What Are the Different Types of World Trade Organization Agreements?

C. Mitchell

Agreements negotiated by members of the World Trade Organization (WTO) fall into three broad categories: agreements governing the sale of goods, agreements covering the rendering of services, and agreements relating the to sale and exchange of intellectual property. The WTO is a voluntary organization made up of representatives from the world’s most prominent trading powers, including China, Japan, the United States, and most of Europe. Agreements bind members to certain kinds of conduct in the international trading sphere. None of the agreements is static, however. WTO members meet regularly to renegotiate and amend various agreement provisions.

One type of world trade organization agreements includes agreements on agricultural rights.
One type of world trade organization agreements includes agreements on agricultural rights.

The core of the WTO is its agreements. When the organization formed in 1994, its main goal was to bring the world’s major trading partners into some agreement about baseline trading rules, policies, and best practices. The WTO formed around the principles of the General Agreement on Tariffs and Trade, or GATT, a 1947 agreement pioneered by the United Nations. Amending the GATT was the first undertaking of the WTO. World Trade Organization agreements have grown from there.

Along with the GATT, the most well-known World Trade Organization Agreements are the General Agreement on Trade in Services (GATS), and the Trade-Related Aspects of Intellectual Property (TRIPS) Agreement. Together, these three agreements make up the backbone of all WTO agreement-making. They also set the foundation for the three World Trade Organization agreement areas: goods, services, and intellectual property.

From these three agreements have sprung nearly 60 extra agreements and amendments. A trademark feature of World Trade Organization agreements is a commitment to liberalized, open trade, and harmonious relationships between countries and trading partners. Agreements deal with a wide variety of topics, from trade tariffs and import exclusions to privileges for developing countries, agreements on agriculture rights, and punishments for countries not in compliance.

As detailed and as regulatory as the World Trade Organization agreements are, however, it is important to remember that they are just that — agreements. Countries have no legal obligation to follow any of the prescribed mandates, even if they formally agreed in a WTO setting. Compliance disputes are typically handled by the World Trade Organization’s dispute resolution center. The consequence of failing to implement any of the WTO’s free trade agreements is typically sanction within the WTO community, potentially leading to revocation of voting or negotiation privileges, or national exclusion from future agreements.

World Trade Organization Agreements are the products of WTO meetings and conferences. These happen in various global locations, typically on a biannual schedule. Delegates debate, discuss, and negotiate a variety of issues at each meeting. Not every meeting ends with an agreement, or even results in approved amendments to existing agreements. Some do, however, and it is through these meetings that needed changes and new issues for consideration are brought to public light.

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