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WTO ANALYTICAL INDEX: SANITARY AND PHYTOSANITARY MEASURES

Agreement on Sanitary and Phytosanitary Measures

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> Article 1
> Article 2
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> Article 5
> Article 6
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> Article 8
> Article 9
> Article 10
> Article 11
> Article 12
> Article 13
> Article 14
> Annex A
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> Annex C
> Relationship of the SPS Agreement with other WTO Agreements

 

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VII. Article 6    back to top

A. Text of Article 6

Article 6: Adaptation to Regional Conditions, Including Pestor Disease-Free Areas and Areas of Low Pest or Disease Prevalence

1.     Members shall ensure that their sanitary or phytosanitary measures are adapted to the sanitary or phytosanitary characteristics of the area — whether all of a country, part of a country, or all or parts of several countries — from which the product originated and to which the product is destined. In assessing the sanitary or phytosanitary characteristics of a region, Members shall take into account, inter alia, the level of prevalence of specific diseases or pests, the existence of eradication or control programmes, and appropriate criteria or guidelines which may be developed by the relevant international organizations.

 

2.     Members shall, in particular, recognize the concepts of pest- or disease-free areas and areas of low pest or disease prevalence. Determination of such areas shall be based on factors such as geography, ecosystems, epidemiological surveillance, and the effectiveness of sanitary or phytosanitary controls.

 

3.     Exporting Members claiming that areas within their territories are pest- or disease-free areas or areas of low pest or disease prevalence shall provide the necessary evidence thereof in order to objectively demonstrate to the importing Member that such areas are, and are likely to remain, pest- or disease-free areas or areas of low pest or disease prevalence, respectively. For this purpose, reasonable access shall be given, upon request, to the importing Member for inspection, testing and other relevant procedures.


B. Interpretation and Application of Article 6

1. General

345.     In Australia — Salmon, Australia claimed that the Panel made an implicit finding of inconsistency of the Australian measure with Article 6, although the Canadian request for the establishment of a panel had not included a claim under Article 6. The Appellate Body rejected Australia’s argument:

“Canada’s request for the establishment of a Panel did not include a claim of violation of Article 6 of the SPS Agreement. The Panel’s terms of reference are determined by Canada’s request for the establishment of a Panel. We, therefore, agree with Australia that Article 6 of the SPS Agreement is not within the terms of reference of the Panel. However, we disagree with Australia that the Panel exceeded its terms of reference in quoting Article 6.1 in a footnote, attached to a paragraph in which the Panel examined a violation of Article 5.5. More precisely, we reject Australia’s contention that the Panel, by merely referring to Article 6.1 in a footnote, made an implied finding of inconsistency with Article 6. In our view, the statement of the Panel with regard to Article 6, in footnote 430 of its Report, is similar in character to the statement of the Panel in United States — Shirts and Blouses, with regard to the powers of the Textile Monitoring Body (‘TMB’). India appealed from this statement, but we found it to be ‘purely a descriptive and gratuitous comment providing background concerning the Panel’s understanding of how the TMB functions’.(427) We did not consider that statement to be ‘a legal finding or conclusion’ which the Appellate Body ‘may uphold, modify or reverse’. Likewise, we consider that in this case, the Panel’s statement in footnote 430 of its Report regarding Article 6.1 of the SPS Agreement is a purely gratuitous comment and not ‘a legal finding or conclusion’. By making such a comment, the Panel did not exceed its terms of reference.”(428)

2. Guidelines to further the practical implementation of Article 6

(a) General

346.     At its meeting of 2–3 April 2008, the SPS Committee adopted guidelines to further the practical implementation of Article 6.(429)

347.     The guidelines are intended to provide assistance to Members by improving transparency, exchange of information, predictability, confidence and credibility between importing and exporting Members. The Committee however noted that the guidelines are not intended to duplicate the technical and administrative guidance provided to members by the International Plant Protection Convention (IPPC) and the World Organisation for Animal Health (OIE).(430)

348.     The guidelines neither add to nor detract from the existing rights and obligations of the Members under the SPS Agreement or any other WTO Agreement.(431)

(b) Recognition(432)

349.     Importing Members are encouraged to publish the basis for recognition of pest- or disease-free areas and areas of low pest or disease prevalence and a description of the general process used including the information generally required to evaluate such requests.

350.     Members are asked to proceed with a recognition process without undue delay and urged to apply the process without discrimination between Members while maintaining transparency in all aspects of the process.

351.     Importing Members should take into account any relevant knowledge of and prior experience with the authorities of the exporting Member. Upon request from the exporting member, an importing Member should provide information on the stage of the exporting Member’s request within its evaluation process.

352.     The importing Member should also, upon request, enter into discussions with the exporting Member with the aim of clarifying the importing Member’s general process and the information generally required to facilitate a request for recognition. The discussions should be undertaken within a reasonable period of time, and normally within 90 days of a request or as otherwise mutually decided. The clarifications made in the course of the discussions should, if necessary, be appropriately recorded by the importing Member and transmitted to the exporting Member to avoid any misunderstandings of the general process.(433)

353.     The Committee stresses that Members have the sovereign right to determine their own process for the evaluation of recognition requests. However, a typical process would generally involve the following steps:(434)

(a)     Step 1: the exporting Member requests information about the importing Member’s requirements and procedures for the evaluation of recognition requests;

 

(b)     Step 2: the importing Member explains its requirements and procedures;

 

(c)     Step 3: the exporting Member sends the documentation demonstrating compliance with the requirements laid down by the importing Member;

 

(d)     Step 4: the importing Member evaluates the documentation and, if necessary, requests additional information

 

(e)     Step 5: the exporting Member provides any clarification, additions or modifications requested by the importing Member;

 

(f)     Step 6: the importing Member evaluates the additional information and, where necessary, steps 4 and 5 are repeated;

 

(g)     Step 7: if applicable, the importing Member carries out on-site verification of the information provided in support of the recognition request and sends a report on the on-site verification to the exporting Member;

 

(h)     Step 8: the exporting Member responds to the inspection report;

 

(i)     Step 9: the importing Member makes a decision to either recognize or not recognize the pest- or disease-free area or area of low pest or disease prevalence. Where the decision is negative, the importing Member should provide the exporting Member the technical grounds for its determination to allow the exporting Member to modify and adapt its system with a view to future requests for recognition. Where the decision is positive, the importing Member then takes steps to facilitate trade from the exporting Member.

354.     The guidelines also provide for an expedited process that permits the Members to skip one or more steps discussed in paragraph 353 above. In determining the possibility of applying an expedited process, the importing Member should take into account the following factors(435):

(a)     when there has been official recognition of an area as a pest- or disease-free area or an area of low pest or disease prevalence by a relevant international organisation;

 

(b)     when there has been an outbreak in an area previously recognized, and suspended by the importing Member as a pest- or disease-free area or an area of low pest or disease prevalence, and which has been restored to its former status as determined by the importing Member;

 

(c)     when the infrastructure and operation of the responsible veterinary or phytosanitary service of the exporting Member are familiar to the importing Member as a result of existing trade relations; or

 

(d)     when there has been no previously notified occurrence of the pest or disease and the importing Member agrees that the surveillance procedures and activities implemented by the exporting Member have shown the non-existence thereof.

 

VIII. Article 7     back to top

A. Text of Article 7

Article 7: Transparency

     Members shall notify changes in their sanitary or phytosanitary measures and shall provide information on their sanitary or phytosanitary measures in accordance with the provisions of Annex B.(436)


B. Interpretation and Application of Article 7

1. Scope of application

355.     In Japan — Agricultural Products II, the Panel concluded that: “Japan, by not having published the varietal testing requirement, acts inconsistently with its obligations under paragraph 1 of Annex B of the SPS Agreement and, for that reason, with its obligations contained in Article 7 of that Agreement.”(437) Japan appealed the Panel’s ruling arguing that the “regulations” referred to in Annex B(1) are limited to legally enforceable instruments. Japan contended that the measure at issue (a varietal testing requirement, as set out in the Experimental Guide) was not a legally enforceable instrument and as such, fell outside the scope of Annex B(1). In rejecting this appeal, the Appellate Body noted that the list of instruments contained in the footnote to Annex B(1) is not exhaustive in nature.(438) The Appellate Body then concluded that the measure at issue was a phytosanitary regulation within the meaning of paragraph 1 of Annex B(1), and upheld the Panel’s finding that Japan had acted inconsistently with Annex B(1) and consequently, with Article 7 of the SPS Agreement.(439) See also paragraph 539 below.

356.     The Panel in Japan — Apples relied on the standard set in Japan — Agricultural Products II and ruled that the measure at issue in that dispute was also a phytosanitary regulation within the meaning of Annex B(1) and as such, was to have been published promptly in such a manner to enable interested Members to become acquainted with them. The Panel reiterated the obligation of Members to promptly publish their phytosanitary regulations pursuant to Article 7 and Annex B of the SPS Agreement.(440)

357.     In Japan — Apples, the Panel established a test, to determine whether changes made to the two instruments at issue in that case, which were subsequent to the entry into force of the SPS Agreement, should have been notified under Article 7, having regard to the two requirements under Annex B(5) of the SPS Agreement. Annex B(5) foresees the notification of SPS regulations if a number of conditions are cumulatively met, i.e.: (a) where a relevant international standard does not exist or the content of the proposed measure is not substantially the same as the content of an international standard, guideline or recommendation, and (b) if the regulation may have a significant effect on trade of other Members.(441) In this case, an international standard did not exist for the subject matter at issue. The Panel therefore was tasked with determining whether changes in the two instruments constituted changes that were to be notified under Article 7 because they may have a “significant effect on trade of other Members”. The Panel applied a two-pronged test: (a) weighing the impact of the alleged changes in the measures on the conditions of market access, that is, would the exported product still be permitted to enter Japan if they complied with the prescription contained in the previous regulations; (b) if this is not the case, the Panel had to consider whether the change could be considered to potentially have a significant effect on the trade of other Members:

“[W]e must determine whether the changes identified above constitute changes which are required to be notified under Article 7 because, inter alia, they ‘may have a significant effect on trade of other Members’ in the context of the chapeau to Paragraph 5 of Annex B.

 

We consider that the most important factor in this regard is whether the change affects the conditions of market access for the product concerned, that is, would the exported product (apple fruit from the United States in this case) still be permitted to enter Japan if they complied with the prescription contained in the previous regulations.(442) If this is not the case, then we must consider whether the change could be considered to potentially have a significant effect on trade of other Members. In this regard, it would be relevant to consider whether the change has resulted in any increase in production, packaging and sales costs, such as more onerous treatment requirements or more time consuming administrative formalities.”(443)

358.     In EC — Approval and Marketing of Biotech Products, on the basis of its finding that a generally applicable measure concerning the administration or operation of an SPS measure is not an SPS measure per se and therefore need not be published, the Panel ruled out notification requirements for this category of measures:

 “Article 7 … requires Members to notify changes in their ‘SPS measures’ and provide information on their ‘SPS measures’. It does not require Members to notify changes in the administration of SPS measures and provide information on the administration of their SPS measures.”(444)

2. Notification requirements

(a) Obligation to “provide information on SPS measures”

359.     The Panel in EC — Approval and Marketing of Biotech Products, on determining the measures at issue under Article 6.2 of the DSU, considered the purpose of Article 7 and provided an outlook on whether the general reference to this provision, in the case at hand, could amount to a violation of the totality of the requirements under Annex B:

Article 7 of the SPS Agreement imposes an obligation on Members to notify changes in SPS measures and to provide information on SPS measures in accordance with the provisions of Annex B of the SPS Agreement. Regarding the obligation to ‘provide information’ on SPS measures, we note that the Complaining Parties have specified in their Panel requests which particular provisions of Annex B they consider to have been violated. We therefore think it is clear that the reference to Article 7 cannot be taken as an indication that the Complaining Parties are alleging violations of all provisions of Annex B.”(445)

(b) Obligation to “notify changes” in SPS measures

360.     The Panel in Japan — Apples, in interpreting the provisions under Article 7, ruled that “Article 7 of the SPS Agreement requires Members to notify ‘changes’ in their SPS measures”(446) and added on a further ground that it does “not believe that changes of legal instruments require, in all instances, notification.”(447)

361.     In EC — Approval and Marketing of Biotech Products, in the context of identifying the particular measures at issue, the Panel clarified the content of the obligation to “notify changes in SPS measures” provided under Article 7. The Panel ruled “that that obligation is very similar in nature to the other obligation set out in Article 7, that is to say, the obligation to ‘provide information’ on SPS measures in accordance with Annex B.”(448)

3. Recommended notification procedures

362.     At its meeting of 29–30 March 1995, the SPS Committee adopted notification procedures recommended by the informal contact group, subject to certain conditions.(449) At its meeting of 29–30 May 1996, the SPS Committee revised the notification procedures to be followed for notifications required under paragraphs 5 and 6 of Annex B.(450) Further, at its meeting of 10–11 March 1999, the SPS Committee again revised the notification procedures.(451) Another revision of the notification procedures was carried out by the SPS Committee at its meeting of 2 April 2002.(452) The notification procedures were revised again on 20 June 2008.(453)

363.     At its meeting of 26 October 2001, the SPS Committee adopted the following provision relating to the notification of the conclusion of equivalence agreements between Members further to the Decision on Equivalence (see paragraphs 106118 above):

“The Committee on Sanitary and Phytosanitary Measures shall revise its recommended notification procedures to provide for the notification of the conclusion of agreements between Members which recognize the equivalence of sanitary and phytosanitary measures.(454) Furthermore, the procedures shall reinforce the existing obligation in paragraph 3(d) of Annex B of the Agreement on the Application of Sanitary and Phytosanitary Measures for national Enquiry Points to provide information, upon request, on the participation in any bilateral or multilateral equivalence agreements of the Member concerned.”(455)

364.     At its meeting of 27 October 2004, the SPS Committee adopted a procedure to “Enhance Transparency of Special and Differential Treatment in Favour of Developing Country Members”.(456) This procedure provides for an addendum of a notification to be circulated with information regarding the provision of special and differential treatment or technical assistance, and the SPS Committee adopted a format for such addenda.(457) This procedure was revised on 18 December 2009.(458)

4. Recommended procedures for implementing the transparency obligations of the SPS Agreement(459)

365.     At its meeting of 20 June 2008, the SPS Committee adopted the revised Recommended Procedures for Implementing the Transparency Obligations of the SPS Agreement (Article 7).(460) In the light of the required modifications to the SPS Information Management System (SPS IMIS), these procedures, including the revised notification formats, did not take effect until 1 December 2008.

366.     The Committee noted that the term “transparency” is used in the context of the WTO to signify one of the fundamental principles of its agreements: the aim is to achieve a greater degree of clarity, predictability and information about trade policies, rules and regulations of Members. In implementing this concept, Members use notifications. Under the SPS Agreement, notifications are used to inform other Members about new or changed regulations that may significantly affect their trading partners. The Committee noted that these procedures were developed to assist Members to fulfil their transparency obligations under Article 7 and Annex B of the SPS Agreement regarding the notification of SPS regulations, answering information requests under the National Enquiry Point System and publishing regulations.(461)

367.     The guidelines neither add to nor detract from the existing rights and obligations of the Members under the SPS Agreement or any other WTO Agreement. The Committee also stressed that these guidelines do not SPS Agreement itself.(462)

368.     Pursuant to paragraph 10 of Annex B of the SPS Agreement, the Committee noted that Members are obliged to designate a “single government authority” as responsible for the implementation at the national level of the provisions concerning notification procedures.(463)

369.     The Committee then recommended notification procedures that are to be followed by Members when notifying regulations as required under paragraphs 5 or 6 of Annex B of the SPS Agreement.

370.     When a regulation contains both SPS and TBT measures, it should be notified according to both the SPS and TBT Agreements, preferably with an indication of which parts of the regulation fall under the SPS Agreement and which part falls under the TBT Agreement.(464)

371.     The recommended procedures also provided formats for routine notifications as well as for emergency notifications, and their respective addenda, corrigenda and revisions.

5. Relationship with other provisions of the SPS Agreement

(a) Annex B

372.     With respect to its relationship to Annex B, please refer to paragraphs 355359 above as well as the Section on Annex B below.

 

IX. Article 8     back to top

A. Text of Article 8

Article 8: Control, Inspection and Approval Procedures

     Members shall observe the provisions of Annex C(465) in the operation of control, inspection and approval procedures, including national systems for approving the use of additives or for establishing tolerances for contaminants in foods, beverages or feedstuffs, and otherwise ensure that their procedures are not inconsistent with the provisions of this Agreement.


B. Interpretation and Application of Article 8

1. General

373.     In EC — Approval and Marketing of Biotech Products, the United States and Canada argued that the European Communities’ general moratorium on approving applications to place genetically modified organisms on the market in the European Communities violated Article 8 because the European Communities had not abided by the provisions of Annex C(1). The Panel found that a failure to observe the provisions of Annex C implies a breach of Article 8:

“We recall that the United States and Canada seek to establish an inconsistency with Article 8 of the SPS Agreement on the basis of an inconsistency with Annex C(1)(a). Article 8 requires, inter alia, that Members observe the provisions of Annex C in the operation of their approval procedures. It follows that a failure to observe the provisions of Annex C(1)(a) implies a breach of Article 8. We have determined above that, as a result of the general de facto moratorium on approvals, the European Communities has failed, in at least one approval procedure conducted under Directives 90/220 and 2001/18, to observe the provisions of Annex C(1)(a), first clause. Accordingly, we conclude that in respect of the aforementioned approval procedure, the European Communities has, by implication, also acted inconsistently with the provisions of Article 8.”(466)

374.     The Panel in US — Poultry (China) observed that Article 8 and Annex C(1) apply to the procedures dealing with control, inspection and approval “which are aimed at checking and ensuring the fulfilment of SPS measures”.(467)

2. Relationship with other Articles

(a) Annex C

375.     In EC — Approval and Marketing of Biotech Products, the Panel found that a failure to observe the provisions of Annex C(1) implies a breach of Article 8. See paragraph 587 below.

(b) Article 5.2 and Annex C

376.     In EC — Hormones, the Appellate Body found that the language of Articles 5.2 and 8 and the footnote to Annex C is amply sufficient to authorize the taking into account of risks arising from failure to comply with the requirements of good veterinary practice in the administration of hormones for growth promotion purposes, as well as risks arising from difficulties of control, inspection and enforcement of the requirements of good veterinary practice. The Appellate Body disagreed with the Panel’s suggestion that exclusion of risks resulting from the combination of potential abuse and difficulties of control is justified by distinguishing between “risk assessment” and “risk management”. The Appellate Body noted that the concept of “risk management” is not mentioned in any provision of the SPS Agreement and, as such, cannot be used to sustain a more restrictive interpretation of “risk assessment” than is justified by the actual terms of Article 5.2, Article 8 and Annex C of the SPS Agreement.(468) The Appellate Body relied on this view in its evaluation of the term “risk assessment” in US/Canada — Continued Suspension.(469)

 

X. Article 9     back to top

A. Text of Article 9

Article 9: Technical Assistance

1.     Members agree to facilitate the provision of technical assistance to other Members, especially developing country Members, either bilaterally or through the appropriate international organizations. Such assistance may be, inter alia, in the areas of processing technologies, research and infrastructure, including in the establishment of national regulatory bodies, and may take the form of advice, credits, donations and grants, including for the purpose of seeking technical expertise, training and equipment to allow such countries to adjust to, and comply with, sanitary or phytosanitary measures necessary to achieve the appropriate level of sanitary or phytosanitary protection in their export markets.

 

2.     Where substantial investments are required in order for an exporting developing country Member to fulfil the sanitary or phytosanitary requirements of an importing Member, the latter shall consider providing such technical assistance as will permit the developing country Member to maintain and expand its market access opportunities for the product involved.


B. Interpretation and Application of Article 9

377.     At the Doha Ministerial Conference, Members resolved to “provide, to the extent possible, the financial and technical assistance necessary to enable least-developed countries to respond adequately to the introduction of any new SPS measures which may have significant negative effects on their trade.”(470)

378.     At the same Ministerial Conference, Members also decided to ensure a level of technical assistance necessary to enable least-developed countries to respond to the special problems they face in implementing the SPS Agreement.(471)

 

XI. Article 10     back to top

A. Text of Article 10

Article 10: Special and Differential Treatment

1.     In the preparation and application of sanitary or phytosanitary measures, Members shall take account of the special needs of developing country Members, and in particular of the least-developed country Members.

 

2.     Where the appropriate level of sanitary or phytosanitary protection allows scope for the phased introduction of new sanitary or phytosanitary measures, longer timeframes for compliance should be accorded on products of interest to developing country Members so as to maintain opportunities for their exports.

 

3.     With a view to ensuring that developing country Members are able to comply with the provisions of this Agreement, the Committee is enabled to grant to such countries, upon request, specified, time-limited exceptions in whole or in part from obligations under this Agreement, taking into account their financial, trade and development needs.

 

4.     Members should encourage and facilitate the active participation of developing country Members in the relevant international organizations.


B. Interpretation and Application of Article 10

1. General

379.     In 2003, the SPS Committee adopted in principle a proposal by Canada to enhance the transparency of special and differential treatment, subject to elaboration of the procedure (hereinafter “the Procedure”).(472) Following discussions on this elaboration in the Committee meetings in March and June 2004, at the October meeting, the Committee adopted the procedure.(473) The Procedure provides that if a Member with an interest in exporting the products affected by a notification identifies a concern with the content of a notification, the exporting Member may request an opportunity to discuss and resolve the potential difficulty with the notifying Member. Upon receipt of a written request, the notifying Member is to enter into bilateral discussions with the exporting Member with a view to resolving the issue of concern.(474) When a decision is taken on whether and how special and differential treatment may be provided, the notifying Member should submit an addendum to its original notification which indicates:

“(1) if special and differential treatment was requested; (2) the name(s) of Member(s) that requested special and differential treatment; (3) if special and differential treatment was provided, the form of such treatment; and (4) if not provided, the Addendum shall indicate why special and differential treatment was not provided and whether technical assistance or any other solution was found to address the identified concern.”(475)

380.     On 1 February 2006, the Committee decided to extend the Procedure and to review its implementation no later than at its first regular meeting in 2008, with a view to deciding then whether to continue with the same procedure or introduce modifications.(476)

381.     At its meeting of 28–29 October 2009, the SPS Committee adopted a Decision revising the Procedure.(477)

2. The Procedure to Enhance Transparency of Special and Differential Treatment in Favour of Developing Country Members(478)

(a) General

382.     The SPS Committee clarified that the procedure that is contained in the 2009 revision should normally be used “during the comment period following the circulation of an SPS notification in accordance with the relevant provisions and procedures contained in the Agreement, or subsequently adopted by Members”, with the exception of a proposed step (Step 5) that involves the process to be followed after entry into force of a new measure. (479)

383.     The SPS Committee emphasized that the procedure proposed in the revised Decision is without prejudice to the rights and obligations of Members under Article 10.1 of the SPS Agreement.(480) That said, the SPS Committee proposed measures relating to the steps that Members ought to take after notification, the steps to be taken after entry into force of a new measure, transparency, and administration of the procedure.(481)

(b) Notification

384.     The SPS Committee proposed three steps relating to the notification of a proposed SPS measure(482):

(i)     Where an exporting developing country identifies significant difficulties with a proposed SPS measure, that Member may, in the comments it submits in writing to the notifying Member, request an opportunity to discuss the issue of concern with the notifying Member. The exporting developing country Member should identify to the notifying Member the specific problems the proposed measure may create for its exports, or the specific reasons why it is unable to comply with the notified measures by the implementation date.

 

(ii)     In response to such a request, where the appropriate level of SPS protection allows scope for the phased introduction of the new measure, a longer time-frame for compliance should be accorded to developing country Members, which shall be understood to mean normally a period of not less than six months.

 

(iii)     Where the appropriate level of SPS protection does not allow scope for the phased introduction of a new measure, the Member notifying the measure, shall, upon such request, enter into consultations with the exporting Member with a view to finding a mutually satisfactory solution to the problem while continuing to achieve the importing Member’s appropriate level of protection. Such consultations shall preferably take place prior to the entry into force of the new measure.

(c) Entry into force of a new measure

385.     The SPS Committee proposed that if, following the adoption or entry into force of a new or modified measure (including an emergency measure), an exporting developing country Member identifies significant difficulties which its exports face in complying with the measure, it:

“[m]ay request an opportunity to discuss its difficulties with the importing Member to attempt to resolve the issue of concern, especially where no time, or insufficient period of time, had been provided for the submission of comments prior to the implementation of the measure. The importing Member shall, upon such request from an exporting developing country Member, enter into consultations with the exporting Member to discuss possible solutions to address the identified problem while continuing to achieve the importing Member’s appropriate level of protection. A possible resolution of the concern identified could include one of the following, or a combination thereof: (1) a change in the measure; (2) the provision of technical assistance to the exporting developing country Member; or (3) the provision of special and differential treatment.”(483)

(d) Transparency

386.     Finally, the SPS Committee put forward a procedure that would facilitate transparency in the implementation of the special and differential treatment activities contained in their proposal. The Committee proposed that when an importing Member decides on whether and how special and differential treatment may be provided in response to a specific request, that Member should inform the SPS Committee. This information should be provided in writing and submitted to the WTO Secretariat as an Addendum to the original notification concerning the measure. The Addendum should indicate:

(i)     The name(s) of the Member(s) that requested special and differential treatment;

 

(ii)     If special and differential treatment was provided, the form of such treatment; and

 

(iii)     If not provided, the Addendum should indicate why special and differential treatment was not provided, and whether technical assistance or any other solution was found to address the identified concern.

3. Article 10.1

(a) Members shall “take account of” the special needs of developing country Members

387.     In EC — Approval and Marketing of Biotech Products, the Panel examined a claim by Argentina that by adopting and applying a general de facto moratorium on approvals of applications to place genetically modified organisms on the market, the EC had failed to apply its legislation in a manner which takes account of developing country Members’ needs. The Panel found that the phrase “take account of” does not prescribe a specific result to be achieved and that merely because a Member (in this case the EC) did not afford special and differential treatment to a developing country member (i.e., Argentina) does not establish a prima facie case that the developed country Member did not “take account of” the developing country’s needs when it made its decision:

“[T]he obligation laid down in Article 10.1 is for the importing Member to ‘take account’ of developing country Members’ needs. The dictionary defines the expression ‘take account of’ as ‘consider along with other factors before reaching a decision’. Consistent with this, Article 10.1 does not prescribe a specific result to be achieved. Notably, Article 10.1 does not provide that the importing Member must invariably accord special and differential treatment in a case where a measure has led, or may lead, to a decrease, or a slower increase, in developing country exports.

The fact that there is no indication that between June 1999 and August 2003 the European Communities accorded Argentina special and differential treatment — e.g., by approving the marketing of biotech products exported from Argentina — does not in and of itself constitute prima facie evidence that the European Communities has failed to ‘take account’ of Argentina’s needs. While the European Communities must take account of the interests of developing country Members in applying its approval legislation, the European Communities may at the same time take account of other legitimate interests, including those of its own consumers, its environment, etc. There is nothing in Article 10.1 to suggest that in weighing and balancing the various interests at stake, the European Communities must necessarily give priority to the needs of Argentina as a developing country. We therefore think it is conceivable that the European Communities ‘took account’ of Argentina’s needs when adopting and applying its general de facto moratorium on approvals, but ultimately determined that applications concerning products of export interest to Argentina warranted no special and differential treatment. Accordingly, we consider that the fact that the European Communities did not accord Argentina special and differential treatment vis-à-vis other developed country exporters does not demonstrate, by itself, an inconsistency with Article 10.1.”(484)

(b) Burden of proof

388.     The Panel in EC — Approval and Marketing of Biotech Products stated that the burden was on the complaining party to demonstrate that the (developed) responding party had not “taken account of” the developing country’s needs in making its decision.

