Slide No. 1

Pradeep S MehtaSecretary GeneralCUTS International

Jaipur, IndiaEmail: psm@cuts.org

International Trade Concerns

Effects of International Regulatory Harmonisation and International Agreements (For Trade)

August 2006

Slide No. 2

• All international agreements for trade are relevant, but their objectives differ.

• Different objectives lead to constant conflicts among divergent approaches.

• Clashes over international agreements have economic implications.

• Developing countries face numerous challenges with the highest economic implications.

• A well-balanced and harmonised international regulatory mechanism needs to be created.

FACTS

Slide No. 3

Following international rule-making bodies govern the Biosafety and Biotechnology regulation:

• WTO: It sets the regulations, which govern global trade in all products.

• Cartagena Biodiversity Protocol: It was negotiated in 2000 to cover transboundary movements of GM and LM products;

• Codex Alimentarius Commission in Rome: It is responsible for providing technical judgments on food safety issues.

INTERNATIONAL REGULATIONS

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 • WTO Agreements i.e. GATT, SPS & TBT aim to ensure that

measures affecting trade are no more restrictive than necessary.

 • Biosafety Protocol and the Codex Alimentarius intend to regulate

the international transfer of LMOs thus focusing primarily on environmental and human health risks.

CONFLICTING REGULATIONS

 

OUTCOME:

 

Uncertainty occurs as to how environmental and health measures can be harmonised with relevant WTO Agreements.

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Uncertainty aggravates when two different groups of countries favour different approaches.

• US, Canada and Argentina have adopted the principle of ‘sound science evidence’ and prefer the WTO Agreements.

• EU, Japan and South Korea have adopted the ‘precautionary principle’ thus restricting trade. They favour CBD to justify their stringent national regulations.

FURTHER COMPLICATIONS

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• This dispute became a test case on how the WTO will deal with

decision-making based on the precautionary principle.

• Ruling in favour of US, Argentina and Canada against EU.

• Ruling could not help clear the dust nor affect the EU's current biotech regulatory framework.

US-EU BIOTECH TRADE DISPUTE

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• Fear related to exports of agricultural commodities to EU and other countries.

• Preserving the export opportunities, they need to be “GM-free” countries.

• If they opt not to grow any GM crops, then the farmers are at a loss.

• Their capacity to implement, monitor and enforce bio-safety laws remains weak.

• India recently went through a very tough time in terms of governance of biotechnology.

• The bio-safety guidelines require a comprehensive and dynamic policy mechanism , not just a tool for regulation.

CHALLENGES FACED BY DEVELOPING COUNTRIES

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• Africa still lacks a comprehensive regulatory system against

agricultural biotechnology vis-à-vis the international negotiations at the WTO.

• Most countries do not have the necessary infrastructure to comply with the regulations.

• Need to balance their rights and obligations under the Biosafety Protocol with their commitments under the WTO.

CHALLENGES FACED BY DEVELOPING COUNTRIES

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• Can take assistance from FAO, IAEA, UNEP and WHO to work

together for developing a model regulatory framework.

• The Codex Alimentarius Commission and Consultative Group on International Agriculture Research (CGIAR) centres can be involved.

TOWARDS INTERNATIONAL REGULATORY HARMONISATION

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For International regulatory harmonisation, US and EU can cooperate either by:

• Mutual recognition of regulatory systems,

• Explicit regulatory harmonisation, or

• Informal mutual regulatory adjustment.

NEED FOR COOPERATION BETWEEN US AND EU

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CONCLUSION

Given the entrenched differences between the US and the EU, and also between the WTO and the Biodiversity Protocol, a formal or informal mutual regulatory adjustment short of formal harmonisation is the most promising.

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Thank You !

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