SPS Disputes

SPS DisputesSPS Disputes

Gretchen H. Stanton

Senior Counsellor

Agriculture and Commodities Division

WTO

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Solving SPS trade disputesSolving SPS trade disputes

• Bilateral Efforts

• SPS Committee – Specific Trade Concerns

• Good Offices by the Chair of the SPS

Committee

• Dispute Settlement of OIE and IPPC

• WTO Dispute Settlement System

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Dispute Settlement of OIE and IPPCDispute Settlement of OIE and IPPC

Pros:• Technical evaluation only• No involvement of lawyers• Less costly

Cons:• Enforcement difficulties• Not binding

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WTO Dispute Settlement System - Main StagesWTO Dispute Settlement System - Main Stages

I. Consultation phase

II. Panel review

III. Appellate Body review

IV. Adoption of report

V. Implementation

Good offices,conciliation and mediationpossible at any moment

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EXPERTS

The Panel ProcessThe Panel Process

Dispute Settlement Body (DSB)

PANEL

AppellateBody(AB)

APPEAL

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Dispute timetableDispute timetable

1 Year 3 months

DSB

ado

pts

repo

rt

APPEAL

SPS may be longer...

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PanelsPanels

• Composition: 3 unbiased individuals

• Procedures:– Detailed working procedures– Consultation of scientific/ technical experts

• Report – Review facts and provide legal analysis– Conclusion regarding consistency of measure

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Appellate BodyAppellate Body

• Standing body of 7• 3 hear any appeal• Reviews issues of law and legal

interpretations by Panel • Upholds, modifies or reverses Panel

findings • AB decision cannot be appealed

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Dispute Settlement Body (DSB) Dispute Settlement Body (DSB)

• Establishes panels

• Adopts Panel /Appellate Body reports

• Determines “reasonable period of time”

• Reviews implementation

• Authorizes “retaliation” or “compensation”

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ComplainantsComplainants

23%

23%

7%6%4%

4%

3%

3%

3%

3%

2%

14%

5%

USECCanadaBrazilIndiaMéxicoArgentinaKoreaJapanThailandChileDevelopingDeveloped

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DefendantsDefendants

25%

22%

5%4%4%

4%

4%

4%

3%

3%

19%

3%

USECIndiaArgentinaCanadaJapanBrazilMéxicoKoreaChileDevelopingDeveloped

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Most cited agreementsMost cited agreements

37%

10%10%

8%

5%

5%

4%

4%4%

4%2%

7%

GATTSubsidies/CVDAntidumpingAgricultureSafeguardsLincensingTBTSPSTRIMsTRIPsServicesOther

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31 (+ 2) disputes have invoked 31 (+ 2) disputes have invoked the SPS Agreementthe SPS Agreement

Reports

Adopted (9 + 2)

27% Panel

Established (4)

12%

Consultations - Pending (13)

40%

Agreed Solution (7)

21%

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SPS DisputesSPS 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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SPS DisputesSPS Disputes

“Hormones”US & Canada vs. EC

“Salmon” Canada (and US) vs. Australia

“Varietals” US vs. Japan

“Fire blight” US vs. Japan

“GMOS”US, Canada & Argentina vs. EC

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Hormones – main conclusionsHormones – main conclusions

• Precautionary principle does not override SPS obligations (reflected in Art. 5.7)

• Measures not based on international standards – not justified under Art.3.3– Codex standards for 5 hormones– Art. 3.3 is conditional right– To be consistent with Art. 3.3, must comply with

Art.5 (risk assessment)

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Hormones – main conclusions Hormones – main conclusions

• Measure not based on risk assessment (Art.5.1)– Risk assessments provided did not support prohibition – Quantitative or qualitative risk assessment – Does not exclude factors that cannot be quantitatively assessed

• No violation of Art. 5.5 – must show:– Different levels of protection in different (but comparable)

situations – Different levels are arbitrary or unjustified– Differences result in discrimination or disguised restriction to trade

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Measures not based on risk assessment (Art. 5.1)

Risk assessments must:• Identify the diseases which a Member wants to

stop from entering• Evaluate the probability of entry, establishment

and dissemination in the case of diseases• As a function of the SPS measures which could

be applied.

