indian avian case -the new jurisprudential approach

Indian AVIAN DISPUTE

New Jurisprudential Understanding of the SPS Agreement

Raunaq Jaiswal (LLM 2015)[email protected]

AbstractThis Paper interprets the Indian-Avian dispute to elucidate upon the principles

governing Articles 2, and 5 of the SPS agreement and their complex connection with the term “scientific evidence”


Contents

List of Abbreviations used in this case......................................................................................2

Introduction................................................................................................................................3

Background of the Dispute.........................................................................................................3

Analysis of Article 2.2...............................................................................................................4

Analysis of Article 5.1 and 5.2...................................................................................................5

Relationship between Article 2.2, Article 5.1 and Article 5.2...................................................7

Conclusion..................................................................................................................................8

Works Cited.............................................................................................................................10

Raunaq Jaiswal (LLM 2015) 1


List of Abbreviations used in this case

AB Appellate Body

ALOP Appropriate level of protection

AI Avian Influenza

HPAI Highly Pathogenic Avian Influenza

HPNAI Highly Pathogenic Notifiable Avian Influenza

LPAI Low Pathogenic Avian Influenza

LPNAI Low Pathogenicity Notifiable Avian Influenza

NAI Notifiable Avian Influenza

OIE World Organization for Animal Health (formerly, Office International des

Epizootes)

Panel Report Panel Report, India- Measures concerning the importation of certain

Agricultural Products, WT/DS430/R and Add.1, circulated to WTO members

14th October 2014

SPS Sanitary and Phytosanitary

SPS

Agreement Agreement on the application of Sanitary and Phytosanitary Measures

WTO World Trade Organization



“One nation’s bunch of grapes is another nation’s repository of carcinogenic pesticide

residue”1

Introduction

Sanitary and Phytosanitary (SPS) Measures2 are measures are a critical component of

country’s response to risks that might negatively impact human, animal or plant health or life.

Almost everyday newspapers carry stories which involve the SPS Agreement. From the Mad

Honey Disease to the Avian Influenza, the trade dimensions are never far from the surface.

The SPS agreement is thus a vital piece of regulation that lays down the rules and procedures

which must be followed by the members.

The Preamble to the SPS Agreement states among other things, that “No Member

should be prevented from adopting or enforcing measures necessary to protect human, animal

or plant life or health, subject to the requirement that these measures are not applied in a

manner which would constitute a means of unjustifiable discrimination between members

where the same conditions prevail or a disguised restriction on international trade”. Here the

words “subject to the requirement that these measures…..” is of particular significance since

it lays down rules and regulations under which a member nation can impose restrictions on

the imports of the other member nation. The word “should be prevented” underlines the duty

of the member nation to only impose the restrictions in case of a genuine threat to human,

animal or plant life or health only.

Background of the Dispute

The India- Measures Concerning The Importation of Certain Agricultural Products ,

2015 Dispute arose because of certain measures and restrictions India imposed on

importation of various agricultural products, primarily poultry products, from United States

of America, because of the concerns related to avian influenza (AI), through two domestic

legislations, i.e. The Livestock Importation Act, as amended, and Statutory Order 1663(E)3.

In the past, India had argued that Low Pathogenic Avian Influenza can mutate into Highly

Pathogenic strains and argued that it is allowed to prohibit trade in poultry under the

Terrestrial Animal Code of the World Organization for Animal Health (OIE). The US 1 Trebilcock and Soloway in International Policy of Domestic Food Safety Regulation: The case for Substantial Deference by the WTO DSB under the SPS Agreement.2 The WTO agreement on Sanitary and Phytosanitary Measures is an International treaty adapted by the WTO on 1st January 1995. The agreement was last checked on 13th October 2015 by the author of this Paper. 3 India- Measures Concerning The Importation of Certain Agricultural Products , 2015 at Para. 1.2



disputes this assessment, arguing that international standards for avian influenza control only

support the imposition of import bans in outbreaks of high pathogenic strains. Washington

therefore claims that there is no basis for imposing an import ban, as only low pathogenic

strains of avian influenza have been detected in the US since 2004.4 "Countries have the right

to impose certain restrictions," said Alex Thiermann, President of the OIE Code Commission.

