Journal of World Trade 36(3): 501515, 2002. 2002 Kluwer Law International. Printed in The Netherlands.

Global Governance and Inter-Agency Co-operation in International Economic Law

Christian TIETJE* I. INTRODUCTION

International economic law is traditionally seen as the law governing the economic relations between states and private entities. International economic organizations such as the World Trade Organization (WTO), as part of the international institutional framework, are thus usually characterized as a means to facilitate the implementation, administration and operation, and further the objectives1 of international economic treaties that are concluded between states. It is in line with this concept of international economic law and the international legal systems in general, that dates back to the time of the establishment of the first international economic organizations,2 that the Agreement Establishing the WTO describes its scope as to provide the common institutional framework for the conduct of trade relations among its Members in matters related to the agreements and associated legal instruments included in the Annexes to this Agreement.3 This statecentred approach towards international economic relations leaves almost no space for an in-depth analysis of inter-agency relations in the international legal order. Even though almost all agreements establishing the most important international economic organizations refer to the need to co-operate with other international organizations,4 international institutional co-operation was for a long time not at the centre of the interest of international legal scholars. It was only recently that co-operation between

1 * Prof. Dr Christian Tietje, LL.M. (Michigan), is Professor of Public Law, European Community Law and International Economic Law and Director of the Institute for Economic Law at the Faculty of Law, MartinLuther-University Halle-Wittenberg. Correspondence address: Juristische Fakultt der Martin-Luther-Universitt Halle-Wittenberg, Universittsplatz 5, 06108 Halle (Saale), Germany; telephone: +493455523180; fax: +49 34527201; e-mail: tietje@jura.uni-halle.de; homepage: <www.jura.uni-halle.de/tietje>. 1 Article III:1 Agreement Establishing the WTO. 2 For an assessment of the development of international organizations that were concerned with economic issues in a broader sense in the nineteenth century, see Pitmann B. Potter, Dveloppement de lorganisation internationale, 18151914, 64 Recueil des Cours (RdC), 71155 (1938 II). 3 Article II:1 WTO Agreement. 4 See, e.g., Article 12 Convention on the Organisation for Economic Co-operation and Development, 88 UNTS 179; Article 35 Convention Establishing the Multilateral Investment Guarantee Agency, 1508 UNTS 1508 99; Article X Articles of Agreement of the International Monetary Fund, 2 UNTS 39; Article V (8) Articles of Agreement of the International Bank for Reconstruction and Development, 2 UNTS 39, 134 and 606 UNTS 295; Article IV (7) Articles of Agreement of the International Finance Corporation, 264 UNTS 117, 439 UNTS 318 and 439 UNTS 1229; Article VI (7) Articles of Agreement of the International Development Association, 439 UNTS 249.

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the WTO and other international economic organizations has gained some interest as an important aspect of governance in the international economic system.5 This article will take a closer look at the overall importance of inter-agency co-operation in international economic law. However, to a degree, the article differs from other contributions on this topic, since it will not only focus on a specific area of institutional co-operation, such as that between the WTO and World Intellectual Property Organization (WIPO),6 but will propose a more general explanation of the importance of international institutional co-operation in the current international economic legal system. It will demonstrate that inter-agency co-operation is a central element in global economic governance and that the legal approach towards this phenomenon has to be different than that taken since the United Nations and the Bretton Woods institutions were established. In fact, one must agree with the Administrative Committee on Co-ordination of the Economic and Social Council of the United Nations, which stressed in its annual overview report for 1999 that [a] new phase in inter-agency co-operation, spurred by the imperatives of globalization, is now emerging.7 In the first part of this article, an introduction will be given on the concept of global governance as being part of the legal structure of the international system and thus also of international economic law. Part two of the contribution will give an overview of inter-agency co-operation among international economic organizations. In the final part, the legal implications of inter-agency co-operation, in an international system of global governance, will be analysed. II. GLOBAL GOVERNANCE AND INTERNATIONAL INTER-AGENCY CO-OPERATION The concept of global governance is closely related to globalization. Even though the term globalization is currently used in order to describe a wide area of social, economic, cultural and other developments in national societies and in the international community, it also has a core legal impact. Globalization, as a legal term, refers to legal and de facto denationalization. It can thus be defined as the process of denationalization of markets, laws and politics in the sense of interlacing peoples and individuals for the sake of the common good.8 This reference of globalization to
5 Frederick M. Abbott, Distributed Governance at the WTO-WIPO: An Evolving Model for Open-Architecture Integrated Governance, 3 J Intl Economic L (2000), 6381; see also Marco C.E.J. Bronckers, More Power to the WTO?, 4 J Intl Economic L 41 (2001), 49 et seq.; see also the Ministerial Declaration adopted on 14 November 2001, WTO Doc. WT/MIN(01)/DEC/1 of 20 November 2001, para. 5: We are aware that the challenges Members face in a rapidly changing international environment cannot be addressed through measures taken in the trade field alone. We shall continue to work with the Bretton Woods institutions for greater coherence in global economic policy-making. 6 See Abbott, as note 5 above. 7 Annual overview report of the Administrative Committee on Co-ordination for 1999, UN Doc. E/2000/53 of 17 May 2000, at 3. 8 Jost Delbrck, Globalization of Law, Politics, and MarketsImplications for Domestic LawA European Perspective, 1 Indiana J of Global Legal Studies 9 (1993), 10 et seq.; see also Alfred C. Amann, The Globalizing State: A Future-Oriented Perspective on the Public/Private Distinction, Federalism, and Democracy, 31 Vanderbilt J of Transnational L (1998), 769870.

