ulla kask agriculture and commodities division wto · world trade organization / 154, rue de...

World Trade Organization/ 154, rue de Lausanne / 1211 Geneva 21 / Switzerland / [email protected] 1

Ulla KASK Agriculture and Commodities Division WTO


A. The WTO and environment

B. Disciplines under the Goods Agreements:

‒ Agreement on Agriculture

‒ Agreement on Subsidies and

Countervailing Measures

‒ Agreement on Technical Barriers to Trade

C. Conclusion

Outline A. Introduction


The WTO is about trade

&

trade rules

Non-trade concerns e.g. environmental

protection

A. Introduction


The Marrakesh Agreement

(the founding charter of the WTO)

The Preamble recognizes the need to:

allow “for the optimal use of the world’s resources in

accordance with the objective of sustainable development”,

and

“both protect and preserve the environment and to enhance the

means for doing so in a manner consistent with their respective

needs and concerns at different levels of economic

development”

A. Introduction


Decision on Trade and Development

.. states that efforts to uphold multilateral trading system and to

protect the environment must be complimentary

A. Introduction


“…commitments under the reform

programme should be made in an

equitable way among all Members,

having regard to non-trade concerns,

including food security and the need to

protect the environment”

Agreement on Agriculture A. Introduction


…recognizes that:

“no country should be prevented from taking

measures necessary …for the protection of … the

environment, …, at the levels it considers

appropriate,

… sets the requirements:

No arbitrary or unjustifiable discrimination

between countries where the same conditions

prevail

No disguised restriction on international trade”

Agreement on Technical Barriers to Trade A. Introduction


Most Favoured Nation (MFN)

&

National treatment

Two key principles of the WTO A. Introduction

9

1A Multilateral

agreements

on trade in

goods

1B GATS

1C TRIPS

2 Dispute

Settlement

Understanding

3 Trade Policy

Review

Mechanism

4 Plurilateral

trade

agreements

Marrakech Agreement establishing the WTO

Signed on 15 April 1994

In force since 1 January 1995

WTO

Uruguay Round 1986-1993 B. Goods Agreements

World Trade Organization / 154, rue de Lausanne / 1211 Geneva 21 / Switzerland / [email protected]

10

GATT 1994 (General Agreement on Tariffs and Trade)

1A

Multilateral

agreements

on trade in

Goods

Goods

Agreements on:

Annex 1A Multilateral agreements on trade in Goods

Are applicable to Production Feedstock and biofuels:

Understandings Marrakech Protocol

Agriculture Customs valuation

Sanitary and phytosanitary measures Preshipment inspection

Textiles and clothing (expired on 1º

January 2005)

Rules of origins

Technical barriers to trade Import licencing

Trade-related investment measures

(TRIMS)

Subsidies and countervailing

measures

Antidumping Safeguards

B. Goods Agreements

World Trade Organization / 154, rue de Lausanne / 1211 Geneva 21 / Switzerland / [email protected] 11

Classification issue

Biofuels Production

feedstock

Ethanol

Agricultural

products

Non-agricultural

products

Biodiesel

Different legal regimes

B. Goods Agreements


Subsidies

• Agreement on Agriculture

– Applies to agricultural products only (as defined in Annex I)

– Amber, Green and Blue Box Support

• Agreement on Subsidies and Countervailing Duties

– applies to both agricultural and non-agricultural products

– prohibited, actionable, non-actionable subsidies

Subsidies to production feedstock and/or biofuel production?

B. Goods Agreements


Subsidies Agreement on Agriculture

Green Box, e.g.

• Research

• Payments under environmental programmes:

(a) Eligibility for such payments shall be determined as part of a clearly-

defined government environmental or conservation programme and

be dependent on the fulfilment of specific conditions …, including

conditions related to production methods or inputs.

(b) The amount of payment shall be limited to the extra costs or loss of

income involved in complying with the government programme.