However, he added that "the code very clearly says that low pathogenic influenza allows for

trade." Thiermann told Bridges that, because low pathogenic forms of the virus can mutate

into highly pathogenic forms, "you have to wait a certain number of days" before importing

poultry meat from a flock of birds that has had a low pathogenic strain of avian influenza.

This is because low pathogenic avian influenza is "a weak virus that disappears after a short

period of time," he said. The United States, however, has not had an outbreak of high

pathogenic avian influenza (HPAI) since 2004, while during that same interval, India has had

over 90 HPAI outbreaks.5

Against the ruling of the Panel, India appealed on the following three grounds-

Whether the Panel failed to make an objective assessment by setting "terms of reference" for

individual experts that were beyond the scope of the OIE Code;

Whether the Panel failed to make an objective assessment by requiring India to prove that

LPNAI is exotic to India, instead of requiring the United States, as the complainant, to

establish prima facie its allegation that LPNAI should be present in India;

Whether the Panel acted inconsistently with Article 11 of the DSU by delegating to the

experts the factual determination of whether LPNAI is exotic to India.

The Appellate Body found that India’s AI measures are inconsistent with Articles 5.1, 5.2

and 2.2 of the SPS Agreement because they are not based on a risk assessment. The measures

that India applied, i.e. The Livestock Importation Act, as amended, and Statutory Order

1663(E) were inconsistent with Article 2.3 of the SPS Agreement because they arbitrarily and

unjustifiably discriminate between Members where identical or similar conditions prevail and

are applied in a manner which constitutes a disguised restriction of international trade.

Further, the AB ruled that the measures were inconsistent with Articles 5.6 and 2.2 of the

SPS Agreement because they are significantly more trade restrictive than required to achieve

4 http://www.ictsd.org/bridges-news/bridges/news/indian-ban-on-imports-of-us-poultry-sparks-wto-dispute5http://americanshipper.com/Main/News/ WTO_hands_US_victory_in_poultry_trade_dispute_with_58530.aspx#hide


http://americanshipper.com/Main/News/WTO_hands_US_victory_in_poultry_trade_dispute_with_58530.aspx#hide

http://americanshipper.com/Main/News/WTO_hands_US_victory_in_poultry_trade_dispute_with_58530.aspx#hide

http://www.ictsd.org/bridges-news/bridges/news/indian-ban-on-imports-of-us-poultry-sparks-wto-dispute


India’s appropriate level of protection (ALOP) with respect to the products covered by

chapter 10.4 of the OIE Terrestrial Code, and therefore are also applied beyond the extent

necessary to protect human and animal life or health.6

The AB ruled in favor of the United States stating “insofar as SO 1663 (E) prohibits

the importation of various agricultural products into India from those countries reporting NAI

(both HPNAI & LPNAI)” the United States challenge to such prohibition was not limited to

the listing of the products prohibited by SO 1663 (E) in paragraph 3 of the panel request, but

encompassed all products, the importation of which is prohibited from countries reporting

Notifiable Avian Influenza pursuant to SO 1663 (E). The AB further concluded that it was

premature for it to determine whether certain measures not specifically listed in the panel

request were within the panel’s terms of reference.7

Analysis of Article 2.2

Article 2.2 of the SPS Agreement falls under the title of “Basic Risk and Obligation”. The

text of the Article is as follows:

Members shall ensure that any sanitary or phytosanitary measure is applied

only to the extent necessary to protect human, animal or plant life or health, is

based on scientific principles and is not maintained without sufficient

scientific evidence, except as provided for in paragraph 7 of Article 5.8

Here, the word ‘shall’, in the first line, imposes a duty or an obligation on the members to

adopt SPS measures only to protect human, animal or plant life or health. But such a measure

should be established on sound “scientific principles” and such a measure should not be

maintained without “sufficient scientific evidence”. Thus, the three main elements of Article

