Law Centre (tralac) encourages relevant, topic-related discussion and intelligent debate. By posting comments on our website, you’ll be contributing to ongoing conversations about important trade-related issues for African countries. Before submitting your comment, please take note of our comments policy.



Email This email address is being protected from spambots. You need JavaScript enabled to view it.
Tel +27 21 880 2010