The World Trade Organization (WTO) is an intergovernmental organization that regulates and facilitates international trade, serving as a permanent institutional framework for global commerce. It was officially established on January 1, 1995, under the Marrakesh Agreement, which was signed by 123 nations on April 15, 1994, following the Uruguay Round of multilateral trade negotiations (1986–1994). The WTO succeeded the General Agreement on Tariffs and Trade (GATT), which was created in 1948 as a provisional treaty to reduce tariffs and other trade barriers, but lacked a robust institutional structure and dispute resolution mechanism. The WTO solved this problem by creating a stronger, rules-based system that covers trade in goods, services, and intellectual property.
The WTO works on core principles, notably non-discrimination, which includes the Most-Favoured-Nation (MFN) rule and the National Treatment principle. The MFN rule requires a member to grant the same favorable trade terms to all other WTO members that it offers to any single member. The National Treatment principle requires imported goods, once they enter the market, to be treated no less favorably than domestic goods. Key mechanisms include the Dispute Settlement Body (DSB), which provides a structured process for resolving trade disputes between members, and the Trade Policy Review Mechanism (TPRM), which periodically reviews members' trade policies. The WTO connects to the International Monetary Fund (IMF) and the World Bank, as all three are considered the "three pillars" of the world economic system, promoting a cohesive approach to global economic governance. A significant recent change is the paralysis of the Appellate Body, the WTO's highest judicial arm, since December 2019, due to the United States blocking the appointment of new members. This has rendered the compulsory, binding multilateral dispute settlement system non-binding for some members, though a workaround called the Multi-Party Interim Appeal Arbitration Arrangement has been developed by 58 members. The core principles like MFN and National Treatment, however, remain the bedrock of the system.