international standards and the wto agreements · international standards and the wto agreements...
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International Standards and the WTO Agreements
Gretchen H. StantonSenior Counsellor
Agriculture and CommoditiesDivision
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What is the World Trade Organization?
• Established 1 January 1995
• Succeeded GATT (1948 - 94)
• Current Membership is 153
• In Geneva, Switzerland
• Secretariat ~ 650
• Budget < 100 mil. Euros
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WTO Members 2008(153)
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The WTO Agreements
• 30 negotiated agreements
• Decisions by consensus
• Status of international treaties
• WTO rules have priority: Members must change trade policies to conform with their WTO obligations
• Dispute settlement
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WTO Structure
Trade Policy Review BodyDispute Settlement Body
Ministerial Conference
General Council
Council - Goods Council - ServicesCouncil - TRIPS
SPS Committee
TBT Committee
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Principles of international trade
• Avoid trade discrimination– Most favoured nation treatment (MFN) – National treatment
• Support trade liberalization• Increase predictability• Encourage fair trade• Stimulate economic reform and
development
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Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement)
and
Agreement on Technical Barriers to Trade (TBT Agreement)
Differences and similarities
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Weighted average import tariff
≈ 40%
> 4%
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The right to :
•impose regulations or standards for legitimate objectives•Protect human, animal or plant lifeor health
Avoiding unnecessary barriers to trade
SPS and TBT Agreements
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StandardsVoluntary
Technical Requirements
Technical RegulationsMandatory
Conformity Assessment Procedures
TBT Agreement - scope
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The TBT Agreement has a wider scope
• It applies to all– technical regulations (mandatory)– standards (voluntary)– conformity assessment procedures
but…• its provisions do not apply to SPS measures
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TBT objectives
“inter alia”• National security requirements• Prevent deceptive practices• Protect human health and safety • Protect animal and plant health• Protect the environment
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SPS Objectives
Human or risks arising from additives,animal health contaminants, toxins or disease
organisms in food, drink, feedstuff
protect from
Human life plant- or animal-carried diseases
Animal or plant life pests, diseases, disease-causingorganisms
A country other damage caused by entry, establishment or spread of pests
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SPS measures: laws, decrees, SPS measures: laws, decrees, regulationsregulations…… including:including:
• End product criteria• processes and production methods• testing, inspection, certification
approval procedures, etc.• quarantine treatments• animal transport• packaging and labelling requirements
directly related to food safety
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Other measures...• Environment protection per se
• Consumer interests other than health related
• Nutrition
• Animal welfare
Are not covered by the SPS Agreement...
…but often by the TBT Agreement
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TBT
SPS
Since January 1995
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SPS or TBT ?
human or animal health
from food-borne risks
human health from animal-
or plant-carried diseases
animals and plants from
pests or diseases
examples:
pesticide residues
food additives
human disease control
(unless it’s food safety)
nutritional claims
food packaging and
quality examples:
labelling (unless
related to food safety)
pesticide handling
seat belts
SPS Measures TBT Measures
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SPS or TBT?Regulation requiring
that all milk products, with the exception of cheese, be pasteurized.
SPS
Regulation specifying what milk products can be called.
TBT
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Minimum size of fruit
Maturity of fruit
Packaging
Pesticide residues
Citrus canker
TBT
SPS
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Use of material that does notcontaminate water
Shape of bottle
Nutritional value(mineral content)
H2O
Volume of bottleTBT
SPS
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SPS• Right to restrain trade
to protect health
• Measures based on scientific principles and risk assessment
TBT• Right to restrain trade
when legitimate objective (+illustrative list)
• Technical regulations take into consideration inter alia available scientific and technical information
Basic Rights and Obligations
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SPS• No unjustified
discrimination
• No disguised restriction of trade
• Conformity with WTO presumed
TBT• Non-discriminatory
• No disguised restriction of trade
• No conformity presumption
Basic Rights and Obligations
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(a) Are we comparing similar products?
(b) If yes, are requirements different for domesticsuppliers than for foreign suppliers? Or different for different foreign suppliers?
(c) Under SPS: are theSPS conditions // risks different?
Non discrimination
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SPS• No more trade restrictive
than necessary to protect health
• Based on assessment of health risks
• Not maintained without sufficient scientific evidence
TBT• No more trade restrictive
than necessary– Based on risks of non-
fulfilment
• Not applied if circumstances changed
• Based on product requirements not design or descriptive characteristics
Basic Rights and Obligations
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International Harmonization SPS & TBT
• Encouragement to use international standards
• Conformity with agreement presumed• Right to be more stringent, but...
TBT requires that fundamental legitimate objectives cannot be met
SPS requires scientific justification or risk assessment
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International Harmonization
• SPS• Food safety
• CODEX
• Animal health• OIE
• Plant protection• IPPC
TBT
• Relevant international standards
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TBT Risk Assessment
Risk of non-fulfilment due to “for instance”
– Fundamental climatic or geographic factors
– Fundamental technological problems
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SPS - Risk Management
Appropriate measure
Minimize negative trade effects
Not more trade-restrictive than required
Technical and economic feasibility
Consistency
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SPS Risk Assessment
Scientific methodology
Economic factors (animals/plants)
•Scientific evidence•Production methods•Inspection methods,etc.
