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The petroleum production management practices of OPEC member states have always been controversial particularly among the major petroleum-consuming nations of the developed world. While this controversy has traditionally been kept within the realm of politics, it is increasingly taking a legal form. A number of suits have been brought against OPEC, OPEC member states as well as their national oil companies or subsidiaries, often for alleged breach of national competition regulation. There have also been several attempts to use the WTO dispute settlement system to challenge OPEC member states that are also members of the WTO. This article attempts to answer the question of whether the petroleum production management practices of OPEC member states are subject to any external legal controls in the form of international economic law and the competition or antitrust laws of non-OPEC countries.
This article is about two distinct areas of law - international trade law and national antitrust or competition law - that come together from different angles to challenge the legality of national measures in respect of one of the most valuable and sensitive natural resources - petroleum. More specifically, the aim of this article is to examine the question of whether the petroleum production management practices of OPEC member states are subject to any external legal controls in the form of international economic law and the competition or antitrust laws of other countries. In terms of the former, the article focuses on the extent to which the rules of the GATT/WTO system apply to the sovereign decisions of OPEC member states to determine the amount they produce at any particular moment, and whether the WTO dispute settlement system can be used successfully to challenge the legality of this practice. Answering this question in the negative, the article then proceeds to examine whether OPECs role as a forum for the coordination of national petroleum production and pricing policies is captured by the national competition or antitrust laws of non-OPEC countries. While acknowledging the remaining legal uncertainties, the article concludes that WTO law does not apply to OPEC production management practices, and that OPEC production restriction measures fall outside the scope of national antitrust law. Finally, the article also highlights some of the legislative initiatives that have been considered,...