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denationalization and common (global) goods9 indicates that the process of globalization affects the role of the state as the main actor in international relations. In the age of globalization, international relations and especially international economic relations are not primarily concerned any more with the co-ordination of competing state interests, but with the conservation, distribution and protection of global public goods. Global governance, therefore, is a legal concept that tries to identify and to describe the process and the actors dealing with global public goods, such as global economic welfare, human rights or the protection of the environment.10 The Commission on Global Governance has thus convincingly defined global governance as:
the sum of the many ways individuals and institutions, public and private, manage their common affairs. It is a continuing process through which conflicting or diverse interests may be accommodated and co-operative actions may be taken. It includes formal institutions and regimes empowered to enforce compliance, as well as informal arrangements that people and institutions either have agreed to or perceive to be in their interest.11

Following this definition, it is important to stress that global governance does not at all refer to some kind of global government. Instead, global governance is a multidimensional concept of networks and multilateral legal and political processes that do not substitute the nation-state, but broaden the picture of international relations and thus the international legal community.12 International economic relations are central to this concept as they are a prime example of legally relevant interrelated activities of governments, international organizations and private actors that can no longer be explained any more simply by referring to the classic sources of public international law in the sense of Article 38(1) of the Statute of the International Court of Justice.13 Moreover, although global governance refers to a multitude of international actors, international institutions play a prominent role in the process of global governance. This is also recognized within the WTO and among its Members. Already in 1989, the Contracting Parties of the General Agreement on Tariffs and Trade (GATT) 1947 urged the Director-General to undertake efforts to strengthen the relationship of GATT with other relevant organizations, in order to achieve greater
9 On global public goods, see the contributions in Inge Kaul, Isabelle Grundberg and Marc A. Stern (eds), Global Public GoodsInternational Co-operation in the 21st Century (New York/Oxford: Oxford University Press, 1999). 10 See, e.g., para. 1 of the Preamble of the Agreement Establishing the WTO; on human rights and international economic law, see Ernst-Ulrich Petersmann, Human rights and international economic law in the 21st century: The need to clarify their interrelationships, 4 J Intl Economic L (2001), 339. 11 Our Global Neighbourhood: The Report of the Commission on Global Governance (Oxford: Oxford University Press, 1995), p. 2. 12 See, e.g., Robert O. Keohane and Joseph S. Nye, Introduction, in Joseph S. Nye and John D. Donahue (eds), Governance in a Globalizing World (Washington: Brookings Institution Press, 2000), pp. 12 et seq.; on the concept of the international legal community, see Hermann Mosler, The International Society as a Legal Community (Alphen aan den Rijn: Sijthoff & Noordhoff, 1980). 13 On Article 38(1) ICJ Statute and its role as defining the sources of international law see, e.g., Ian Brownlie, Principles of Public International Law (5th edn, Oxford: Oxford University Press, 1998), pp. 3 et seq.

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coherence in global economic policy making.14 This call for more effective interagency co-operation in international economic law was followed by the Marrakesh Declaration on the Contribution of the World Trade Organization to Achieving Greater Coherence in Global Economic Policymaking, that has been reaffirmed at the fourth ministerial conference of the WTO in Doha.15 Even though these documents do not explicitly refer to global governance, they are based on the overall rationale of this concept. This can been seen by looking at certain communications from WTO Members, in preparation for the 1999 ministerial conference, that followed the Marrakesh Declaration. A detailed communication from the European Communities, for example, on addressing the Challenges of Globalization: The Role of the WTO in Co-operation with Other International Organizations explicitly refers to global economic governance and inter-agency co-operation.16 A similar approach is followed by Canada in a communication on the WTO and International Economic Policy Coherence.17 Moreover, on a broader scale the United Nations Development Programme (UNDP), in its 1999 report on human development, made it quite clear that international co-operation among and with international organizations is central to a global governance architecture that can cope with the challenges of globalization.18 This is in line with United Nations Resolution 49/97 on strengthening international organizations in the area of multilateral trade.19 Overall, one aspect of the current discussion on global governance is international institutional or inter-agency co-operation. Inter-agency co-operation is one part in the multidimensional picture of global governance structures that increasingly evolves because of the legal implications of globalization. This is, of course, not only true with regard to the international legal system in general, but in the field of international economic relations in particular. The underlying rationale for this development will be analysed in a later part of this article. Before doing so, it is necessary to take a look at empirical evidence on inter-agency co-operation in international economic law.

14 Way of Achieving Greater Coherence in Global Economic Policy Making Through Strengthened GATT Relationships with other Relevant International Organizations; Report by the Director-General, GATT Doc. MTN.GNG/NG14/ W/35, 20 September 1989. 15 The Marrakesh Declaration is reprinted in 33 ILM (1994), at 1249; for the Ministerial Declaration of the Fourth Ministerial Conference of the WTO, see note 5 above. 16 WTO Doc. WT/GC/W/391, 12 November 1999; see also EC Approach to Capacity Building and Coherence in Global Economic Policy Making, Communication from the European Communities, WTO Doc. WT/GC/W/297, 5 August 1999. 17 WTO Doc. WT/GC/W/360, 12 October 1999. 18 UNDP, Human Development Report 1999 (New York/Oxford: Oxford University Press, 1999), pp. 97 et seq. 19 United Nations General Assembly Resolution 49/97, 19 December 1994.

