What is the WTO?

THE World Trade Organisation (WTO) was established in January 1995 with the aim of helping global commerce flow as freely and fairly as possible and overseeing agreed rules.

Based in Geneva, the WTO has 149 members, of whom about three quarters are developing countries. Saudi Arabia joined on Sunday.

The WTO replaced the looser General Agreement on Tariffs and Trade (GATT) which had laid down the rules of commerce since 1948 and oversaw eight rounds of trade negotiations.

The WTO was formed at the end of the Uruguay Round that ran from 1986 to 1994. WTO agreements cover not only goods, as was the case under the GATT, but also trade in services, inventions, creations and designs.

Although a procedure for settling disputes existed under the GATT, the WTO system is faster and more extensive, even though trade cases can still last for several years from an initial decision to a final appeals ruling. WTO rulings are binding and cannot be blocked.

Experts hear complaints, give rulings and authorise a country to impose sanctions against another WTO member. Contentious issues have included bananas, sugar, steel, textiles and tax breaks.

One of the key planks in all WTO accords aims to prevent countries from discriminating between trade partners - a special favour such as a lower customs duty rate granted to one partner has to apply to all other WTO members.

Ministers from member countries meet at least once every two years: Singapore 1996, Geneva 1998, Seattle 1999, Doha 2001, and Cancun 2003. The next ministerial conference will be from December 13 to 18 in Hong Kong.

In November 2001, members meeting in the Qatari capital, Doha launched a new "round" of talks to liberalise trade in new areas. Known as the Doha Development Agenda, it was originally scheduled to run until the end of 2004. After the Cancun conference collapsed, the target was shifted to the end of 2006.

The negotiations cover agriculture, including reducing subsidies and opening markets, liberalising services, including in banking, insurance and tourism, and lifting barriers on non-agricultural products, ranging from industrial products to fish.

Other issues are "trade facilitation," or smoothing the way for commerce by cutting red tape, as well as trade and the environment, intellectual property and "geographical indications" or place names used to identify products.

The WTO takes decisions on the basis of consensus among members, not majority votes. Under its "single undertaking" rules nothing can be agreed until everything is agreed.

The ruling executive is the WTO General Council, which groups trade ambassadors from all member governments. In September, former European Union trade chief Pascal Lamy took over as director-general from Thailand's Supachai Panitchpakdi.

According to the WTO's 2004 statistics, the international goods trade was worth 8.9 trillion dollars and commerce in services 2.1 trillion dollars.