In Brief

WTO PANEL TO EXAMINE ECUADOR'S CHALLENGE OF US SHRIMP DUTIES

Following Ecuador's second request for a panel submitted to the WTO's Dispute Settlement Body (DSB) at its 19 July meeting, the WTO will set up a panel to examine Ecuador's challenge of the US safeguard measures on shrimp imports imposed in January 2005 (see Bridges Trade BioRes, 11 November 2005; WT/DS335/*). Shrimp constitute Ecuador's largest private sector export to the US and the second largest export industry, representing 10 percent of total exports in 2005 with a value of over US$450 million. Specifically, Ecuador is taking issue with the US Commerce Department's use of "zeroing" to calculate the anti-dumping duties imposed on certain frozen warmwater shrimp from Ecuador and other countries. Under this methodology, investigators treat transactions with negative dumping margins as having margins equal to zero in determining weighted average antidumping margins, allegedly resulting in artificial and inflated anti-dumping margins. A number of cases have already been brought against the US over its use of zeroing in which the DSB has consistently ruled against the US (see e.g. WT/DS294/*). Under dispute settlement rules, a panel will be established within ca. 45 days with the panel report expected by mid-2007. Thailand, India, Brazil, China, Japan, the EU and Korea have reserved their rights as third parties.

Other countries have also requested consultations with the US over its shrimp duties. India has focused its challenge on the bonds that importers of Indian shrimp have to deposit with US customs authorities (see Bridges Trade BioRes, 16 June 2006; WF/DS345/*). Thailand has challenged both the use of zeroing and the bonds (see Bridges Trade BioRes, 28 April 2006; WT/DS343/*).

WTO documents are available at online.

ICTSD reporting; "DSB establishes panels in reference to shrimp and gambling services disputes," WTO, 19 July 2006.

WORLD TRADE REPORT: USING SUBSIDIES TO ACHIEVE POLICY OBJECTIVES

The 2006 World Trade Report, published annually by the WTO, notes that subsidies can often be the most efficient way of pursuing public policy objectives and correcting market failures. The reports cites environmental subsidies among examples of such measures, including subsidies to mitigate negative environmental externalities or to support compliance with environmental regulation. At the same time, however, the report cautions that government grants can distort trade flows if they are used to give an artificial leg up to exporters or import-competing industries. The right mix, the report concludes, will depend on the specific cause of the market failure, a country's socio-economic level development and the likelihood of government failure.

The report stresses that the impacts of subsidies remain "seriously under-researched" and many WTO Members are yet to fully meet their notification obligations, which is further contributing to the lack of data and transparency. WTO economists estimate that worldwide subsidy grants totalled US$300 billion in 2003. Of this, around US$250 billion was spent in 21 developed countries. The bulk of agricultural domestic support is provided by three Members, the EU (US$96.1 billion between 1995 and 2001), the US (US$ 66.2 billion) and Japan (US$41.8 billion). Fisheries subsidies paid by OECD countries have been estimated at US$6 billion annually, representing 20 percent of the landed value of fish. While rich country farm subsidies have somewhat declined, the level of fisheries subsidies seems to have remained largely unchanged. However, there appears to be a recent shift in the provision of fisheries subsidies towards a greater emphasis on environmental protection, the report concluded.

ICTSD reporting; "WTO World Trade Report focuses on subsidies," WTO, 24 July 2006.

EUROPEAN OMBUDSMAN OVERRULES COMMISSION ON RELEASE OF BIOTECH SUBMISSION

The European Ombudsman on 11 July announced that the European Commission's refusal to disclose a submission in a WTO dispute on biotech products to Friends of the Earth Europe (FOEE) on the ground that "the WTO dispute settlement procedure has to be assimilated to court proceedings" amounted to an instance of "maladministration". The Ombudsman overruled the Commission's claim that WTO disputes should involve similar secrecy levels to court cases in order to defend parties' interests from external influences. The Ombudsman stressed, however, that his decision should not be seen to imply that the Commission would be obliged, in general, to publish or otherwise disclose to third parties its submissions in WTO disputes when they are filed with the WTO panel.

On February 2005, FOEE had made a complaint to the European Ombudsman concerning the European Commission's refusal to give them access to its second submission in the WTO dispute over the EU's de facto moratorium on the approval of new biotech products brought by the US, Argentina and Canada (see Bridges Trade BioRes, 19 May 2006). According to FOEE, the document should have been made available to the public on the grounds that the case dealt with issues related to human and environmental safety. The Commission had eventually disclosed the document in question last year. The submission pointed to scientific uncertainties about the safety of GM food and crops. "What we now know is that whilst the EC has been telling us for years that biotech foods are safe, they were arguing behind closed doors that there are legitimate scientific concerns that warrant a more precautionary approach," said Adrian Bebb, GMO foods campaigner for FOEE.