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III. EXAMPLES OF INTER-AGENCY CO-OPERATION IN THE INTERNATIONAL ECONOMIC SYSTEM The United Nations Charter (UNC) is, in general, the starting point of any interagency co-operation, especially among international economic organizations. Following the experience of the League of Nations and specifically the proposals made in the famous Bruce Report,20 the Economic and Social Council (ECOSOC) was set up as one of the main organs of the United Nations.21 Beyond its general competencies in social, economic and other areas, the ECOSOC is responsible for inter-agency co-operation with the specialized agencies of the United Nations among each other and with the UN itself.22 This function of the ECOSOC is mainly conducted within the Administrative Committee on Coordination of the United Nations (ACC). By 1946 the ACC was already established.23 As a strictly administrative organ with the Secretary-General of the UN and the executive heads of the other respective organizations as members, the Member States of the organizations represented have hardly any influence on its work. Moreover, even though the ACC in the past was mainly concerned with administrative issues of the work of international organizations, it has recently re-defined its own functions. As outlined in its annual report of 1999, the ACC sees its own responsibility and function in contributing to the strengthening of inter-agency co-operation and coordination in order to cope with the challenges of globalization.24 The basic rationale for this new phase in inter-agency co-operation25 is seen by the ACC through the process of globalization that requires both a new and a better balance among economic, social and environmental objectives, and mutually reinforcing initiatives and concurrent progress on a larger number of fronts.26 The integration of the economic sphere at all levelsglobal, regional and nationalwith the social, cultural and environmental spheres27 is the main substantial point of this new approach of the ACC. In sum, it becomes clear that inter-agency co-operation, especially within the international economic system, is institutionalized within the ACC. If the ACC is able, in its future work, to meet its own goals, inter-agency co-operation will have important inputs on the work of international organizations dealing with economic and related issues.

20 Le dveloppment de la collaboration internationale dans le domaine conomique et social, League of Nations Document A 23 (1939); for details see Victor-Yves Ghbali, The League of Nations and Functionalism, in Victor Yves Groom and Paul Taylor (eds), FunctionalismTheory and Practice in International Relations (London: University of London Press, 1975), pp. 141161; Klaus Dicke, Effizienz und Effektivitt internationaler Organisation (Berlin: Ducker & Humblot, 1994), pp. 72 et seq. 21 See Articles 7(1) and 61 et seq. UNC; for details on the ECOSOC, see Rainer Lagoni, ECOSOC Economic and Social Council, in Rdiger Wolfrum (ed.), United Nations: Law, Policies and Practice, Vol. 1 (2nd edn, Munich/Dordrecht: Beck/Martinus Nijhoff, 1995), pp. 461469. 22 See Articles 62 and 63 UNC. 23 ECOSOC Resolution 13 (III), 21 February 1946 and Resolution 166 (VII), 29 August 1948; for details on the ACC, see Werner Meng, Article 60 marginal notes 13 et seq., in Bruno Simma (ed.), The Charter of the United Nations (Munich/Oxford: Beck/Oxford University Press, 1995); Dicke, as note 20 above, pp. 256 et seq. 24 See note 7 above. 25 ACC, as note 7 above, at 3. 26 Ibid. 27 Ibid.

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The relationship of the WTO and the United Nations Organization (UNO) has to be seen in light of the described importance of the ACC. After a lengthy discussion during the preparations for establishing the WTO, Members decided not to set up the organization as a special agency of the UN.28 Following the tradition that has been established under the GATT 1947, the relationship of the WTO and the UNO is only governed by an exchange of letters of the WTO Director-General and the UNO Secretary-General.29 Although the letters only express in general terms the desire of both organizations to keep each other informed on relevant activities within the organizations, it is interesting to note that the WTO participates in the work of the ACC. This clearly indicates that notwithstanding the lack of formal ties with the World Organization, the WTO committed itself to take up an active part in the described global governance structure of inter-agency co-operation. Formal co-operation agreements have been concluded between the WTO, the International Monetary Fund (IMF) and the World Bank.30 These agreements fulfil the mandate of the aforementioned Marrakesh Declaration on Greater Coherence in Global Economic Policymaking and they are in line with Article III:5 of the Agreement Establishing the WTO, Article X of the IMF Agreement and Article V:8(a) of the World Bank Agreement. Thus, after unsuccessful attempts to establish such formal ties of co-operation already in 1948 at the time of the work on the failed International Trade Organization (ITO) and later on in the history of the GATT 1947,31 finally a legally binding agreement exists between the worlds most important trade and financial organizations. The underlying rationale for the necessity of such ties of co-operation has to be seen in the fact that trade issues cannot be isolated from financial matters and vice versa. For example, this is the case with regard to exchange and balance-of-payments questions (see Articles XV:1 and 2 GATT).32 However, recent decisions of the WTO Dispute Settlement Body made clear that the co-operation agreement between the IMF and the WTO does not affect rights and obligations of WTO Members under the WTO or the IMF Agreement.33 Instead, the Appellate Body has determined the agreement between the WTO and the IMF as being of a strictly administrative nature.34 This however, does not diminish the importance of co-operation between the WTO, the IMF and the World Bank. On the
28 See Articles 57 and 63 UNC; for details, see Wolfgang Benedek, Relations of the WTO with other International Organizations and NGOs, in Friedl Weiss, Erik Denters and Paul de Waart (eds), International Economic Law with a Human Face (The Hague/Dordrecht/London: Kluwer Law International, 1998), pp. 478 et seq.; John H. Jackson, The World Trade OrganizationConstitution and Jurisprudence (London: Royal Institute of International Affairs, 1998), p. 52. 29 WTO Doc. WT/GC/W/10, 3 November 1995. 30 The agreements are reproduced in WTO Doc. WTO/L/195, 18 November 1996; see also Dukgeun Ahn, Linkages between International Financial and Trade InstitutionsIMF, World Bank and WTO, 34 J.W.T. 4 (August 2000), pp. 1 et seq 31 For details, see Ahn, ibid., pp. 3 et seq. 32 See also Articles XXXVI:6, 7 and XXXVIII:2 GATT. 33 ArgentinaCertain measures affecting imports of footwear, textiles, apparel and other itemsComplaint by the United States, WT/DS56/AB/R, para. 72. 34 This Agreement provides for specific means of administrative co-operation between the two organizations, WT/DS56/AB/R, para. 71.

