This article is part of a Synergies series on Next generation trade arrangements for environment and sustainable development. Any views and opinions expressed are those of the author(s) and do not necessarily reflect those of TESS or any of its partner organizations or funders.

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Today’s international storms and crises require rapid governmental, legislative, and security actions by all states. Decision-making must, therefore, be more agile and malleable, even if the normative network becomes less stable and riskier—domestically or with other states. Flexibility and adaptability are characteristics that are largely absent in traditional trade agreements. At the same time, security and predictability remain pertinent values for international exchanges.

Traditionally, cooperation and negotiations between governments aimed at stability through agreed, binding, and enforceable rules. These kinds of treaty provisions were always considered to be the best, if not the only, tools to bring about predictability. 

Today, international law-making and the modification of rules between states have proven to be very difficult, slow, often inefficient, and resource- and time-consuming. This is particularly true for international trade, where the development of new multilateral initiatives has been strangled. 

At the same time, digitalization and artificial intelligence dictate and demand faster and more malleable regulatory trade norms and mechanisms. Our dynamic digital economy and the rapid development of new technologies may benefit from being regulated by flexible arrangements rather than hard rules. States need to be able to implement all of these new actions, adapt, and develop more flexible and dynamic instruments capable of rapid and adaptable implementation. 

Sustainable development actions are also urgent and cannot be delayed by collective inaction. Sustainable development requires active implementation by states. For example, the World Trade Organization (WTO) E-Commerce Agreement suggests that implementation need not take place only after ratification. As discussed in the following sections of this note, the Fourteenth WTO Ministerial Conference (MC14) brings a new focus on implementation as a dynamic means of building up international agreements. Sustainable development needs to take advantage of this dynamism and be integrated into such agreements. In today’s geopolitical and financial limitations, trade and sustainable development need to operate within a more flexible framework that allows for adaptive implementations with iterative modifications when possible. 

My suggestion is not a glorification of informality or a denial of the rule of law. If hard law commitments are not possible, soft law commitments can be used to implement hard law and maintain transparency on the relevant issues. Implementation by domestic actors can itself be a source of experience helping the formation of international agreements. Generally, “imperfect” agreements do not prima facie violate rights afforded under the WTO Agreement as their main goal is to favour and promote trade. As inaction and blockages bring dangerous risks, “imperfect” actions that promote WTO values are better and can have good normative influence. 

“Imperfect agreements” can be defined as instruments reflecting agreement on some issues, but which are either incomplete, transitional, illegal, or not respecting (all formal) requirements. Some experts would suggest they are evidence of the non-relevance or weakness of the WTO which is “dépassé” or “toothless,” as the White House prefers to call it. I do not agree. The WTO belongs to the future, but I acknowledge that governments shall work differently.

This first note (out of three) introduces (successful) imperfect but effective agreements, such as targeted trade deals, subgroup actions and instruments, soft law norms, and coordinated trade actions (sometimes initiated and coordinated via implementation). These instruments allow WTO members to obviate the need for WTO consensus and enable members to assume their sustainable development responsibilities by effectively collaborating and implementing norms in new areas. This in turn contributes to the development of state practices, experiences in implementation, and law-making.

The note does not elaborate on WTO-consistency of the arrangements discussed. Rather, I tend to agree with an old quote by Robert Hudec: “I believe that disobedience to GATT law is not always the more harmful alternative—that in certain situations of legal crisis, disobedience may be less damaging to GATT law than continuing to abide by the rules.” 

Typically sectoral in scope, these agreements prioritize cooperation, regulatory dialogue, and shared standards over rigid enforcement mechanisms. The Global Value Chain Development Report 2025 identified 185 of such deals in critical minerals and digital trade. This trend reflects experimental norm-setting in areas where multilateral consensus remains elusive.

For example, unlike comprehensive regional trade agreements, targeted trade deals such as the Digital Economy Partnership Agreement or the data flow provisions in the EU-Japan Economic Partnership Agreement, operate through best-endeavour commitments, information-sharing, and iterative frameworks, thereby relying on coordination, policy convergence, and reputational incentives rather than dispute settlement.

From a WTO law perspective, such instruments are not per se inconsistent with the Marrakesh Agreement, as they primarily facilitate dialogue and cooperation rather than modify existing binding commitments. Crucially, targeted trade deals function as more than mere political signalling. By fostering sustained engagement, they generate state practice and normative expectations, gradually shaping regulatory behaviour and facilitating coordination in emerging areas. These instruments influence the trajectory of future plurilateral and multilateral negotiations, by acting as a bridge between regulatory cooperation and eventual legal codification. In some of those deals, like on critical minerals, sustainable development considerations are mentioned including specifically forced labour and environmental considerations. However, sustainable development needs to be better and more coherently integrated in those new mini deals.