2.2 are:

-only to the extent to protect human, animal or plant life or health

6 As stated in the summary of the findings in the WTO website. The summary was up to date as of 29 th June 2015. URL- https://www.wto.org/english/tratop_e/dispu_e/cases_e/ds430_e.htm 7 Supra n.3 at 1.9 8 Article 5.7 In cases where relevant scientific evidence is insufficient, a Member may provisionally adopt sanitary or phytosanitary measures on the basis of available pertinent information, including that from the relevant international organizations as well as from sanitary or phytosanitary measures applied by other Members. In such circumstances, Members shall seek to obtain the additional information necessary for a more objective assessment of risk and review the sanitary or phytosanitary measure accordingly within a reasonable period of time


https://www.wto.org/english/tratop_e/dispu_e/cases_e/ds430_e.htm


-based on scientific principles

-not maintained without sufficient scientific evidence

The focus of the DSB has been on “sufficiency” rather than “science”. By science, it has been

held that evidence to be considered should be evidence gathered through scientific methods.

Placing Article 2.2 in the context of other science based obligations in the agreement, the AB

finds that there is scientific justification for a measure where there is ‘rational’ or ‘objective’

between the measure and the scientific evidence. This is to be determined ‘on a case to case

basis and will depend upon particular circumstances of the case, including the characteristics

of the measure at issue and quality of scientific evidence’.9 The obligation in Article 2.2 that

an SPS Measure not be “maintained without sufficient scientific evidence” requires “the

existence of a sufficient or adequate relationship between two elements, in casu, between the

SPS Measure and the scientific evidence.10 The other element, namely, that an SPS measure

must be based on scientific principles and not maintained without sufficient scientific

evidence are linked to the more specific obligations in Articles 5.1 and 5.2.

In EC Measures Concerning Meat and Meat Products, 2009, the appellate body found that it

was not lawful under the SPS agreement, for a member to guard against a merely theoretical

or hypothetical risk where to do so would affect international trade. Joanne Scott argues that

‘until and unless, the “more than theoretical” threshold is reached, only the language of

science will resonate in the application of this Agreement.11

In Japan- Measures Affecting Agricultural Products , 2001 the AB ruled that the contested

measure, i.e. the varietal testing requirements for agricultural products on which codling

moth might occur, was maintained without sufficient scientific evidence. On this evidence it

concluded that there was no further need to examine “what is required for a… measure to be

based on scientific principles” or whether a testing regime was so based. Similarly in Japan

— Measures Affecting the Importation of Apples, 2005, the focus was on the 3rd prong of the

Article 2.2, with the panel concluding that the measure was not underpinned by scientific

evidence. The AB ruled in EC- Approval and Marketing of Biotech products, 2008 that any

measure must satisfy all three tests in order to pass the muster under Article 2.2

9 Japan Varietals (Japan- Measures Affecting Agricultural Products , 2001) (AB), para. 8410 Ibid at para.7311 Joanne Scott, ‘On Kith and Kine’: Trade and Environment in the EU and WTO in JHH Weiler, ed., The EU, The WTO and the NAFTA-Towards a Common Law of International Trade? (New York: Oxford University Press 2000) at 157 and as Cited in (Epps, 2008) at 185



Analysis of Article 5.1 and 5.2

Articles 5.1 and 5.2 fall under the title of “Assessment of Risk and Determination of the

Appropriate Level of Sanitary or Phytosanitary Protection”. The text of the agreement is as

follows:

5.1 Members shall ensure that their sanitary or phytosanitary measures are

based on an assessment, as appropriate to the circumstances, of the risks to

human, animal or plant life or health, taking into account risk assessment

techniques developed by the relevant international organizations.