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contrary, the growing awareness of more and more intertwined trade and financial elements makes clear that only a coherent policy of the three organizations can cope with the challenges given.35 It is, however, interesting to note that some WTO Members expressed serious concern with regard to the autonomous executive structure of the co-operation between the WTO, the IMF and the World Bank. The Director-General of the WTO was thus forced to reassure WTO Members on their remaining sovereignty.36 This demonstrates the importance of the executive (administrative) structure of international institutional co-operation that is also evident with regard to the aforementioned work of the ACC. There are, of course, other areas in which interrelated economic and related problems force international organizations to co-operate. A key element in the current discussion on the new international financial architecture is the necessity of effective international institutional co-operation, not only between IMF and World Bank, but also on a broader scope with, e.g., the International Labour Organization (ILO). This is because the Poverty Reduction and Growth Facility (as an example), which was recently established by the IMF, strongly focuses on general social aspects while deciding on financial support of states.37 A central element of the policy of the IMF on social policy issues is thus a close co-operation of the organization with other international agencies such as the ILO, the United Nations Development Programme (UNDP) and the World Health Organization (WHO).38 These activities of interagency co-operation in international economic law are in line with a communiqu issued after the annual meeting of the Bretton Woods Institutionsnow called International Monetary and Financial Committee39that stressed the need of the IMF and the World Bank to focus on their areas of comparative strength while developing partnership with other international institutions.40 Other examples of international institutional co-operation can be taken from the work of the WTO. Several WTO agreements directly affect the work of other international organizations. For example, the General Agreement on Trade in Services (GATS) has a direct impact on the work of the International Telecommunication Union (ITU). In fact, due to the increasing linkage between the various aspects of telecommunications and trade policy-making that fall within the respective mandates of the International Telecommunication Union (ITU) and the World Trade Organization (WTO) and based on GATS Article XXVI, both organizations
Ahn, as note 30 above, pp. 28 et seq. See Statement by the Director-General on Consultations and Coherence, WTO Doc. WT/L/194/Add. 1, 18 November 1996. 37 Ludwig Gramlich, Eine neue internationale Finanzarchitektur oder: Der IMF in der Krise?, 38 Archiv fr Vlkerrecht (2000), pp. 399 et seq., at 407 et seq. and 439 et seq. 38 For details, see IMF, Social Policy Issues in IMF-Supported Programs: Follow-Up on the 1995 World Summit for Social Development, available at <www.imf.org/external/np/fad/wldsum/index.htm> (visited 28 January 2002). 39 Gramlich, as note 37 above, p. 431. 40 Communiqu of the International Monetary and Financial Committee of the Board of Governors of the International Monetary Fund, 16 April 2000, available at <http://www.imf.org/external/np/cm/2000/ 041600.htm> (visited 28 January 2002).
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concluded a co-operation agreement on 20 May 2000.41 In line with other international institutional agreements, it provides for several means of administrative co-operation between the two organizations. A similar agreement on the basis of an exchange of letters between its executive organs exists for the relationship of the WTO and the International Office of Epizootics.42 It is concerned with the importance of the International Office of Epizootics within the framework of the Agreement on Sanitary and Phytosanitary Measures (SPS Agreement).43 Another important international institutional co-operation has been established between the WTO and WIPO. Due to the incorporation of Conventions on intellectual property protection administrated by WIPO in the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs), a close administrative co-operation between the two organizations has been agreed upon in a co-operation agreement of 1 January 1996.44 Moreover, in a WTO Panel proceeding of 1999, the Panel has requested information on certain legal aspects of WIPO conventions which have been provided for by the WIPO Secretariat.45 Furthermore, several attempts have been made to strengthen co-operation between, on the one hand the WTO and the ILO, and on the other hand, the WTO and the respective bodies of multilateral environmental agreements in order to prevent possible conflicts in the problematic fields of trade and labour rights and trade and environment. Calls for such efforts of effective institutional co-operation can be found, for example, in the communiqu of the G-8 meeting in June 1999, where the importance of effective co-operation between the WTO and the ILO on the social dimension of globalization and trade liberalization has been stressed.46 Concerning trade and environment, a similar call has been made in detail in Chapter 38 of Agenda 21 dealing with International Institutional Arrangements in the field of environment and development.47 Another important recent example of inter-agency co-operation is known as the Integrated Framework for Trade-Related Technical Assistance to LeastDeveloped Countries. This programme is based on the Comprehensive and Integrated WTO Plan of Action for the Least-Developed Countries which was adopted at the ministerial conference of the WTO in 1996 in Singapore. The Plan of Action envisaged a closer co-operation between the WTO and other multilateral agencies assisting least-developed countries.48 According to the plan, it
WTO Doc. S/C/11, 21 September 2000, preamble para. 2. WTO Doc. G/SPS/W/61, 22 May 1996. 43 For details, see Terence P. Stewart and David S. Johanson, The SPS Agreement of the World Trade Organization and International Organizations: The Roles of the Codex Alimentarius Commission, the International Plant Protection Convention, and the International Office of Epizootics, 26 Syracuse J Intl L & Commerce (1998), pp. 2753. 44 WTO Doc. IP/C/6/Add. 1, 17 January 1996; Abbott, as note 5 above. 45 United StatesSection 110(5) of US Copyright Act, WT/DS160/5, 16 April 1999, Annex 4. 46 For details, see Steve Charnovitz, The International Labour Organization in its Second Century, 4 Max Planck United Nations Yearbook (2000), pp. 160 et seq. 47 Available at <http://www.unep.org/Documents/Default.asp?DocumentID=52> (visited 28 January 2002). 48 WTO Doc. WT/MIN(96)/14, 7 January 1997.
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was agreed by the WTO, United Nations Conference on Trade and Development (UNCTAD) and International Trade Commission (ITC) Secretariats, in collaboration with the staff of the IMF, the World Bank and the UNDP, to set up an integrated framework for the provision of trade-related technical assistance for least-developed countries.49 Finally, an interesting example of administrative institutional co-operation between two international organizations dealing with economic issues can be taken from the law of the European Community. Even though, according to Article 300(1) EC Treaty, it appears that only the Council of the European Union may conclude binding international agreements on behalf of the EC, in 1993 the EC Commission concluded, in the form of an exchange of letters, an executive agreement with the Food and Agricultural Organization of the United Nations (FAO).50 The agreement concerns joint projects of the EC and the FAO and regulates questions of co-finance and co-administration of such joint projects. Without further discussing the question of the legality of this agreement under EC law at this point, the existence of such a practice of executive co-operation between two organizations in an area of overlapping interests is worth noting.51 Although many other examples could be given on international institutional co-operation in international economic law and related areas, the evidence given seems to be sufficient to allow some preliminary assessments to be made. First, one may say that international organizations with assigned tasks in areas of direct or indirect economic relevance are today related to each other within a close network of co-operation. The underlying reason for thisthat will be discussed in more detail in the next section of this articleis, second, diminishing jurisdictional borders in the international institutional system. Because international economic law affects a wide area of policy issues beyond classic trade law, more and more organizations are concerned with economic aspects of issues that are covered by their respective mandate. As a consequence of this, international organizations have established several forms of administrative institutional co-operation. This approach can be traced back to the establishment of the ACC in 1946. Third, and finally, the analysis of international institutional co-operation has demonstrated that the form in which this co-operation takes place has an administrative structure. The important role played by international administration in institutional co-operation should be seen as one aspect of an emerging international administration that is more and more independent.