“Argentina argues that the European Communities has not provided any evidence which would prove that it has taken into account Argentina’s special needs as a developing country Member. This argument lacks merit, for it is incumbent on Argentina as the Complaining Party to adduce evidence and argument sufficient to raise a presumption that the European Communities has failed to take into account Argentina’s special needs as a developing country Member.”(485)

 

The Panel in EC — Approval and Marketing of Biotech Products also found that the absence of any reference to developing countries in the respondent Member’s legislation was not enough to establish that the legislation did not take the needs of developing countries into account. Additionally, the Panel noted that Article 10.1 does not require Members to document how they have complied with Article 10.1.

 

“[T]he absence of a reference to developing country needs in the text of the EC approval legislation does not demonstrate that that legislation itself fails to take account of these needs, or that the European Communities is precluded from taking account, or has not taken account, of these needs when applying that legislation. We therefore consider that it is not sufficient, for the purposes of establishing a claim under Article 10.1, to point to the absence in the EC approval legislation of a reference to the needs of developing country Members.

 

Argentina further argues that for the entire period of application of the general de facto moratorium on approvals it could not identify any evidence supporting the conclusion that the European Communities has taken account of Argentina’s special needs. We note that Argentina has merely asserted the absence of relevant evidence, without specifying what efforts it has undertaken to collect such evidence. Moreover, we note that Article 10.1 does not specifically require the importing Member to document how it has complied with Article 10.1.”(486)

(c) Relationship with other Agreements

389.     The Panel in US — Clove Cigarettes examined a claim under Article 12.3 of the TBT Agreement, which the Panel in EC — Approval and Marketing of Biotech Products had previously described as the “equivalent provision” to Article 10.1 of the SPS Agreement.(487) In the context of interpreting Article 12.3 of the TBT Agreement, the Panel in US — Clove Cigarettes was guided by the EC — Approval and Marketing of Biotech Products Panel’s interpretation of Article 10.1. See Article 12.3 of the Chapter on the TBT Agreement.

4. Article 10.2

(a) longer time-frame for compliance

390.     At the Doha Ministerial Conference, Members adopted a decision in order to establish a time-frame for the gradual introduction of new sanitary and phytosanitary measures:

“Where the appropriate level of sanitary and phytosanitary protection allows scope for the phased introduction of new sanitary and phytosanitary measures, the phrase “longer time-frame for compliance” referred to in Article 10.2 of the Agreement on the Application of Sanitary and Phytosanitary Measures, shall be understood to mean normally a period of not less than 6 months.”(488)

(b) where phased introduction of SPS measures is not possible

391.     At the same Ministerial Conference, Members adopted a decision that established a process to be applied in cases where the phased introduction of a new measure may not be possible:

“Where the appropriate level of sanitary and phytosanitary protection does not allow scope for the phased introduction of a new measure, but specific problems are identified by a Member, the Member applying the measure shall upon request enter into consultations with the country with a view to finding a mutually satisfactory solution to the problem while continuing to achieve the importing Member’s appropriate level of protection.”(489)

 

XII. Article 11     back to top

A. Text of Article 11

Article 11: Consultations and Dispute Settlement

1.     The provisions of Articles XXII and XXIII of GATT 1994 as elaborated and applied by the Dispute Settlement Understanding shall apply to consultations and the settlement of disputes under this Agreement, except as otherwise specifically provided herein.

 

2.     In a dispute under this Agreement involving scientific or technical issues, a Panel should seek advice from experts chosen by the Panel in consultation with the parties to the dispute. To this end, the Panel may, when it deems it appropriate, establish an advisory technical experts group, or consult the relevant international organizations, at the request of either party to the dispute or on its own initiative.

 

3.     Nothing in this Agreement shall impair the rights of Members under other international agreements, including the right to resort to the good offices or dispute settlement mechanisms of other international organizations or established under any international agreement.


B. Interpretation and Application of Article 11

1. Articles of the SPS Agreement invoked in panel and Appellate Body proceedings

392.     For a table of disputes under the SPS Agreement, see the table of “Articles of the Covered Agreements Invoked in Panel and Appellate Body Proceedings” in the Chapter on the DSU.

2. Article 11.2

(a) General

393.     For information on scientific experts in WTO dispute settlement proceedings, including a table of all proceedings under the SPS Agreement (and the GATT 1994) in which panels consulted with scientific experts, see Article 13.2 of the Chapter on the DSU.

(b) Scope of application

394.     The Appellate Body in US/Canada — Continued Suspension noted that Article 11.2 specifically addresses the consultation of experts in disputes under the SPS Agreement.(490)

(c) Role and value of experts

395.     The Panel in US/Canada — Continued Suspension stated that “the role of the experts was to act as an ‘interface’ between the scientific evidence and the Panel, so as to allow it to perform its task as the trier of fact”(491). This view was reiterated by the Appellate Body who added that the experts consulted by a panel can significantly influence the decision-making process.(492)

396.     In Australia — Salmon (Article 21.5 — Canada), the Panel considered that the assistance of scientific experts in the original dispute was of utmost relevance, noting “how valuable such expert advice had been during its previous examination” of the matter before it. The Panel decided to seek further scientific and technical advice for the 21.5 proceedings as “the evidence submitted to it included several new risk analysis reports.”(493)

(d) Selection of experts

(i) The need for experts

397.     In EC — Approval and Marketing of Biotech Products, the Panel chose to seek expert advice despite the complaining parties’ argument that there was no need to do so. The Panel decided to seek advice after receiving the second written submissions of the parties:

“[T]he European Communities formally requested the Panel to seek advice from scientific and technical experts at an appropriate stage. In particular, the European Communities suggested that the Panel seek advice from the most relevant sources reflecting a representative spectrum of views, including individual experts and perhaps competent international organizations. Shortly thereafter, the European Communities submitted a proposal for the terms of reference for scientific and technical advice. The Complaining Parties expressed the view that they did not consider it necessary for the Panel to seek any scientific and technical advice, inter alia because they were not challenging the opinions or assessments of the EC scientific committees.

 

The Panel decided to take a decision regarding the need for expert advisers only in the light of the second written submissions by the Parties, and provided the Parties with a further opportunity to comment on the need for expert advice. The European Communities repeated its request for input from experts; the Complaining Parties continued to argue that no expert advice was necessary in the circumstances of this case.

 

On 4 August 2004, the Panel informed the Parties that it considered that certain aspects of the Parties’ submissions raised scientific and/or technical issues in respect of which the Panel might benefit from expert advice. Accordingly, the Panel decided to consult individual experts to obtain their opinion on certain scientific and/or technical issues raised in the Parties’ submissions.”(494)

398.     In Japan — Apples, the Panel having noted that the proceedings “involved scientific or technical issues, consulted with parties regarding the need for expert advice. Neither party objected to the Panel’s intention to seek expert advice.”(495)

(ii) Importance of selection process

399.     In US/Canada — Continued Suspension, the Appellate Body made it clear that the selection of experts has a significant bearing in the solution of disputes within the SPS Agreement:

“Scientific experts and the manner in which their opinions are solicited and evaluated can have a significant bearing on a Panel’s consideration of the evidence and its review of a domestic measure, especially in cases like this one involving highly complex scientific issues.”(496)

400.     Having recognized the importance of scientific experts in the settlement of SPS disputes, the Appellate Body, in US/Canada — Continued Suspension, cautioned that although panels might face challenges when selecting experts, they should pay due consideration to this procedural step and exercise it properly:

“We understand that Panels often face practical difficulties in selecting experts who have the required level of expertise and whose selection is not objected to by the parties. We do not wish to make the expert selection process more difficult than it may already be. However, experts consulted by a Panel can have a decisive role in a case, especially when it involves highly complex scientific questions such as this one. The Panel in this case said ‘the role of the experts was to act as an “interface” between the scientific evidence and the Panel, so as to allow it to perform its task as the trier of fact.’ Experts appointed by a Panel can significantly influence the decision-making process.”(497)

(iii) Consultation with the parties to the dispute

General

401.     In US/Canada — Continued Suspension, the Appellate Body ruled that a panel’s obligation to consult with parties when selecting experts is a foundational requirement entitled to preserve parties’ due process rights during the proceedings:

“[C]onsultation with the parties in the adoption of working procedures for selecting the experts and in the expert selection process is a means for ensuring that the parties’ due process rights are respected. However, … the obligation to afford the protection of due process to the parties is not circumscribed to the expert selection stage and does not end with the appointment of the experts. Due process protection continues to apply throughout the consultations with the experts.”(498)

402.     In all cases to date, panels have selected experts in consulation with the parties.

(iv) Individual experts or expert review group

403.     In each case where experts have been consulted, the panels have decided to consult experts on an individual basis, rather than create an expert group. In EC — Hormones, the Appellate Body agreed with the Panel’s decision to hear from individual experts rather than to establish an expert review group:(499)

“[I]n disputes involving scientific or technical issues, neither Article 11.2 of the SPS Agreement, nor Article 13 of the DSU prevents Panels from consulting with individual experts. Rather, both the SPS Agreement and the DSU leave to the sound discretion of a Panel the determination of whether the establishment of an expert review group is necessary or appropriate.”(500)

404.     In EC — Hormones, with respect to the role of individual scientific experts, the Panel noted that:

“It is of particular importance that we made clear to the experts advising the Panel that we were not seeking a consensus position among the experts but wanted to hear all views.”(501)

(v) Number of experts

405.     In Australia — Apples, Australia expressed a preference for two experts to be consulted in each of the three relevant areas of expertise and complained that one area of expertise only had one expert assigned to it. The Panel acknowledged that, in general, more experts might provide more advice than just one expert and this might be useful to a panel. The Panel considered that while this does not imply that consulting one competent expert would not be sufficiently useful for a panel in a given dispute, it would necessarily narrow the range of scientific expert advice that the Panel would receive, nor that the parties would be prejudiced by the selection of only one expert on a given subject.(502) The Panel also noted that neither Article 13 of the DSU, nor Article 11.2 of the SPS Agreement, which jointly provide the legal basis for WTO Panels to seek the advice of experts in SPS disputes, specify the number of experts that should be selected for each particular issue.(503) In arriving at its decision to use only one expert for a specific area of expertise, the Panel took into account the fact that there was a limited available pool of experts as well as the inappropriateness of further delaying the selection process, given that this would have hindered the objective of seeking a prompt settlement of the dispute, contrary to Article 3.3 of the DSU and the expressed interest of both Parties.(504)

(vi) International organizations

406.     In EC — Approval and Marketing of Biotech Products, although the complaining parties disagreed with the Panel’s decision to consult with international organizations, the Panel found it relevant to seek assistance from certain international organizations in order to clarify certain aspects of the parties’ submissions. The Panel considered that the concepts at issue “raised scientific and/or technical issues” in respect of which it might benefit from experts’ advice:

“[T]he Panel decided that it would seek information from certain international organizations which might assist the Panel in determining the meaning of selected terms and concepts. Most of these terms and concepts appear in the WTO agreements at issue in this dispute (e.g., ‘pest’). We note in this regard that the European Communities argued that the Panel also needed to consult scientific experts on the meaning of the relevant terms. The Complaining Parties opposed the European Communities’ request, arguing that the terms in question were terms appearing in WTO agreements and that, as such, the Panel needed to determine their meaning by applying the customary rules of interpretation of public international law, as required by Article 3.2 of the DSU.”(505)

407.     The Panel in EC — Approval and Marketing of Biotech Products, having decided to request input from some international organizations, took into account the parties’ opinions throughout its consultation with the designated organizations. (506)

(vii) Conflict of interest

General

408.     See also the Section on the Rules of Conduct in the Chapter on the DSU.

Disclosure requirement

409.     The Appellate Body in US/Canada — Continued Suspension, considered that “[t]he purpose of the self-disclosure statement is to reveal relevant facts that would allow the Panel to determine whether the information is likely to affect or give rise to justifiable doubts as to the expert’s independence or impartiality”.(507)

410.     In US/Canada — Continued Suspension, the Appellate Body described the scope of application of the self-disclosure rules provided under Section VI of the Rules of Conduct:

“Covered persons should be encouraged to disclose any information that may be relevant for purposes of ascertaining whether there may be justifiable doubts as to their independence or impartiality. Disclosure should not lead to automatic exclusion. Whether the disclosed information is likely to affect or give rise to justifiable doubts as to the person’s independence or impartiality must be objectively determined and properly substantiated. In the case of an expert, the Panel should assess the disclosed information against information submitted by the parties or other information that may be available. It should then determine whether, on the correct facts, there is a likelihood that the expert’s independence and impartiality may be affected, or if justifiable doubts arise as to the expert’s independent or impartiality. If this is indeed the case, the Panel must not appoint such person as an expert.”(508)

The Panel’s obligation to ensure the impartiality of selected experts

411.     In US/Canada — Continued Suspension, the Appellate Body held that the qualifications and relevant knowledge of selected experts or their membership to an international recognized scientific body, are not by themselves sufficient guarantees of their independence and impartiality:

“An expert could be very qualified and knowledgeable and yet his or her appointment could give rise to concerns about his or her impartiality or independence, because of that expert’s institutional affiliation or for other reasons. Similarly, the fact that JECFA may select its experts according to strict procedures does not in itself ensure that these experts are independent and impartial in respect of the issues that may arise in a WTO dispute.”(509)

412.     In emphasizing the Panel’s obligation to observe the principles of fairness and impartiality in the selection of experts and consultations with scientific experts, the Appellate Body in US/Canada — Continued Suspension stated:

“Fairness and impartiality in the decision-making process are fundamental guarantees of due process. Those guarantees would not be respected where the decision-makers appoint and consult experts who are not independent or impartial. Such appointments and consultations compromise a Panel’s ability to act as an independent adjudicator. For these reasons, we agree with the view of the European Communities that the protection of due process applies to a Panel’s consultations with experts. This due process protection applies to the process for selecting experts and to the Panel’s consultations with the experts, and continues throughout the proceedings.”(510)

413.     The Appellate Body in US/Canada — Continued Suspension held that a panel, presented with information likely to raise doubts as to the independence or impartiality of an expert, should not select that expert:

“The requirements under Section VI of the Rules of Conduct relate, as the title indicates, to the self-disclosure obligation of covered persons, including experts. The Rules of Conduct do not provide for automatic exclusion of a covered person upon the disclosure of information pursuant to Section VI and the Illustrative List of Information to be Disclosed, which is attached to the Rules of Conduct as Annex 2. However, we fail to see on what basis a Panel, presented with information likely to affect or give rise to justifiable doubts as to the independence or impartiality of an expert, could choose to consult such an expert.”(511)

Affiliations that may raise doubts as to independence and impartiality

414.     In US/Canada — Continued Suspension, the Appellate Body considered that the affiliation of the appointed experts with the institution that performed the risk assessment at issue may diminish their independence and impartiality. The Appellate Body rejected the Panel’s reasoning related to the decision-making process within the scientific body where the experts served previously(512):

“We recognize that JECFA involves a decision-making process based on consensus and that the outcome of the process need not necessarily reflect the views of its individual members. However, the fact that this process involves several individuals and that the outcome may be the result of a compromise does not mean that the joint outcome of the process can be disconnected from the experts that participated in the process. On the contrary, one would expect that the views of the experts that participated in the process would be reflected, in various degrees, in the outcome. As noted earlier, Drs. Boisseau’s and Boobis’ participation was not indirect or marginal. Rather, both would be expected to have had particular influence in the process given their respective roles as Chairman and Vice-Chairman, and Joint Rapporteur. Moreover, irrespective of their degree of influence in the process, both would be expected to have a natural inclination to identify with JECFA’s evaluation as participants in the consensus. Therefore, we do not consider that the fact that JECFA reaches its conclusions by consensus dispels our concerns regarding the propriety of the Panel asking Drs. Boisseau and Boobis to evaluate the European Communities’ risk assessment.”(513)

415.     The Appellate Body in US/Canada — Continued Suspension also disagreed with the Panel’s statements that scientists could be considered objective when assessing their own work, particularly where the stated work has been used as a benchmark by the Panel:

“The Panel … expressed the view that Drs. Boisseau and Boobis, by virtue of their work as scientists, could be relied upon to be objective in their assessment of critiques of their work, as well as of new scientific evidence that might require altering the conclusions of their prior work. …

 

We recognize that scientists will often be asked to review studies performed by other scientists and that the scientific community must constantly reassess theories in the light of scientific progress. However, … the Panel did not simply ask Drs. Boisseau and Boobis about JECFA’s work and risk assessments. In the consultations with experts, the Panel asked Drs. Boisseau and Boobis to evaluate the European Communities’ risk assessment and they did so using JECFA’s evaluations as a benchmark. This is problematic in this case because the European Communities’ risk assessment called into question the validity of JECFA’s evaluations and explicitly stated that it would not follow them. In the light of this, it was improper for the Panel to consult with Drs. Boisseau and Boobis, who were directly involved in JECFA’s evaluations. The concerns raised in this situation are not addressed by the fact that scientists regularly conduct ‘peer reviews’ or may recognize that science evolves. Nor are the concerns addressed by the Panel’s explanation that JECFA’s work is linked to Codex, which is expressly recognized by the SPS Agreement as having responsibilities for the ‘establishment of international standards, guidelines and recommendations’(514).”(515)

416.     In Australia — Apples, Australia objected to the Panel’s decision to consult with a particular expert, arguing that the expert had a connection to New Zealand. In overruling Australia’s objection, the Panel noted that panels are responsible for ensuring that the selected experts have the necessary qualifications and expertise, and comply with the requirements for independence, impartiality and avoidance of conflicts of interest. Conversely, it is not enough for a party to simply assert an objection regarding the selection of a particular expert. Any party raising such an objection is expected to explain in what manner the expert’s independence or impartiality have been or may be compromised.(516) The Panel stated:

“Under the Rules of Conduct for the DSU applicable to all covered persons in WTO dispute settlement, experts ‘shall be independent and impartial, shall avoid direct or indirect conflicts of interest … pursuant to the dispute settlement mechanism, so that through the observance of such standards of conduct the integrity and impartiality of that mechanism are preserved.’ … like other persons covered by the Rules of Conduct, experts ‘shall disclose any information that could reasonably be expected to be known to them at the time which, coming within the scope of the Governing Principle of these Rules, is likely to affect or give rise to justifiable doubts as to their independence or impartiality.’ According to the Illustrative List annexed to the Rules of Conduct, this disclosure shall include information relating to:

 

‘(a)     financial interests (e.g. investments, loans, shares, interests, other debts); business interests (e.g. directorship or other contractual interests); and property interests relevant to the dispute in question;

 

(b)     professional interests (e.g. a past or present relationship with private clients, or any interests the person may have in domestic or international proceedings, and their implications, where these involve issues similar to those addressed in the dispute in question);

 

(c)     other active interests (e.g. active participation in public interest groups or other organisations which may have a declared agenda relevant to the dispute in question);

 

(d)     considered statements of personal opinion on issues relevant to the dispute in question (e.g. publications, public statements);

 

(e)     employment or family interests (e.g. the possibility of any indirect advantage or any likelihood of pressure which could arise from their employer, business associates or immediate family members).’

According to Australia, Dr Cross’s alleged connection to the New Zealand Government results from his ‘research projects and publications with researchers from Hort Research New Zealand.’ As a matter of fact, Hort Research is wholly owned by the New Zealand Government. However, participation in joint research with other scientists who may be affiliated with a government-funded institution does not itself imply a connection with that Government. There is no indication that Dr Cross has worked for the Government of New Zealand, nor that he has received any monetary compensation from that Government. The extent of his collaboration with New Zealand scientists at Hort Research and the fact that he did not have ‘any jointly funded research projects’ with these scientists was disclosed by Dr Cross, when initially approached by the Panel.

 

Australia does not submit any additional arguments, nor any specific evidence for the alleged connection of Dr Cross with the New Zealand Government. In the light of the Illustrative List of the Rules of Conduct cited above, there is no indication that Dr Cross has any financial, business or property interests ‘relevant to the dispute in question’, nor that he has any professional, other active, employment or family interests in the dispute, under paragraphs (a), (b), (c) and (e) of that List.”(517)

(e) Obligations of individual experts

417.     In US/Canada — Continued Suspension, the Appellate Body noted that the experts were not only bound by the obligations in the ad hoc Working Procedures adopted by the Panel, but also by the Rules of Conduct:

“Paragraph 9 of the Experts Working Procedures adopted by the Panel prescribes that experts will be selected ‘on the basis of their qualification and the need for specialized scientific or technical expertise’. Paragraph 11 additionally provides:

 

The selected experts shall act in their individual capacities and not as representatives of any entity. They shall be subject to the Rules of Conduct for the Understanding on Rules and Procedures Governing the Settlement of Disputes (WT/DSB/RC1), including the self-disclosure requirement set out in Section VI of the Rules of Conduct.”(518)

418.     In US/Canada — Continued Suspension, the Appellate Body adduced the rules providing for independence and impartiality of the scientific experts advising the Panel:

“[E]xperts advising Panels are specifically covered by the Rules of Conduct and, pursuant to Section II (Governing Principle), they ‘shall be independent and impartial, [and] shall avoid direct or indirect conflicts of interest …, so that through the observance of such standards of conduct the integrity and impartiality of that mechanism are preserved’.

 

Selected experts are also subject to certain self-disclosure and confidentiality obligations set out elsewhere in the Rules of Conduct, and procedures exist for the referral of a ‘material violation’ of these obligations to the Chairman of the DSB for appropriate action.(519)”(520)

(f) Consultation with experts

(i) Significant investigative authority

General

419.     In Canada — Continued Suspension and US — Continued Suspension, the Appellate Body stated that Panels are understood to have significant investigative authority under Article 13 of the DSU and Article 11.2 of the SPS Agreement and broad discretion in exercising this authority.(521)

420.     In Australia — Apples, the Panel noted that a panel has a broad right to seek information and technical advice from scientific experts to help the Panel make an objective assessment of the matter before it. The Panel recalled that a panel has significant investigative authority and one way of exercising this authority was through expert consultation:

“Under Articles 13.1 of the DSU and 11.2 of the SPS Agreement, a Panel has a broad right to seek information and technical advice from scientific experts. Indeed, under Article 11.2 of the SPS Agreement, a Panel engaged in dispute settlement proceedings involving scientific or technical issues under that agreement should ‘seek advice from experts chosen by the Panel in consultation with the parties to the dispute’. Expert consultation is part of the broad right of a Panel ‘to seek information and technical advice from any individual or body which it deems appropriate’ and to ‘seek information from any relevant source’ and ‘consult experts to obtain their opinion on certain aspects of the matter’ under Article 13 of the DSU. Ultimately, the purpose of expert consultation is to allow a Panel to exercise its duty to ‘make an objective assessment of the matter before it’, pursuant to Article 11 of the DSU.

As noted above, in the US/Canada — Continued Suspension dispute, the Appellate Body confirmed the ‘significant investigative authority’ of Panels under Article 13 of the DSU and Article 11.2 of the SPS Agreement and the broad discretion of Panels in exercising this authority, including through expert consultation.(522)”(523)

Limitations on significant investigative authority

421.     In Japan — Agricultural Products II, the Appellate Body stressed that the investigative authority of a panel did not stretch so far as to “make the case for a complaining party”:

[A]rticle 13 of the DSU and Article 11.2 of the SPS Agreement suggest that Panels have a significant investigative authority. However, this authority cannot be used by a Panel to rule in favour of a complaining party which has not established a prima facie case of inconsistency based on specific legal claims asserted by it. A Panel is entitled to seek information and advice from experts and from any other relevant source it chooses, pursuant to Article 13 of the DSU and, in an SPS case, Article 11.2 of the SPS Agreement, to help it to understand and evaluate the evidence submitted and the arguments made by the parties, but not to make the case for a complaining party.”(524)

422.     In Australia — Apples, in the context of the Panel’s consultation with experts, the Panel held that a panel is precluded from considering issues that fall outside the terms of reference approved by the DSB.(525)

(ii) Due process

423.     The Panel in Australia — Apples acknowledged that due process fully applies to the selection and consultation of experts by panels but noted that it is difficult to state in the abstract whether a specific type of procedural concern affects due process. The Panel found that such concerns are to be addressed on a case-by-case basis:

“The concept of due process is implicit in WTO dispute settlement.(526) …

 

According to the Appellate Body, due process fully applies to the selection and consultation of experts by Panels: ‘[T]he protection of due process applies to a Panel’s consultations with experts. This due process protection applies to the process for selecting experts and to the Panel’s consultations with the experts, and continues throughout the proceedings.’(527)

 

If a procedural concern puts at risk the purpose and role of due process in WTO dispute settlement, it is effectively a due process concern, to which Panels need to pay special attention. However, it is difficult to state in the abstract whether a specific type of procedural concern affects due process. Only by taking into account the specific circumstances of the case, can a Panel assess whether a procedural concern affects due process and thus merits such special attention.”(528)

424.     In Australia — Apples, Australia raised concerns about how some questions to the experts were framed. The Panel found that when each party has been allowed to pose its own questions, to comment on responses received from the experts and to pose subsequent questions to the experts in a meeting with the Panel, the parties’ respective positions in the proceedings and their due process rights are not prejudiced by the specific formulation of a question posed by a panel to the experts.(529)

(g) Relationships with other provisions of WTO Agreements

(i) Article 14 of the TBT Agreement

425.     In EC — Approval and Marketing of Biotech Products, the Panel adduced the provisions of Article 14 of the TBT Agreement along with those of Article 13.1 of the DSU and Article 11.2 of the SPS Agreement as bases for an eventual request for assistance from scientific experts:

Articles 14.2 and 14.3 of the TBT Agreement provides that:

 

14.2 At the request of a party to a dispute, or at its own initiative, a Panel may establish a technical expert group to assist in questions of a technical nature, requiring detailed consideration by experts.

 

14.3 Technical expert groups shall be governed by the procedures of Annex 2. …

 

In light of the claims of the Complaining Parties that the measures at issue violated, inter alia, the SPS Agreement and/or the TBT Agreement, at the time of the organizational meeting the Panel established a deadline for the Parties to request the Panel to seek appropriate scientific and technical advice pursuant to the provisions of these agreements.”(530)

(ii) Article 13 of the DSU

426.     In EC — Hormones, the Panel consulted individual experts on the bases of Article 11.2 of the SPS Agreement and Article 13.2 of the DSU:

“For our examination of this dispute, we considered it more useful to leave open the possibility of receiving a range of opinions from individual experts on specific scientific and technical questions, rather than to establish an expert review group which would have been required to reach a consensus view on the basis of general terms of reference given to it by the Panel. We considered that neither Article 11.2 of the SPS Agreement nor Article 13.2 of the DSU limits our right to seek information from individual experts as provided for in Article 11.2, first sentence, of the SPS Agreement and Articles 13.1 and 13.2, first sentence, of the DSU.”(531)

427.     The Appellate Body in EC — Hormones stated: “[b]oth Article 11.2 of the SPS Agreement and Article 13.2 of the DSU require Panels to consult with the parties to the dispute during the selection of the experts”.(532)

428.     As regards the Panel’s authority to seek information from scientific experts, the Appellate Body in US/ Canada — Continued Suspension made reference to Article 13.1 of the DSU and Article 11.2 of the SPS Agreement noting that “Panels are understood to have ‘significant investigative authority’(533) under Article 13 of the DSU and Article 11.2 of the SPS Agreement and broad discretion in exercising this authority”.(534)

(iii) Rules of Conduct

429.     See the Section on the Rules of Conduct in the Chapter on the DSU.

430.     For a discussion of the relationship between Article 11.2 of the SPS Agreement and the Rules of Conduct, please refer to paragraphs 417 and 418 above.