5.2 In the assessment of risks, Members shall take into account available

scientific evidence; relevant processes and production methods; relevant

inspection, sampling and testing methods; prevalence of specific diseases or

pests; existence of pest- or disease-free areas; relevant ecological and

environmental conditions; and quarantine or other treatment.

Using the word “shall” the Article 5.1 imposes a duty or an obligation on the members to

ensure that any SPS measure is based on an “assessment” as suitable to the situation on the

threat to human, animal or plant health or life, taking into consideration “risk assessment”

techniques developed by relevant international organizations.

Article 5.2 which is read with Article 5.1, requires the Members, to take into “available

scientific evidence” and prevalence of specific diseases or pests among things. This is to

ensure that the Members don’t place arbitrary restrictions on trade. Any restriction place

should be done only if the procedural aspects, i.e. scientific reports as to the existence of a

disease in the importing country, which has been inspected and sampled. If the process has

not been followed, the restrictions are liable to be declared violative of the SPS Measures.

Using the mandatory ‘shall’, Article 5.1 requires Members to “ensure that their sanitary or

phytosanitary measures are based on an assessment, as appropriate to the circumstance, of the

risks to human, animal or plant life or health”. With respect to the term “based on” in Article

5.1, the appellate body in EC-Hormones noted that “’based on’ is appropriately taken to refer

to a certain objective relationship between two elements, that is to say, to an objective

situation that persists and is observable between an SPS measure and a risk assessment”12

12 EC-Hormones (AB), para.189 as cited at para 5.16 Supra n.3



A "risk assessment", as envisaged under Article 5.1, is defined in paragraph 4 of Annex A to

the SPS Agreement as follows:

The evaluation of the likelihood of entry, establishment or spread of a pest or

disease within the territory of an importing Member according to the sanitary

or phytosanitary measures which might be applied, and of the associated

potential biological and economic consequences; or the evaluation of the

potential for adverse effects on human or animal health arising from the

presence of additives, contaminants, toxins or disease-causing organisms in

food, beverages or feedstuffs.

In EC-Hormones, the AB described a “risk assessment” as “a process characterized by

systematic, disciplined and objective enquiry and analysis, that is, a mode of studying and

sorting out facts and opinions”13. Science plays a “central role” in a risk assessment. The

Appellate Body has, however, cautioned against taking “too narrow” an approach to a risk

assessment. In Australia-Apples, the Appellate Body stated that “Article 5.2 requires a risk

assessor to take into account the available scientific evidence along with other factors.

Drawing upon the context provided by Article 2.2, the AB in India- Measures Concerning

The Importation of Certain Agricultural Products , observed that Article 5.1 when

contextually read as it should be, in conjunction with and as informed by Article 2.2 of the

SPS Agreement, requires that the results of the risk assessment must sufficiently warrant- that

is to say, reasonably support-the SPS measure at stake. The requirement that an SPS measure

be “based on” a risk assessment is a substantive requirement that there be a rational

relationship between the measure and the risk assessment”.14

Relationship between Article 2.2, Article 5.1 and Article 5.2

The provisions of the SPS Agreement that relate to the scientific centered approach

have been exposed to active condemnation. The problem is not with the agreement or with

the epistemic premises upon which it rests, but with the manner in which this agreement has

been interpreted and applied, which results in a disproportionately rigid approach to the term

“scientific evidence”.

13 Supra n.3 at para. 5.19 14 EC Hormones para. 193



The AB in EC Hormones, viewed Article 5.1 as a specific application of the basic

obligation set out in Article 2.2. It stresses that these two paras should be “constantly read

together”. Article 2.2 informs Article 5.1 the elements that define the basic obligation set out

in Article 2.2 impart meaning to Article 5.115.

In Japan- Measures Affecting Agricultural Products , 2001, the AB’s conclusions on

the meaning of Article 5.1 are deemed “useful” and to “provide guidance” in the construction

of Article 2.216.