For details, see WTO Doc. WT/LDC/HL/1/Rev.1, 23 October 1997. Not published, on file with the author. 51 For a more detailed discussion on this agreement, see Christian Tietje, Art. 302 marginal notes 15 et seq., in Eberhard Grabitz and Meinhard Hilf (eds), Das Recht der Europischen Union, Vol. I (Munich: Beck, 2000).
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IV. THE DUTY OF INTER-AGENCY CO-OPERATION AND THE LEGAL STRUCTURE OF THE INTERNATIONAL SYSTEM In order to evaluate the legal impact of todays inter-agency co-operation, it is necessary to compare the system of international institutional co-operation as it was designed by the Charter of the United Nations with the current status quo. As the establishment of the ACC in 1946 demonstrates, inter-agency co-operation has been part of the international legal system for many years. In fact, it was during the League of Nations era that the idea of inter-agency co-operation as a part of the structure of the international system, especially in the economic area, was born. Due to the increasing activities of the League of Nations and other international organizations, mainly in the economic and social field, it became increasingly difficult to secure coherence in international policy-making. Thus, in order to increase the effectiveness of the work of international organizations as a whole, it was one aim of the Bruce Report to meet the fact that the development in the nature of the work results in a growing inter-connection between the activities of the different organizations, and that therefore a co-ordinating direction is more and more required.52 In an effort to realize this aim, the Bruce Report suggested setting up a new entity within the League of Nations, to be known as the Central Committee for Economic and Social Questions. Although this proposal was not realized within the League of Nations, it laid the foundations for the establishment of the ECOSOC. The system that was thus created by the Charter of the United Nations, in order to co-ordinate activities of different international organizations, especially in the economic and social area, is known as a system of functional deconcentration.53 It is based on the idea that instead of having one single international organization responsible for all questions of economic and social concern, different organizations should work in their respective areas of special competence. The co-ordination of the work of the different organizations was assigned to the ECOSOC and the ACC. Referring to Articles 57 and 63 of the UNC, the International Court of Justice (ICJ) has recently described this system of deconcentration as follows:
As these provisions demonstrate, the Charter of the United Nations laid the basis of a system designed to organize international co-operation in a coherent fashion by bringing the United Nations, invested with powers of general scope, into relationship with various autonomous and complementary organizations, invested with sectorial powers. The exercise of these powers by the organizations belonging to the United Nations system is co-ordinated, notably, by the relationship agreements concluded between the United Nations and each of the specialized agencies.54