Over the past years, the Commission has typically disclosed its submissions to WTO panels immediately after the hearing has taken place. However, applications for access are assessed on a case-by-case basis with a view to deciding whether it is possible to publish papers prior to the hearings. More generally, the EU believes greater transparency is essential to make dispute settlement rulings more acceptable to the general public.

Decision of the European Ombudsman on complaint 582/2005/PB against the European Commission

Submissions and other documents related to US-EC biotech dispute are available on the ICTSD website.

"EU Guilty of Withholding Genetically-Modified Food Data", DOW JONES, 19 July 2006; "European Commission Guilty of Wrongly Concealing GMO Documents Says Ombudsman", FOEE, 18 July 2006; "EU Approves Genetically Modified Foods Despite Serious Concerns: New Documents Reveal EU Commission's Double Standards", FOEE, GREENPEACE, 18 April 2006.

SCIENTISTS WARN OF IRREVERSIBLE BIODIVERSITY LOSS

In a joint declaration published in the journal Nature, a group of 19 leading scientists and policy experts from 13 countries warn of a "catastrophic loss of species", with a great number of species expected to become extinct in the next century. "Biodiversity loss is essentially irreversible, it poses serious threats to sustainable development and the quality of life of future generations", they noted. According to Charles Perrings of the Arizona State University and Vice-Chair of DIVERSITAS, biodiversity "provides ecosystem services such as disease and climate regulation, storm protection and habitat for useful species. The loss of biodiversity imposes real economic costs on society, and we need to develop clear science guidance for policy options."

The biodiversity specialists call for the establishment of a UN-led advisory panel on biodiversity protection similar to the Intergovernmental Panel on Climate Change (IPCC). "For the sake of the planet, the biodiversity science community has to create a way to get organised, to co-ordinate its work across disciplines, a together with one clear voice advise governments on steps to halt the potentially catastrophic loss of species already occurring," said Robert Watson, chief scientist of the World Bank and former chair of the IPCC. He also stressed that it is "critical to get the world economic system right because subsidies in agriculture and energy undermine the sustainability of ecosystems."

The current rate of species loss is around 1,000 times faster than at any time since 65 million years ago, when the earth was hit by an asteroid that led to mass extinction. The four-year Millennium Ecosystem Assessment carried out by more than 1,300 researchers from 95 countries found that with the added pressures of climate change, up to 30 percent of all mammal, bird and amphibian species are in danger of becoming extinct by 2050.The Convention on Biodiversity (CBD) had set a target of reducing the rate of loss, but the rate of decline continues to escalate. The group highlights that the CBD dos not have "the structural means to mobilise the expertise of a large scientific community".

"Biodiversity Experts to Create Global Intergovernmental Advisory Panel," ENS, 19 July 2006; "Biodiversity: Warn of Species Holocaust," TERRAVIVA EUROPE, 20 July 2006; "Earth Faces Catastrophic Loss of Species," THE INDEPENDENT, 21 July 2006.

SHARKS, STURGEON, WHALES DISCUSSED AT CITES ANIMALS COMMITTEE

At its 22nd Meeting, from 7-13 July 2006 in Lima, Peru, the Animals Committee of the Convention on International Trade in Endangered Species of Wild Flora and Fauna (CITES) adopted six recommendations concerning, among other issues: the review of significant trade (RST) in Appendix II species; transport of live specimens; sea cucumbers; conservation and management of sharks; and the periodic review of animal species included in the Convention's appendices.

On agenda items concerning the conservation and management of sharks, as well as the biological and trade status of sea cucumbers, the discussions were focused on the sustainability of commercially-traded marine species and fisheries management. For both sharks and sea cucumbers, better and more harmonised collection and reporting of international trade data is needed and more cooperation with the UN Food and Agricultural Organisation was recommended, particularly in the area of capacity-building. It was decided that a joint work programme for law enforcement, fisheries management, research and capacity building would be established regarding the conservation and management of sharks.

It was reported to the meeting that large quantities of illegal caviar continue to be confiscated in Europe (see Bridges Trade BioRes, 20 January 2006). The Secretariat will provide information to the next Steering Committee meeting on sturgeon and paddlefish for Caspian Sea stocks so that the Steering Committee can decide on the pending recommendation to suspend trade. On Queen conch, the Steering Committee has already decided to recommend a suspension of trade from range States where the Secretariat, in consultation with the Animals Committee Chair, had not been able to verify implementation of recommendations.

The Central and South America and the Caribbean representative, Canada and Japan supported Finland's proposal to include the central stock of North Atlantic fin whales in the periodic review. Spain pointed out that this was a precedent for arbitrary inclusion of species in the periodic review upon Parties' requests and contrary to the scientific criteria developed over the years in the Animals Committee. In spite of this warning, a vote was taken and the majority voted to include the fin whales in the periodic review.

A summary report is available from IISD Linkages.

ICTSD reporting; ENB Vol. 21 No. 49, 15 July 2006.