In Australia-Salmon, the AB observed that where a measure is not based on risk

assessment in accordance with Article 5.1, that measure will also, by implication, be

inconsistent with Article 2.217 The AB endorsed the proposition of the panel that a measure

not based on risk assessment “can be presumed, more generally, not to be based on scientific

evidence” and consequently not to be incompatible with the second and third requirements of

in Article 2.2. Even if the nature of such an implication is to be regarded as rebuttable, it

implies a reversal in the burden of proof for Article 2.2 for measures not based upon risk

assessment in accordance with Article 5.1. At the same time it is apparent that the reverse

presumption does not apply in either direction. That a measure does not violate Article 5.1

cannot be taken to imply that it is consistent with Article 2.2. That a measure is inconsistent

with Article 2.2 cannot be taken to imply that it violates Article 5.1. The concept of a rational

relationship between available science and the measure in question has emerged as an

element of each.18

In EC-Biotech, the panel recalls the AB’s construction of this relationship, but further

refines it, viewing Article 5.1 as a “specific application of the second and third obligations

provided for in Article 2.2. Article 2.2 imparts meaning to Article 5.1. But in addition,

Articles 5.1, 3.3 and 5.7 are cited as providing context to the concept of sufficiency in Article

2.2.19 The panel further did not discuss the relationship between the constituent parts of Art.

5.7 From the point of view of Art. 6.2 Of DSU, this reflects its nature as a qualified

exemption from Articles 2.2 and 5.1. Since a breach of Article 5.7 is treated as a prerequisite

for a finding of breach of Article 2.2 and 5.1.The four requirements of Article 5.7 are

15 (EC Measures Concerning Meat and Meat Products, 2009)16 (Japan- Measures Affecting Agricultural Products , 2001)17 Salmon-Australia (AB) at para 13818 (Scott, 2010)19 (Epps, 2008)



cumulative, it only being necessary to establish a breach of one part, and so this does not

really resolve the issue of clarity of presentation of a request for establishment of a panel.

Article 2 sets out the basic rights and obligations for WTO Members; Several

paragraphs of Art. 5 elaborate upon the basic obligations set out in Article 2. The AB in

considering the relationships that exist between the basic obligations in Article 2 and several

paragraphs of Article 5 has consistently emphasized the close link that exists no/t only

between Article 2.2 and 5.1 and 5.2, but also between Articles 2.2 and 5.6 and between

Articles 2.3 and 5.5. With respect to each of these obligations, the AB has acknowledged that

relevant text of Article 2, serves as a context for understanding the corresponding specific

obligations in Article 5 and vice versa. Given that the provisions of Article 5 set out “more

specific obligations” of the “basic” rights and obligations, we consider that the structure and

logic of the SPS Agreement, as understood in the light of the relationship between the various

provisions of Articles 5 and 2, is such that the preferred means for complying with the basic

obligations under Article 2 is through the “particular routes” or “specific routes” set out in

Article 520.

The panel in Indian- Avian noted that Articles 2.2 5.1 and 5.2 all deal with the

scientific foundation of the SPS Measures and are ‘intimately related’. The Panel recalled the

Appellate Body’s observation that Article 5.1 constitutes a “specific obligation” of the basic

obligations contained in Article 2.2; that Article 2.2 informs Article 5.1 because the elements

that define the basic obligation set out in Article 2.2 impart meaning to Article 5.1; and

finally that Articles 2.2 and 5.1 should “constantly be read together”.21 The Panel observed

that the relationship between these provisions had led past panels and AB to conclude that,

when an SPS measure is not based on a risk assessment, in accordance with Article 5.1 and

5.2, that measure can be presumed, more generally, not to be based on scientific principles or

to be maintained without sufficient scientific evidence.22

The Panel further considered this to mean that, in practical terms, a violation of

Articles 5.1 and 5.2 “entails” a violation of the more general 2.2. The Panel, however, noted

that the opposite is not always true, given the broader scope of Article 2.2, and that not all

instances of violation of Article 2.2 “entail” a violation of Articles 5.1 and 5.2.