 

XIII. Article 12     back to top

A. Text of Article 12

Article 12: Administration

1.     A Committee on Sanitary and Phytosanitary Measures is hereby established to provide a regular forum for consultations. It shall carry out the functions necessary to implement the provisions of this Agreement and the furtherance of its objectives, in particular with respect to harmonization. The Committee shall reach its decisions by consensus.

 

2.     The Committee shall encourage and facilitate ad hoc consultations or negotiations among Members on specific sanitary or phytosanitary issues. The Committee shall encourage the use of international standards, guidelines or recommendations by all Members and, in this regard, shall sponsor technical consultation and study with the objective of increasing coordination and integration between international and national systems and approaches for approving the use of food additives or for establishing tolerances for contaminants in foods, beverages or feedstuffs.

 

3.     The Committee shall maintain close contact with the relevant international organizations in the field of sanitary and phytosanitary protection, especially with the Codex Alimentarius Commission, the International Office of Epizootics, and the Secretariat of the International Plant Protection Convention, with the objective of securing the best available scientific and technical advice for the administration of this Agreement and in order to ensure that unnecessary duplication of effort is avoided.

 

4.     The Committee shall develop a procedure to monitor the process of international harmonization and the use of international standards, guidelines or recommendations. For this purpose, the Committee should, in conjunction with the relevant international organizations, establish a list of international standards, guidelines or recommendations relating to sanitary or phytosanitary measures which the Committee determines to have a major trade impact. The list should include an indication by Members of those international standards, guidelines or recommendations which they apply as conditions for import or on the basis of which imported products conforming to these standards can enjoy access to their markets. For those cases in which a Member does not apply an international standard, guideline or recommendation as a condition for import, the Member should provide an indication of the reason therefor, and, in particular, whether it considers that the standard is not stringent enough to provide the appropriate level of sanitary or phytosanitary protection. If a Member revises its position, following its indication of the use of a standard, guideline or recommendation as a condition for import, it should provide an explanation for its change and so inform the Secretariat as well as the relevant international organizations, unless such notification and explanation is given according to the procedures of Annex B.

 

5.     In order to avoid unnecessary duplication, the Committee may decide, as appropriate, to use the information generated by the procedures, particularly for notification, which are in operation in the relevant international organizations.

 

6.     The Committee may, on the basis of an initiative from one of the Members, through appropriate channels invite the relevant international organizations or their subsidiary bodies to examine specific matters with respect to a particular standard, guideline or recommendation, including the basis of explanations for non-use given according to paragraph 4.

 

7.     The Committee shall review the operation and implementation of this Agreement three years after the date of entry into force of the WTO Agreement, and thereafter as the need arises. Where appropriate, the Committee may submit to the Council for Trade in Goods proposals to amend the text of this Agreement having regard, inter alia, to the experience gained in its implementation.


B. Interpretation and Application of Article 12

1. Article 12.1

(a) General

431.     At its meeting of 19–20 March 1997, the SPS Committee adopted Rules of Procedure.(535)

(b) Relationship with other Articles

(i) Article 3.5

432.     Articles 12.1 and 12.4 are mentioned in Article 3.5 which mandates the SPS Committee to develop a procedure to monitor the international harmonization of standards, guidelines and recommendations. See paragraph 439 below.

(ii) Article 5.5

433.     Article 12.1, along with Articles 12.2 and 12.3, is mentioned in the second sentence of Article 5.5. In this sentence, Members are asked to cooperate with the SPS Committee to develop guidelines to further the implementation of the provision. In accordance with this sentence, the SPS Committee, in June 2000, adopted guidelines to further the practical implementation of Article 5.5. For the description of these guidelines, refer to paragraphs 244248 above.

2. Article 12.2

(a) General

434.     Several Members have submitted proposals for a procedure to facilitate the use of ad hoc consultations and negotiations among Members.(536)

435.     On the basis of the proposals from Members, in 2009 the Secretariat prepared a “Proposed Recommendation Procedure [To Encourage and Facilitate] [on] Ad Hoc Consultations [or Negotiations] Among Members under the SPS Agreement (Article 12.2)”.(537) The Secretariat has been revised on several occasions, most recently on 12 September 2009.(538)

(b) Relationship with other Articles

(i) Article 5.5

436.     Article 12.2, along with Articles 12.1 and 12.3, is mentioned in the second sentence of Article 5.5. In this sentence, Members are asked to cooperate with the SPS Committee to develop guidelines to further the implementation of the provision. In accordance with this sentence, the SPS Committee has adopted guidelines to further the practical implementation of Article 5.5. For the description of these guidelines, refer to paragraphs 244248 above.

3. Article 12.3

(a) General

437.     Since 1995, the SPS Committee has granted observer status to a total of 21 bodies, either on a regular basis, as part of a WTO reciprocity agreement/MOU, or on an ad hoc basis.(539)

(b) Relationship with other Articles

(i) Article 5.5

438.     Article 12.3, along with Articles 12.1 and 12.2, is mentioned in the second sentence of Article 5.5. In this sentence, Members are asked to cooperate with the SPS Committee to develop guidelines to further the implementation of the provision. In accordance with this sentence, the SPS Committee has adopted guidelines to further the practical implementation of Article 5.5. For the description of these guidelines, refer to paragraphs 244248 above.

4. Article 12.4

(a) General

439.     At its meeting of 15–16 October 1997, the SPS Committee adopted provisional procedures to monitor the use of international standards(540), and also agreed to review the operation of the provisional monitoring procedure 18 months after its implementation, with a view to deciding at that time whether to continue with the same procedure, amend it or develop another one.(541) After agreeing to a number of extensions on the provisional procedure to monitor the use of international standards, at its meeting of 27–28 October 2004, the SPS Committee adopted modifications to the provisional procedure to monitor the use of international standards.(542) On 5 July 2006, the Committee adopted a decision to modify and extend the provisional procedure to monitor the process of international harmonization.(543)

(b) Relationship with other Articles

(i) Article 3.5

440.     Articles 12.1 and 12.4 are mentioned in Article 3.5 which mandates the SPS Committee to develop a procedure to monitor the international harmonization of standards, guidelines and recommendations. See paragraph 439 above.

5. Article 12.7

441.     At its meeting on 15–16 October 1997, the SPS Committee agreed on procedures for conducting the review of the implementation and operation of the SPS Agreement.(544) The First Review was completed in March 1999.(545)

442.     At the Doha Ministerial Conference, Members adopted a deadline for reviewing the operation and implementation of the SPS Agreement:

“Pursuant to the provisions of Article 12.7 of the Agreement on the Application of Sanitary and Phytosanitary Measures, the Committee on Sanitary and Phytosanitary Measures is instructed to review the operation and implementation of the Agreement on Sanitary and Phytosanitary Measures at least once every four years.”(546)

443.     At its meeting of 22–23 June 2004, the Committee decided on the process for the Second Review of the SPS Agreement. The Committee completed its Second Review and adopted a report in this respect on 30 June 2005.(547)

444.     At its October 2008 meeting, the Committee adopted a procedure and timetable to undertake the Third Review of the Agreement.(548) The report of the Third Review was adopted by the Committee on 18 March 2010.(549)

445.     As in the two previous Reviews, the Committee discussions in the Third Review focused on operation and implementation issues related to: Consistency (Article 5.5); Equivalence (Article 4); Transparency (Article 7 and Annex B); Monitoring the use of international standards (Article 3.5 and 12.4); Technical assistance and training activities (Article 9); Special and differential treatment (Article 10); Regionalization (Article 6); Monitoring the implementation of the Agreement (Articles 12.1 and 12.2) — Specific trade concerns / Use of ad hoc consultations; Cooperation with Codex Alimentarius, World Organisation for Animal Health (OIE), and the International Plant Protection Convention (IPPC) (Article 12.3); and Dispute settlement activities (Article 11). In addition, in the Third Review the Committee also considered: Implementation of the Agreement — Article 13; Private voluntary standards; Good regulatory practice; and Control, Inspection and Approval Procedures (Article 8 and Annex C).(550)

 

XIV. Article 13     back to top

A. Text of Article 13

Article 13: Implementation

Members are fully responsible under this Agreement for the observance of all obligations set forth herein. Members shall formulate and implement positive measures and mechanisms in support of the observance of the provisions of this Agreement by other than central government bodies. Members shall take such reasonable measures as may be available to them to ensure that non-governmental entities within their territories, as well as regional bodies in which relevant entities within their territories are members, comply with the relevant provisions of this Agreement. In addition, Members shall not take measures which have the effect of, directly or indirectly, requiring or encouraging such regional or non-governmental entities, or local governmental bodies, to act in a manner inconsistent with the provisions of this Agreement. Members shall ensure that they rely on the services of non-governmental entities for implementing sanitary or phytosanitary measures only if these entities comply with the provisions of this Agreement.


B. Interpretation and Application of Article 13

1. Scope of the SPS Agreement

446.     The Panel in Australia — Salmon (Article 21.5 — Canada), in reading the obligations of the provisions of Article 1.1 and 13 of the SPS Agreement together, found that a measure taken by a regional government within Australia’s territory, was a measure taken by an “other than central government body” and would fall under the responsibility of Australia as WTO Member when it comes to observance of SPS obligations. Thus, the Panel concluded that it was entitled to consider whether the measure taken by the regional government observed the SPS Agreement(551):

Article 13 of the SPS Agreement provides unambiguously that: (1) ‘Members are fully responsible under [the SPS] Agreement for the observance of all obligations set forth herein’; and (2) ‘Members shall formulate and implement positive measures and mechanisms in support of the observance of the provisions of this Agreement by other than central government bodies’. Reading these two obligations together [Article 1.1 and Article 13]…, we consider that sanitary measures taken by the Government of Tasmania, being an ‘other than central government’ body as recognized by Australia, are subject to the SPS Agreement and fall under the responsibility of Australia as WTO Member when it comes to their observance of SPS obligations.”(552)

2. SPS-related private standards

447.     Regarding SPS-related private standards, see the Section on Article 1 below.

 

XV. Article 14     back to top

A. Text of Article 14

Article 14: Final Provisions

The least-developed country Members may delay application of the provisions of this Agreement for a period of five years following the date of entry into force of the WTO Agreement with respect to their sanitary or phytosanitary measures affecting importation or imported products. Other developing country Members may delay application of the provisions of this Agreement, other than paragraph 8 of Article 5 and Article 7, for two years following the date of entry into force of the WTO Agreement with respect to their existing sanitary or phytosanitary measures affecting importation or imported products, where such application is prevented by a lack of technical expertise, technical infrastructure or resources.


B. Interpretation and Application of Article 14

448.     In EC — Hormones, the Panel referred to Article 14 in the context of finding that the SPS Agreement applies to SPS measures that were enacted before 1 January 1995 but were maintained thereafter:

“[S]everal provisions of the SPS Agreement confirm the general principle that the SPS Agreement should also apply to sanitary measures which were enacted before its entry into force but which remain in force thereafter. Except for Article 14 which authorizes delays in the application of some or all of the provisions of the SPS Agreement for least-developed and other developing countries, no transition periods are provided for. The fact that Article 14 explicitly provides for a two-year transition period for developing countries with respect to some of their existing sanitary and phytosanitary measures, confirms that the SPS Agreement generally applies to measures enacted before the entry into force of the SPS Agreement but which are maintained in force after that date.”(553)

449.     In EC — Hormones, the Appellate Body upheld the Panel’s finding regarding the temporal scope of the SPS Agreement. After stating that the SPS Agreement does not contain any provision limiting the temporal application of the SPS Agreement to SPS measures adopted after 1 January 1995, the Appellate Body noted:

Article 14 of the SPS Agreement allows the least-developed country Members and other developing country Members to delay implementation of the provisions of that Agreement for a period of five and two years, respectively, following the date of entry into force of the WTO Agreement. Developing country Members may only delay application of the provisions of that Agreement where such application is prevented by lack of technical expertise, technical infrastructure or resources. This right to defer application of the provisions of the SPS Agreement concerns, however, both SPS measures existing before the entry into force of the WTO Agreement and SPS measures enacted since.”(554)

 

XVI. Annex A     back to top

A. Text of Annex A

Annex A: Definitions(4)

(footnote original) 4 For the purpose of these definitions, “animal” includes fish and wild fauna; “plant” includes forests and wild flora; “pests” include weeds; and “contaminants” include pesticide and veterinary drug residues and extraneous matter.

 

1.     Sanitary or phytosanitary measure — Any measure applied:

 

(a)     to protect animal or plant life or health within the territory of the Member from risks arising from the entry, establishment or spread of pests, diseases, disease-carrying organisms or disease-causing organisms;

 

(b)     to protect human or animal life or health within the territory of the Member from risks arising from additives, contaminants, toxins or disease causing organisms in foods, beverages or feedstuffs;

 

(c)     to protect human life or health within the territory of the Member from risks arising from diseases carried by animals, plants or products thereof, or from the entry, establishment or spread of pests; or

 

(d)     to prevent or limit other damage within the territory of the Member from the entry, establishment or spread of pests.

 

Sanitary or phytosanitary measures include all relevant laws, decrees, regulations, requirements and procedures including, inter alia, end product criteria; processes and production methods; testing, inspection, certification and approval procedures; quarantine treatments including relevant requirements associated with the transport of animals or plants, or with the materials necessary for their survival during transport; provisions on relevant statistical methods, sampling procedures and methods of risk assessment; and packaging and labelling requirements directly related to food safety.

 

2.     Harmonization — The establishment, recognition and application of common sanitary and phytosanitary measures by different Members.

 

3.     International standards, guidelines and recommendations

 

(a)     for food safety, the standards, guidelines and recommendations established by the Codex Alimentarius Commission relating to food additives, veterinary drug and pesticide residues, contaminants, methods of analysis and sampling, and codes and guidelines of hygienic practice;

 

(b)     for animal health and zoonoses, the standards, guidelines and recommendations developed under the auspices of the International Office of Epizootics;

 

(c)     for plant health, the international standards, guidelines and recommendations developed under the auspices of the Secretariat of the International Plant Protection Convention in cooperation with regional organizations operating within the framework of the International Plant Protection Convention; and

 

(d)     for matters not covered by the above organizations, appropriate standards, guidelines and recommendations promulgated by other relevant international organizations open for membership to all Members, as identified by the Committee.

 

4.     Risk assessment — 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.

 

5.     Appropriate level of sanitary or phytosanitary protection — The level of protection deemed appropriate by the Member establishing a sanitary or phytosanitary measure to protect human, animal or plant life or health within its territory.

 

NOTE: Many Members otherwise refer to this concept as the “acceptable level of risk”.

 

6.     Pest- or disease-free area — An area, whether all of a country, part of a country, or all or parts of several countries, as identified by the competent authorities, in which a specific pest or disease does not occur.

 

NOTE: A pest- or disease-free area may surround, be surrounded by, or be adjacent to an area — whether within part of a country or in a geographic region which includes parts of or all of several countries — in which a specific pest or disease is known to occur but is subject to regional control measures such as the establishment of protection, surveillance and buffer zones which will confine or eradicate the pest or disease in question.

 

7.     Area of low pest or disease prevalence — An area, whether all of a country, part of a country, or all or parts of several countries, as identified by the competent authorities, in which a specific pest or disease occurs at low levels and which is subject to effective surveillance, control or eradication measures.


B. Interpretation and Application of Annex A

1. Annex A(1): sanitary or phytosanitary measure

(a) The definition of an SPS measure

450.     The Appellate Body in Australia — Apples considered that a fundamental element of the definition of “SPS measure” set out in Annex A(1) is that such a measure must be one applied to protect at least one of the listed interests or to prevent or limit specified damage.(555)

(i) Relevance of trade effects of a measure

451.     In Japan — Apples, the Panel noted that the definition in Annex A(1) does not consider the trade effect of a given measure as a factor to determine whether such a measure is or is not a phytosanitary measure.(556)

(ii) Purpose, form and nature

452.     In EC — Approval and Marketing of Biotech Products, the Panel examined whether various European Communities’ actions constituted an SPS measure that would fall under the SPS Agreement. Specifically, the Panel looked to the definition of a sanitary or phytosanitary measure set out in Annex A(1) and explained that in determining whether a measure is an SPS measure, regard must be had to such elements as the purpose of the measure, its legal form and its nature:

Annex A(1) indicates that for the purposes of determining whether a particular measure constitutes an ‘SPS measure’ regard must be had to such elements as the purpose of the measure, its legal form and its nature. The purpose element is addressed in Annex A(1)(a) through (d) (‘any measure applied to’). The form element is referred to in the second paragraph of Annex A(1) (‘laws, decrees, regulations’). Finally, the nature of measures qualifying as SPS measures is also addressed in the second paragraph of Annex A(1) (‘requirements and procedures, including, inter alia, end product criteria; processes and production methods; testing, inspection, certification and approval procedures; [etc.]’).”(557)

453.     Acknowledging the Panel’s decision in EC — Approval and Marketing of Biotech Products, the Panel in Australia — Apples noted that Annex A(1) contains the legal definition for the term SPS measure.(558) However, the Panel had a different reading of how two of the elements (form and nature) are reflected in the second paragraph of Annex A(1) from that adopted by the Panel in EC — Approval and Marketing of Biotech Products. The Panel did not agree that the list of examples in the second paragraph of Annex A(1) provides a clear-cut division between the elements of form and nature. The Panel considered that the ordinary way to read “laws, decrees, regulations, requirements and procedures” is as an enumeration of five items with the words “all relevant” qualifying each one of them:

“This Panel considers that the second paragraph of Annex A(1) sets out elements of the definition of SPS measures by providing examples. In fact, the second paragraph starts with the words ‘Sanitary and phytosanitary measures include’. Thus, the items spelt out in the second paragraph do not form a closed list. This is quite different from the closed list of possible purposes of a covered SPS measure under the first paragraph of Annex A(1), in particular its subparagraphs (a)-(d).

 

Further, the Panel does not consider that the list of examples in the second paragraph of Annex A(1) provides a clear-cut division between the elements of form and nature, the first three items (‘laws, decrees, regulations’) corresponding to the form, and the latter two (‘requirements and procedures’) to the nature of SPS measures. Given the placing of the word ‘and’ between the fourth and fifth items, the ordinary way to read ‘laws, decrees, regulations, requirements and procedures’ is as an enumeration of five items, with the words ‘all relevant’ qualifying each one of them.”(559)

454.     In arriving at its conclusion on the elements of form and nature, the Panel in Australia — Apples examined the English, Spanish and French versions of the SPS Agreement:

“[O]ne basic principle of treaty interpretation is that ‘[t]he terms of the treaty are presumed to have the same meaning in each authentic text’(560), and that the treaty interpreter should aim at ‘the meaning which best reconciles the texts [in the different authentic language versions], having regard to the object and purpose of the treaty.’(561) The SPS Agreement has three language versions, in English, French and Spanish, each equally authentic.(562)

 

The Spanish version of the second paragraph of Annex A(1) refers to ‘todas las leyes, decretos, reglamentos, prescripciones y procedimientos pertinentes’, placing the ‘y’ before the fifth item of the enumeration, and embracing the five items between the words ‘todas’ and ‘pertinentes’ (‘all relevant’ in English). The French version mentions ‘toutes lois, tous décrets, toutes réglementations, toutes prescriptions et toutes procédures pertinents’, again with the word ‘et’ appearing before the fifth item. Further, the French version makes it evident that both the words in the phrase ‘all relevant’ at the beginning of the enumeration in the English version should be read as relating to all five items of the list. In fact, the French version repeats the word ‘tou[te]s’ before each of the five items. Further, it uses the adjective ‘pertinents’ in the masculine, indicating that it cannot relate only to the immediately preceding noun ‘procédures’, nor to the two preceding nouns (‘prescriptions’ and ‘réglementations’). …

 

In the light of the above, the three authentic language versions of the last paragraph of Annex A(1) are interpreted most harmoniously if the terms ‘laws, decrees, regulations, requirements and procedures’ are perceived as a list of five items of equal quality and importance, with the words ‘all’ and ‘relevant’ referring to each of these items.

Since this Panel reads ‘all relevant laws, decrees, regulations, requirements and procedures’ as a list of five items, it disagrees with the EC — Approval and Marketing of Biotech Products Panel that the examples following this list in Annex A(1) would relate only to the last two items of the list (‘requirements and procedures’). The Panel is aware that some of the examples repeat the words ‘requirements’ and ‘procedures’. But not all do. Laws, decrees and regulations may typically set out requirements and procedures, so the examples including the words ‘requirements’ and ‘procedures’ can be read as also qualifying ‘laws, decrees, regulations’.”(563)

455.     Having reviewed the language of Annex A(1) in all three versions of the SPS Agreement, the Panel in Australia — Apples concluded that both the form and nature elements in the definition of SPS measures were broad and closely connected, without a clear distinction between the two:

“In sum, the form and nature elements in the definition of SPS measures in Annex A(1) are both broad, and they are closely connected to each other. Accordingly, the Panel will now analyse whether the 16 measures fit the elements of form and nature spelt out in the second paragraph of Annex A(1). Given the linkage of form and nature under that paragraph, the Panel will assess these two elements together to analyse whether the 16 measures can qualify as SPS measures.”(564)

456.     The Panel in US — Poultry (China) also disagreed with the Panel’s findings in EC — Approval and Marketing of Biotech Products on the premise that the text of Annex A(1) provides no clear distinction between form and nature. The Panel stated:

“We note that the text of Annex A(1) does not mention the term ‘nature’ but neither does it mention the terms ‘purpose’ and ‘form’. This does not mean that the analysis of the ordinary meaning of the wording of Annex A(1) in its context and in light of its object and purpose, would not lead us to examining both the purpose and form of Section 727 in order to determine whether it is an SPS measure.

 

 

The Panel has carefully examined the Panel’s findings in EC — Approval and Marketing of Biotech Products as regards the legal basis for distinction of ‘form’ and ‘nature’ and has difficulty with following the reasoning. The rationale for dividing the phrase ‘laws, decrees, regulations, requirements and procedures including …,’ into ‘form’ and ‘nature’ is not clear to us as the Panel did not elaborate on this point. The Panel did not explain how ‘requirements and procedures’ were somehow fundamentally different from laws, decrees, regulations’ or why it believed that all SPS measures somehow have the nature of a ‘requirement’ or ‘procedure’. If we examine the text of Annex A(1), we note that there is no such separation and a plain reading might lead one to believe that ‘requirements and procedures’ are also descriptions of the possible types or ‘forms’ of an SPS measure while the substantive descriptions following ‘including inter alia‘ are just illustrative examples of the types of SPS measures Members have imposed.”(565)

457.     The Panel in US — Poultry (China) considered that the first part of Annex A(1) refers to the purpose of the measure while the second part provides a list of the types of SPS measures. The Panel observed:

“We note that the first part of Annex A(1)(a) to (d) refers to an SPS measure as ‘any measure applied … to protect … to prevent’. Both parties and the Panel agree that this language refers to the ‘purpose’ of a measure.

 

The second part of Annex A(1), after having enunciated the possible purposes for which an SPS measure could be applied, goes on to provide a list of the types of SPS measures. …”(566)

(iii) Principal and ancillary measures

458.     In Australia — Apples, Australia advanced the notion of a distinction between ancillary and principal measures to support its argument that many of the measures at issue could not be reviewed under the SPS Agreement individually, but only in combination with certain other measures, which were supposedly principal measures. The Panel rejected this argument noting that Annex A(1) does not mention any distinction between principal and ancillary measures.(567) The Appellate Body upheld the Panel’s finding in this regard.(568)

(iv) Substantive SPS measures and procedural requirements

459.     The Panel in US — Poultry (China) articulated the distinction between substantive SPS measures and procedural requirements. The Panel stated:

“[P]rior panels have discussed the scope of both Articles 2 and 5 by making a distinction between ‘substantive’ SPS measures taken to achieve a Member’s ALOP and ‘procedural requirements’. In particular, the Panel in Australia — Salmon (Article 21.5 — Canada) made a distinction between risk reduction measures allegedly needed to achieve a WTO Member’s ALOP, which it called ‘substantive SPS measures in their own right’ and procedures or information requirements to check and ensure the fulfilment of sanitary measures that are subject to Annex C(1)(c) of the SPS Agreement.(569)”(570)

(v) SPS measuresidentification in terms of their purpose

General

460.     In Australia — Apples, the Appellate Body considered that the word “applied” in the chapeau of Annex A(1) points to the application of the measure and thus suggests that the relationship of the measure and one of the objectives listed in Annex A(1) must be “manifest in the measure itself or otherwise evident from the circumstances related to the application of the measure”. This led the Appellate Body to conclude that “the purpose of a measure is to be ascertained on the basis of objective considerations”.(571)

461.     The Panel in EC — Approval and Marketing of Biotech Products, when examining country specific safeguard measures on genetically modified organisms within the European Communities, stated that a panel need not limit its inquiry to determining the purpose for which SPS measures were adopted but also the purposes for which the measures were maintained and applied:

“[W]e consider that it would not be appropriate in this case to limit our inquiry to determining the purposes for which the safeguard measures were adopted. To begin with, we recall that our task in this case is to determine the purposes for which the relevant safeguard measures were maintained in August 2003. Furthermore, Annex A(1) does not refer to measures ‘adopted’ for one of the enumerated purposes, but, more broadly, to measures ‘applied’ for one of the enumerated purposes. Moreover, we see nothing in the SPS Agreement which would bar a Panel from considering purposes which were not articulated by the member States when they adopted their safeguard measures. Finally, our approach is consistent with the view expressed by the Appellate Body that in identifying the purposes of a measure, Panels need not seek to determine the subjective intent of the legislators or regulators who adopted the measure. According to the Appellate Body, the purposes of a measure may and should rather be ascertained on the basis of objective considerations, for instance by examining whether there is an objective relationship between the stated purposes and the text and structural features of the relevant measure.(572)”(573)

SPS measure versus environment protection measure

462.     On the basis of the definition of an SPS measure within Annex A, the Panel in EC — Approval and Marketing of Biotech Products inferred that since the measures at issue aim at protecting plant life or health as part of the environment protection objective, they might well serve one of the purposes of the SPS Agreement and could therefore be considered, in this particular circumstance, as SPS measure:

“We note that in accordance with Annex A(1)(a) and (b) of the SPS Agreement, the SPS Agreement covers measures applied to protect animal and plant life or health from certain risks. Thus, to the extent Directives 90/220 and 2001/18 are applied to protect animals and plants as part of their purpose of protecting the environment, they are not a priori excluded from the scope of application of the SPS Agreement.”(574)

463.     In EC — Approval and Marketing of Biotech Products, the Panel made a distinction between an SPS requirement and an environment protection measure. Drawing from the 1993 GATT Secretariat Background Paper, the panel used examples to warn that the purpose of environmental protection, per se, is not sufficient to bring a measure within the scope of application of the SPS Agreement, even if the measure otherwise meets the definition of an SPS measure (e.g., in terms of its form and nature):

“To provide an example, a measure to reduce air pollution may be applied to protect the life or health of plants (to the extent that high levels of air pollution could result in certain plant species lacking sufficient sunlight for them to exist and survive), and hence to protect the environment, but it would nonetheless not be a measure applied for one of the purposes enumerated in Annex A(1) of the SPS Agreement (in that the measure would not be applied to protect plant life or health from risks arising from the entry, establishment or spread of pests, diseases, disease-carrying organisms or disease-causing organisms, or to prevent other damage from the entry, establishment or spread of pests).”(575)

464.     On addressing the exclusion of environmental measures per se from the scope of application of the SPS Agreement, the Panel in EC — Approval and Marketing of Biotech Products turned to the 1990 Draft Text on Sanitary and Phytosanitary Measures circulated by the Chairman of the Working Group on Sanitary and Phytosanitary Measures. On consideration of the style used in the draft text, the Panel refrained from considering that the removal of bracketed texts in that instance amounts to dismissal of environmental measures from the scope of the SPS Agreement. The Panel further declined to consider this evidence in the case at issue:

“We note that the draft text contained bracketed text the acceptance of which would have meant that ‘measures for the protection of animal welfare and of the environment, as well as of consumer interests and concerns’ are ‘SPS measures’ within the meaning of the Annex A(1) definition.(576) However, the Annex A(1) definition in the Chairman’s draft text also contained bracketed text which stated that ‘[r]equirements concerning quality, composition, grading, [consumer preferences, […], the environment or ethical and moral considerations] are not included in the definition of sanitary or phytosanitary measures’. Neither of the two bracketed texts was included in the final text of the SPS Agreement. Since according to one of the two bracketed texts measures taken for the protection of the environment would have been covered by the SPS Agreement, while according to the other bracketed text such measures would not have been covered, and since neither text was included in the final text of the SPS Agreement, we cannot draw the inference that the European Communities asks us to draw — that the removal of the bracketed text which would have meant that measures taken for the protection of the environment are SPS measures implied a decision that such measures should not be covered by the SPS Agreement. In view of the fact that neither of the two bracketed texts was included in the final text of the SPS Agreement, we consider that the Working Group Chairman’s draft text does not assist us in determining whether all measures applied to protect from risks to the environment other than risks to the life or health of animals or plants fall outside the scope of application of the SPS Agreement.”(577)

(vi) Whether a law, or a requirement contained therein, may be deemed to embody an SPS measure as well as a non-SPS measure

465.     In EC — Approval and Marketing of Biotech Products, the European Communities requested the Panel to determine “whether a law, or a requirement contained therein, may, if it meets the applicable conditions, be considered to incorporate an SPS measure as well as a distinct measure which falls to be assessed under a WTO agreement other than the SPS Agreement, such as the TBT Agreement”. The Panel considered, using a hypothetical example, that the European Communities view might well be tenable in specific circumstances:

“[W]e consider that to the extent the requirement in the consolidated law is applied for one of the purposes enumerated in Annex A(1), it may be properly viewed as a measure which falls to be assessed under the SPS Agreement; to the extent it is applied for a purpose which is not covered by Annex A(1), it may be viewed as a separate measure which falls to be assessed under a WTO agreement other than the SPS Agreement. It is important to stress, however, that our view is premised on the circumstance that the requirement at issue could be split up into two separate requirements which would be identical to the requirement at issue, and which would have an autonomous raison d’être, i.e., a different purpose which would provide an independent basis for imposing the requirement.