Amber Box (i.e. most trade distorting support) • All other support (except Green or Blue Box)

• … incl. measures directed at agricultural processors … to the extent that

such measures benefit the producers of the basic agricultural products

B. Goods Agreements

Annex

2 Art.6.5

Amber Box (AMS)

14

Argentina Iceland Morocco Chinese Taipei

Australia Israel New Zealand Tajikistan

Brazil Japan Norway Thailand

Canada Jordan Papua New Guinea Tunisia

Colombia Korea (Rep. of) Russia Ukraine

Costa Rica Mexico Saudi Arabia United States

European Union Moldova South Africa Venezuela

FYR of

Macedonia

Montenegro Switzerland-

Liechtenstein

Vietnam

Members with reduction commitments

B. Goods Agreements

AMS Entitlements

15

Table: AMS entitlements

Final Bound Total AMS De minimis

Country

Currency Value

US$ million

(value in

2016)

%

1 Argentina $ at the1992 rate 75,021,292.4 75.0* 10

2 Australia $A million 471.9 350.8 5

3 Brazil US$ thousand 912,105.2 912.1 10

4 Canada Can$ million 4,301.0 3,245.1 5

5 Colombia US$ thousand 344,733.0 344.7 10

6 Costa Rica US$ thousand 15,945.0 15.9 10

7 European Communities (15) € million 67,159.0 74,288.0 5

European Union (28) –

uncertified € million 72,378.0

80,061.0 5

8 FYR of Macedonia € million 16.3 18.0 5

9 Iceland SDR million 130.1 93.6 5

10 Israel US$ thousand 568,980.0 569.0 10

11 Japan ¥ billion 3,972.9 36,518.0 5

12 Jordan JD 1,333,973.0 1.9 10

13 Korea, Republic of W billion 1,490.0 1,284.2 10

14 Mexico Mex$ 1991 million 25,161.2 11,164.4** 10

15 Moldova SDR million 12.8 17.8 5

16 Montenegro € 333,278 0.4 5

17 Morocco DH million 685.0 69.8 10

18 New Zealand $NZ million 288.3 200.7 5

19 Norway Nkr million 11,449.0 1,363.0 5

20 Papua New Guinea US$ million 34.2 34.2 10

21 Russia US$ billion 4.4 4,400.0 5

22 Saudi Arabia SR million 3,218.3 858.2 10

23 South Africa R million 2,015.4 137.0 5

24 Switzerland – Liechtenstein Sw F million 4,257.0 4,320.8 5

25 Chinese Taipei NT$ million 14,165.2 469.7 5

26 Tajikistan US$ thousands 182,667 1,826.7 10

27 Thailand B million 19,028.5 539.1 10

28 Tunisia D million 59.3 27.6 10

29 Ukraine UAH million 3,043.4 119.1 5

30 United States of America US$ million 19,103.3 19,103.3 5

31 Venezuela US$ thousand 1,130,667.0 1,130.7 10

32 Vietnam VND billion 3,961.6 182.6** 10

B. Goods Agreements

NB! De minimis is available to all Members


Subsidies Agreement on Subsidies and Countervailing Duties (ASCM)

Prohibited subsidies:

– export incentive subsidies that are contingent on export

performance, and

– local content subsidies granted for use of domestic inputs over

imported goods

Actionable subsidies:

– remedial measures if there is serious prejudice:

• imports into the market of the subsidizing country are displaced;

• exports to third country markets as a result of the subsidy are displaced;

• there is significant price suppression as a result of the subsidy; and

• there is an increase in world market share by the subsidizing country

B. Goods Agreements

Agreement on Subsidies and Countervailing Duties (ASCM)

Non-Actionable Subsidies (Art. 8)

(a) assistance for research activities conducted by firms or by higher

education or research establishments

(b) assistance to disadvantaged regions

(c) assistance to promote adaptation of existing facilities to new

environmental requirements imposed by law and/or regulations which

result in greater constraints and financial burden on firms, provided that the

assistance:

(i) is a one-time non-recurring measure; and

(ii) is limited to 20% of the cost of adaptation; and

(iii) does not cover the cost of replacing and operating the assisted investment; and

(iv) is directly linked to and proportionate to a firm’s planned reduction of nuisances and

pollution, …; and

(v) is available to all firms

Expired in 2000


B. Goods Agreements Subsidies (cont’d)


• Mandatory and voluntary technical specifications for products

• … for a variety if legitimate objectives, incl. environmental

protection

• Conditions:

‒ non-discirmination

‒ no unnecessary obstacles to trade

‒ transparency

Agreement on Technical Barriers to Trade

Sustainability criteria

B. Goods Agreements


IMS ID Title Member(s) subject

to STC Member(s)

raising STC First date

raised Last date

raised

500

Russian Federation - Implementation plan related

to excise tax on palm oïl and soda products (ID

500) Russian Federation Indonesia 09/03/2016

499 France - Amendment 367 on Biodiversity Law (ID

499) France; European

Union Brazil; Indonesia 09/03/2016

431

European Union - Regulation (EU) No 1169/2011

of the European Parliament and of the Council of

25 October 2011 on the provision of food

information to consumers establishes the general

principles, requirements and responsibilities

governing food information, and in particular food

labelling (ID 431) European Union Indonesia;

Malaysia 18/06/2014

408 United States — EPA Palm Oil Biofuels Regulatory

Program (ID 408) United States of

America Indonesia;

Malaysia 30/10/2013 19/03/2014

346

Spain – Ministerial Order of the Government of

Spain IET/822/2012, published on 21 April 2012

and in force as of 22 April 2012 (ID 346) European Union;

Spain Argentina 13/06/2012

307 European Union – Directive 2009/28/CE,

Renewable Energy Directive (EU - RED) (ID 307) European Union

Argentina;

Indonesia;

Malaysia; United

States of America 15/06/2011 19/03/2014

216 Colombia – Draft Decree Establishing Provisions to

Promote the Use of Biofuels (ID 216) Colombia Argentina; Mexico;

European Union 18/03/2009 20/03/2012

TBT: specific-trade concerns http://tbtims.wto.org/

B. Goods Agreements


Tariffs - cannot be challenged per se at the WTO if not above

the bound levels

Export taxes – no disciplines, however the tax escalation

may make a difference

‒ DS473: European Union — Anti-Dumping Measures on Biodiesel from

Argentina

(Export tax on biodiesel = 5%, export tax on soy = 30%)

Tariffs and export taxes B. Goods Agreements

21

Prohibitions

Article XI*: General Elimination of Quantitative Restrictions

1. No prohibitions or restrictions other than duties, taxes or other

charges, whether made effective through quotas, import or export

licences or other measures, … on the importation or on the

exportation or sale for export….

2. Exceptions (none of them is based on environmental

consideration):

(c) Import restrictions on any agricultural or fisheries product, imported

in any form,* necessary to the enforcement of governmental

measures which operate:

(i) to restrict the quantities of the like domestic product permitted to be marketed or

produced, …

(ii) to remove a temporary surplus of the like domestic product, ..

(iii) to restrict the quantities permitted to be produced of any animal product the production

of which is directly dependent, …, on the imported commodity,

B. Goods Agreements


Examples:

the Montreal Protocol for the protection of the ozone layer

the Basel Convention on the trade or transportation of

hazardous waste across international borders, and

the Convention on International Trade in Endangered

Species (CITES)

Priority given to the domestic environmental policies

Prohibitions/restrictions through

multilateral environmental agreements

B. Goods Agreements


GATT Article XX - General Exceptions

Allows to take measures:

(g) relating to the conservation of exhaustible natural resources

if such measures are made effective in conjunction with

restrictions on domestic production or consumption

that are not applied in a manner which would constitute:

‒ a means of arbitrary or unjustifiable discrimination between

countries where the same conditions prevail, or

‒ a disguised restriction on international trade

B. Goods Agreements


Conclusion

Environmental protection is a legitimate policy objective under

the WTO disciplines

Policy space available for both: production feedstock and

biofuels, e.g. – tariffs

– subsidies

– technical regulations

Implementation is crucial

– non – discrimination (MFN / National treatment)

– no unnecessary trade obstacle

– least trade distortive

Information on the actual use of these measures is very

fragmented

B. Goods Agreements

For more information:

Trade and environment https://www.wto.org/english/tratop_e/envir_e/envir_e.htm

Agriculture http://www.wto.org/english/tratop_e/agric_e/agric_e.htm#work

Agricultural Information Management System http://agims.wto.org

Technical Barriers to Trade Information

Management System http://tbtims.wto.org/

Documents online http://docsonline.wto.org/gen_home.asp?language=3

https://www.wto.org/english/tratop_e/envir_e/envir_e.htm

https://www.wto.org/english/tratop_e/envir_e/envir_e.htm

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

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

http://agims.wto.org/

http://tbtims.wto.org/

http://tbtims.wto.org/

http://docsonline.wto.org/gen_home.asp?language=3