Salmon – Main conclusionSalmon – Main conclusion

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Salmon – Main conclusionsSalmon – Main conclusions

No consistency in level of risk accepted (Art. 5.5)

Permitted importation of other products capable of transmitting some of the same diseases

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Salmon – ImplementationSalmon – Implementation

“Consumer ready” requirement – packages of less than 450 g.

• Not based on a risk assessment (Art. 5.1)• More trade restrictive than necessary (Art. 5.6)

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Varietals – Main conclusionsVarietals – Main conclusions

• Measure maintained without sufficient scientific evidence (Art. 2.2)

– Need rational relationship between the scientific evidence and the measure

• Measure not notified (Art. 7 and Annex B)– Administrative procedures which set conditions for

import must be notified

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Varietals – Main conclusions Varietals – Main conclusions

Measure not justified as provisional measure under Art. 5.7

• Japan did not seek more scientific evidence in order to do risk assessment

• Did not revise measure within “reasonable period of time”

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Apples – Main conclusions Apples – Main conclusions

• Measure maintained without sufficient scientific evidence (Art. 2.2)– No evidence of transmission of fire blight via mature

apples– Right to take into account risks from human errors or

illegal actions

• Not justified as a provisional measure (Art. 5.7)– Sufficient scientific evidence exists to do risk

assessment– Scientific uncertainty does not justify measure under

Art. 5.7

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Apples – Main conclusions Apples – Main conclusions

• Measure not based on risk assessment (Art. 5.1)– Risk assessment not specific to risk from imports

of mature apples – Did not take account possible risk mitigation

measures

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Apples – implementation Apples – implementation

Measure not justified by scientific evidence

(Art. 2.2)

Measure not based on appropriate risk assessment (Art. 5.1)

More trade restrictive than necessary (Art. 5.6)

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GMOsGMOs

Three claims by complainants:• General moratorium on GM products: GMOs

subject to prior approval but for 5 years, no decision on any application

• Product specific moratorium • EC member states’ safeguard measures -

some GMOs approved by EC but banned by certain EC member states

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GMOs – Main conclusionsGMOs – Main conclusions

• Protection of biodiversity – under SPS• Food allergens – under SPS• SPS measure: approval procedure – but

existence of prior approval not challenged

Moratorium – found to exist -- application of measure – violation of Annex C

• No violation:

Art. 2.2, 2.3, 5.1, 5.5, 5.6, 7

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GMOs – Main conclusionsGMOs – Main conclusions

Product Specific Measures• Panel examined 27 specific applications • Failure to complete individual approval

procedures without undue delay for 24 products• Violation: Article 8, Annex C (1) (a)• No violation: Articles 2.2, 2.3, 5.1, 5.5, 5.6, 7

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GMOs – Main conclusionsGMOs – Main conclusions

EC member State bans

• Under SPS Agreement• Not based on risk assessments (Art. 5.1)• Sufficient scientific evidence -

(Art. 5.7 inapplicable)

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GMOs – not consideredGMOs – not considered

• If biotech products pose risk to health or environment

• Right to have prior approval procedure• EC approval legislation• Conformity with Agreement on Technical

Barriers to Trade• If biotech products are “like” conventional

products

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DISPUTE

Sci. justification ( 5.7) X (5.7) X (5.7) X (5.7)

Harmoniz. X

Risk Assess. X X X X

Consistency X X

Least trade restrictive

X X

Transparency X X

Annex C approvals

X

Not yet examined: equivalence, regionalization

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Where to get more information? Where to get more information?

Dispute settlement gateway

http://www.wto.org/english/tratop_e/dispu_e.htm

Panel and Appellate Body report

http://www.wto.org/english/tratop_e/dispu_e/dispu_status_e.htm

SPS gateway

http://www.wto.org/english/tratop_e/sps/_e.htm