 

We recognize that, formally, the requirement at issue constitutes one single requirement. However, neither the WTO Agreement nor WTO jurisprudence establishes that a requirement meeting the condition referred to in the previous paragraph may not be deemed to embody two, if not more, distinct measures which fall to be assessed under different WTO agreements. We note that Annex A(1) of the SPS Agreement, which defines the term ‘SPS measure’, refers to ‘[a]ny measure’ and to ‘requirements’. But these references do not imply that a requirement cannot be considered to embody an SPS measure as well as a non-SPS measure.”(578)

466.     To further advocate the benefits of considering a single requirement as embodying an SPS as well as a non-SPS measure, the Panel in EC — Approval and Marketing of Biotech Products added the element that, on a procedural level choosing to enact a measure which embeds SPS and non-SPS provisions is invaluable for a WTO Member. However, aware of the possible consequences of such an option, the Panel cautioned that enacting a requirement as an SPS measure and a non-SPS measure might reveal some intricacies that could prejudice the coherence of the adopting Member’s legal order:

“In addition to the foregoing considerations, there is another consideration which we think militates against treating the requirement at issue as constituting only an SPS measure. To see this, it should first of all be recalled that, as a general matter, Members impose requirements because they consider it necessary to do so.(579) If they do deem it necessary to impose a particular requirement, it is only logical that they also seek to minimize the risk of a successful legal challenge, whether before a domestic court or at the WTO. In the case of our hypothetical example, the Member concerned would face the risk — for instance, due to uncertainties as to the correct interpretation or application of relevant WTO provisions — that a WTO Panel would find the requirement at issue to be WTO inconsistent as an SPS measure but WTO-consistent as a non-SPS measure, or vice versa, or that a Panel would find the requirement to be WTO-inconsistent either as an SPS or as a non-SPS measure.

 

If the view were taken that the requirement at issue would constitute an SPS measure only, the Member concerned would have to defend that requirement as an SPS measure. In view of the possibility that the requirement at issue might withstand scrutiny by a WTO Panel as a non-SPS measure, but not as an SPS measure, it is reasonable to assume, however, that, ex abundanti cautela, the Member concerned would not want to forgo the opportunity of defending the requirement at issue also as a non-SPS measure. The Member concerned could prevent this by enacting the requirement at issue twice, either in different laws with a statement of the appropriate purpose or in the same law as separate provisions with a statement of their different purpose. However, a Member might face substantial difficulties in convincing its legislators of the need for enacting the same requirement twice, whether it be in different laws or as separate provisions in the same law. Moreover, pursuing this option might run counter to many Members’ basic legislative objectives and requirements. It is axiomatic that the primary objective of legislation is to communicate directives to those affected by it in a manner that is clear, easily understandable and reduces uncertainties. By enacting the same requirement twice, in different laws or as separate provisions in the same law, a Member would arguably reduce clarity and create a potential for confusion and uncertainty among those affected by the law. Also, if the same requirement were enacted twice in different laws, the result would be a more fragmented domestic legal order.”(580)

467.     Having reviewed the benefits within the choice to enact a single requirement as both SPS and non-SPS measure, the Panel in EC — Approval and Marketing of Biotech Products conceded that Members remain free to choose the option which better fits into their needs in this particular area, taking into account the need to act in accordance with their legitimate legislative objectives:

“[I]f we were to embrace the view that the requirement in the consolidated law must be considered to constitute an SPS measure only, we would effectively impose an unwanted choice on the Member concerned. The Member could either choose to enact the requirement at issue twice and thus possibly act inconsistently with sound legislative objectives. Or it could choose not to enact the requirement twice and thus expose itself to potential legal risks. We think it would be ill-advised to put Members in a situation where they effectively have to make this kind of choice, particularly when it is not imposed by WTO rules. As we have said, we are unaware of a directive in the WTO Agreement which says that a requirement can never be deemed to embody two or more distinct measures which fall to be assessed under different WTO agreements.

 

To be clear, we are not saying that Members cannot, or should not, enact the same requirement twice if they see fit to do so. Plainly, Members may do so. Our concern is with those Members, and the European Communities appears to be among them, that see fit not to do so. We consider that we should not interpret the WTO Agreement in a manner which would effectively require Members to choose between enacting a requirement twice, which may be inconsistent with their internal laws or their legitimate preference, and exposing themselves to potential legal risks, which may be imprudent.”(581)

(b) Annex A(1)(a)

(i) General

468.     The Panel in EC — Approval and Marketing of Biotech Products held that in order to determine whether the European Communities’ measures fell within the definition of an SPS measure, it needed to consider the meaning and scope of particular terms and phrases in Annex A(1)(a) and whether the potential effects of genetically modified organisms identified as the purpose behind the European Communities’ measures meet the definitions of those terms and phrases.

“In order for us to determine whether Directives 90/220 and 2001/18 fall within the scope of Annex A(1)(a), we need to consider the meaning and scope of some of the terms and phrases used in Annex A(1)(a) and address whether certain potential effects of GMOs identified in the Directives meet the definition of these terms and phrases. Accordingly, we have structured our analysis below according to certain terms and phrases used in Annex A(1)(a), including ‘animal or plant life or health’, ‘risks arising from’, ‘entry, establishment or spread’, ‘pests’ and ‘diseases, disease-carrying organisms or disease-causing organisms.’ We note that one specific concern which has been identified in Directives 90/220 and 2001/18 relates to potential adverse effects of GMOs resulting from the use of antibiotic resistance marker genes. A separate subsection addresses whether this concern can be considered to relate to the risks covered in Annex A(1)(a).”(582)

469.     The Appellate Body in Australia — Apples made reference to its prior decision under Article III of the GATT 1994, in determining whether a measure fell within the scope of Annex A(1)(a). The Appellate Body stated:

“We consider that the meaning that has been attributed to the phrase ‘applied … so as to afford protection’ in the context of Article III:1 of the GATT 1994 may provide some assistance to the interpretative task before us.(583) The language of Annex A(1)(a) to the SPS Agreement is similar to Article III:1 of the GATT 1994, to the extent that both provisions use the word ‘applied’, and in both provisions this word is followed by the infinitive of purpose, namely, ‘to protect’ or ‘to afford protection’, respectively. With regard to Article III of the GATT 1994, the Appellate Body has opined that, although the purpose of a measure is not easily ascertained, it can often be discerned from the measure’s design, architecture, and structure.(584) A similar approach is called for under Annex A(1)(a) to the SPS Agreement. Whether a measure is ‘applied … to protect’ in the sense of Annex A(1)(a) must be ascertained not only from the objectives of the measure as expressed by the responding party, but also from the text and structure of the relevant measure, its surrounding regulatory context, and the way in which it is designed and applied. For any given measure to fall within the scope of Annex A(1)(a), scrutiny of such circumstances must reveal a clear and objective relationship between that measure and the specific purposes enumerated in Annex A(1)(a).”(585)

(ii) to protect animal or plant life or health

470.     The Panel in EC — Approval and Marketing of Biotech Products found that the phrase “to protect animal or plant life or health” in Annex A(1)(a) looked to the footnote to the definition and concluded that the phrase included all types of flora and fauna including micro- and macro-flora and fauna and target and non-target organisms:

“[I]t should be recalled that the footnote to the definitions provided in Annex A of the SPS Agreement states that: ‘For the purpose of these definitions, ‘animal’ includes fish and wild fauna; ‘plant’ includes forests and wild flora; ‘pests’ include weeds; and ‘contaminants’ include pesticide and veterinary drug residues and extraneous matter.’ The term ‘fauna’ is commonly defined as ‘the animals or animal life of a given area, habitat, or epoch’, whereas the term ‘flora’ is commonly defined as ‘plants or plant life of a given area, habitat, or epoch’. The clarification provided in the footnote to Annex A that the terms ‘animal’ and ‘plant’ include ‘wild fauna’ and ‘wild flora’ indicates to us that the scope of the phrase ‘animal or plant life or health’ is meant to be comprehensive in coverage. Moreover, we note that, textually, the unqualified terms ‘animal’ and ‘fauna’, on the one hand, and ‘plant’ and ‘flora’, on the other, can encompass macro- and micro-fauna, on the one hand, and macro- and micro-flora, on the other. We also consider that the terms ‘animal’ and ‘plant’ can encompass both target and non-target fauna and flora. By ‘non-target’ fauna and flora, we mean plants and animals (including insects) which are not themselves the organisms farmers seek to control or eliminate through the cultivation of GM crops, but which are affected by the cultivation of the GM crop, including through consumption of components of the GM plants (e.g., pollen). In the light of this, we consider that non-target microorganisms, such as soil or aquatic micro-organisms, are ‘animals’ or ‘plants’ within the meaning of Annex A(1).(586)”(587)

(iii) risks arising from

471.     The Panel in EC — Approval and Marketing of Biotech Products, relying on dictionary meanings, found that the phrase “risks arising from” as used in Annex A(1)(a) meant “occur as a result of”:

“The Panel notes that the dictionary defines the phrasal verb ‘to arise from’ as meaning ‘occur as a result of’. Thus, the phrase ‘risks arising from’ indicates that the relevant risks to animal or plant life or health must occur as a result of some event, substance, condition, etc. In the specific context of Annex A(1)(a), the phrase ‘risks arising from’ implies that the risks to animal or plant life or health must occur as a result of a pest, disease, disease-carrying organism or disease-causing organism.”(588)

(iv) entry, establishment or spread

472.     In EC — Approval and Marketing of Biotech Products, the Panel, on addressing the SPS criteria of the measures at issue, ruled on whether the purpose of the measures was concerned with the “entry, establishment or spread” of pests, diseases, etc.:

“It is clear to us that the purpose of avoiding disease in general includes the purpose of avoiding, more specifically, the ‘entry, establishment or spread’ of ‘diseases’. (…) We think that the purpose of avoiding ‘pest effects’ of GMOs includes the purpose of avoiding the ‘entry, establishment or spread’ of GMOs as ‘pests’.… In the light of this, we are satisfied that Directives 90/220 and 2001/18 can be considered to constitute measures applied to protect against risks arising from the ‘entry, establishment or spread’ of, inter alia, disease and ‘pest effects’ which may be caused by GMOs.”(589)

(v) pests

Definition

473.     The Panel in EC — Approval and Marketing of Biotech Products found that in the context of the SPS Agreement the term “pests” should be understood as referring to an animal or plant which is destructive, or causes harm to the health of other animals, plants, or humans, or other harm, or a troublesome or annoying animal or plant:(590)

“The Panel notes at the outset that three of the subparagraphs of Annex A(1) to the SPS Agreement, namely, Annex A(1)(a), A(1)(c) and A(1)(d), identify ‘pests’ as a possible source of risks. The word ‘pest’ ordinarily means ‘a troublesome, annoying or destructive person, animal, or thing’. In applying this definition to Annex A(1), we find two contextual elements in particular to be noteworthy. The first is the previously mentioned footnote to the definitions provided in Annex A of the SPS Agreement. It specifies that, for the purposes of the SPS Agreement, the term “pest” includes weeds. Weeds are plants. Therefore, we consider that the term ‘pest’ in Annex A(1) must be understood to cover plants in addition to animals. The other element which we find instructive are the references in Annex A(1)(a) and A(1)(c) to ‘animal or plant life or health’ and ‘human life or health’ as well as the reference in Annex A(1)(d) to ‘other damage’. It is apparent from these references that the SPS Agreement is intended to be applicable, not just to measures taken to protect against risks which pose a threat to the life, and thus the very existence, of animals, plants or humans, but also to measures taken to protect against risks to the ‘health’ of animals, plants or humans, and to measures taken to prevent other ‘damage’ within the territory of a Member. In the light of this, we consider that the term ‘pest’ should be interpreted to cover ‘destructive’ animals or plants — that is animals or plants which destroy the life and threaten the very existence of other animals, plants or humans. Equally, however, we think that, for the purposes of the SPS Agreement, the term ‘pest’ should be interpreted to cover animals and plants which cause other, less serious, deleterious effects, namely, animals and plants which cause harm to the health of animals, plants or humans or which cause other harm.”(591)

Whether pests must be living organisms

474.     Rejecting the European Communities’ view that pests are meant to be living organisms, the Panel in EC — Approval and Marketing of Biotech Products argued that pests do not need to be alive to be considered as liable to exert harmful damages to life or health:

“The European Communities has argued that a pest must be a living organism. We have previously noted that the term ‘pest’ in Annex A(1) encompasses plants which are destructive, or which cause harm to the health of other animals, plants or humans. While it may be true that many organisms will lose their ability to act as pests if they are no longer alive, we are not persuaded that this is necessarily always the case. In particular, we are not convinced that all plants which are pests as living organisms cease to be destructive or harmful to health immediately after being harvested.”(592)

(vi) diseases, disease-carrying organisms or disease-causing organisms

475.     In EC — Approval and Marketing of Biotech Products, the Panel provided the definition of the terms “diseases, disease-carrying organisms or disease-causing organisms”, in light of the ordinary meanings given to these words by the World Health Organization:

“The Panel observes that the common definition of the term ‘disease’ as it appears in Annex A(1)(a) is ‘a disorder of structure or function in an animal or plant of such a degree as to produce or threaten to produce detectable illness or disorder’. The World Health Organization (hereafter the ‘WHO’) defines disease as ‘[a] pathological condition of the body that presents a group of clinical signs, symptoms, and laboratory findings peculiar to it and setting the condition apart as an abnormal entity differing from other normal or pathological conditions (CMD 1997)’. Regarding the term ‘disease-carrying organisms’ and ‘disease-causing organisms’ in Annex A(1)(a), we note that the WHO defines a disease-carrying organism as a ‘vector’ and a disease-causing organism as a ‘pathogen’.”(593)

(c) Annex A(1)(b)

(i) General

476.     As with the methodology it followed for the previous subparagraph of Annex A, the Panel in EC — Approval and Marketing of Biotech Products assessed the compliance of the measures at issue with the provisions of Annex A(1)(b) by referring to the ordinary meaning given to the concepts in question within the provisions of Annex A:

“We now turn to analyse whether Directives 90/220 and 2001/18 fall within the scope of Annex A(1)(b) of the SPS Agreement. As we have done above with regard to Annex A(1)(a), we will structure our analysis below according to certain terms and phrases used in Annex A(1)(b), including ‘foods, beverages or feedstuffs’, ‘additives’, ‘contaminants’ and ‘toxins’. The Parties have also addressed concerns relating to potential effects of allergens on human and animal health in the context of Annex A(1)(b), hence we will also consider these concerns below.”(594)

(ii) foods, beverages or feedstuffs

477.     The Panel in EC — Approval and Marketing of Biotech Products used the dictionary definition of the individual terms in the phrase “foods, beverages or feedstuffs” and found that genetically modified crops eaten by animals can be considered feedstuffs and food:

“The Panel notes that the common definition of a ‘food’ is a substance taken into the body to maintain life and growth. Thus, we consider that a substance which a human being or an animal consumes for nutritional reasons may be classified as a ‘food’. A ‘feedstuff” on the other hand is defined as fodder, and ‘fodder’ is defined as ‘food for cattle, horses, etc., and more specifically as dried food, as hay, straw, etc., for stall-feeding’.

 

Applying these definitions in the context of this dispute, we consider that a GM crop grown for the explicit purpose of providing food to animals, and in particular to farmed animals, would qualify as a “feedstuff”. A GM crop that has been grown for a different purpose, but is eaten by animals, including wild fauna(595), can be considered to be a ‘food’ for that animal. This would include, for example, pollen of the GM crop which is consumed by insects and GM plants consumed by non-target insects, deer, rabbits or other wild fauna. Contrary to the European Communities, we think GM seeds used for sowing purposes could also be considered animal “food”, for instance if these seeds are spilled next to a field or on a farm and are subsequently eaten by birds, etc.”(596)

(iii) additives

Concept

478.     The Panel in EC — Approval and Marketing of Biotech Products relied on the dictionary and the Codex definition of “additive” to find that a gene could be considered a food additive:

“The Panel notes that the New Shorter Oxford English Dictionary defines ‘additives’ as ‘a substance added to another so as to give it specific qualities’. Given that Annex A(1)(b) is concerned with additives in foods, we also find informative that Codex defines a ‘food additive’ as: ‘Food additive means any substance not normally consumed as a food by itself and not normally used as a typical ingredient of the food, whether or not it has nutritive value, the intentional addition of which to food for a technological (including organoleptic) purpose in the manufacture, processing, preparation, treatment, packing, packaging, transport or holding of such food results, or may be reasonably expected to result, (directly or indirectly) in it or its by-products becoming a component of or otherwise affecting the characteristics of such foods. The term does not include ‘contaminants’ or substances added to food for maintaining or improving nutritional qualities.’ The Panel is not convinced by the European Communities’ categorical assertion that genes cannot be considered substances. A ‘substance’ is defined as the ‘real physical matter of which a person or thing consists’. It is our understanding that genes may be considered as ‘real physical matter’. We do not dispute that genes contain and encode instructions for the creation of various substances. However, this does not exclude that genes may themselves constitute substances.”(597)

Relevance of Codex

479.     Although the Panel in EC — Approval and Marketing of Biotech Products utilized the Codex definition of additives in its interpretation of Annex A(1)(b), it found that the Codex definition was not dispositive.(598) The Panel found that the specific reliance on international standards found in Article 3 and Annex A(3) of the SPS Agreement did not apply to Annex A(1):

“In any event, the Codex definition is not dispositive of the meaning of the term ‘additives’ as it appears in Annex A(1)(b). We are aware that pursuant to Article 3(1) of the SPS Agreement Members are to base their SPS measures on ‘international standards, guidelines and recommendations’, where they exist, and that in accordance with Annex A(3)(a) of the SPS Agreement, Codex standards relating to food additives are relevant ‘international standards’ within the meaning of Annex A(3)(a).(599) However, unlike Article 3(1) and Annex A(3), Annex A(1) makes no reference to ‘international standards, guidelines and recommendations’. Had the drafters of the SPS Agreement intended for terms like ‘additives’ to have the meaning given to them by definitions contained in relevant international standards, etc., we think Annex A(1) would have made this clear.(600) Looking at the text of Annex A(1)(b), we note that it broadly, and simply, refers to ‘additives’ ‘in foods’.”(601)

(iv) contaminants

480.     The Panel in EC — Approval and Marketing of Biotech Products also examined the term “contaminants” and found that it must mean something distinct from an “additive”. After examining dictionary and Codex definitions as well as the footnote to Annex A, the Panel found that for a substance to be a contaminant the presence of the infecting or polluting substance would have to be unintentional:

“The Panel notes that the common meaning of a contaminant is ‘a substance which pollutes, corrupts or infects’. We also note that the footnote to Annex A to the SPS Agreement states in relevant part that ‘[f]or purposes of these definitions […] ‘contaminants’ include pesticide and veterinary drug residues and extraneous matter’. These definitions have in common the fact that they refer to substances which are not intentionally added to food. This view is consistent with the abovementioned Codex definition of ‘contaminant’, which refers to any substance not intentionally added to food, and which is present in such food as a result of the production, processing, packaging, etc., or as a result of environmental contamination.

 

Based on the above elements, and noting that the term ‘contaminants’ must be interpreted so as to have a meaning that differs from the meaning of the term ‘additive’ which also refers to substances, we consider that a critical element for determining whether a substance can be considered to be a ‘contaminant’ is that the presence of the substance which is said to ‘infect or pollute’ be unintentional. For this reason, we consider that genes intentionally added to GM plants that are eaten or used as inputs into processed foods would not be ‘contaminants’ in and of themselves. Furthermore, we think that substances such as proteins which are produced by GM plants, and which are intended, should not be considered to be ‘contaminants’. However, we agree with Canada that proteins produced through the unintended expression of modified genes in agricultural crops may be considered ‘contaminants’ within the meaning of Annex A(1)(b), if these proteins ‘infect or pollute’ the food product.”(602)

(v) toxins

Definition

Relevance of the criteria related to “unintentional addition to food”

481.     In EC — Approval and Marketing of Biotech Products, the Panel examined the ordinary meaning of the term toxin having regard to the definitions provided under the Codex Alimentarius and other relevant texts. From these definitions, the Panel ruled that “unintentional addition to food” is not an element of the definition of “toxin”:

“The Panel notes that common definitions of a ‘toxin’ are ‘a poison produced by a microorganism or other organism and acting as an antigen in the body’ or ‘any poisonous antigenic substance produced by or derived from microorganisms, which causes disease when present at low concentration in the body’. Codex Standard 193 defines two types of toxins in the context of describing the general standard for contaminants and toxins in foods. One is a my cotoxin defined as ‘a toxicant that is produced as a toxic metabolite of certain micro fungi that are not intentionally added to food.’ The other is a microbial toxin defined as ‘toxicants that are produced by algae and that may be accumulated in edible aquatic organisms such as shellfish’. FAO defines a toxin as ‘a compound produced by one organism, which is deleterious to the growth and/or survival of another organism of the same or different species’. We note that these definitions do not suggest that toxins in foods are inherently substances which have been unintentionally added to foods. To be sure, every effort is ordinarily made to avoid the presence of toxins in foods. Nonetheless, a toxin specific to a particular pest is sometimes deliberately added to a food for the purpose of controlling or eradicating that target pest.”(603)

482.     The Panel in EC — Approval and Marketing of Biotech Products examined the term “toxin” as used in paragraph (1)(b) and found that, unlike contaminants, the addition of the toxin to the food or feedstuff does not need to be unintentional.

“The European Communities argues that the toxins produced by insecticidal GM plants to kill the target insect are not ‘covered’ by Annex A(1)(b) since the production by the GM plant of the toxins is intentional and since it is not possible to kill the target insect and at the same time seek to protect the life and health of those very insects. In our view, the mere fact that the toxin is intentionally produced in the GM plant would not necessarily remove any concerns relating to the toxic effect on the target insect from the scope of Annex A(1)(b). For it could be argued, not implausibly, that the insecticide-producing GM plant constitutes a ‘toxin’ in the food of the target insect which poses a risk to the life and health of the target insect. However, the target insect in the European Communities’ example is assumed to be a recognized pest. Accordingly, the release of insecticide-producing GM plants into the environment would normally be controlled, not to protect the life or health of the target insect from risks arising from the release of the GM plant, but to protect the life or health of non-target organisms, etc., from any risks arising from the release of the GM plant.”(604)

Relevance of the poisonous effect of the toxins

483.     The Panel in EC — Approval and Marketing of Biotech Products rejected the argument of the European Communities that the term “toxin” should be construed narrowly so that a measure aimed to protect animal, plant or human life from an allergen would not fall under the definition of an SPS measure in paragraph (1)(b). The Panel stated:

“We see nothing in Annex A(1) or in the ordinary meaning of the term ‘toxin’ which indicates that for a substance to qualify as a ‘toxin’ in a food or in a feedstuff, the substance needs to be poisonous for each and every human being or animal which is exposed to it through the consumption of the food or feedstuff. Indeed, we find it difficult to believe that the term ‘toxins’ was intended to have such a narrow meaning. If that were the case, a measure applied by a Member to protect human health from risks arising from substances present in food which are poisonous for only a small fraction of its population would not be subject to the disciplines of the SPS Agreement. Conversely, a measure applied to protect from risks arising from substances present in food which are poisonous for the entire population would be subject to the SPS Agreement. In our view, it would be incongruous if Members were subject to stricter disciplines when it comes to controlling risks affecting the entire population than they would be when they seek to control risks affecting only a small segment of their population. Also, the measures taken in either case might have equivalent effects on trade.”(605)

Allergens as toxins

Definition of allergens

484.     In addressing parties’ concerns on potential allergic responses to GMOs in the context of Annex A(1)(b), the Panel in EC — Approval and Marketing of Biotech Products first noted that Annex A(1)(b) does not mention allergenicity as a food safety concern. The Panel then examined whether allergens in foods or feedstuffs could nevertheless be considered to fall within the category of toxins and therefore be included in the definition of Annex A(1)(b):

“The term ‘allergen’ is commonly defined as ‘a substance that causes an allergic reaction’. The term ‘allergic’ is defined as ‘of, caused by, or relating to an allergy’, and the term ‘allergy’ is defined in turn as ‘a damaging immune response by the body to a substance to which it has become hypersensitive’. It may be inferred from these definitions that an ‘allergen’ is a substance which causes a damaging immune response by the body in humans or animals which have become hypersensitive to that substance. This is consistent with the definition of ‘allergen’ provided in the FAO Glossary of Biotechnology for Food and Agriculture, which describes an allergen as ‘an antigen that provokes an immune response’.

