UK joins WTO trade arbitration alternative

By Olivia Le Poidevin

GENEVA (Reuters) -The United Kingdom has become the latest country to join an alternative mechanism for resolving disputes to the World Trade Organization, it said in a statement on Wednesday.

The World Trade Organization’s top appeals body has been inactive since 2019, after President Donald Trump, during his first term, blocked new appointments to the top appeal's court. That left the WTO's key dispute settlement system only partially functional, as the Appellate Body no longer had enough members to hear cases.

Washington had accused the WTO Appellate Body of judicial overreach in trade disputes.

The U.K. announced the decision on Wednesday as part of its new trade strategy, which it said will protect and boost British business amid a turbulent economic situation, resurgent protectionism and unfair trading practices.

"The UK will join the Multi-Party Interim Appeal Arbitration Arrangement (MPIA)...demonstrating our commitment to an effective rules-based international trading system," the Department of Business and Trade said in a statement.

Sixteen WTO members established the separate appeals mechanism for trade disputes in March 2020 as an alternative temporary arbitration arrangement for resolving WTO disputes that are appealed by a member while the WTO Appellate Body is not operational.

The MPIA currently has 56 members, according to the MPIA website, including the European Union, Canada and Brazil.

The decision comes one week after British Prime Minister Keir Starmer and Trump signed an agreement formally lowering some tariffs on imports into the U.S. from Britain as the countries continue working toward a formal trade deal.

Britain had avoided tariffs of up to 50% on steel and aluminium that the U.S. imposed on other countries earlier this month, but it could have faced elevated tariffs starting July 9 unless a deal to implement the tariff reduction was reached.

(Reporting by Olivia Le Poidevin; Editing by Leslie Adler)