International Tribunal Spotlight
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The Permanent Review Court of the Mercosur (“Mercado Comun del Sur” or Common Market of the South)
By: Lucia Druetta, Assistant Editor, International Judicial
Monitor, and Director Of Academic Programs, International Judicial Academy
The Permanent Review Court of the Mercosur (“Tribunal Permanente de Revision”) is this year celebrating its 10th year anniversary. Created on February 18, 2002 under the Olivos Protocol, this Court is a juridical body of the common market of the southern part of the South American continent, which in shortened form is called Mercosur.
The Mercosur is comprised of four countries: Argentina, Brazil, Paraguay, and Uruguay. It was created under the Treaty of Asuncion of 1991 (“Tratado de Asuncion”). Under the aforementioned treaty and subsequent agreements, the Member States have economically and politically agreed to gradually eliminate import/export fees and establish a free economic zone within their borders.
The Treaty of Asuncion and then the Brasilia Protocol of 1991 were the first instruments that set forth a temporary dispute settlement system within the Mercosur. However, the procedure was changed and improved with the Olivos Protocol of 2002. The Olivos Protocol provides different mechanisms to settle disputes between Member States related to the interpretation, application and breach of the Treaty of Asuncion and subsequent treaties, decisions or measures taken under the Treaty of Asuncion. These mechanisms consist of direct negotiations (Chapter IV) and an optional mediation procedure before the Mercosur Group (Chapter V) on the one hand, and ad hoc arbitration (Chapter VI) and proceedings before the Permanent Review Court (Chapter VII), on the other. The first group of mechanisms is known as pre-trial mechanisms.
The Role of the Permanent Review Court
The Permanent Review Court is the highest instance court in the dispute settlement system of Mercosur. It was officially “installed” in August, 2004 and its judges were officially nominated that same year. Its headquarters have been located in Asuncion del Paraguay, Paraguay since 2004.
Pursuant to the Olivos Protocol, the Permanent Review Court’s role is to settle disputes submitted to it by Member States and to give advisory opinions on legal questions that might arise. In the first case, the Court will hear cases in four different situations. First, it will hear appeals to arbitral awards rendered by the Mercosur ad hoc arbitral tribunals under the procedure set forth in Chapter VI of the Olivos Protocol. This appellate review is limited to questions of law developed in the ad hoc arbitration court decision. Second, it will hear cases that could not be mediated and settled through direct negotiations or mediation procedures before the Mercosur Group under the procedure established in Chapters IV and V of the Olivos Protocol. Third, the Court will hear cases that could cause irreparable damage to the party and where exceptional measures should be ordered. The interested party must follow the procedure stated under Mercosur Decision N 23/04, which established the requirements that should be met to be eligible for the exceptional measure. Finally, the Court will hear disputes arising from ministers’ meetings related to the interpretation, application or breach of international agreements. In these cases, the decisions of the Permanent Review Court will be final and binding on the parties.
The Court can also give advisory opinions regarding the interpretation and application of the Mercosur provisions in order to apply them uniformly within the territories of the Member States. The Member States, Mercosur organs, Superior Tribunals of Member States and the Mercosur Parliament can request advisory opinions from the Permanent Review Court. These advisory opinions are not binding on the parties.
Although the dispute settlement system provided by the Olivos Protocol only applies to Member States, private parties (natural or juridical persons) can also submit their claims related to the application of legal or administrative discriminatory measures issued by Member States in breach of the Treaty of Asuncion and subsequent treaties, protocols and other decisions rendered within the Treaty of Asuncion in their own countries. In that respect, private parties must follow the procedure established under Chapter XI of the Olivos Protocol.
Organizational Structure
The Permanent Review Court consists of a body of five arbitrators, five deputy arbitrators and a Secretariat. The arbitral body is composed of two representatives (arbitrator and deputy arbitrator) from each of the four Member States and a fifth arbitrator and deputy arbitrator who are unanimously elected by all of the Member States. Each of the first four arbitrators and deputy arbitrators serve for a period of two (2) years, renewable for not more than two consecutive periods. The fifth arbitrators serve for a period of three years. These terms will not be renewed unless otherwise agreed. The Presidency of the Court is selected on a rotating basis. The arbitrators must be at permanent disposal of the Permanent Review Court.
The Secretariat is headed by a national of any of the Member States and is called the Secretary. The Secretary is appointed by the Committee of the Mercosur for a two year term, renewable for another two years. He or she should have a law degree, a specialization in international law and at least ten years of work experience in the field. The primary function of the Secretariat is to provide institutional support for the Permanent Review Court proceedings and supervise the four sections that comprise the Secretariat as follows: (1) Library and Archives; (2) Database; (3) Administrative; and (4) Legal. Other functions of the Secretariat consist of assisting the arbitrators of the Court, coordinating the work between the different areas of the Secretariat, coordinating the relationships between the Court and other bodies of the Mercosur and drafting the budget of the Court, among others. While disputing parties bear the costs of Court proceedings, the Member States finance the Secretariat’s administrative costs.
It should be noted that there is one other juridical body that serves the Mercosur – the Administrative-Labor Court. This court has jurisdiction to hear and determine disputes between Mercosur and its employees, or employees of Mercosur contractors. It is composed of four judges appointed by the Common Market Group. This court will accept cases only after the employee has exhausted all administrative remedies
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