 

With specific reference to the products at issue in this dispute, we add that, in our understanding, allergens would be proteins generated through the expression of genes. Thus, the concern about potential allergenicity of GMOs relates to the effect of modified genes on protein composition in GM plants and the subsequent exposure of humans or animals to these proteins through the consumption of food or feedstuffs produced using the GM plants.”(606)

Inclusion of allergens in the categories within Annex A

485.     Having reviewed the definitions of allergens, the Panel in EC — Approval and Marketing of Biotech Products ruled that allergens could be considered as toxins in light of their definition and the damaging effect that they may have on life and health:

“[T]he Complaining Parties argue that ‘allergens’ would generally meet the definition of the term ‘toxins’ as it is used in Annex A(1)(b). We have stated earlier that the term ‘toxin’ in Annex A(1)(b) can be understood to refer to a poisonous substance produced by a micro-organism or other organism and acting as an antigen in the body. A ‘poison’ is commonly defined as ‘a substance that causes death or harm when introduced into or absorbed by a living organism’, or as ‘a substance that through its chemical action is able to kill, injure, or impair an organism’.

 

We have said that allergens may be understood as substances which act as antigens and cause a damaging immune response by the body in humans or animals. From the information submitted to us, we understand that such immune responses can be very damaging to health, and in some cases may even be fatal, e.g., in the event of an anaphylactic shock. In the light of this, it seems to us to be correct to characterize food allergens as substances which can ‘cause death or harm’ to health, or as substances which through their chemical action are able to ‘kill, injure or impair an organism’. Thus understood, the kind of food allergens which might be produced by GMOs can be appropriately viewed as poisonous substances produced by an organism and acting as an antigen in the body. Consequently, we think that for the specific purposes of Annex A(1) the term ‘toxins’ encompasses, inter alia, food allergens which might be produced by GMOs. We observe in this connection that we have seen no evidence establishing that the drafters of the SPS Agreement intended to exclude food allergens from the scope of the SPS Agreement in general, and the term ‘toxins’ in particular.”(607)

(d) Relationship between Annex A(1)(a) and Annex A(1)(b)

486.     In Australia — Salmon, the Panel examined whether an Australian prohibition on imports of dead salmon was a “sanitary measure” within the meaning of paragraph 1(b) of Annex A of the SPS Agreement. The Panel found that while the definition in Annex A(1)(a) is broad and covers measures intended to protect animal or plant life or health from risks arising as a result of pests and diseases, Annex A(1)(b) focuses on measures intended to protect human or animal life or health from disease-causing organisms contained in food, beverages or feedstuffs. The Panel held:

“In the circumstances at hand, we consider that the definition of a ‘sanitary measure’ in paragraph 1(a) encompasses the coverage sought by Australia under the definition in paragraph 1(b). The definition in paragraph 1(a) deals with risks arising from ‘the entry, establishment or spread of pests, diseases … or disease-causing organisms’ in general. In the context of disease-causing organisms, the definition in paragraph 1(b) is limited in the sense that it only addresses risks arising from ‘disease-causing organisms in foods, beverages or feedstuffs’ (hereafter also referred to as food-borne risks). We are of the view that, even though both definitions of a ‘sanitary measure’ invoked by Australia might be applicable to the measure in dispute, the objectives for which that measure is being applied are more appropriately covered by the definition in paragraph 1(a). These objectives have been clearly expressed by Australia on several occasions.”(608)

487.     With respect to the two definitions of risk assessment under paragraph 4, see paragraph 503 below.

(e) Annex A(1)(c)

(i) The issue of presence of allergens in the environment

488.     In the context of analysing the broader issue of potential allergenic effects of GMOs which are not used as or in foods within the meaning of Annex A(1)(c) of the SPS Agreement, the Panel in EC — Approval and Marketing of Biotech Products considered the issue of exposure of persons working, or otherwise coming into contact, with GMOs by means other than through food. For the Panel, what was at issue was the potential of GMOs to produce allergenic effects when not used as or in foods. The Panel took the view that if GMOs’ allergenicity was established in the latter context, they could be considered as pests:

“We consider that if interaction with, and exposure to, GMOs other than as or in a food produced allergenic effects in persons, the GMOs in question could be viewed as ‘pests’ within the meaning of Annex A(1). We recall our view that the term ‘pests’ in Annex A(1) encompasses plants which are destructive, or which cause harm to the health of other animals, plants or humans. We also recall our view that allergens may be understood as substances which cause a damaging immune response by the body in humans, and that such immune responses can be very damaging to health, and in some cases may even be fatal, e.g., in the event of an anaphylactic shock. In the light of this, we consider that to the extent a GM plant produces allergenic effects other than as a food, it would be a plant which causes harm to the health of humans and, as such, would qualify as a ‘pest’. We recognize that a GM crop producing this type of allergenic effects would often be cultivated intentionally. From the perspective of the farmer cultivating the GM crop, the GM crop would not, therefore, constitute a ‘pest’. However, from the perspective of the farm worker who is in contact with the crop in the field, or a person walking past the field, the GM crop may constitute a ‘pest’ if the person is hypersensitive to the allergen.”(609)

(ii) Possible health effects from increased herbicide use associated with GMOs

489.     In EC — Approval and Marketing of Biotech Products, the Panel discussed the issue of introduction of herbicide-resistant GM plants to the extent that this introduction might lead to the use of herbicides in the field when no herbicides were previously used and increase use of herbicides or use of different herbicides. As this introduction might in turn cause harm to human health, the Panel endorsed the European Communities’ hypothesis that the relevant harm deriving from the use of pesticides would not be the result of herbicide residues in the GM plant, but of exposure to the herbicide other than through the consumption of the GM plant. The Panel stated:

“[I]t may be that the European Communities’ concern about possible negative health effects relates to improper use, or unanticipated effects, of approved herbicides. We therefore proceed with our analysis, assuming that there may be situations where the use of approved herbicides could cause harm to the health of persons applying the herbicide in the field or otherwise coming into contact with it.

[I]n relation to the scenario involving adverse effects on human health, it is clear to us that the weeds against which a particular herbicide is used qualify as ‘pests’ within the meaning of Annex A(1), and that the herbicide use constitutes a pest control measure. We likewise consider that risks to human health resulting from the use of a herbicide, or of a different herbicide, may be viewed as arising indirectly from the entry, establishment or spread of weeds qua relevant pests.

The GM plants, the herbicide and the weeds being interlinked in this way, we consider that there is a rational relationship between controlling the release into the environment of herbicide tolerant GM plants and the purpose of protecting human health from risks arising indirectly from the entry, spread or establishment of weeds. We recall in this context that there is nothing in the text of Annex A(1) to suggest that the product subject to an SPS measure — in this case, a herbicide tolerant GM plant to be released into the environment — need itself be the pest which gives rise, directly or indirectly, to the risks from which the measure seeks to protect.”(610)

(f) Annex A(1)(d)

(i) other damage

490.     The Panel in EC — Approval and Marketing of Biotech Products analysed the term “other damage” as it is used in Annex A(1)(d) and concluded that it must comprise damage other than damage to the life or health of plants, animals or humans, because these are covered by paragraphs (1)(a), (1)(b) and (1)(c). The Panel noted that “other damage” could include a broad range of possibilities, including damage to property, economic damage and damage to the environment other than damage to the life or health of living organisms:

“The Panel considers that it may be inferred from the reference in Annex A(1)(d) to “other damage” (emphasis added) that like Annex A(1)(d), sub-paragraphs (a) through (c) of Annex A(1) refer to measures which are applied to protect from a certain kind of potential ‘damage’. The ‘damage’ at issue in sub-paragraphs (a) through (c) of Annex A(1) is damage to plant, animal or human life or health. It follows, therefore, that the category of ‘other damage’ covered by Annex A(1)(d) must comprise damage other than damage to the life or health of plants, animals or humans. This is indeed the view expressed by all of the Parties.

 

The residual category of ‘other damage’ is potentially very broad. In our view, ‘other damage’ could include damage to property, including infrastructure (such as water intake systems, electrical power lines, etc.). In addition, we think “other damage” could include economic damage (such as damage in terms of sales lost by farmers). The dictionary defines the term ‘damage’ as ‘physical harm impairing the value, usefulness, or normal function of something’ and ‘unwelcome and detrimental effects’, or ‘a loss or harm resulting from injury to person, property, or reputation’. These definitions cover harm resulting in a reduction of economic value, adverse economic effects, or economic loss. Also, interpreting ‘other damage’ to include economic damage is consistent with the context of Annex A(1)(d). Article 5.3 of the SPS Agreement states that relevant ‘economic factors’ to be taken into account in a risk assessment include ‘the potential damage in terms of loss of production or sales in the event of the entry, establishment or spread of a pest or a disease’. Thus, Article 5.3 shows that the SPS Agreement elsewhere uses the term ‘damage’ in an economic sense, and it does so in connection with damage from ‘pests’. Thus, Article 5.3 contemplates a similar situation to that contemplated in Annex A(1)(d).”(611)

(ii) Relationship with other provisions of the SPS Agreement

Article 5.3

491.     The Panel in EC — Approval and Marketing of Biotech Products held that Article 5.3 contemplates a similar situation to that contemplated in Annex A(1)(d) in the interpretation of the word “damage”. The Panel noted that the definition of “damage” covers harm resulting in a reduction of economic value, adverse economic effects, or economic loss.(612)

(g) Annex A(1) second paragraph

(i) General

492.     For a discussion of whether this paragraph provides for two elements — form and nature — that define SPS measures, refer to paragraphs 452 and 453 above.

493.     The Appellate Body in Australia — Apples discussed the meaning of the first line of Annex A(1) second paragraph: “Sanitary or phytosanitary measures include all relevant laws, decrees, regulations, requirements and procedures …”. The Appellate Body emphasized the significance of the words “include”, “all” and “relevant” and stated that:

“We note that this last sentence of Annex A(1) follows, and relates to, all of the first sentence, including all of the purposes enumerated in subparagraphs (a) through (d). The first part of this sentence contains a list of legal instruments linked by the conjunction ‘and’ (‘laws, decrees, regulations, requirements and procedures’). This list is modified by the words ‘include’ and ‘all relevant’. The word ‘relevant’ is, in our view, a key element within this sentence. We see ‘relevant’ as a reference back to the preceding sentence in Annex A(1), that is, to the list of specific purposes that are the defining characteristic of every SPS measure. The words ‘include’ and ‘all’, which also introduce the list of instruments, suggest that the list is both illustrative and expansive. Taken together, the words ‘include’ and ‘all relevant’ therefore suggest that measures of a type not expressly listed may nevertheless constitute SPS measures when they are ‘relevant’, that is, when they are ‘applied’ for a purpose that corresponds to one of those listed in subparagraphs (a) through (d). Conversely, the fact that an instrument is of a type listed in the last sentence of Annex A(1) is not, in itself, sufficient to bring such an instrument within the ambit of the SPS Agreement.”(613)

(ii) all relevant laws, decrees, regulations

494.     In EC — Approval and Marketing of Biotech Products, the Panel noted that the second paragraph of Annex A(1) provides that SPS measures include “all relevant laws, decrees [and] regulations,” which suggests that the SPS Agreement does not prescribe a particular legal form and that SPS measures may in principle take many different legal forms:

“Whether a particular DSU measure constitutes, at the same time, an SPS measure is to be determined, according to the above definition, by reference to such criteria as the objective of the measure, its form and its nature. Regarding the objective of SPS measures, subparagraphs (a) through (d) indicate that SPS measures must ‘be applied’ to protect against certain enumerated risks. Regarding the form of SPS measures, the second paragraph of the definition provides that SPS measures include ‘all relevant laws, decrees [and] regulations’. This enumeration suggests that the SPS Agreement does not prescribe a particular legal form and that SPS measures may in principle take many different legal forms. Finally, in relation to the nature of SPS measures, the second paragraph stipulates that SPS measures include ‘requirements and procedures’. The second paragraph then goes on to mention, by way of example, a number of relevant substantive requirements (prescribed end product criteria, prescribed quarantine treatments, certain packaging and labelling requirements, etc.) and procedures (testing procedures, inspection procedures, certification procedures, approval procedures, etc.). We note that the term ‘requirements’ is broad in scope. For instance, both an authorization to market a particular product and a ban on the marketing of a particular product may be considered ‘requirements’, in that one is effectively a requirement to permit the marketing of a product and the other a requirement to ban the marketing of a product.”(614)

(iii) requirements and procedures

495.     The Panel in EC — Approval and Marketing of Biotech Products found that the reference to “requirements and procedures” in the definition of an SPS measure, as contained in Annex A(1), does not include the application of such requirements and procedures. With respect to the European Communities’ general moratorium on approving the applications to place on the market genetically modified organisms, the Panel determined that the decision to apply a general moratorium was a decision concerning the application, or operation of procedures and as such was not an SPS measure within the meaning of Annex A(1)(615):

“Still in relation to the reference in the second paragraph of Annex A(1) to ‘requirements and procedures’, we note that no reference is made to the ‘application’ of ‘requirements and procedures’. This omission suggests that whereas requirements and procedures as such may constitute SPS measures, the application of such requirements and procedures would not, itself, meet the definition of an SPS measure. The provisions of the SPS Agreement support the view that the omission of a reference to ‘application’ is deliberate, for there are several provisions which establish obligations specifically with regard to the ‘application’ of SPS measures. For instance, Article 2.3, second sentence, states that SPS measures ‘shall not be applied in a manner which constitutes a disguised restriction on international trade’. Similarly, Article 10.1 states in relevant part that ‘[i]n the preparation and application of [SPS] measures, Members shall take account of the special needs of developing country Members’. Finally, we note that Article 8 draws a distinction between, on the one hand, the ‘operation’ of procedures and, on the other hand, the ‘procedures’, which, themselves, are defined in Annex A(1) as SPS measures.

We have characterized the decision to apply a general moratorium on approvals as a procedural decision to delay final substantive approval decisions. In our assessment, this procedural decision did not impose a substantive ‘requirement’ in relation to biotech products with pending or future applications. It neither approved nor rejected applications. Similarly, we are of the view that the decision to delay final substantive approval decisions cannot appropriately be viewed as providing for a ‘procedure’, considering that it did not itself establish a new procedure or amend the existing EC approval procedures. We have said that the decision to delay final approval decisions was procedural in nature insofar as it was a decision relating to the application, or operation, of the existing EC approval procedures. However, the mere fact that the decision in question related to the application, or operation, of procedures does not turn that decision into a procedure for the purposes of Annex A(1).

 

Based on these considerations, we conclude that the European Communities’ decision to apply a general moratorium on approvals was a decision concerning the application, or operation, of procedures. As such, it did not provide for ‘requirements [or] procedures’ within the meaning of Annex A(1).”(616)

496.     Although the Panel in EC — Approval and Marketing of Biotech Products found that the phrase “requirements and procedures” did not include the application of those requirements and procedures, it did find that the term “requirements” is unqualified and can apply to general regulatory requirements or requirements imposed on a specific product:

“It should be added in this context that the term ‘requirements’ as it appears in the second paragraph of Annex A(1) is unqualified and thus is applicable both to requirements which are generally applicable and to requirements which have been imposed on specific products.(617) In our view, the application of a generally applicable SPS ‘requirement’ (e.g., a pre-marketing approval requirement for biotech products) to a specific product may result in a different, product-specific SPS ‘requirement’ (e.g., a ban on the marketing of a specific biotech product). In other words, there may be cases where the application of an SPS ‘requirement’ and, hence, of an SPS measure, may give rise to a new SPS requirement and, hence, a new SPS measure. Applying these considerations to Article 5.1, it could be argued that a generally applicable SPS requirement as set out, e.g., in a law and a product-specific decision based on that requirement might both constitute SPS measures which must be based on a risk assessment.”(618)

(iv) labelling requirements

General

497.     In EC — Approval and Marketing of Biotech Products, the Panel ruled that Annex A of the SPS Agreement encompasses not only labelling requirements related to food safety(619) but also other labelling requirements. The Panel concluded that the labelling requirement in the measure at issue in that dispute fell within the scope of the SPS Agreement:

“We note that Annex A(1) to the SPS Agreement specifies that SPS measures include, ‘inter alia‘, ‘packaging and labelling requirements directly related to food safety’. As is indicated by the term ‘inter alia’ in Annex A(1), the requirements specifically mentioned are not necessarily intended to exclude similar requirements. Hence, while recognizing that labelling requirements imposed on food safety grounds may be more common, we consider that labelling requirements imposed for the purpose of protecting plant, animal or human health from the risks covered in Annex A(1)(a) and (c), or for the purpose of preventing or limiting other damage from the risk covered in Annex A(1)(d), would likewise be subject to the disciplines of the SPS Agreement.

 

… To the extent [the labelling requirement in Directive 2001/18] is applied to protect the environment, it would fall within the scope of Annex A(1)(a), (b) or (d), depending on what the adverse effects would be. To the extent it is applied to protect human health, it would fall within the scope of Annex A(1)(b) or (c). Thus, we consider that the labelling requirement in question does not remove Directive 2001/18 from the scope of the SPS Agreement.”(620)

498.     The Panel in EC — Approval and Marketing of Biotech Products, having agreed that labelling requirements fell within the scope of the SPS Agreement, declined however, to rule on the consistency of these measures with the Agreement, arguing that such an examination goes beyond its mandate in the dispute at issue:

“We stress that our finding that the labelling requirement in Directive 2001/18 falls within the scope of the SPS Agreement does not necessarily imply that the requirement is consistent with the provisions of that Agreement. The consistency of the relevant requirement with the SPS Agreement is an issue that is not before us, and so we refrain from expressing a view on it.”(621)

Purpose of labelling requirements

499.     With respect to the relevance of labelling requirements in the context of Annex A, the Panel in EC — Approval and Marketing of Biotech Products examined whether the labelling requirement in one of the measures at issue is linked to the purpose of protecting human health and the environment and hence is a measure applied for one of the purposes identified in Annex A(1)(622):

“Explicit identification of the presence of a GMO alerts and sensitizes operators and users of a product containing or consisting of a GMO to the possibility that any observed adverse effects of the product on human health or the environment might be attributable to the presence of a GMO as opposed to other factors. Increased awareness of operators and users of the presence of GMOs may be presumed to lead to a situation where more observations which could be indicative of risks associated with a GMO are reported to consent holders and competent authorities, or where relevant observations are reported more promptly. Explicit identification of the presence in a product of a GMO may thus be presumed to result in consent holders and competent authorities being better informed, or informed more promptly, than they otherwise would be of unanticipated risks of a GMO to human health and the environment, allowing them to determine whether additional measures are necessary to protect human health and the environment.

 

Additionally, we observe that explicit identification of the presence in a product of a GMO serves the purpose of health and/or environmental protection in situations of unexpected, accidental release of a GMO — e.g., in connection with its storage or transport — into an environment in which the GMO is not be used or in which the potential for adverse effects has not specifically been considered in the risk assessment. In such situations, it can, in our view, be presumed that explicit identification of the presence in a product of a GMO will result in consent holders and competent authorities being more promptly and more effectively informed of any relevant incidents than would be the case if the product being stored or transported did not explicitly identify the presence of a GMO. To use again the example of storage or transport, we note that persons storing or transporting GMOs (e.g., the driver of a transportation vehicle) need not necessarily be persons under the supervision of the producer or user of GMOs or persons otherwise familiar with the specific characteristics of the product they are handling. For such persons in particular, explicit identification of the presence of a GMO renders more likely, and facilitates, an adequate and prompt response in situations of unexpected, accidental release of a GMO into the environment.”(623)

(v) directly related to food safety

500.     In EC — Approval and Marketing of Biotech Products, the Panel noted that “[t]he term ‘food safety’ as it is used in the Agreement encompasses the safety of such substances as food additives, contaminants (including pesticide residues), etc.”.(624)

2. Annex A(3): “international standards, guidelines and recommendations”

(a) Relationship with Articles 3.1 and 3.2

501.     The Appellate Body in US/Canada — Continued Suspension noted that the relevant “international standards, guidelines or recommendations” that are referred to in Articles 3.1 and 3.2 are those set by the international organizations listed in Annex A, paragraph 3 of the SPS Agreement, which includes Codex as the relevant standard-setting organization for matters of food safety.(625)

502.     The Appellate Body in Australia — Apples noted that Article 5.1 requires Members performing risk assessments to take “into account risk assessment techniques developed by the relevant international organizations”. In this regard, the Appellate Body acknowledged that according to Annex A(3)(c), the international standards, guidelines and recommendations relevant for plant health are those developed under the auspices of the IPPC in cooperation with the regional organizations working within the framework of the IPPC.(626)

3. Annex A(4): “risk assessment”

(a) General

503.     The Panel in Australia — Salmon (Article 21.5 — Canada) held that a requirement that Members assess risk “according to the [sanitary] measures which might be applied” could not be read into the definition of “risk assessment”; rather, the requirement of a linkage between the risk assessment on the one hand, and the final measure and the necessity to use such measure on the other, were to be derived from other provisions of the SPS Agreement:

“Canada’s claim … raises the question of whether the definition of risk assessment as such, requiring Members to assess risk ‘according to the [sanitary] measures which might be applied’, can be construed so as to include the obligation to make the link between the assessment, the measures finally selected and the necessity to use these measures in order to achieve the [appropriate level of sanitary or phytosanitary protection]. We find it difficult to read such a requirement into paragraph 4 of Annex A.

 

In our view, the rights and obligations in respect of these linkages are set out not in the definition of risk assessment itself — which logically precedes the selection of measures — but, inter alia, in the obligation to base sanitary measures on a risk assessment in Article 5.1 and to ensure that sanitary measures are not more trade restrictive than required to achieve the [appropriate level of sanitary or phytosanitary protection] in the sense of Article 5.6. To examine these questions of relationship between the risk assessment, the measures selected and the [appropriate level of sanitary or phytosanitary protection] under the definition of risk assessment — as Canada … seem[s] to do — would, in our view, run the risk of adding to or diminishing the more specific rights and obligations of Members set out in other SPS obligations, contrary to Article 19.2 of the DSU.

 

… In any event, we prefer to address this question of relationship between the measures selected and the risk assessment under the obligation to base measures on a risk assessment pursuant to Article 5.1 rather than under the very definition of risk assessment referred to in the same provision.”(627)

(b) First part of Annex A(4): First definition of risk assessment

(i) Types of risks

504.     The Appellate Body in Australia — Salmon found that the first type of risk assessment in Annex A(4) is substantially different from the second type of risk assessment contained in the same paragraph. While the second requires only the evaluation of the potential for adverse effects on human or animal health, the first type of risk assessment demands an evaluation of the likelihood of entry, establishment or spread of a disease, and of the associated potential biological and economic consequences.(628)

505.     The Panel in Australia — Salmon, in statements affirmed by the Appellate Body(629), discussed the types of risks set that must be examined in the first definition of “risk assessment” in Annex A(4):

“Examining the definition of risk assessment applicable to the measure at issue, i.e., 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’, we consider, first of all, that the risk thus to be assessed includes (1) the risk of ‘entry, establishment or spread’ of a disease and (2) the risk of the ‘associated potential biological and economic consequences’. When we refer hereafter to the risk related to a disease, this risk thus includes the risk of entry, establishment or spread of that disease as well as the biological and economic consequences associated therewith.

In this dispute, the measure at issue is intended to protect animal health as a sanitary measure defined in paragraph 1(a) of Annex A and is to be based on a risk assessment in the sense of the first definition in paragraph 4 of Annex A. According to this first definition in paragraph 4, such risk assessment has to take into account risks arising not only from the ‘entry, establishment or spread of a pest or disease’, but also from the ‘associated biological and economic consequences’.”(630)

(ii) Elements of a risk assessment

506.     On the three aspects of the first type of risk assessment, see paragraph 147 above.

(iii) Identifying risk on a disease-specific basis

507.     The Panel in Australia — Salmon stated that where several diseases were involved in the risk assessment, such risk assessment at least had to identify the risk on a disease-specific basis. The Panel also referred to the Appellate Body’s findings in EC — Hormones to this effect:

“[G]iven the definition of risk assessment applicable in this case (the ‘evaluation of the likelihood of entry, establishment or spread of a … disease’, in the singular form), a risk assessment for the measure at issue in this dispute at least has to identify risk on a disease specific basis, i.e., it has to identify the risk for any given disease of concern separately, not simply address the overall risk related to the combination of all diseases of concern. … The experts advising the Panel on this issue confirmed this. In the EC — Hormones case as well, both the Panels and the Appellate Body required some degree of specificity for a risk assessment — or a study or report allegedly part thereof — to be in accordance with the requirements imposed in Article 5.1.”(631)

(iv) likelihood

508.     In Australia — Salmon, the Appellate Body recalled its finding in EC — Hormones where it had distinguished between the terms “potential” and “probability”. Finding that the term “likelihood” was synonymous with the term “probability”, the Appellate Body disagreed with the Panel’s finding that a risk assessment required only some evaluation of likelihood or probability:

“We note that the first definition in paragraph 4 of Annex A speaks about the evaluation of ‘likelihood.’ In our report in European Communities — Hormones, we referred to the dictionary meaning of ‘probability’ as ‘degrees of likelihood’ and ‘a thing that is judged likely to be true’, for the purpose of distinguishing the terms ‘potential’ and ‘probability’. For the present purpose, we refer in the same manner to the ordinary meaning of ‘likelihood’, and we consider that it has the same meaning as ‘probability’. On this basis, as well as on the basis of the definition of ‘risk’ and ‘risk assessment’ developed by the Office international des épizooties (‘OIE’) and the OIE Guidelines for Risk Assessment, we maintain that for a risk assessment to fall within the meaning of Article 5.1 and the first definition in paragraph 4 of Annex A, it is not sufficient that a risk assessment conclude that there is a possibility of entry, establishment or spread of diseases and associated biological and economic consequences. A proper risk assessment of this type must evaluate the ‘likelihood’, i.e., the ‘probability’, of entry, establishment or spread of diseases and associated biological and economic consequences as well as the ‘likelihood’, i.e., ‘probability’, of entry, establishment or spread of diseases according to the SPS measures which might be applied.

 

We note that, although the Panel stated that the definition of a risk assessment for this type of measure requires an ‘evaluation of the likelihood’, for the purpose of satisfying the second and third requirements, it subsequently was hesitant in applying these requirements, by stating or suggesting in paragraphs 8.80, 8.83, 8.89 and 8.91, that some evaluation of the likelihood or probability would suffice. We consider this hesitation unfortunate. We do not agree with the Panel that a risk assessment of this type needs only some evaluation of the likelihood or probability. The definition of this type of risk assessment in paragraph 4 of Annex A refers to ‘the evaluation of the likelihood’ and not to some evaluation of the likelihood. We agree, however, with the Panel’s statements in paragraph 8.80 that the SPS Agreement does not require that the evaluation of the likelihood needs to be done quantitatively. The likelihood may be expressed either quantitatively or qualitatively. Furthermore, we recall, as does the Panel, that we stated in European Communities — Hormones that there is no requirement for a risk assessment to establish a certain magnitude or threshold level of degree of risk.”(632)

509.     The Panel in Japan — Apples recalled the Appellate Body’s finding in EC — Hormones that the evaluation of likelihood involves more than a mere identification of “possibilities” and requires an assessment of probability of entry, which implies a higher degree or a “threshold of potentiality or possibility”. The Panel added that such probability need not be expressed in quantitative terms, but may be expressed in qualitative terms.(633)

510.     In EC — Approval and Marketing of Biotech Products, the Panel considered that the failure to evaluate likelihood in a study meant that the study did not meet the definition of a risk assessment:

“Given the lack of evaluation of likelihood in the Hoppichler study, we consider that the study does not meet the definition of a risk assessment as provided in Annex A(4), and therefore does not constitute a risk assessment within the meaning of Annex A(4) and Article 5.1.”(634)

(v) according to the [SPS] measures which might be applied

511.     Regarding the requirement to evaluate the likelihood of entry, establishment or spread of the diseases according to the SPS measures which might be applied, the Appellate Body in Japan — Apples agreed with the Panel that the phrase “according to the [SPS] measures which might be applied” implies that a risk assessment should not be limited to an examination of the measure already in place:

“[A]ccording to the Panel, the terms in the definition of ‘risk assessment’ set out in paragraph 4 of Annex A to the SPS Agreement — more specifically, the phrase ‘according to the sanitary or phytosanitary measures which might be applied’ — suggest that ‘consideration should be given not just to those specific measures which are currently in application, but at least to a potential range of relevant measures.’ …

 

The definition of ‘risk assessment’ in the SPS Agreement requires that the evaluation of the entry, establishment or spread of a disease be conducted ‘according to the sanitary or phytosanitary measure which might be applied.’ We agree with the Panel that this phrase ‘refers to the measures which might be applied, not merely to the measures which are being applied.’ The phrase ‘which might be applied’ is used in the conditional tense. In this sense, ‘might’ means: ‘were or would be or have been able to, were or would be or have been allowed to, were or would perhaps’. We understand this phrase to imply that a risk assessment should not be limited to an examination of the measure already in place or favoured by the importing Member. In other words, the evaluation contemplated in paragraph 4 of Annex A to the SPS Agreement should not be distorted by preconditioned views on the nature and the content of the measure to be taken; nor should it develop into an exercise tailored to and carried out for the purpose of justifying decisions ex post facto.”(635)

512.     In US/Canada — Continued Suspension, the Appellate Body stated that upon completion of a risk assessment, Members are not required to adopt an SPS measure. The decision to adopt an SPS measure or not is dependent on the outcome of the risk assessment. The Appellate Body considered that Members may not deem it appropriate to adopt SPS measure if the result of the risk assessment does not compel to adopt such measure:

“Whilst WTO Members have the right to take SPS measures, they are not required to do so. The risk assessment may conclude that there is no ascertainable risk, in which case no SPS measure can be taken. Alternatively, a WTO Member may conclude that an SPS measure is not necessary in the light of the risks determined in the risk assessment and the acceptable level of protection determined by that WTO Member.”(636)

513.     With respect to the Appellate Body’s position on the Members’ discretion to adopt or not to adopt an SPS measure following the completion of a risk assessment, see also paragraph 169 above.