The Joint Statement Initiative on Services Domestic Regulation (SDR) provides another example of how initial soft law commitments can become hard law within the WTO system, thus bringing stability and predictability. Faced with the inability to incorporate the outcome as a formal plurilateral agreement due to the consensus blockage by India, participating members adopted an alternative approach: they inscribed SDR disciplines into their individual GATS schedules as “additional commitments.” India insisted that the text of the SDR agreement be fully transcribed in each members’ schedules, and not via a cross reference to the Joint Statement Initiative (JSI) document and symbol. India refused to recognize the validity and even the legal existence of such a document. Parties went to arbitration on India’s claim that Australia’s inscription and reference to the commitments in the SDR JSI nullified its most-favoured-nation (MFN) benefits. The arbitration body concluded that the modification by Australia does not adversely affect the benefits accrued to India under the General Agreement on Trade in Services (GATS). 

By embedding these SDR commitments within the GATS schedule of additional commitment framework, members ensured that they remain anchored in WTO principles, including transparency and predictability. In doing so, SDR illustrates a broader pattern in WTO governance: flexible, member-driven processes that preserve institutional coherence while avoiding negotiation deadlock. Although the JSI on SDR was initially somewhat soft, the eventual inscription of SDR disciplines into individual GATS schedules formalized the commitments. 

With respect to changes to goods schedules, the conclusion of the panel in EU–Poultry Meat (China) is informative. That panel concluded that certification does not constitute a legal prerequisite for modifying a member’s schedule. The panel found that such modifications produce legal effects inter se between the concerned exporting and importing members and may be implemented notwithstanding the absence of certification. 

Both dispute settlement reports confirm that non-concerned members cannot oppose duly negotiated changes to schedules. This gives members an opportunity to formalize their commitments and embed them in the WTO system via their schedules.

The need for faster change capacity was also faced by contracting parties in late 1970, when they decided that changes to schedules (which became frequent and considered useful) did not need to follow the formal amendment of GATT procedures. They adopted S/L/80 that regulated the Article XXVIII process and provided for certification under certain conditions after 90 days of circulation of the revised schedule. 

The Mechanism on Dispute Settlement practices (JOB/DSB/1) allows participating members to resolve disputes through their own specific ad hoc procedure (as of today, there are 14 such mechanisms in place). This mechanism is also the legal basis for the Multi-Party Interim Appeal Arbitration Arrangement (MPIA). The MPIA currently has 60 participating members and provides for an interim arbitration appeal procedure under Article 25 of the Dispute Settlement Understanding (DSU) until the resurrection of the Appellate Body. This mechanism binds those who want to follow the agreed-upon procedures. And non-participants can participate as third parties in proceedings. The MPIA demonstrated to members that dispute settlement is accessible to subgroups. Indeed, the E-Commerce Agreement (ECA) cross-references and applies the DSU and the MPIA mutatis mutandis in disputes between its parties. MPIA contributes to sustainable development by allowing members to resolve disputes and clarify acceptable trade practices in line with sustainable development, recalling that there is no one-size-fits-all approach to achieving sustainable development.

The recent E-Commerce Agreement is a beautiful example of a new generation of trade agreements. Its nature cannot be defined any other way than dynamic and hybrid. Some claim the ECA is “outside” the WTO; but it carries a WTO symbol, and it was one of the significant outcomes of MC14. 

Approximately 66 members have committed to coordinated implementation of the ECA on an interim basis, pending its incorporation as a plurilateral agreement (under Annex 4 of the WTO Agreement or otherwise). This “interim” approach functions as a club-based arrangement, coupled with an intention to multilateralize over time. Notably, it includes an annex that makes WTO dispute settlement rules applicable mutatis mutandis.

Importantly, this structure enables participating members to implement and operationalize commitments domestically, even in the absence of formal adoption within the WTO framework. In doing so, the ECA builds on a soft law foundation, facilitating regulatory alignment, policy development, and the expansion of expertise and enforcement at the domestic level. 

In doing so, the ECA does necessarily affect the prior WTO rights of non-ECA parties, as the arrangement addresses emerging sectors, new issues, and regulatory areas not appropriately covered by old WTO disciplines. To the extent that similarly situated members are treated similarly, the arrangement avoids discrimination on a de facto basis. The overall institutional pattern set up for the ECA balances flexibility with systemic coherence and does not deny or contradict multilateral ongoing work.