20 Supra n.3 at Para 5.1221 Ibid at para 5.7.22 Ibid



Conclusion

The methodology of the dispute settlement bodies in interpreting the science based

obligations has become technical in nature. To this extent the constraints implied by these

obligations may be understood in terms of decision making methodology and not outcomes.

Thus, the Article 5.1 requirement that members base their measures on a risk assessment

requires the existence of a risk assessment meeting the demands of Annex A.4. Member State

compliance will be assessed on the basis of scientific evidence available and not merely on

the basis of scientific evidence originating within that state. The agreement forces Members

to look beyond their own domestic research domain, to the results of “foreign” and

international research. This viewpoint is reinforced by the willingness of the AB to recognize

that the range of considerations to be taken into account is not closed. Members must have

regard to certain specified categories of information but not necessarily to the exclusion of all

others.

The SPS Agreement contains four key science-based obligations, that a party

requesting a panel must, in addition to identifying specific measures being challenged,

provide a brief summary of the legal basis of the complaint sufficient to present the problem

clearly. Where distinct obligations in a single article, or in a single paragraph or a sub-

paragraph within a single article, are similar or interlinked, the approach of the panel in EC-

Biotech was to view Members as absolved of providing any further breakdown (paras 67-67

reproduced in para 7.47 of the panel report). A third obligation is treated as implicit in Art.

6.2, namely a requirement to identify which measures are alleged to violate which of the

provisions identified in the request.

Article 2.2 forms part of the basic rights and obligations laid down in the agreement.

It requires that the members shall ensure that any SPS measure is applied only to the extent

necessary to protect human, animal or plant life or health, is based on scientific principles and

is not maintained without sufficient scientific evidence, except as provided by Article 5.7

In cases where relevant scientific evidence is insufficient, a Member may

provisionally adopt sanitary or phytosanitary measures on the basis of available pertinent

information, including that from the relevant international organizations as well as from

sanitary or phytosanitary measures applied by other Members. In such circumstances,

Members shall seek to obtain the additional information necessary for a more objective



assessment of risk and review the sanitary or phytosanitary measure accordingly within a

reasonable period of time.

In the Indian-Avian dispute, India had not identified any risk assessment on which its

AI measures were based, but rather relied on its defense that, because its measures conform

to the OIE Code, the absence of a risk assessment was “of no consequence” because it was

“not required to conduct a risk assessment for measures which conform to the international

standards”. The Panel concluded that India did not have a risk assessment within the meaning

of Annex A, paragraph 4, and as required by Article 5.1.23 In the absence of a risk

assessment, the Panel concluded that India’s AI measures are inconsistent with Articles 5.1

and 5.2 of the SPS agreement.

Therefore, the Panel summarized and the AB concluded that where an SPS measure is

not based on risk assessment as required by Articles 5.1 and 5.2, the measure is presumed not

to be based on scientific principles, and to be maintained without sufficient scientific

evidence in contravention of Article 2.2.

Works Cited

Australia — Measures Affecting Importation of Salmon (2000) WTO.

23 Supra n.3 at para 5.9



Australia — Measures Affecting the Importation of Apples from New Zealand (2010) WTO.

EC- Approval and Marketing of Biotech products (2008).

EC Measures Concerning Meat and Meat Products (2009).

Epps, T., 2008. International Trade And Health Protection- A Critical Assessment of the

WTO's SPS Agreement. Cheltenham: Elgar International Economic Law .

India- Measures Concerning The Importation of Certain Agricultural Products (2015).

Japan — Measures Affecting the Importation of Apples (2005) WTO.

Japan- Measures Affecting Agricultural Products (2001).

Scott, J., 2010. Oxford Commentary on The WTO Agreement on Sanitary and Phytosanitary

Measures. New York: Oxford University Press, New York.


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