(vi) Evaluation of likelihood of entry, establishment or spread of a pest or disease

Risk assessment to be specific to the product at issue

514.     In Japan — Apples, the Appellate Body upheld the Panel’s finding that Japan’s risk assessment did not evaluate the likelihood of entry, establishment or spread of fire blight because its risk assessment was not specific enough about the product at issue — apple fruit:

“[U]nder the SPS Agreement, the obligation to conduct an assessment of ‘risk’ is not satisfied merely by a general discussion of the disease sought to be avoided by the imposition of a phytosanitary measure.(637) The Appellate Body found the risk assessment at issue in EC — Hormones not to be ‘sufficiently specific’ even though the scientific articles cited by the importing Member had evaluated the ‘carcinogenic potential of entire categories of hormones, or of the hormones at issue in general.’(638) In order to constitute a ‘risk assessment’ as defined in the SPS Agreement, the Appellate Body concluded, the risk assessment should have reviewed the carcinogenic potential, not of the relevant hormones in general, but of ‘residues of those hormones found in meat derived from cattle to which the hormones had been administered for growth promotion purposes’. Therefore, when discussing the risk to be specified in the risk assessment in EC — Hormones, the Appellate Body referred in general to the harm concerned (cancer or genetic damage) as well as to the precise agent that may possibly cause the harm (that is, the specific hormones when used in a specific manner and for specific purposes).

 

In this case, the Panel found that the conclusion of the 1999 PRA with respect to fire blight was ‘based on an overall assessment of possible modes of contamination, where apple fruit is only one of the possible hosts/vectors considered.’ … Given that the measure at issue relates to the risk of transmission of fire blight through apple fruit, in an evaluation of whether the risk assessment is ‘sufficiently specific to the case at hand’, the nature of the risk addressed by the measure at issue is a factor to be taken into account. In light of these considerations, we are of the view that the Panel properly determined that the 1999 PRA ‘evaluat[ion of] the risks associated with all possible hosts taken together’ was not sufficiently specific to qualify as a ‘risk assessment’ under the SPS Agreement for the evaluation of the likelihood of entry, establishment or spread of fire blight in Japan through apple fruit.”(639)

(c) Second part of Annex A(4): Second definition of risk assessment

(i) Distinction from the first definition of risk assessment

515.     With respect to the second definition of “risk assessment” contained in Annex A(4), the Appellate Body in Australia — Salmon noted that while the first definition speaks of “likelihood”, the second definition speaks of “potential” for adverse effects:

“We note that the first type of risk assessment in paragraph 4 of Annex A is substantially different from the second type of risk assessment contained in the same paragraph. While the second requires only the evaluation of the potential for adverse effects on human or animal health, the first type of risk assessment demands an evaluation of the likelihood of entry, establishment or spread of a disease, and of the associated potential biological and economic consequences. In view of the very different language used in paragraph 4 of Annex A for the two types of risk assessment, we do not believe that it is correct to diminish the substantial differences between these two types of risk assessments, as the European Communities seems to suggest when it argues that ‘the object, purpose and context of the SPS Agreement indicate that no greater level of probability can have been intended for the first type of risk assessment than for the second type, [as b]oth types can apply both to human life or health and to animal or plant life or health’. (Third participant’s submission of the European Communities, para. 7).”(640)

516.     With respect to the second definition of risk assessment, the Panel in EC — Hormones described risk assessment as a two-step process that “should (i) identify the adverse effects on human health (if any) arising from the presence of the hormones at issue when used as growth promoters inmeat …, and (ii) if any such adverse effects exist, evaluate the potential or probability of occurrence of such effects”. On appeal, the Appellate Body did not find the Panel’s two-step process to be substantially wrong, save for the Panel’s use of “probability” as an alternative term for “potential”. The Appellate Body found that the ordinary meaning of “potential” relates to “possibility” and is different from the ordinary meaning of “probability”. “Probability” implies a higher degree or a threshold of potentiality or possibility. It thus appears that here the Panel introduces a quantitative dimension to the notion of risk.(641)

(ii) No requirement to quantify the level of risk

517.     With respect to the relevance of the second definition of “risk assessment” within Annex A, the Appellate Body in US/Canada — Continued Suspension reasoned that the Panel’s reference to “potential occurrence” of adverse effects when asking questions to the experts, does not amount to the requirement of a quantitative method of risk assessment. On this basis, the Appellate Body also contemplated the relevance of potentiality for the purpose of a “risk assessment” under the second sentence of Paragraph A:

“Although the definition of a risk assessment does not require WTO Members to establish a minimum magnitude of risk, it is nevertheless difficult to understand the concept of risk as being devoid of any indication of potentiality. A risk assessment is intended to identify adverse effects and evaluate the possibility that such adverse effects might arise. This distinguishes an ascertainable risk from theoretical uncertainty. However, the assessment of risk need not be expressed in numerical terms or as a minimum quantification of the level of risk. We are also mindful that the risk assessment at issue in this case concerns the potential for adverse effects under the second sentence of paragraph 4 of Annex A and not an evaluation of likelihood under the first sentence of paragraph 4.(642)

[W]e consider that the Panel’s reference to ‘potential occurrence’ of adverse health effects could be read consistently with the definition of a risk assessment in paragraph 4 of Annex A of the SPS Agreement, as interpreted by the Appellate Body. Accordingly, we dismiss the European Communities’ claim that the Panel incorrectly interpreted Article 5.1 and paragraph 4 of Annex A of the SPS Agreement as requiring quantification of risk.”(643)

518.     On the basis of its ruling that a risk assessment need not be expressed in numerical terms, the Appellate Body in US/Canada — Continued Suspension held that the Panel’s reference to magnitude when appraising the European Communities’ risk assessment did not amount to a requirement that the European Communities quantify the level of risk:

“[A] ‘risk assessment’ involves an indication of potentiality, even though this need not be expressed in numerical terms or as a minimum quantification of the level of risk. In this sense, the Panel’s reference to ‘magnitude’ is in our view not sufficient to establish that the Panel incorrectly interpreted Article 5.1 and paragraph 4 of Annex A as requiring a quantitative risk assessment.

 

… For these reasons, we consider that the Panel’s reference to ‘potential occurrence’ of adverse health effects could be read consistently with the definition of a risk assessment in paragraph 4 of Annex A of the SPS Agreement, as interpreted by the Appellate Body.”(644)

(iii) Methodology of risk assessment

Two-step analysis

519.     In EC — Hormones, with respect to the methodology for a risk assessment under the second definition of paragraph 4 of Annex A of the SPS Agreement, the Panels stated that “in this dispute, a risk assessment carried out in accordance with the SPS Agreement should (i) identify the adverse effects on human health (if any) arising from the presence of the hormones at issue when used as growth promoters in meat or meat products, and (ii) if any such adverse effects exist, evaluate the potential or probability of occurrence of these effects”.(645) The Appellate Body did not disagree with the Panels’ two-step analytical approach but cautioned against equating the terms “potential” and “probability”:

“Although the utility of a two-step analysis may be debated, it does not appear to us to be substantially wrong. What needs to be pointed out at this stage is that the Panel’s use of ‘probability’ as an alternative term for ‘potential’ creates a significant concern. The ordinary meaning of ‘potential’ relates to ‘possibility’ and is different from the ordinary meaning of ‘probability’. ‘Probability’ implies a higher degree or a threshold of potentiality or possibility. It thus appears that here the Panel introduces a quantitative dimension to the notion of risk.”(646)

Specific attribution of risk

520.     The Appellate Body in Japan — Apples agreed with Japan that, whether to analyse the risk on the basis of the particular pest or disease or on the basis of a particular commodity, is a “matter of methodology” that lies within the discretion of the importing Member. However, the Appellate Body found that the Panel did not suggest, as Japan had argued, that there was an obligation to follow any particular methodology in conducting a risk assessment. The Appellate Body emphasized that Members are free to consider, in their risk analysis, multiple agents in relation to one disease, provided that the risk assessment attributes a likelihood of entry, establishment or spread of the disease to each agent specifically:

“Japan contends that the ‘methodology’ of the risk assessment is not directly addressed by the SPS Agreement. In particular, Japan suggests that, whether to analyze the risk on the basis of the particular pest or disease, or on the basis of a particular commodity, is a ‘matter of methodology’ not directly addressed by the SPS Agreement. We agree. Contrary to Japan’s submission, however, the Panel’s reading of EC — Hormones does not suggest that there is an obligation to follow any particular methodology for conducting a risk assessment. In other words, even though, in a given context, a risk assessment must consider a specific agent or pathway through which contamination might occur, Members are not precluded from organizing their risk assessments along the lines of the disease or pest at issue, or of the commodity to be imported. Thus, Members are free to consider in their risk analysis multiple agents in relation to one disease, provided that the risk assessment attribute a likelihood of entry, establishment or spread of the disease to each agent specifically. Members are also free to follow the other ‘methodology’ identified by Japan and focus on a particular commodity, subject to the same proviso.”(647)

(d) Distinction between “risk assessment” and “risk management”

521.     In EC — Hormones, the Panel sought to distinguish between the concepts of risk assessment and risk management, in determining what could properly be described as a risk assessment within the meaning of Article 5 and Annex A of the SPS Agreement. The Appellate Body rejected this distinction noting that the term “risk management” does not appear in the SPS Agreement:

“The second preliminary consideration relates to the Panel’s effort to distinguish between ‘risk assessment’ and ‘risk management’. The Panel observed that an assessment of risk is, at least with respect to risks to human life and health, a ‘scientific’ examination of data and factual studies; it is not, in the view of the Panel, a ‘policy’ exercise involving social value judgments made by political bodies. The Panel describes the latter as ‘non-scientific’ and as pertaining to ‘risk management’ rather than to ‘risk assessment’. We must stress, in this connection, that Article 5 and Annex A of the SPS Agreement speak of ‘risk assessment’ only and that the term ‘risk management’ is not to be found either in Article 5 or in any other provision of the SPS Agreement. Thus, the Panel’s distinction, which it apparently employs to achieve or support what appears to be a restrictive notion of risk assessment, has no textual basis. The fundamental rule of treaty interpretation requires a treaty interpreter to read and interpret the words actually used by the agreement under examination, and not words which the interpreter may feel should have been used.”(648)

522.     In US/Canada — Continued Suspension, the Appellate Body, recalling its ruling in EC — Hormones, reiterated that the term “risk management” is not found in the SPS Agreement. The Appellate Body however acknowledged that Codex draws a distinction between “risk management” and “risk assessment”:

“We understand that Codex draws a distinction between ‘risk assessment’ and ‘risk management’. It defines ‘risk management’ as ‘the process, distinct from risk assessment, of weighing policy alternatives … considering risk assessment and other factors relevant for the health protection of consumers and for the promotion of fair trade practices, and, if needed, selecting appropriate prevention and control options’. In EC — Hormones, the Appellate Body noted that the SPS Agreement does not refer to the concept of ‘risk management’ and it rejected the Panel’s restrictive interpretation of a ‘risk assessment’ based on that distinction.(649)”(650)

523.     The Appellate Body in US/Canada — Continued Suspension considered the Panel’s distinction between risk assessment and risk management to be rigid, equating this distinction to the Panel’s exclusion of risks arising from misuse or abuse in the administration of hormones. The Appellate Body ruled that these risks are of utmost relevance:

“We find it difficult to reconcile the Panel’s understanding of EC — Hormones with what the Appellate Body held in that Report. As we noted above, in that case, the Appellate Body rejected the rigid distinction drawn by the Panel between ‘risk assessment’ and ‘risk management’ …

 

Subsequently in the same Report, the Appellate Body reiterated its view that ‘the concept of “risk management” is not mentioned in any provision of the SPS Agreement and, as such, cannot be used to sustain a more restrictive interpretation of “risk assessment” than is justified by the actual terms of Article 5.2, Article 8 and Annex C of the SPS Agreement’.

 

Therefore, in our view, the Panel’s interpretation of ‘risk assessment’ resulted in the same ‘restrictive notion of risk assessment’ that the Appellate Body found to be erroneous in EC — Hormones. The Panel sought in this case to rewrite the Appellate Body Report in EC — Hormones and to re-establish the rigid distinction between ‘risk assessment’ and ‘risk management’ that the Appellate Body had rejected in that case.”(651)

524.     Finally, the Appellate Body in US/Canada — Continued Suspension ruled that the Panel’s dismissal of risks arising from abuse or misuse in the administration of hormones amounted to an incorrect application of the provisions of Article 5.1 and Annex A of the SPS Agreement:

“The European Communities made it clear that the risks of abuse or misuse were a relevant consideration in its risk assessment. This is confirmed in the 1999 and 2002 Opinions. At least two of the scientific experts consulted by the Panel recognized that the misuse or abuse in the administration of the hormones could give rise to adverse effects. The Panel had a duty to engage with this evidence and with the discussion of this evidence in the SCVPH Opinions. By summarily dismissing the evidence on the misuse or abuse in the administration of the hormones and the consequent conclusions in the SCVPH Opinions in the manner that it did, the Panel incorrectly applied Article 5.1 and the definition of ‘risk assessment’ in Annex A of the SPS Agreement, as interpreted by the Appellate Body.”(652)

525.     For additional information on the distinction between “risk assessment” and “risk management” see paragraph 131 above.

526.     With respect to the analysis addressing the requirement for risks arising from abuse of controlled substances, see Article 5.2 above.

(e) Relationship with other provisions of the SPS Agreement

527.     The Panel in US — Poultry (China) considered that in determining whether a measure is based on a risk assessment within the meaning of Article 5.1 of the SPS Agreement, one needs to first determine whether a risk assessment was conducted at all. The Panel stated that “[i]n order to do so, it is helpful to start by looking into what a risk assessment is, in light of the definition in Annex A(4)”.(653)

528.     The Panel in US — Poultry (China) discussed the relationship between the SPS measures as identified in Annex A(1)(a)(d) and the two types of risk assessment identified in Annex A(4). The Panel stated:

“[I]t would seem that SPS measures under Annex A(1)(a) and (c) would require risk assessments conducted pursuant to the definition under the first sentence of Annex A(4) while those which satisfy the definition of an SPS measure under Annex A(1)(b) would require that the risk assessment be conducted pursuant to the second sentence of Annex A(4).”(654)

4. Annex A(5): “appropriate level of protection”

(a) General

(i) Right to determine the appropriate level of protection

529.     The Appellate Body in Australia — Salmon held that the determination of the appropriate level of protection, a notion defined in Annex A(5), is a prerogative of the Member concerned and not of a panel or the Appellate Body.(655)

(ii) Relationship between the risk assessmentand the appropriate level of protection

530.     In US/Canada — Continued Suspension, the Appellate Body reasoned that the choice of an appropriate level of protection has significant bearing on the scope of the risk assessment to be performed by a Member. Reflecting on this statement, the Appellate Body considered that the same remains true in case a Member chooses a protection measure that is more restrictive than an existing international standard. However, the Appellate Body cautioned that the chosen level of protection should not influence the outcome of the risk assessment. The risk assessment must remain an objective and rigorous process:

“The risk assessment cannot be entirely isolated from the appropriate level of protection. There may be circumstances in which the appropriate level of protection chosen by a Member affects the scope or method of the risk assessment. This may be the case where a WTO Member decides not to adopt an SPS measure based on an international standard because it seeks to achieve a higher level of protection. In such a situation, the fact that the WTO Member has chosen to set a higher level of protection may require it to perform certain research as part of its risk assessment that is different from the parameters considered and the research carried out in the risk assessment underlying the international standard. However, the chosen level of protection must not affect the rigour or objective nature of the risk assessment, which must remain, in its essence, a process in which possible adverse effects are evaluated using scientific methods.(656) Likewise, whatever the level of protection a Member chooses does not pre-determine the results of the risk assessment. Otherwise, the purpose of performing the risk assessment would be defeated.”(657)

531.     See also paragraphs 178180 above on the relationships between the risk assessment and the appropriate level of protection.

(iii) Relationship between the SPS measureand the appropriate level of protection

532.     In Australia — Salmon, the Appellate Body stressed that the “appropriate level of protection” established by a Member and the “SPS measure” have to be clearly distinguished. The first is an objective, the second is an instrument chosen to attain or implement that objective:(658)

“It can be deduced from the provisions of the SPS Agreement that the determination by a Member of the ‘appropriate level of protection’ logically precedes the establishment or decision on maintenance of an ‘SPS measure’.”(659)

533.     The Panel in Australia — Apples noted that SPS measures are indicative — although not necessarily conclusive — of a Member’s appropriate level of protection as defined by Annex A(5) of the SPS Agreement.(660)

(b) Relationship with other provisions of the SPS Agreement

(i) Article 3.3

534.     See paragraph 90 above.

(ii) Article 5.4

535.     Refer to paragraphs 207208 above.

(iii) Article 5.5

536.     For a detailed discussion of the application of the term “appropriate level of protection” in Article 5.5, refer to the Section on Article 5.5 above.

(iv) Article 5.6

537.     A Member’s appropriate level of protection is to be taken into account when a Panel or the Appellate Body is making a determination on a violation of Article 5.6. See the Section on Article 5.6 above.

(v) Article 5.7

538.     A Member’s chosen level of protection is irrelevant when applying the requirement to seek to obtain more information and review the provisional SPS measures within a reasonable period of time. See paragraph 320 above.

 

XVII. Annex B     back to top

A. Text of Annex B

Annex B: Transparency of sanitary and phytosanitary regulations

Publication of regulations

 

1.     Members shall ensure that all sanitary and phytosanitary regulations(5) which have been adopted are published promptly in such a manner as to enable interested Members to become acquainted with them.

 

(footnote original) 5 Sanitary and phytosanitary measures such as laws, decrees or ordinances which are applicable generally.

 

2.     Except in urgent circumstances, Members shall allow a reasonable interval between the publication of a sanitary or phytosanitary regulation and its entry into force in order to allow time for producers in exporting Members, and particularly in developing country Members, to adapt their products and methods of production to the requirements of the importing Member.

 

Enquiry points

 

3.     Each Member shall ensure that one enquiry point exists which is responsible for the provision of answers to all reasonable questions from interested Members as well as for the provision of relevant documents regarding:

 

(a)     any sanitary or phytosanitary regulations adopted or proposed within its territory;

 

(b)     any control and inspection procedures, production and quarantine treatment, pesticide tolerance and food additive approval procedures, which are operated within its territory;

 

(c)     risk assessment procedures, factors taken into consideration, as well as the determination of the appropriate level of sanitary or phytosanitary protection;

 

(d)     the membership and participation of the Member, or of relevant bodies within its territory, in international and regional sanitary and phytosanitary organizations and systems, as well as in bilateral and multilateral agreements and arrangements within the scope of this Agreement, and the texts of such agreements and arrangements.

 

4.     Members shall ensure that where copies of documents are requested by interested Members, they are supplied at the same price (if any), apart from the cost of delivery, as to the nationals(6) of the Member concerned.

 

(footnote original) 6 When “nationals” are referred to in this Agreement, the term shall be deemed, in the case of a separate customs territory Member of the WTO, to mean persons, natural or legal, who are domiciled or who have a real and effective industrial or commercial establishment in that customs territory.

 

 Notification procedures

 

5.     Whenever an international standard, guideline or recommendation does not exist or the content of a proposed sanitary or phytosanitary regulation is not substantially the same as the content of an international standard, guideline or recommendation, and if the regulation may have a significant effect on trade of other Members, Members shall:

 

(a)     publish a notice at an early stage in such a manner as to enable interested Members to become acquainted with the proposal to introduce a particular regulation;

 

(b)     notify other Members, through the Secretariat, of the products to be covered by the regulation together with a brief indication of the objective and rationale of the proposed regulation. Such notifications shall take place at an early stage, when amendments can still be introduced and comments taken into account;

 

(c)     provide upon request to other Members copies of the proposed regulation and, whenever possible, identify the parts which in substance deviate from international standards, guidelines or recommendations;

 

(d)     without discrimination, allow reasonable time for other Members to make comments in writing, discuss these comments upon request, and take the comments and the results of the discussions into account.

 

6.     However, where urgent problems of health protection arise or threaten to arise for a Member, that Member may omit such of the steps enumerated in paragraph 5 of this Annex as it finds necessary, provided that the Member:

 

(a)     immediately notifies other Members, through the Secretariat, of the particular regulation and the products covered, with a brief indication of the objective and the rationale of the regulation, including the nature of the urgent problem(s);

 

(b)     provides, upon request, copies of the regulation to other Members;

 

(c)     allows other Members to make comments in writing, discusses these comments upon request, and takes the comments and the results of the discussions into account.

 

7.     Notifications to the Secretariat shall be in English, French or Spanish.

 

8.     Developed country Members shall, if requested by other Members, provide copies of the documents or, in case of voluminous documents, summaries of the documents covered by a specific notification in English, French or Spanish.

 

9.     The Secretariat shall promptly circulate copies of the notification to all Members and interested international organizations and draw the attention of developing country Members to any notifications relating to products of particular interest to them.

 

10.     Members shall designate a single central government authority as responsible for the implementation, on the national level, of the provisions concerning notification procedures according to paragraphs 5, 6, 7 and 8 of this Annex.

 

General reservations

 

11.     Nothing in this Agreement shall be construed as requiring:

 

(a)     the provision of particulars or copies of drafts or the publication of texts other than in the language of the Member except as stated in paragraph 8 of this Annex; or

 

(b)     Members to disclose confidential information which would impede enforcement of sanitary or phytosanitary legislation or which would prejudice the legitimate commercial interests of particular enterprises.


B. Interpretation and Application of Annex B

1. Annex B(1): publication requirements

(a) Footnote to Annex B(1)

539.     In Japan — Agricultural Products II, with reference to the footnote to Annex B(1), the Appellate Body held that the list of instruments contained therein was not exhaustive in nature and referred to the object and purpose of Annex B(1):

“We consider that the list of instruments contained in the footnote to paragraph 1 of Annex B is, as is indicated by the words ‘such as’, not exhaustive in nature. The scope of application of the publication requirement is not limited to ‘laws, decrees or ordinances’, but also includes, in our opinion, other instruments which are applicable generally and are similar in character to the instruments explicitly referred to in the illustrative list of the footnote to paragraph 1 of Annex B.

 

The object and purpose of paragraph 1 of Annex B is ‘to enable interested Members to become acquainted with’ the sanitary and phytosanitary regulations adopted or maintained by other Members and thus to enhance transparency regarding these measures. In our opinion, the scope of application of the publication requirement of paragraph 1 of Annex B should be interpreted in the light of the object and purpose of this provision.

 

We note that it is undisputed that the varietal testing requirement is applicable generally. Furthermore, we consider in the light of the actual impact of the varietal testing requirement on exporting countries, as discussed by the Panel in paragraphs 8.112 and 8.113 of the Panel Report, that this instrument is of a character similar to laws, decrees and ordinances, the instruments explicitly referred to in the footnote to paragraph 1 of Annex B.”(661)

(b) Scope of application of publishing requirements

540.     In Japan — Agricultural Products II, the Panel set the conditions of application of the publishing requirements under Annex B:

“[I]n our view, for a measure to be subject to the publication requirement in Annex B, three conditions apply: (1) the measure ‘[has] been adopted’; (2) the measure is a ‘phytosanitary regulation’, namely a phytosanitary measure such as a law, decree or ordinance, which is (3) ‘applicable generally’.”(662)

541.     The Panel, in Japan — Agricultural Products, in the context of verifying whether the requirement at issue could be considered as an SPS measure albeit its non-mandatory nature, considered that such a requirement could still be an SPS measure in light of the conditions under Annex A of the SPS Agreement:

“Even though the varietal testing requirement is not mandatory — in that exporting countries can demonstrate quarantine efficiency by other means — in our view, it does constitute a ‘phytosanitary regulation’ subject to the publication requirement in Annex B. The footnote to paragraph 1 of Annex B refers in general terms to ‘phytosanitary measures such as laws, decrees or ordinances’. Nowhere does the wording of this paragraph require such measures to be mandatory or legally enforceable. Moreover, Paragraph 1 of Annex A to the SPS Agreement makes clear that ‘phytosanitary measures include all relevant laws, decrees, regulations, requirements and procedures’. It does not, in turn, require that such measures be mandatory or legally enforceable. The interpretation that measures need not be mandatory to be subject to WTO disciplines is confirmed by the context of the relevant SPS provisions, a context which includes provisions of other WTO agreements and the way these provisions define ‘measure’, ‘requirement’ or ‘restriction’, as interpreted in GATT and WTO jurisprudence. This context indicates that a non-mandatory government measure is also subject to WTO provisions in the event compliance with this measure is necessary to obtain an advantage from the government or, in other words, if sufficient incentives or disincentives exist for that measure to be abided by.”(663)

542.     In EC — Approval and Marketing of Biotech Products, the Panel examined whether the publishing requirements in Annex B(1) applied not only to SPS measures, but to a generally applicable measure concerning the administration or operation of an SPS measure. The Panel concluded that Annex B(1) applies only to SPS regulations, which are a sub-category of SPS measures. Therefore, the Panel determined that the publishing requirements did not apply to actions that were not SPS measures. On this basis and given its ruling that the EC general moratorium on approving applications was not an SPS measure, the Panel found that the provisions of Annex B(1) did not apply to the moratorium:

Annex B(1) applies to ‘sanitary and phytosanitary regulations’ (hereafter ‘SPS regulations’) which have been ‘adopted’. An explanatory footnote to Annex B(1) indicates that the term ‘SPS regulations’ should be understood as meaning ‘[s]anitary and phytosanitary measures such as laws, decrees or ordinances which are applicable generally’. That SPS regulations are ‘SPS measures’ is confirmed by Article 7 which states that Members must notify changes in their ‘SPS measures’ and provide information on their ‘SPS measures’ ‘in accordance with the provisions of Annex B’. It can be inferred from this that the ‘SPS regulations’ at issue in Annex B(1) are a sub-category of ‘SPS measures’. Regarding the meaning of the term ‘SPS measures’, we recall Article 1 of the SPS Agreement.