Bruce Report, as note 20 above, section V(b). For a detailed analysis, see C. Wilfred Jenks, Co-Ordination: A New Problem of International Organization, in 77 RdC, pp. 149301, at 172 et seq. (1950 II). 54 ICJ, Legality of the Use by a State of Nuclear Weapons in Armed Conflict (Request of the World Health Organization), ICJ Reports, 1996, p. 66, at para. 26.
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As can be seen by looking at the historical development and the judgment of the ICJ, the United Nations system is based on the idea that a clear-cut distinction between the competencies and areas of activities of different international organizations is possible. However, the process of globalization that can be seen, particularly in the economic area, challenges this perspective. As it is increasingly difficult to separate trade and financial issues from other areas of social concern, such as the protection of the environment, the protection of core human and social rights, technical aspects of communication or sanitary and phytosanitary questions, the work of different international organizations is increasingly overlapping. In the Marrakesh Declaration on the Contribution of the WTO to achieving greater coherence in global economic policy-making, ministers thus recognized that the interlinkages between the different aspects of economic policy require that the international institutions with responsibilities in each of these areas follow consistent and mutually supportive policies.55 This indicates that inter-agency co-operation among organizations that are responsible for economic and related issues is essentially a necessity because of the overlapping areas of responsibility of the different organizations. In fact, as will be demonstrated, public international law requires international organizations to co-operate in areas of overlapping areas of responsibility. In support of this argument, the first aspect that has to be taken into account, is the recognized international legal personality of international organizations. In line with the famous advisory opinion of the ICJ in the reparations for injury case,56 it is widely accepted that international organizations possess international legal personality.57 Moreover, the ICJ held that the rights and duties of an entity such as the Organization [the UNO] must depend upon its purpose and functions as specified or implied in its constituent documents and developed in practice.58 Therefore, the ICJ continued, under international law, the Organization must be deemed to have those powers which, though not expressly provided in the Charter, are conferred upon it by necessary implication as being essential to the performance of its duties.59 Even though the ICJ made these statements only with respect to the United Nations, they are today widely recognized as being valid for any international organization.60 Because of their legal personality and their powers necessary to perform their functions and duties, international organizations are entitled to claim a protected area of jurisdiction. Even though the concept of jurisdiction is usually referred to states in regard to their territorial and personal jurisdiction,61 it also appliesat least in
33 ILM (1994), 1249. ICJ Reports, 1949, pp. 174 et seq. 57 Brownlie, as note 13 above, at 678 et seq . 58 ICJ Reports, 1949, p. 180. 59 ICJ Reports, 1949, p. 182. 60 Brownlie, as note 13 above, pp. 687 et seq. 61 See, e.g., Bernhard H. Oxman, Jurisdiction of States, in Rudolf Bernhardt (ed.), Encyclopedia of Public International Law, Vol. III (Amsterdam: Elsevier, 1997), p. 56: The fundamental bases for the exercise of jurisdiction by a State are rooted in two aspects of the modern concept of the State itself: defined territory and permanent population.
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principleto international organizations with regard to areas of competences assigned to them in their founding treaty. An example of a case in which recognized jurisdictional competences of an international organization became relevant is the pipeline embargo dispute between the United States and the European Communities in the beginning of the 1980s. In this dispute, the EC based their claims against the US on aspects of protected jurisdiction under international law.62 A similar situation arises in cases of extraterritorial application of anti-trust law by the EC and against the EC.63 One may thus safely conclude that international organizations possess jurisdiction within their competencies and that this jurisdiction is protected by international law. In general, the possession of jurisdiction by an international organization has implications for the duty to inter-agency co-operation in international economic law and related areas. Due to the fact of overlapping areas of work conducted by different international organizations, conflicts of jurisdiction arise. Take, for example, the work of the WTO and of the ITU. The increasing linkage between the various aspects of telecommunications and trade policy-making that fall within the respective mandates of the International Telecommunication Union (ITU) and the World Trade Organization (WTO),64 as it is stated in the agreement of co-operation between the WTO and the ITU, in fact indicates that there is the possibility of a conflict of jurisdiction between the two organizations. Such a situation is similar to conflicts of jurisdictions between states based on extraterritorial measures, e.g. in the area of anti-trust law,65 or with regard to the application of trade sanctions for environmental purposes as in the Tuna or Shrimp cases.66 Although the legality of extraterritorial measures is still disputed, most scholars and courts argue that at least two requirements must be fulfilled: There must be a sufficient link to the state exercising jurisdiction, i.e. a substantial effect within its jurisdiction, and the exercise of jurisdiction with extraterritorial effect must comply with the rule of reason in the sense of a balancing of interests.67 The Appellate Body in the Shrimp case has basically also applied this