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EquivalenceSPS TBT
• Acceptance of equivalent measures
• Condition: achieve the appropriate level of health protection of importer
• Exporter to demonstrate• Access to importer• Bilateral and multilateral
agreements
• Acceptance of equivalent regulations
• Condition: adequately fulfill the objective of the importer
• Mutual recognition agreements – conformity
assessment procedures
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SPS - Regionalization
Adaptation of measures to risk profile
Pest- or disease-free areas
FMD, BSE, AI, ….
Exporter: burden of proof(…reasonable access)
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Control, inspection Control, inspection andandapprovalapproval -- Conformity evaluation Conformity evaluation
procedures procedures SPS TBT
• Non discriminatory• Non disguised
restriction• Harmonization – use
internationally developed procedures
• Non discriminatory• Without undue delay• If operate national
system for approval of additives/tolerances: encourage interim use of international standards
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TBT -Transparency - SPS
Members shallshall Establish an Enquiry PointAND
Designate a Notification Authority
Notify other Members of new or changed regulations when
no international standard exists OR
the new regulation is differentthan the international standard
regulation may have significant effect on trade
AND
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Special and differential treatment
TBT & SPS
•Take into account special needs of LDC•Specified, time-limited exceptions upon request•Facilitate active participation LDC in international organizations
Flexibility international standardsTBT
SPSNo flexibility international standardsDelayed application
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Technical assistance
Reinforcement servicesEstablishment regulatory bodiesAdvice, credits, donations, grants
Bilateral “Three sisters”
TBT SPSITC
FAO
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TBT - Committee - SPSImplementation of the Agreement
Trade problemsInformation by Members
Discussion of notifications
MonitoringConsistency
Review Agreement
SPS StandardsTechnical regulations
Conformity assessment
Technical Assistance
TBT
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STANDARDS AND TRADE DEVELOPMENT FACILITY (STDF)Joint initiative of FAO, OIE, World Bank, WHO
and WTO
Objective of STDF - assist developingcountries enhance capacity to implementinternational SPS standards
…. thus improve human, animal health and plant protection enable new or maintain access to markets
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• Grants for preparation of projects (US$ 20,000)
• Grants for projects (US$ 300,000 to 600,000)
• Least developed and other low income countries– 10% contribution
• Other developing countries – 30% contribution
• Projects focussed on collaboration, innovation, best practices
Web site: www.standardsfacility.org
STDF Secretariat: [email protected]
STDF – Financing available
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Role of Codex in WTO• Develops relevant international standards
(explicitly under SPS, by implication under TBT)• Develops risk assessment techniques (SPS)• Exhortations for WTO Members to participate • Coordinate re: monitoring use of international
standards (SPS)• Identifies relevant scientific experts for WTO
dispute cases (especially SPS)
• Secretariat – to – Secretariat relationship• Coordination in technical assistance
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WTO Dispute settlement
• WTO unified dispute settlement procedures– GATT XXII: Consultation– GATT XXIII: Nullification or impairment– Memorandum of understanding
• Possibility technical experts (group)
• SPS: right to resort to dispute settlement mechanisms of other IO
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WTO Dispute Settlement
• Coverage: goods, services and intellectual property
• Procedures: strict time limits
• Adoption of reports by the Panel: inverted consensus
• Examination by the Appellate Body
• Non-compliance with recommendations
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WTO Dispute SettlementGovernment brings complaint
Panel established– 3 “ad hoc judges”
Submissions and hearings of interested governments [Consultation of scientific experts]
Panel reports on consistency with WTO rules
Report adopted or appealedAppellate Body review (3 of 7 standing judges)Appellate Report supports or modifies Panel
report
Report Adopted - implementation
Bilateral consultations
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Codex in WTO Disputes
• US/ Canada case against EC ban on hormone-treated meat (SPS)
• Peru case against EC designation of“sardines” (TBT)
• US / Canada / Argentina case againstEC on GMOs (SPS)
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SPS Disputes
• Food safety:– US/Canada vs. EC - Hormones (WT/DS26, 48)– US/Canada/Argentina vs. EC - Biotech (WT/DS291, 292, 293)– EC vs. US/ Canada - Retaliation on Hormones (WT/DS320, 321)
• Animal health:– Canada / US vs. Australia - Salmon (WT/DS18, 21)
• Plant Protection:– US vs Japan - Variety Testing (WT/DS76)– US vs. Japan – Fire blight (WT/DS245)– Philippines vs. Australia - Tropical Fruit (WT/DS270)– New Zealand vs. Australia - Apples (WT/DS367)
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Hormones dispute - SPSCodex standards existed for 5 of 6 hormones
EC failed to justify not basing its measure(prohibition) on Codex standards
– because failed to demonstrate that measure was based on an appropriate risk assessment
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Sardines dispute - TBT
Codex standard for what species could be called“sardines”
EC failed to justify not basing its labeling requirements on Codex – because could not demonstrate that Codex standard would not meet EC’s “legitimate objectives”
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Gretchen H. StantonThe World Trade Organization
Centre William Rappardrue de Lausanne 154CH–1211 Geneva 21
Switzerland
Tel: +41 (0)22 739 50 86email: [email protected]
website: www.wto.org