Annex B(1) read in conjunction with the accompanying footnote provides that a generally applicable ‘SPS measure’ which has been adopted must be published promptly. We recall that according to Annex A(1) the term ‘SPS measures’ includes ‘requirements and procedures’. It can be deduced from this that a generally applicable measure imposing a substantive SPS requirement or establishing an SPS procedure is to be published, since such a measure would itself be an ‘SPS measure’. In contrast, neither Annex B(1) nor its accompanying footnote suggests that a generally applicable measure concerning the administration, or operation, of an SPS measure — such as a measure providing for a particular operation of an SPS approval procedure — is, also, to be published.”(664)

(c) Publication versus information

543.     In Japan — Agricultural Products II, the Panel established that publication requirements are not exhausted by the mere information of the relevant entities and that, once adopted, an SPS measure, provided that it meets all three conditions for a measure to be subject to the publication requirement in paragraph 1 of Annex B, needs to be “published promptly in such a manner as to enable interested Members to become acquainted with them”:

“Japan acknowledges that it has not published the varietal testing requirement. The fact that Japan distributed the guidelines to foreign plant quarantine authorities does not mitigate the lack of publication. In our view, distribution to a limited number of addressees and MAFF’s general availability to answer any queries, does not equal prompt publication which enables interested Members to become acquainted with the varietal testing requirement. The publication by MAFF of the protocols relating to approved products does not ensure publication of the varietal testing requirement itself. It only informs Members of products which have met this requirement. Moreover, we do not consider that the highly technical nature of the varietal testing requirement can excuse Japan from publishing it.”(665)

2. Annex B(2): “reasonable interval”

544.     At the Doha Ministerial conference, Members decided that the “reasonable interval” in respect of paragraph 2 should normally be understood as a period of not less than six months:

“Subject to the conditions specified in paragraph 2 of Annex B to the Agreement on the Application of Sanitary and Phytosanitary Measures, the phrase ‘reasonable interval shall be understood to mean normally a period of not less than 6 months. It is understood that timeframes for specific measures have to be considered in the context of the particular circumstances of the measure and actions necessary to implement it. The entry into force of measures which contribute to the liberalization of trade should not be unnecessarily delayed.”(666)

3. Annex B(3): enquiry points

(a) General

545.     The Panel in Australia — Salmon found that there was no obligation under the SPS Agreement for a Member to positively identify its chosen appropriate level of protection. In the context of this finding, the Panel held that paragraph 3 of Annex B did not impose a “substantive obligation on Members to identify or quantify their appropriate level of protection”, but rather merely a “mainly procedural obligation to provide ‘answers to all reasonable questions from all interested Members’”.(667) The Appellate Body reversed the Panel’s finding and held that there was such an obligation — albeit implicit — in Annex B(3).(668)

(b) Paragraph 3(d)

546.     In relation to the reinforcement of the transparency obligation of the agreements on equivalence between Members, see paragraph 363 above.

4. Annex B(5): conditions for notification requirements

547.     The Panel in Japan — Apples, in determining whether any changes in Members’ SPS measures constitute changes that must be notified under Article 7, found that the most important factor to be taken into consideration is “whether the change affects the conditions of market access for the product concerned, that is, would the exported product still be permitted to enter [the market (Japan in this case)] if they complied with the prescription contained in the previous regulations(669)” under the chapeau of Annex B(5). The Panel was of the view that even if this situation did not occur, the Panel must still consider whether the change could be considered to potentially have a significant effect on the trade of other Members:

“It is not disputed that the present situation is one where ‘an international standard, guideline or recommendation does not exist … or the content of a proposed sanitary or phytosanitary regulation is not substantially the same as the content of an international standard, guideline or recommendation’. Therefore, we must determine whether the changes identified above constitute changes which are required to be notified under Article 7 because, inter alia, they ‘may have a significant effect on trade of other Members’ in the context of the chapeau to Paragraph 5 of Annex B.

 

We consider that the most important factor in this regard is whether the change affects the conditions of market access for the product concerned, that is, would the exported product (apple fruit from the United States in this case) still be permitted to enter Japan if they complied with the prescription contained in the previous regulations. (670) If this is not the case, then we must consider whether the change could be considered to potentially have a significant effect on trade of other Members. In this regard, it would be relevant to consider whether the change has resulted in any increase in production, packaging and sales costs, such as more onerous treatment requirements or more time-consuming administrative formalities.”(671)

548.     Still in this regard, the Panel in Japan — Apples held that it was barred from addressing legal claims falling outside its terms of reference. To succeed in a claimunder Article 7 and Annex B of the SPS Agreement, the party making the allegation of the change that was not notified must establish a prima facie case by specifying in what respect any changes in SPS regulations departed from previous ones:

“We recall that, in EC — Hormones, the Appellate Body noted that

 

‘… Panels are inhibited from addressing legal claims falling outside their terms of reference. However, nothing in the DSU limits the faculty of a Panel freely to use arguments submitted by any of the parties — or to develop its own legal reasoning — to support its own findings and conclusions on the matter under its consideration.’

 

However, the Appellate Body clarified in Korea — Dairy that ‘[B]oth ‘claims’ and ‘arguments’ are distinct from the ‘evidence’ which the complainant or respondent presents to support its assertions of facts and arguments’. (672) We note in this regard that the party making an allegation must provide sufficient evidence in support of this allegation, and that a Panel should not entertain a claim for which a prima facie case has not been made.(673) In the present case, the United States has effectively argued that Japan had substantially changed its fire blight measures since the entry into force of the SPS Agreement. However, the United States limited its argumentation to mention that new regulations had been implemented and to attach translations of the regulations to its first written submission. It did not specify in what respect these new regulations departed from the previous ones.

 

Indeed, either the United States knows in which respect the 1997 texts differ from the ones they replace — in which case it could and should have mentioned it in its submissions — or it does not, in which case it cannot be deemed to have established a prima facie case. In either situation, for the Panel to examine the regulations at issue to identify differences would be equivalent to ‘making a case’ for the United States, something we are not allowed to do. For these reasons we conclude that the United States did not establish a prima facie case in relation to the violation of Article 7 and Annex B of the SPS Agreement.”(674)

5. Recommended procedures for implementing the transparency obligations of the SPS Agreement (Article 7)

549.     At itsmeeting of 2–3April 2008, the SPS Committee adopted the revised Recommended Procedures for Implementing the Transparency Obligations of the SPS Agreement (Article 7). The procedures were developed to assist Members to fulfil their transparency obligations under Article 7 and Annex B of the SPS Agreement. For a discussion of these procedures, refer to Sections VIII.B.3VIII.B.4 above.


C. Relationship with other Provisions of the SPS Agreement

1. Article 7

550.     The Panel in EC — Approval and Marketing of Biotech Products referred to the text of Article 7 as a confirmation of its understanding that the term “SPS regulations”, as used in Annex B, meant SPS measures:

Annex B(1) applies to ‘sanitary and phytosanitary regulations’ (hereafter ‘SPS regulations’) which have been ‘adopted’. An explanatory footnote to Annex B(1) indicates that the term ‘SPS regulations’ should be understood as meaning ‘[s]anitary and phytosanitary measures such as laws, decrees or ordinances which are applicable generally’. That SPS regulations are ‘SPS measures’ is confirmed by Article 7 which states that Members must notify changes in their ‘SPS measures’ and provide information on their ‘SPS measures’ ‘in accordance with the provisions of Annex B’. It can be inferred from this that the ‘SPS regulations at issue in Annex B(1) are a sub-category of ‘SPS measures’.”(675)

551.     In EC — Approval and Marketing of Biotech Products, the Panel established that, in a case where the demanding party seeks to establish an inconsistency with Article 7 on the basis of an alleged inconsistency with Annex B(1), if the measure in question is not found inconsistent with Annex B it would similarly be devoid of inconsistency with Article 7 even on the assumption that Article 7 would be applicable to the case at hand:

“[W]e have found that the provisions of Annex B(1) are not applicable to the product-specific measures challenged by the United States, these measures cannot be inconsistent with these provisions. … [T]here can then logically be no inconsistency with Article 7 either, even assuming that Article 7 is applicable to these measures.”(676)

 

XVIII. Annex C     back to top

A. Text of Annex C

Annex C: Control, inspection and approval procedures(7)

(footnote original) 7 Control, inspection and approval procedures include, inter alia, procedures for sampling, testing and certification.

 

1.      Members shall ensure, with respect to any procedure to check and ensure the fulfilment of sanitary or phytosanitary measures, that:

 

(a)     such procedures are undertaken and completed without undue delay and in no less favourable manner for imported products than for like domestic products;

 

(b)     the standard processing period of each procedure is published or that the anticipated processing period is communicated to the applicant upon request; when receiving an application, the competent body promptly examines the completeness of the documentation and informs the applicant in a precise and complete manner of all deficiencies; the competent body transmits as soon as possible the results of the procedure in a precise and complete manner to the applicant so that corrective action may be taken if necessary; even when the application has deficiencies, the competent body proceeds as far as practicable with the procedure if the applicant so requests; and that upon request, the applicant is informed of the stage of the procedure, with any delay being explained;

 

(c)     information requirements are limited to what is necessary for appropriate control, inspection and approval procedures, including for approval of the use of additives or for the establishment of tolerances for contaminants in food, beverages or feedstuffs;

 

(d)     the confidentiality of information about imported products arising from or supplied in connection with control, inspection and approval is respected in away no less favourable than for domestic products and in such a manner that legitimate commercial interests are protected;

 

(e)     any requirements for control, inspection and approval of individual specimens of a product are limited to what is reasonable and necessary;

 

(f)     any fees imposed for the procedures on imported products are equitable in relation to any fees charged on like domestic products or products originating in any other Member and should be no higher than the actual cost of the service;

 

(g) the same criteria should be used in the siting of facilities used in the procedures and the selection of samples of imported products as for domestic products so as to minimize the inconvenience to applicants, importers, exporters or their agents;

 

(h)     whenever specifications of a product are changed subsequent to its control and inspection in light of the applicable regulations, the procedure for the modified product is limited to what is necessary to determine whether adequate confidence exists that the product still meets the regulations concerned; and

 

(i)     a procedure exists to review complaints concerning the operation of such procedures and to take corrective action when a complaint is justified.

 

Where an importing Member operates a system for the approval of the use of food additives or for the establishment of tolerances for contaminants in food, beverages or feedstuffs which prohibits or restricts access to its domestic markets for products based on the absence of an approval, the importing Member shall consider the use of a relevant international standard as the basis for access until a final determination is made.

 

2.     Where a sanitary or phytosanitary measure specifies control at the level of production, the Member in whose territory the production takes place shall provide the necessary assistance to facilitate such control and the work of the controlling authorities.

 

3.     Nothing in this Agreement shall prevent Members from carrying out reasonable inspection within their own territories.


B. Interpretation and Application of Annex C

1. Annex C(1)

a) General

552.     In Australia — Apples, the Panel addressed the question of whether Annex C(1)(a) of the SPS Agreement can be interpreted as applying to the development of SPS measures:(677)

“[T]he text of Annex C(1)(a) relates to ‘procedures to check and ensure the fulfilment of SPS measures’, not to develop SPS measures. However, under the definition of Annex A(1) of the SPS Agreement, SPS measures include both substantive requirements and procedures. Therefore, the ‘SPS measure’ referenced in the language of Annex C(1)(a) may be a requirement to conduct an import risk assessment prior to allowing for the importation of goods that might pose sanitary or phytosanitary risks. In that case, the actual import risk assessment conducted for a specific good might constitute the procedure to check and ensure the fulfilment of this ‘SPS measure’.”(678)

(b) Application of Annex C(1)

(i) General

553.     The Panel in US — Poultry (China) found that Annex C(1) does not specify or exclude any type of procedures from its application. Rather, the Panel considered that Annex C(1) covered any measure that is aimed at checking and ensuring the fulfilment of SPS measures. The Panel stated:

“Considering the actual text of Annex C(1) of the SPS Agreement, the Panel notes that Annex C(1) does not specify, nor exclude, any types of ‘procedures’. According to our reading, Annex C(1) basically requires that ‘any procedure’ is covered by its provisions so long as that ‘procedure’ is aimed at ‘checking and ensuring the fulfilment of sanitary or phytosanitary measures’, and is undertaken in the context of ‘control, inspection, or approval’. In the Panel’s view, no a priori exclusion is contemplated by the SPS Agreement.

 

We find equally important to note that the SPS Agreement does not specify, or limit, the SPS measures referred to in Annex C(1). Indeed, Annex C(1) of the SPS Agreement merely provides that any procedure to check and ensure the fulfilment of SPS measures is subject to the provisions of items (a) through (i).”(679)

554.     The Panel in US — Poultry (China) also determined that the application of Annex C(1) (and other SPS provisions) is not dictated by the title or the characterization given to that measure by the Member maintaining it. The Panel noted:

“The ‘approval procedures’ encompassed by Annex C of the SPS Agreement may cover a broad array of procedures, as the drafters of the SPS Agreement did not limit the scope of these ‘procedures’ to any specific type of ‘approval procedures’. Bearing that in mind, the Panel considers that the application of specific provisions of the SPS Agreement, such as Annex C(1), is by no means restricted to the title or the characterization of an SPS measure given to that measure by the WTO Member maintaining it. To put it differently, it is not because the United States named its requirements as ‘FSIS equivalence determination process’ and characterizes it as a purely ‘equivalence’ process, that the only provisions applicable to the measure are those of Article 4 of the SPS Agreement.”(680)

555.     The Appellate Body in Australia — Apples addressed the issue of what measure may violate the obligation in Annex C(1) and Article 8 noting that, while procedures are the direct target of the obligation in these two provisions, this would not necessarily exclude other types of measures from being subject to the obligation. The Appellate Body found:

“[T]he obligation in Annex C(1)(a) requires Members to commence, and to complete specific procedures without undue delay. Thus, procedures are the direct target of the relevant obligation and those procedures may themselves be the measure in violation of that obligation. Yet, it does not follow that other types of measures are precluded, a priori, from being an appropriate target of a claim of inconsistency with Annex C(1)(a) and Article 8. In our view, the obligation to ensure that relevant procedures are undertaken and completed without undue delay may be infringed through measures other than the control, inspection and approval procedures themselves, such as actions that prohibit, prevent or impede undertaking and completing such procedures ‘without undue delay’, or omissions in the form of a failure to act ‘without undue delay’. Such measures, even when they are not, themselves, procedures, could equally give rise to a violation of Annex C(1)(a) and Article 8.”(681)

(ii) Temporal scope

556.     According to the Appellate Body in Australia — Apples, the text of Annex C(1) suggests that the measures covered by Article 8 and Annex C(1) must exist prior to the operation, undertaking or completion of the relevant procedures. The Appellate Body stated:

[A]rticle 8 refers to the ‘operation of control, inspection and approval procedures’, and subparagraph (a) of Annex C(1) requires relevant procedures to be undertaken and completed without undue delay. Since the procedures referred to in Annex C(1) are those that check and ensure fulfilment of SPS measures, this suggests that such measures exist prior to the operation, undertaking or completion of, the relevant procedures, as the latter seek to check and ensure fulfilment with the former.”(682)

(c) Annex C(1)(a) first clause

(i) Rationale of the provision

Principle of good faith

557.     In EC — Approval and Marketing of Biotech Products, the Panel found that Annex C(1)(a) first clause was essentially a good faith obligation requiring Members to proceed with their approval procedures as promptly as possible, taking account of the need to check and ensure the fulfilment of their relevant SPS requirements:

“[I]t is pertinent to call attention to the introductory paragraph of Annex C(1). It indicates that approval procedures serve to ‘check and ensure the fulfilment of [SPS] measures’. We consider that if approval procedures serve to check and ensure the fulfilment of SPS requirements, then Members applying such procedures must in principle be allowed to take the time that is reasonably needed to determine with adequate confidence whether their relevant SPS requirements are fulfilled, at least if these requirements are WTO-consistent. Put another way, we view Annex C(1)(a), first clause, essentially as a good faith obligation requiring Members to proceed with their approval procedures as promptly as possible, taking account of the need to check and ensure the fulfilment of their relevant SPS requirements. Consequently, delays which are justified in their entirety by the need to check and ensure the fulfilment of a Member’s WTO-consistent SPS requirements should not, in our view, be considered ‘undue’.”(683)

Enforcement of SPS provisions

558.     In EC — Approval and Marketing of Biotech Products, the Panel ruled that the purpose of Annex C(1)(a) is to ensure the enforcement of the SPS Agreement. The Panel considered that by providing for a prompt settlement of approval procedures, this article serves, in line with the preamble of the SPS Agreement, the overall purpose of urging Members to apply rapidly and conclusively the requirements of the Agreement:

“[I]f the time taken by a Member to complete an approval procedure, or a particular stage thereof, exceeds the time that is reasonably needed to check and ensure the fulfilment of its relevant SPS requirements, for instance because the Member concerned did not proceed as expeditiously as could be expected of it in the circumstances, the delay caused in this way would, in our view, be ‘undue’. This interpretation of Annex C(1)(a) is supported by the object and purpose of the SPS Agreement. The fourth preambular paragraph of the SPS Agreement states that one particular object and purpose of the SPS Agreement is ‘the establishment of a multilateral framework of rules and disciplines to guide the […] enforcement of sanitary and phytosanitary measures in order to minimize their negative effects on trade’. Annex C(1)(a), first clause, establishes disciplines concerning the ‘enforcement’ of SPS measures, namely, approval procedures. If Annex C(1)(a), first clause, were interpreted to mean that Members need not undertake and complete their approval procedures as soon as possible under the circumstances, we think the object and purpose of minimizing negative trade effects of approval procedures could not be achieved.”(684)

(ii) undertake and complete

559.     In EC — Approval and Marketing of Biotech Products, the Panel held that the phrase “undertake and complete” covers all stages of approval procedures and should be taken to mean that, once an application has been received, approval procedures must be started and then carried out from beginning to end:

“The verb ‘undertake’ makes clear that Members are required to begin, or start, approval procedures after receiving an application for approval. The verb ‘complete’, on the other hand, indicates that approval procedures are not only to be undertaken, but are also to be finished, or concluded. Thus, in our view, the phrase ‘undertake and complete’ covers all stages of approval procedures and should be taken as meaning that, once an application has been received, approval procedures must be started and then carried out from beginning to end.”(685)

560.     The Panel in Australia — Apples held that it is perfectly plausible that an unduly delayed specific approval process is found inconsistent with Annex C(1)(a) (and consequently Article 8) of the SPS Agreement, even if that process does not lead to the adoption of substantive SPS requirements. The Panel noted that there could be situations where an approval process simply takes too long for the complainant, especially if the complainant is prevented from exporting the goods in question during that period. In such circumstances, the Panel found that it would be inappropriate if the complainant were prevented from initiating a WTO dispute merely because the lengthy approval process did not lead to substantive SPS requirements. A different interpretation would empty out the procedural requirement contained in the first clause of Annex C(1)(a) of the SPS Agreement.(686)

(iii) without undue delay

Definition

561.     In EC — Approval and Marketing of Biotech Products, the Panel, on interpreting the phrase without undue delay, connected it to the preceding words and considered that it addresses both the verbs “undertake” and “complete”, where it comes that the requirement to proceed rapidly relates to these two actions equally:

“There is one additional aspect of Annex C(1)(a), first clause, which it is appropriate to address before examining the merits of the claims before us. The phrase ‘without undue delay’ follows the phrase ‘undertake and complete’. We consider that the phrase ‘without undue delay’ relates, not just to the immediately preceding verb ‘complete’, but to both elements of the phrase ‘undertake and complete’. In other words, we consider that Annex C(1)(a), first clause, should be read as requiring that Members must ‘undertake’ approval procedures ‘without undue delay’ and, subsequently, ‘complete’ them ‘without undue delay’. Were it otherwise, a Member could easily circumvent the requirement to complete approval procedures without undue delay by causing undue delay in the undertaking of approval procedures.”(687)

562.     Having ruled that the phrase “without undue delay” concerns both the verbs “undertake” and “complete” in the preceding clause, the Panel in EC — Approval and Marketing of Biotech Products, contemplated the liabilities which might come from a failure to observe this provision. The Panel emphasized the overall need to act rapidly in the completion of the whole approval process regardless of the time that might have been saved in some previous procedural steps:

“The view that the phrase ‘without undue delay’ relates to both elements of the phrase ‘undertake and complete’ implies that if a Member causes undue delay at any stage in an approval procedure, this would constitute a breach of the provisions of Annex C(1)(a), first clause. In our view, there would be a breach of Annex C(1)(a) even if the Member concerned completed one or more previous stages of the approval procedure sooner than could be expected. If, contrary to our view, a Member could balance undue delay in the completion of a particular procedural stage against a period of time ‘saved’ at an earlier stage in the approval procedure, the implication would be that in some cases a Member could temporarily delay the completion of an approval procedure even though there is no need to do so. We consider that such an interpretation of Annex C(1)(a), first clause, would not be supported by the object and purpose of the SPS Agreement. In particular, we consider that interpreting Annex C(1)(a), first clause, as permitting a Member temporarily to delay the completion of an approval procedure even when there is no need for a delay would not be consistent with the previously mentioned object and purpose of minimizing negative trade effects of approval procedures.”(688)

563.     The Panel in EC — Approval and Marketing of Biotech Products found that the phrase “undue delay” as used in Annex C(1)(a) means “without an unjustified loss of time”:

“It is clear from the text of Annex C(1)(a), first clause, that not every delay in the undertaking or completion of approval procedures which is caused by a Member is contrary to the provisions of Annex C(1)(a), first clause. Only ‘undue’ delay is.(689) Regarding the meaning of the phrase ‘undue delay’, we consider that of the dictionary meanings of the term ‘delay’ which have been identified by the United States, there is one which fits naturally with the provisions of Annex C(1)(a), first clause, namely, ‘(a period of) time lost by inaction or inability to proceed’. So far as concerns the term ‘undue’, of the dictionary meanings referred to by the United States we find two to be particularly relevant in the specific context of Annex C(1)(a), first clause — ‘[g]oing beyond what is warranted […]’ and ‘unjustifiable’. We note that the United States, Canada and the European Communities have all identified ‘unjustifiable’ as a relevant meaning of ‘undue’. This view is supported also by the French version of Annex C(1)(a), first clause, which refers to ‘retard injustifié’. Thus, based on the ordinary meaning of the phrase ‘without undue delay’, we consider that Annex C(1)(a), first clause, requires that approval procedures be undertaken and completed with no unjustifiable loss of time.”(690)

564.     The Appellate Body in Australia — Apples referred to the dictionary meanings of the words “undue” and “delay” in establishing the meaning of the phrase “without undue delay”. The Appellate Body stated:

Annex C(1)(a) contains an obligation that relevant procedures be undertaken and completed ‘without undue delay’. In this regard, the ordinary meaning of the word ‘delay’ relates to ‘(a period of) time lost by inaction or inability to proceed’. The term ‘undue’ means something ‘that ought not to be or to be done, inappropriate, unsuitable, improper, unrightful, unjustifiable’, or ‘going beyond what is warranted or natural; excessive, disproportionate’. Thus, Annex C(1)(a) requires Members to ensure that relevant procedures are undertaken and completed with appropriate dispatch, that is, they do not involve periods of time that are unwarranted, or otherwise excessive, disproportionate or unjustifiable.”(691)

Determination of “undue delay”

565.     The Panel in EC — Approval and Marketing of Biotech Products found that an “undue delay” is determined not by the length of the delay, but by whether the delay was justified. The Panel concluded, that such determinations must be made on a case-by-case basis:

“[I]n our view, Annex C(1)(a), first clause, requires that there not be any unjustifiable loss of time. Thus, what matters is whether there is a legitimate reason, or justification, for a given delay, not the length of a delay as such. Accordingly, if a Member causes a relatively short, but unjustifiable delay, we do not consider that the mere fact that the delay is relatively short would, or should, preclude a Panel from finding that it is ‘undue’. Similarly, we do not consider that a demonstration that a particular approval procedure has been delayed by, say, two years would always and necessarily be sufficient to establish that the relevant procedure has been ‘unduly’ delayed. Having said this, we note that a lengthy delay for which no adequate explanation is provided might in some circumstances permit the inference that the delay is ‘undue’

In our view, a determination of whether a particular approval procedure has been undertaken and/or completed ‘without undue delay’ must be made on a case-by-case basis, taking account of relevant facts and circumstances. We therefore consider that it would be neither possible nor useful to attempt to define the reasons which would render a given delay ‘undue’, and those which would not render it ‘undue’”.(692)

566.     In EC — Approval and Marketing of Biotech Products, the Panel rejected the view that a delay could be considered undue if caused by a measure which is not supported by scientific evidence. The Panel listed several examples of delays originating from governmental interventions, not supported by scientific evidence but nevertheless not “undue” within the meaning of Annex C:

“Canada argues that a delay in undertaking and completing an approval procedure must be considered ‘undue’ if the delay is caused by a measure which is not based on scientific evidence. We would agree that delays caused by measures which are not based on scientific evidence may in some cases be considered ‘undue’.(693) However, we do not agree that such delays must in all cases be considered ‘undue’. A delay in undertaking and completing an approval procedure may be caused by a temporary government shutdown in the wake of a natural disaster or civil unrest. Likewise, if a Member is confronting an unforeseeable and sharp increase in the number of products submitted for approval, this could cause a short delay in the processing of some or all pending applications, due to the need for that Member to reallocate existing resources, or to obtain additional resources, to deal with the new situation.(694) In both examples provided, the delay would be caused by government action, or inaction, which is not supported by scientific evidence. Yet, in our view, there is a convincing argument to be made that the delay would be needed for the Member to be able to check and ensure the fulfilment of relevant SPS requirements. Therefore, we consider that, in both cases, the delay in undertaking and completing approval procedures could properly be viewed as not ‘undue’ and hence not inconsistent with Annex C(1)(a), first clause.”(695)

567.     In Australia — Apples, the Appellate Body concluded that “[w]hether a relevant procedure has been unduly delayed is therefore not an assessment that can be done in the abstract, but one which requires a case-by-case analysis as to the reasons for the alleged failure to act with appropriate dispatch, and whether such reasons are justifiable”.(696)

Applying precaution while avoiding “undue delay”

Requirements of prudence and precaution

568.     In EC — Approval and Marketing of Biotech Products, the Panel agreed with the European Communities’ argument that precaution and prudence need to be observed in the adoption and implementation of GMO-related legislation. However, the Panel set out the standard of review that it would apply in order to assess whether the measures duly entail delays or if the Members overly and purposely extended the allowable timeframe when drafting their SPS requirements:

“As an initial matter, we note that, in our view, Annex C(1)(a), first clause, does not preclude the application of a prudent and precautionary approach to identifying, assessing and managing risks to human health and the environment arising from GMOs and GMO-derived products. As we have said, we consider that Annex C(1)(a), first clause, allows a Member to take the time that is reasonably needed to determine with adequate confidence whether its relevant SPS requirements are fulfilled. Consistent with this, we consider that a Member which finds it appropriate to follow a prudent and precautionary approach in assessing and approving applications concerning GMOs and GMO-derived products, might, for instance, be justified in requesting further information or clarification of an applicant in a situation where another Member considers that the information available is sufficient to carry out its assessment and reach a decision on an application.(697) Whether a particular request is a reflection of genuine caution and prudence or whether it is a pretext to delay the completion of an approval procedure would need to be determined in the light of all relevant facts and circumstances.”(698)

569.     The Panel in EC — Approval and Marketing of Biotech Products found that although Members are permitted to take actions with precaution and prudence, they must do so within reasonable time limits, otherwise Annex C(1)(a) would lose meaning:

“[W]e perceive no inherent tension between the obligation set out in Annex C(1)(a), first clause, to complete approval procedures without undue delay and the application of a prudent and precautionary approach to assessing and approving GMOs or GMO-derived products. Nevertheless, it is clear that application of a prudent and precautionary approach is, and must be, subject to reasonable limits, lest the precautionary approach swallow the discipline imposed by Annex C(1)(a), first clause. Indeed, if a Member could endlessly defer substantive decisions on the grounds of a perceived need for caution and prudence in the assessment of applications, Annex C(1)(a), first clause, would be devoid of any meaning or effect. In applying the provisions of Annex C(1)(a), first clause, it is therefore important always to bear in mind that Annex C(1)(a), first clause, implies as a core obligation the obligation to come to a decision on an application.”(699)

Delays supported by evolving science and precautionary approach

570.     Having addressed the status of the precautionary principle in international law, the Panel in EC — Approval and Marketing of Biotech Products discussed the impact of the principle on the delay noted in the implementation of SPS measures. In this context the Panel examined “whether evolving science and the consequent application by the European Communities of a prudent and precautionary approach would provide a justification for delays which may have occurred due to the European Communities’ general suspension of final approvals between June 1999 and August 2003”. Drawing from its observation that no tension exists between the precautionary approach and the requirement of avoiding undue delays, the Panel placed emphasis on the provisions of Article 5.7 and ruled out the European Communities’ reliance on the precautionary principle to postpone the adoption of SPS requirements:

“The European Communities argues that in the case of applications concerning GMOs and GMO-derived products it is difficult to come to a decision, in view of evolving science and a body of available scientific information and data that is still limited. Even if we were to accept this as an accurate description of the situation as it prevailed between June 1999 and August 2003, we consider that in the light of the provisions of Annex C(1)(a), first clause, this situation in and of itself would not warrant delays in the completion of approval procedures.

