SPS Committee Hears from China, Moves Forward on Private Sector Standards

16 October 2008

The WTO Committee that deals with trade measures related to food safety and animal and plant health has heard from China on the recent melamine contamination of Chinese milk products. Aside from more specific concerns on measures that affect trade, the committee also outlined a roadmap for addressing private sector standards, heard concerns over new international standards, and endorsed technical assistance for developing countries' development.

With around 300 delegates in attendance, the 43rd meeting of the Committee on Sanitary and Phytosanitary Measures (the SPS committee), held on 8 and 9 October at WTO headquarters in Geneva, was one of the largest ever convened. The committee was preceded by a workshop on technical assistance to developing countries to implement SPS standards, held on 6 October, and two informal consultations, on special and differential treatment and a review of the operation and implementation of the SPS agreement, both held on 7 October.

The SPS agreement is intended to allow governments to protect human, animal, and plant life or health by restricting trade. Trade restrictions implemented by Members must be based on scientific assessment and not used as a front for unfairly discriminatory or protectionist policies. Such standards are garnering more weight as tariffs and other traditional barriers to trade are lowered.

China defends melamine-free exports

China used the meeting to acknowledge the global concern sparked over the illness of 54,000 children and death of four babies in China, which has been attributed to milk containing melamine, a chemical substance that artificially raises a product's protein content in nutritional analyses. The Chinese delegation reported that its government was making enormous efforts to deal with the problem. Greater regulations were introduced on 10 September, which were further tightened ten days later, and since then no contamination has been discovered, the officials said.

However, China asked that any import bans that Members impose be in compliance with international guidelines on scientific risk assessment and official notification, among other things. More than 30 countries have limited imports of Chinese dairy products, and in some cases more than dairy products, since the contamination was detected, the Associated Press reported.

Members also raised concerns about other health-related trade restrictions at the meeting, including 'mad cow disease' and 'novel' food regulations by the EU.

Bovine Spongiform Encephalopathy (BSE or 'mad cow disease') was again on the SPS agenda. Canada noted concern that beef import restrictions under Korea's revised Livestock Epidemic Prevention Act may violate the SPS agreement. Together Canada, the EU, Uruguay, Switzerland and the World Organisation for Animal Health (OIA) stressed that many countries enforce import restrictions that are too strict and out of step with OIE recommendations. Furthermore, it was argued that many countries are not applying the idea of 'regionalisation' set out in the SPS agreement. This provision recognises that, while waiting for an entire country to be declared free, regions can be free from a disease and so have restrictions lifted from trade.

Peru, with the support of the Philippines and several Latin American countries, raised another health-related matter criticising new European food regulations. The EU argues it requires assurance that traditional foods exported to Europe do not present health risks and, as such, suppliers must prove that traditional or ethnic products are safe from historical evidence of consumption over a large region.

But the complainants contended that the proposed regulations are too burdensome on suppliers and that the EU had not notified the SPS committee of the new regulations. In response, the EU said that revision of the regulation is under discussion in the European Parliament and that its main concern was with extracts or food supplements, rather than with entire fruits or vegetables.

Discussion on private sector standards gains momentum

Despite ongoing debate surrounding the committee's decision to address private standards, delegates at the meeting decided to move forward on the issue by starting to analyse specific standards applied to individual products. A report, with input from relevant international organisations, compiling and analysing information from Member's on specific products whose trade has been identified as being affected by private standards will be produced.

The strategy for how to proceed was developed from Members' discussions earlier in the week, as well as responses to a Secretariat questionnaire on these issues (G/SPS/W/230, available at http://docsonline.wto.org).

The issue of whether to address private standards was first raised in 2005 and represents new territory for the SPS committee, which traditionally deals with guidelines set by governments or international standards-setting bodies (see Bridges Weekly, 6 July 2005, http://www.ictsd.org/bridges-news/bridges/news/sps-ctte-considers-private-sector-standards-struggles-continue-with-sd).

A number of developing countries have been highly critical of the use of private sector standards, arguing that they reduce the efficacy of the SPS regime by creating higher standards outside of government control. These countries stress that the standards are arbitrary and end up penalising developing countries and small farmers exporting to the North since they lack capacity and funding. Many developing countries argue that governments should to take responsibility for standards set by private-sector actors within their boundaries. Others, especially developed countries, say that private sector standards fall outside the remit of the WTO and its SPS Agreement (see Bridges Weekly, 2 July 2008, http://www.ictsd.org/bridges-news/bridges/news/sps-committee-considers-establishing-working-group-on-private-sector).

Controversy over proposed international standards

Controversy heated up over a proposed shipping standard intended to prevent the spread of invasive species. China, Japan, Korea and Indonesia objected to a new plant standard proposed by the North American Plant Protection Agency (NAPPO) that would require that all ships be inspected for the Asian gypsy moth before entering territorial waters of NAAPO's member states - Canada, Mexico and the US.

The complainants argued that the standard is not based on science or current international standards and that it is too broad in scope as it covers all of temperate Asia and would subject entire shiploads, instead of just products, to inspection. Therefore they contended that the standard would unjustifiably disrupt trade.

But Canada, Mexico and the US defended the proposal, saying that it is based on proper risk assessment of the Asian gypsy moth that may threaten 600 North American plant species if introduced. Furthermore, the NAPPO members said that they had taken their trading partners' concerns into account by allowing regions to be declared pest free, and that ships entering and moving throughout any of the three countries waters would only need to be inspected once.

Embody SPS measures in development assistance, committee says

The workshop on technical assistance held prior to the SPS meeting raised a theme that was to endure throughout the week: how SPS issues in developing countries can improve trade performance. In particular, delegates suggested that SPS implementation should be brought within the realm of mainstream development assistance. According to a staff member of the WTO Secretariat, this means that development experts should recognise just how important it is to deal with SPS standards in trying to bolster a developing country's capacity to export and ultimately strengthen its economy.

The seventh transitional review of China, required for the first eight years under China's accession agreement, also took place at the meeting. China responded to US and EU questions on certain Chinese trade restrictions such as trade on beef, other BSE related restrictions, pathogen standards, ractopamine residue standards, avian influenza and animal health standards.

The next meeting of the SPS Committee is scheduled to take place from the 25-26 February 2009, during which the third review of the SPS agreement is scheduled to begin.

ICTSD reporting. "Officials: WTO faults China in piracy dispute," THE ASSOCIATED PRESS, 10 October 2008.

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