62 Bruno Simma and Christoph Vedder, Artikel 281 marginal note 12, in Eberhard Grabitz and Meinhard Hilf (eds), Das Recht der Europischen Union (Munich: Beck, 2000); for further details, see Pieter J. Kuyper, The European Community and the US Export Control: Comments on Comments, 27 German Yearbook of Intl L (1984), pp. 72 et seq.; Karl-Matthias Meessen, Extraterritoriality of Export Control: A German Lawyers Analysis of the Pipeline Case, 27 German Yearbook of Intl L (1984), pp. 97 et seq. 63 Simma and Vedder, ibid.; Derrick Wyatt and Alan Dashwood, European Community Law (3rd edn, London: Sweet & Maxwell, 1993), pp. 384 et seq. 64 Preamble para. 2 of the Agreement of Co-operation between the WTO and the ITU, WTO Doc. S/C/ 11, 21 September 2000. 65 Werner Meng, Extraterritorial Effects of Administrative, Judicial and Legislative Acts, in Rudolf Bernhardt (ed.), Encylopedia of Public International Law, Vol. II (Amsterdam: Elsevier, 1995), pp. 337 et seq. 66 United StatesRestrictions on Imports of Tuna (Tuna I), Panel Report dated 16 August 1991 (not adopted), BISD 39S/155; United StatesRestrictions on Imports of Tuna (Tuna II), Panel Report dated 16 June 1994 (not adopted), reprinted in 33 ILM (1994), 839; United StatesImport Prohibition of Certain Shrimp and Shrimp Products, Report of the Panel dated 15 May 1998, WT/DS58/R; Report of the Appellate Body dated 12 October 1998, WT/DS58/AB/R. 67 Restatement (Third) of the Foreign Relations Law of the United States (St Paul: American Law Institute, 1987), s.403; Meng, as note 65 above, pp. 340 et seq. with further references.

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approach to the problems of extraterritorial measures, i.e. measures reaching beyond a given jurisdiction.68 Considering that, first, international organizations possess protected jurisdiction and, second, conflicts of jurisdiction arise due to overlapping work areas of different organizations, especially in international economic law and related areas, it is necessary to apply also the generally accepted standards of international law to the relationship of international organizations. Thus, a possible conflict of jurisdiction between different organizations has to be solved by balancing the legal interests involved. As the Appellate Body has recognized in the Shrimp case, the duty to co-operate is one aspect of balancing competing interests in cases of conflicts of jurisdiction involving global public goods.69 Although the Appellate Body stipulated a duty to co-operate only with regard to environmental global public goods, the underlying rationale also applies to other areas of global concern. In fact, the necessity to co-operate in the international system is part of the overall shift from the law of international co-ordination to the law of international co-operation, which was forcefully described by Wolfgang Friedmann in 1964.70 In the same way that states are thus obliged to solve conflicts of jurisdiction by means of co-operation, international organizations are obliged to co-operate in areas of overlapping and conflicting jurisdiction. As it is increasingly difficult to make clear-cut distinctions between the assigned competencies of different organizations, especially in international economic law and related areas, inter-agency co-operation is the only possible means to secure the effectiveness of international organizations. Furthermore, international organizations are not only entitled to act in the most effective way to fulfil their mandate,71 but are also obliged to do so. The purpose of the establishment of any international organization is not only to create a new subject of international law, but also that the organization created pursues the specific tasks assigned to it by its members. With regard to the WTO, Art. III:1 of the Agreement Establishing the WTO clearly states that the WTO shall facilitate the implementation, administration and operation, and further the objectives, of this Agreement and of the Multilateral Trade Agreements . This is certainly more than a reference to the competencies of the WTO. It also indicates that the WTO is obligated to fulfil its mandate in the most efficient way. Thus, whenever it is necessary
68 United StatesImport Prohibition of Certain Shrimp and Shrimp Products, Report of the Appellate Body dated 12 October 1998, WT/DS58/AB/R, para. 164; for details, see Patricia Isela Hansen, Transparancy, Standards of Review, and the Use of Trade Measures to Protect the Global Environment, 39 Virginia J Intl L (1999), pp. 1038 et seq. and 1053 et seq.; Christian Tietje, Die vlkerrechtliche Kooperationspflicht im Spannungsverhltnis Welthandel/ Umweltschutz und ihre Bedeutung fr die europische Umweltblume, Europarecht (2000), pp. 285296; confirmed in United StatesImport Prohibition of Certain Shrimp and Shrimp Products, Recourse to Article 21.5 by Malaysia, Report of the Panel dated 15 June 2001, WT/DS58/RW, paras 5.43 et seq.; United StatesImport Prohibition of Certain Shrimp and Shrimp Products, Recourse to Article 21.5 by Malaysia, Report of the Appellate Body dated 22 October 2001, WT/DS58/AB/RW, paras 115 et seq. 69 Appellate Body, as note 66 above, paras 166 et seq. 70 Wolfgang Friedmann, The Changing Structure of International Law (London: Stevens, 1964), pp. 60 et seq.; see also Rdiger Wolfrum, International Law of Co-operation, in Rudolf Bernhardt (ed.), Encyclopedia of Public International Law, Vol. II (Amsterdam: Elsevier, 1995), pp. 1242 et seq. with further references. 71 Brownlie, as note 13 above, pp. 687 et seq.