After the failure of members to agree on a permanent moratorium on e-commerce duties at MC14, 23 members decided to continue to uphold the moratorium (“Joint Statement on the Moratorium on Customs Duties on Electronic Transmissions”, WT/GC/283). “We agree to maintain the current practice not to impose customs duties on electronic transmissions among ourselves.” The deal adds that “electronic transmission made using any electromagnetic means and includes the content of the transmission.” All but seven of the Joint Statement signatories (US, Guatemala, Mexico, Panama, Taiwan/Taipei, and Uruguay) are also party to the ECA. It seems that such a moratorium is only among signatories (therefore MFN is not mandatory but possibly possible). But the Joint Statement could nonetheless serve as model or incentive for more members to join in, or for other WTO members to do the same in the context of regional trade agreements or Generalized System of Preferences (GSP) schemes—forming a growing epistemic community network of members who share beliefs, methods, and ways of understanding the benefit of a moratorium on e-commerce duties.

 I decided to work on this paper before Mavroidis, Evenett, Hoekman, and Wolff published their amazing paper that argued better than I do how non-formal actions can bring trade efficiency. They suggest that disruptions linked to the Strait of Hormuz, in particular the energy and food and fertilizer crisis, present an opportunity to develop a voluntary trade scheme that would inter alia connect providers/exporters and importers and facilitate collective monitoring of export restraints. They point to the Singapore and New Zealand initiative on essential goods (covering medical supplies) that was established during the COVID-19 pandemic as a model which included both import liberalization and export restraints of medical supply. As the authors note, such a voluntary scheme “required no new WTO rules, does not depend on consensus, and can operate independently of the largest players.” This initiative was upgraded to a legally binding agreement and signed on 4 May 2026.

On 17 April 2026, the Australia-Singapore Protocol on Economic Resilience and Essential Supplies (annexed to their FTA) was concluded. It concerns trade in essential supplies including petroleum oils, such as diesel, and liquefied natural gas. The Protocol was based on the Joint Statement on Economic Resilience and Essential Supplies delivered by Australia’s Prime Minister Anthony Albanese and Singapore’s Prime Minister Lawrence Wong on 10 April 2026. A very effective informal commitment.

Some WTO members have demonstrated creativity by developing (imperfect) arrangements that implement trade values and benefits in situations where more formal avenues were closed. The above suggestions are not instead of the formal multilateral route but in addition, in parallel, and together with. But this requires WTO members to work differently.

WTO members can take different types and formats of decisions and as sovereigns they can decide to use imperfect agreements to promote WTO goals, including sustainable development, and develop trade benefits. The issue is not whether these imperfect agreements can (permanently) replace formal agreements; this is not their goal. These imperfect arrangements facilitate the implementation of important agreed rules among an open subgroup of members. Imperfect agreements can assist in developing and improving state practices (both domestically and inter se) and help attract more participants—thus increasing the legitimacy of imperfect agreements and aiding in legalizing such arrangements.

Integrating sustainable development into these new types of arrangements will keep sustainable development at the discussion table and perpetuate sustainable development values. Where consensus-based multilateral actions are not possible, it is legitimate and even beneficial for members seeking to enhance and protect international trade and advance cooperative initiatives on sustainable development to be able do so within the WTO system.

In fact, there are new ways of doing so. In this sense, these new ways of working reflect an evolution in trade governance, whereby de facto coordination by members and plurilateral implementation, alongside other forms of imperfect and soft law agreements and/or practices, bring about soft and de facto legal change and serve as stepping stones towards eventual integration into the multilateral system. As noted by DG Ngozi: “If we all accept that we can no longer do business as usual, that will help us create the parameters for success. The WTO can deliver results if members “accept we can do things differently.” This is the new multilateralism brought about by MC14 that can promote trade and sustainable development. 

Imperfect agreements can have a rich normative influence as they promote trade values and initiate the implementation of WTO reform.

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Gabrielle Marceau is Honorary Professor (Emer), University of Geneva; and Visiting Professor, University Of Ottawa.

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Synergies is an online platform featuring expert commentary and opinions curated by TESS. We foster dialogue and incubate ideas on how to shape a global trading system that effectively addresses global environmental crises and advances sustainable development. Synergies draws on perspectives from leading experts and practitioners across policy communities from around the world. We cultivate solutions-oriented policy analysis for a sustainable future.

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