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to co-operate with other international organizations in order to secure the effectiveness of the work in question, an international organization such as the WTO has a legal duty to do so. In short, inter-agency co-operation is not only a political slogan, but also a legal requirement in the current international legal system. Due to the increasing phenomenon of overlapping jurisdiction of international organizations in international economic law and related areas, inter-agency co-operation is required in order to solve conflicts of jurisdiction and to secure the effectiveness of the work of each organization involved. The original system of deconcentration as designed by the UN Charter is therefore no longer capable of explaining the structure of inter-agency co-operation in international economic law and related areas. Instead of looking at a functional separation of different international organizations with different and separated tasks, it has to be recognized that the international economic system is currently a system of interrelated jurisdictions and activities of numerous international organizations. Consequently, not only co-ordination of the work of international organizations,72 but also co-operation, is necessary. Once international organizations co-operate, they are capable of identifying issues of common interest. This is the first step towards securing the effectiveness of the work of each organization involved in the process of globalization. A final question remains: Does international law provide for clear and explicit criteria that determine the process of co-operation? Following the proposed approach that the duty to co-operate in inter-agency relations essentially derives from the necessity of balancing interests in areas of overlapping jurisdiction, the answer seems to be no. Whether a given duty to co-operate has been fulfilled can only be decided on a case-by-case basis. However, the Panel and the Appellate Body in the Article 21(5) DSU proccedings in the Shrimp case have demonstrated the legal way in which such a case-by-case approach has to be conducted.73 Moreover, in general terms the underlying legal obligation governing the duty to co-operate can be described in analogy to a pactum de negotiando.74 The substantial obligation arising out of this principle of law has been clearly articulated by the ICJ in the North Sea Continental Shelf case. The Court held that:
the parties are under an obligation to enter into negotiations with the view of arriving at an agreement, and not merely to go through a formal process of negotiation as a sort of prior conditions for the automatic application of a certain method of delimination in the absence of agreement; they are under an obligation so to conduct themselves that the negotiations are

72 For this original approach of the UN Charter, see the comprehensive analysis by Jenks, as note 53 above, pp. 149301. 73 United StatesImport Prohibition of Certain Shrimp and Shrimp Products, Recourse to Article 21.5 by Malaysia , Report of the Panel dated 15 June 2001, WT/DS58/RW, paras 5.43 et seq.; United StatesImport Prohibition of Certain Shrimp and Shrimp Products, Recourse to Article 21.5 by Malaysia, Report of the Appellate Body dated 22 October 2001, WT/DS58/AB/RW, paras 115 et seq. 74 For details, see Ulrich Beyerlin, Pactum de Contrahendo, Pactum de negotiando, in Rudolf Bernhardt (ed.), EPIL, Vol. III (Amsterdam: Elsevier, 1997), pp. 854 et seq.

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meaningful, which will not be the case when either of them insists upon its own position without contemplating any modifications of it 75

An even more precise description of the nature of a pactum de negotiando was given by the German External Debts Arbitration Tribunal in a decision of 26 January 1972. The Tribunal ruled as follows:
However, a pactum de negotiando is also not without legal consequences. It means that both sides would make an effort, in good faith, to bring about a mutually satisfactory solution by way of a compromise, even if that meant the relinquishment of strongly held positions earlier taken. An undertaking to negotiate involves an understanding to deal with the other side with a view to coming to terms To be meaningful, negotiations have to be entered into with a view to arriving at an agreement. Though an agreement to negotiate does not necessarily imply an obligation to reach an agreement, it does imply that serious efforts towards that end will be made.76

The main obligation arising out of a pactum de negotiando is thus to make substantially good faith efforts on the subject concerned. This is more than an obligation to simply negotiate, but rather it is a far-reaching obligation for international co-operation with the aim of achieving a mutually satisfactory solution. In order to fulfil the duty to co-operate in inter-agency relations, the respected organizations and their organs are thus obliged to conduct legal meaningful, good faith efforts to solve the described problems of overlapping jurisdictions. V. CONCLUSION

Inter-agency co-operation in international economic law is a central element of global economic governance. Co-operation of international organizations with responsibilities in economic and related areas is more than a political call for coherence in global economic governance. It is essentially a legal obligation arising out of the phenomenon of overlapping jurisdiction and the duty of any international organization to effectively pursue its assigned tasks. Global economic governance is thus not only an issue for states and non-state actors. International organizations play a major part in this process of governance. Therefore, calls for a more effective international inter-agency co-operation, as made, for example, by the EC and international scholars,77 are well founded from the perspective of public international law and international economic law.

75 76 77

ICJ Reports, 1969, 3, p. 47. ILR, Vol. 47, 1974, 418, at 453 et seq.; see also Beyerlin, as note 74 above, p. 857. WTO Doc. WT/GC/W/391, 12 November 1999; Abbott, as note 5 above; Bronckers, as note 5 above.