 

We note in this regard that if relevant scientific evidence were insufficient to perform a risk assessment as defined in Annex A(1) of the SPS Agreement and as required by Article 5.1 of the SPS Agreement, pursuant to Article 5.7 of the SPS Agreement, a Member may provisionally adopt an SPS measure on the basis of available pertinent information. Contrariwise, in situations where relevant scientific evidence is sufficient to perform a risk assessment, a Member must base its SPS measure on a risk assessment. Of course, the mere fact that relevant scientific evidence is sufficient to perform a risk assessment does not mean that the result and conclusion of the risk assessment are free from uncertainties (e.g., uncertainties linked to certain assumptions made in the course of the performance of a risk assessment). Indeed, we consider that such uncertainties may be legitimately taken into account by a Member when determining the SPS measure, if any, to be taken. In view of these uncertainties, a given risk assessment may well support a range of possible measures. Within this range, a Member is at liberty to choose the one which provides the best protection of human health and/or the environment, taking account of its appropriate level of protection, provided that the measure chosen is reasonably supported by the risk assessment and not inconsistent with other applicable provisions of the SPS Agreement, such as Article 5.6.”(700)

Distinction between undue delay and a refusal to take SPS action

571.     Although the Panel in EC — Approval and Marketing of Biotech Product declined to settle on a definitive meaning of what constitutes “undue delay”, it did determine that Members cannot justify refusing to take substantive SPS decisions because of evolving science, scientific complexity, uncertainty, and/or limited available scientific information or data:

“[E]volving science, scientific complexity and uncertainty, and limited available scientific information or data are not, in and of themselves, grounds for delaying substantive approval decisions, and that the SPS Agreement does not envisage that Members in such cases defer making substantive SPS decisions. Indeed, even in cases where relevant scientific evidence does not permit the performance of a risk assessment, the SPS Agreement envisages that Members take substantive SPS decisions. Certainly, such factors as evolving science and limited availability of scientific evidence affect the confidence which Members can have in the results of their assessments. But they do not inherently affect a Member’s ability to reach substantive decisions on an application, particularly since a Member may take account of such factors in reaching substantive decisions.”(701)

572.     In EC — Approval and Marketing of Biotech Products, the Panel acknowledged that, in cases where scientific discoveries are likely to occur in a given field, delays could allow decisions which take into account latest evidence or fill the existing gaps in the scientific justification of the measure. However, the Panel took the view that the SPS Agreement, in Articles 5.1 and 5.7, offers the possibility to grant time-limited approvals or refuse approvals at any stage of scientific knowledge, without occasioning undue delays:

“It is quite possible that in the situation described by the European Communities where science evolves and there is limited available scientific evidence, a deferral of substantive decisions might allow for better decisions at a later point in time, provided that appropriate analyses and research are undertaken. However, we do not consider that Annex C(1)(a), first clause, can or should be interpreted to allow Members to go into a sort of holding pattern while they or other entities undertake research with a view to obtaining additional scientific information and data. As we have stated earlier, the core obligation implied by Annex C(1)(a), first clause, is for Members to come to a substantive decision. This view is entirely consistent, and fits well with the aforementioned provisions of Article 5.1 and Article 5.7.(702) It is important to note in this regard that the SPS Agreement nowhere states that substantive decisions on applications need to give a straight yes or no answer to applicants. Members may in principle grant time-limited approvals or approvals subject to other appropriate conditions. Alternatively, they may in principle decide to reject an application subject to the possibility of a review of that decision if and when relevant circumstances change. Relevant circumstances could include the state of scientific knowledge. Thus, there is no reason to consider that our interpretation of Annex C(1)(a), first clause, would prejudice Members’ ability to take differentiated, proportionate action to protect human health and/or the environment from potential risks arising from GMOs or GMO-derived products.”(703)

Delay due to failures in the national legislation

573.     The Panel found that the delays challenged in EC — Approval and Marketing of Biotech Products, were not justified by the need to check and ensure the fulfilment of the relevant SPS requirements. The Panel added that, as a practical matter, the need for regular adjustment and amendment of relevant legislation is to be expected. The Panel considered that if a Member could suspend and delay the granting of final approvals every time it updated its approval legislation, there would be long periods of time during which final approval decisions would be suspended:

“[T]he lack of EC-level legislation ensuring labelling and traceability did not affect the European Communities’ ability to check the fulfilment of its existing SPS requirements. Finally, even if the European Communities considered that new and additional requirements relating to labelling and traceability needed to be imposed as conditions attached to approval decisions, to ensure the fulfilment of existing SPS requirements (e.g., the requirement to avoid long-term adverse effects on the environment), there is no reason for believing that the need for, and modalities of, such conditions could only be established in September 2003.

Two further considerations militate in favour of our view that the lack of legislation ensuring labelling and traceability of GMOs and GMO-derived products would not have provided an eo ipso justification for delays which might have occurred for this reason in the completion of approval procedures. To begin with, putting in place new legislation is by nature a time-consuming process which not infrequently takes one or more years to complete. The European Communities itself stated that completing and updating its legislation ‘inevitably took quite some time to be completed in the light of the serious social and political debate on the issues linked to GMOs and GM food production’. We also note the EC statement that legislation concerning GMOs and GMO-derived products needs to keep pace with the ‘constant evolution of the scientific and regulatory debate’ on these products, which suggests that a need for regular adjustment and amendment of relevant legislation is to be expected. The evolution of relevant EC legislation would appear to support this statement. In these circumstances, we are concerned that if a Member could suspend and, consequently, delay the granting of final approvals essentially every time it completes and updates its approval legislation, there might be frequent and long periods of time during which final approval decisions are suspended. Incidentally, given the time required to revise legislation, a need for further revision and updating might in some cases be identified even before the previous revision has made its way through the legislative process.”(704)

Delays as a means of avoiding risk assessment

574.     The Panel in EC — Approval and Marketing of Biotech Products observed that a Member may deliberately use delays as a risk management instrument: the Member would postpone the adoption of a measure which is at odds with the present legal framework, awaiting occurrence of better legislative conditions. The Panel commented that this attitude would be inconsistent with Annex C(1)(a) and the SPS provisions addressing the risk assessment regime:

“The other consideration to be noted relates to the use of procedural delay as an instrument to manage or control risks. It is useful to illustrate this using an example. For instance, if the European Communities delayed the completion of a particular approval procedure because existing legislation precluded it from imposing a traceability requirement for a GMO which would facilitate the withdrawal of the product in the event of unforeseen adverse effects on human health or the environment, the European Communities would effectively use procedural delay as a substitute for a substantive risk management measure (the traceability requirement) that would not be imposable under existing approval legislation. In our view, however, the pursuit of a risk management objective would not justify a delay in the completion of an approval procedure and hence would be inconsistent with Annex C(1)(a), first clause. If procedural delay could be used, directly or indirectly, as an instrument to manage or control risks, then Members could evade the obligations to be observed in respect of substantive SPS measures, such as Article 5.1, which requires that SPS measures be based on a risk assessment. Clearly, we cannot interpret Annex C(1)(a), first clause, in a manner which would nullify or impair the usefulness and intended effect of other provisions of the SPS Agreement. Indeed, as we see it, a central purpose of Annex C(1)(a), first clause, is precisely to prevent a situation where Members avoid the substantive disciplines which Articles 2 and 5 of the SPS Agreement impose with respect to substantive SPS decisions by not reaching final substantive decisions on applications for marketing approval.”(705)

(d) Annex C(1)(a) second clause

575.     The Panel in EC — Approval and Marketing of Biotech Products found that in order to establish an inconsistency with Annex C(1)(a) second clause, a complainant must establish that the imported products have been treated in a “less favourable manner” than domestic products with respect to the undertaking and completion of approval procedures. The complainant must also establish that the imported products which are alleged to have been treated less favourably are “like” the domestic products which are alleged to have been treated more favourably:

“In order to establish an inconsistency with Annex C(1)(a), second clause, Argentina must establish (i) that imported products have been treated in a ‘less favourable manner’ than domestic products in respect of the undertaking and completion of approval procedures, and (ii) that the imported products which are alleged to have been treated less favourably are ‘like’ the domestic products which are alleged to have been treated more favourably. If either one of these two elements is not met, that is, if imported products have not been treated ‘less favourably’ than the domestic products to which they are being compared, or if these domestic products are not ‘like’ the relevant imported products, Argentina’s claim of inconsistency must fail.”(706)

576.     As Annex C(1)(a) second clause sets out a “national treatment obligation”, the Panel in EC — Approval and Marketing of Biotech Products referred to the past panel and Appellate Body rulings on Article III:1 and III:4 of the GATT. The Panel concluded that differential treatment of like products does not by itself demonstrate less favourable treatment. Additionally, an unfavourable result for an application for placing an imported product on the market would not be sufficient to establish less favourable treatment:

“Reading Annex C(1)(a), second clause, in the light of the jurisprudence on Article III:4,we consider that in undertaking and completing its approval procedures, a Member may, in principle, differentiate between products that have been found to be like because this would not, by itself, mean that the relevant approval procedures have been undertaken or completed in less favourable manner for the group of like imported products than for the group of like domestic products. In particular, a mere showing that a Member has undertaken or completed a particular approval procedure in a manner which is unfavourable for a given imported product would not be sufficient to establish a ‘less favourable manner’ of undertaking or completing approval procedures if the relevant Member’s conduct is explained by factors or circumstances unrelated to the foreign origin of the product.”(707)

(e) Annex C(1)(b)

(i) General

577.     In EC — Approval and Marketing of Biotech Products, the Panel ruled that the provisions of Annex C(1)(b) apply “with respect to any procedure to check and ensure the fulfilment of sanitary or phytosanitary measures”.(708)

578.     The Panel in EC — Approval and Marketing of Biotech Products remarked that Annex C(1)(b) sets out five separate, but related, obligations to observed by Members in the operation of their approval procedures: “Annex C(1)(b) essentially sets out five separate, but related, obligations to be observed by Members in the operation of approval procedures. These obligations relate to:

(i)     the publication or communication to applicants of the processing period of each procedure;

 

(ii)     the examination of the completeness of the documentation and the communication to applicants of deficiencies;

 

(iii)     the transmission of the results of the procedure;

 

(iv)     the processing of applications which have deficiencies; and

 

(v)     the provision of information about the stage of a procedure and the provision of an explanation of any delay.”(709)

(ii) First obligation in Annex C(1)(b): publication or communication of processing period

579.     In EC — Approval and Marketing of Biotech Products, the United States argued that as a result of its general moratorium on approvals, the European Communities did not follow the standard processing periods which are published in its applicable approval legislation. The Panel ruled that the lack of publication was not a result of the measure at issue. The Panel also considered that the anticipated processing period is to be provided to applicants upon request and in this dispute, no evidence of applicants’ requests was provided:

“Even if we were to accept that what has to be published in accordance with the first obligation in Annex C(1)(b) is the ‘effective’ standard processing period, and that the general moratorium on approvals effectively modified the European Communities’ published standard processing periods, the fact that they were unpublished would not be a consequence of the measure at issue, i.e., the general moratorium. Rather, it would be a consequence of a separate and independent failure by the European Communities to publish the new standard processing periods. This is confirmed by the fact that the European Communities could apply the general moratorium on approvals and at the same time publish any new standard processing periods.

The United States’ second argument in support of its claim under Annex C(1)(b) is that since the European Communities does not acknowledge the moratorium, the anticipated processing period is not communicated to the applicant. We note that pursuant to Annex C(1)(b) the anticipated processing period is to be communicated to the applicant “upon request”. The United States has provided no evidence to show (i) that an applicant requested that the anticipated processing period be communicated to it, (ii) that the request was denied by a relevant EC entity, and (iii) that this was because of the general moratorium on approvals. Moreover, we do not think that the general moratorium on approvals necessarily resulted in the European Communities not communicating the anticipated processing periods to applicants upon request. The European Communities could apply the general moratorium on approvals and at the same communicate to applicants the anticipated processing periods upon request.”(710)

(iii) Second obligation in Annex C(1)(b): completeness of documentation

580.     In EC — Approval and Marketing of Biotech Products, the United States argued that because of the general moratorium on approvals, the European Communities did not promptly examine the completeness of documentation and inform applicants of any deficiencies. The Panel rejected this argument observing that the US challenge was not supported by evidence. The Panel concluded that the alleged lack of completed documentation was not the result of the measure at issue:

“We note that the United States has identified no concrete evidence to support this assertion. Moreover, we do not think that the general moratorium on approvals necessarily resulted in the European Communities not examining promptly the completeness of documentation and not informing applicants of any deficiencies. The European Communities could apply the general moratorium on approvals and at the same time examine the completeness of documentation and inform applicants of deficiencies in the documentation submitted.(711)”(712)

(iv) Third obligation in Annex C(1)(b): transmission of results

581.     In EC — Approval and Marketing of Biotech Products, the United States raised the contention that under the measure at issue, the results of procedures were not promptly communicated to applicants so that corrective action could be taken. The Panel considered that the United States had failed to establish its claim under the third obligation contained in Annex C(1)(b) as it did not identify the results that were to be transmitted:

“We note that the United States has not identified any results of procedures which were not transmitted to an applicant as soon as possible and in a precise and complete manner. Moreover, we do not think that the general moratorium on approvals necessarily resulted in the European Communities not transmitting as soon as possible, and in a precise and complete manner, the results of approval procedures. Furthermore, it should be recalled that under the general moratorium, the European Communities prevented final results from being achieved. Thus, there were no final results which could have been communicated to applicants.”(713)

(v) Fourth obligation in Annex C(1)(b): processing of deficient applications

582.     In EC — Approval and Marketing of Biotech Products, the United States complained that under the general moratorium, the respondent in that dispute did not proceed as far as practicable in the approval process. The Panel disagreed with this view and commented that the complainant did not provide evidence of the applicant making such request and had the applicant made such request, the European Communities failure to proceed with procedures would not be a result of the measure at issue:

“We note that pursuant to Annex C(1)(b) the competent body is to proceed as far as practicable with the procedure ‘if the applicant so requests’. The United States has provided no evidence of an applicant making such a request and of a relevant EC entity denying that request because of the general moratorium. Moreover, we do not think that the general moratorium on approvals necessarily resulted in the European Communities not proceeding as far as practicable with procedures if applicants so requested. The European Communities could apply the general moratorium on approvals and at the same time proceed as far as practicable with procedures upon request.”(714)

(vi) Fifth obligation in Annex C(1)(b): explanation of delay

583.     The Panel in EC — Approval and Marketing of Biotech Products, dismissed the United States’ argument that the respondent did not comply with the fifth obligation under Annex C(1)(b). The Panel found that the United States did not submit any evidence that it had made a request for an explanation of the delay:

“The fifth obligation states that ‘upon request’ the applicant is to be informed of the stage of the procedure, with any delay being explained. The United States has provided no evidence of an applicant making such a request and of a relevant EC entity denying an explanation of any delay because of the general moratorium. Moreover, we do not think that the general moratorium on approvals necessarily resulted in the European Communities not informing applicants of the stage of procedures and not explaining any delays, if applicants so requested. The European Communities could apply the general moratorium on approvals and at the same time inform applicants of the stage of procedures and explain any delays.”(715)

(f) Annex C(1)(c)

584.     In Australia — Salmon (Article 21.5 — Canada), Canada claimed that Australia acted inconsistently with its obligations under Annex C(1)(c). The Panel noted that only “procedures to check and ensure the fulfilment of sanitary or phytosanitary measures” fall under the scope of paragraph 1(c) of Annex C. The Panel also considered that the Australian requirements referred to by Canada were “substantive sanitary measures in their own right” and not “procedures to check and ensure the fulfilment of sanitary or phytosanitary measures”. The Panel thus concluded that no violation of Annex C(1)(c) was established.(716)

(g) Annex C(1)(e)

585.     In EC — Approval and Marketing of Biotech Products, Argentina argued that the detailed requirements of the EC legislation and regulation did not meet the criteria that they be limited to what is reasonable and necessary. The Panel did not address these two particular requirements merely observing that Annex C(1)(e) focuses on the approval requirements of “individual specimens” whereas the challenged measures did not concern “individual specimens”:

“We note that Annex C(1)(e) imposes limitations on any requirements for approval of ‘individual specimens of a product’. The product-specific measures challenged by Argentina do not concern ‘individual specimens’ of biotech products. They concern specific biotech products for which marketing approval has been sought.”(717)

2. Relationships with other provisions of the SPS Agreement

(a) Article 4

586.     The Panel in US — Poultry (China) found that while the recognition of equivalence is governed by Article 4 of the SPS Agreement, the equivalence determination process of the importing Member must still comply with the obligations on “approval procedures” under Annex C(1), particularly where a Member uses equivalence recognition as the only route for access into its market. The Panel stated:

“The Panel acknowledges that nothing in the SPS Agreement seems to prevent a Member from using an equivalent process to determine whoever is eligible to export certain products to its market. … Nevertheless, we are of the view that, where the recognition of equivalence (as the one granted through the FSIS equivalence determination process) is the only way that a Member may export its products to an importing Member, then the equivalence determination process of the importing Member must comply with the pertinent obligations on ‘approval procedures’ under Annex C(1) of the SPS Agreement.

[T]he Panel understands that to deny that an equivalence determination process, which also has the ultimate effect of approving the importation of a product from a given WTO Member as envisaged in any other ‘approval procedure’, is subject to Annex C(1) of the SPS Agreement would unfairly reward the ingenuity of some WTO Members and possibly create a dangerous safe haven for disguised protectionism. Such an understanding would result in an undesired precedent that may entice some WTO Members to circumvent the application of the SPS Agreement.”(718)

(b) Article 8

587.     In EC — Approval and Marketing of Biotech Products, the Panel ruled that the provisions of Article 8 and those of Annex C need to be read together and consequently, whenever the first paragraph of Annex C(1) is violated, Article 8 is likewise affected:

“We recall that the United States and Canada seek to establish an inconsistency with Article 8 of the SPS Agreement on the basis of an inconsistency with Annex C(1)(a). Article 8 requires, inter alia, that Members observe the provisions of Annex C in the operation of their approval procedures. It follows that a failure to observe the provisions of Annex C(1)(a) implies a breach of Article 8. We have determined above that, as a result of the general de facto moratorium on approvals, the European Communities has failed, in at least one approval procedure conducted under Directives 90/220 and 2001/18, to observe the provisions of Annex C(1)(a), first clause. Accordingly, we conclude that in respect of the aforementioned approval procedure, the European Communities has, by implication, also acted inconsistently with the provisions of Article 8.”(719)

 

XIX. Relationship of the SPS Agreement with other WTO Agreements     back to top

A. WTO Agreement

1. Article XVI:4

588.     In arriving at the conclusion referred to in paragraph 14 above, the Appellate Body in EC — Hormones referred to Article XVI:4 of the WTO Agreement:

“Finally, we observe, more generally, that Article XVI.4 of the WTO Agreement stipulates that:

 

Each Member shall ensure the conformity of its laws, regulations and administrative procedures with its obligations as provided in the annexed Agreements.

 

Unlike the GATT 1947, the WTO Agreement was accepted definitively by Members, and therefore, there are no longer ‘existing legislation’ exceptions (so-called ‘grandfather rights’)”.(720)

B. TBT Agreement

589.     See Article 1.5 of the Chapter on the TBT Agreement.

C. GATT 1994

1. Order of analysis

590.     The Panel in EC — Hormones decided that both the SPS Agreement and the GATT 1994 applied to the European Communities’ measure at issue. The Panel then addressed the question of which of the two Agreements to examine first:

“The SPS Agreement specifically addresses the type of measure in dispute. If we were to examine GATT first, we would in any event need to revert to the SPS Agreement: if a violation of GATT were found, we would need to consider whether Article XX(b) could be invoked and would then necessarily need to examine the SPS Agreement; if, on the other hand, no GATT violation were found, we would still need to examine the consistency of the measure with the SPS Agreement since nowhere is consistency with GATT presumed to be consistency with the SPS Agreement. For these reasons, and in order to conduct our consideration of this dispute in the most efficient manner, we shall first examine the claims raised under the SPS Agreement.”(721)

591.     The Panel in Australia — Salmon also dealt with the question whether to first address the claims under the GATT 1994 or those under the SPS Agreement:

“Canada recognizes that the SPS Agreement provides for obligations additional to those contained in GATT 1994, but, nevertheless, first addresses its claim under Article XI of GATT 1994. Australia invokes Article 2.4 of the SPS Agreement, which presumes GATT consistency for measures found to be in conformity with the SPS Agreement, to first address the SPS Agreement. We note, moreover, that (1) the SPS Agreement specifically addresses the type of measure in dispute, and (2) we will in any case need to examine the SPS Agreement, whether or not we find a GATT violation (since GATT consistency is nowhere presumed to constitute consistency with the SPS Agreement). In order to conduct our consideration of this dispute in the most efficient manner, we shall, therefore, first address the claims made by Canada under the SPS Agreement before addressing those put forward under GATT 1994.”(722)

2. Article III and Article XI

(a) The Panel’s exercise of judicial economy

592.     In EC — Hormones, the Panel stated: “Since we have found that the EC measures in dispute are inconsistent with the requirements of the SPS Agreement, we see no need to further examine whether the EC measures in dispute are also inconsistent with Articles III or XI of GATT.”(723)

593.     In Australia — Salmon, the Panel stated: “Since we have found that the measure in dispute is inconsistent with the requirements of the SPS Agreement, we see no need to further examine whether it is also inconsistent with Article XI of GATT 1994.”(724)

3. Article XX(b)

594.     In EC — Hormones, the European Communities submitted that “the ‘substantive’ provisions of the SPS Agreement can only be addressed if recourse is made to GATT Article XX(b), i.e., if, and only if, a violation of another provision of GATT is first established”. The Panel, rejected this argument, stating:

“According to Article 1.1 of the SPS Agreement, two requirements need to be fulfilled for the SPS Agreement to apply: (i) the measure in dispute is a sanitary or phytosanitary measure; and (ii) the measure in dispute may, directly or indirectly, affect international trade. There are no additional requirements. The SPS Agreement contains, in particular, no explicit requirement of a prior violation of a provision of GATT which would govern the applicability of the SPS Agreement, as asserted by the European Communities.”(725)

595.     With respect to the relationship between the SPS Agreement and Article XX(b) of the GATT 1994, the Panel in EC — Hormones took the view that “[m]any provisions of the SPS Agreement impose ‘substantive’ obligations which go significantly beyond and are additional to the requirements for invocation of Article XX(b)”:

“[W]e find the EC claim that the SPS Agreement does not impose ‘substantive’ obligations additional to those already contained in Article XX(b) of GATT not to be persuasive. It is clear that some provisions of the SPS Agreement elaborate on provisions already contained in GATT, in particular Article XX(b). The final preambular paragraph of the SPS Agreement provides, indeed, that the Members desired ‘to elaborate rules for the application of the provisions of GATT 1994 which relate to the use of sanitary or phytosanitary measures, in particular the provisions of Article XX(b)’. Examples of such rules are, arguably, some of the obligations contained in Article 2 of the SPS Agreement. However, on this basis alone we cannot conclude that the SPS Agreement only applies, as Article XX(b) of GATT does, if, and only if, a prior violation of a GATT provision has been established. Many provisions of the SPS Agreement impose ‘substantive’ obligations which go significantly beyond and are additional to the requirements for invocation of Article XX(b). These obligations are, inter alia, imposed to ‘further the use of harmonized sanitary and phytosanitary measures between Members’(726) and to ‘improve the human health, animal health and phytosanitary situation in all Members’.(727) They are not imposed, as is the case of the obligations imposed by Article XX(b) of GATT, to justify a violation of another GATT obligation (such as a violation of the non-discrimination obligations of Articles I or III).”(728)

596.     The Panel in US — Poultry (China) observed that the preamble of the SPS Agreement uses the word “elaborate” to qualify the relationship of the SPS Agreement with Article XX(b). The Panel noted:

“[T]he ordinary meaning of the word ‘elaborate’ is to ‘explain something in detail’. Accordingly, when the preamble states that the SPS Agreement elaborates the rules for the application of Article XX(b), it is thus saying that the SPS Agreement ‘explains in detail’ how to apply Article XX(b). …

 

This is further confirmed by the wording of a number of provisions throughout the SPS Agreement which either explicitly refer to Article XX(b) or mirror relevant language in that provision.”(729)

597.     The Panel reinforced its understanding of the relationship between the SPS Agreement and Article XX(b) by looking to the record of the negotiations leading to the SPS Agreement. The Panel stated:

“The negotiating history of the SPS Agreement also appears to confirm our interpretation. The Negotiating Group on Agriculture established by the Group of Negotiation on Goods, sought to strengthen the GATT rules and disciplines, in particular Article XX(b) recognizing the need to rely on scientific evidence for SPS measures.(730) This strengthening of GATT rules and disciplines was to be done by developing a set of principles that would govern the use of SPS regulations and barriers.(731) In this sense, one of the purposes of the SPS Agreement was to complement Article XX(b) by providing specific provisions that SPS measures must comply with in order to be consistent with Article XX(b).

 

We therefore conclude that the SPS Agreement elaborates and thus explains the provisions of Article XX(b) in further detail when dealing with SPS measures. In the Panel’s view, this interpretation gives meaning to both Article XX(b) of the GATT 1994 and the SPS Agreement in a harmonious manner.”(732)

598.     The Panel in US — Poultry (China) concluded that an SPS measure which has been found inconsistent with Articles 2 and 5 of the SPS Agreement, cannot be justified under Article XX of the GATT 1994.(733)

4. Articles XXII and XXIII

599.     Pursuant to Article 11.1 of the SPS Agreement, the provisions of Articles XXII and XXIII of GATT 1994 as elaborated and applied by the DSU shall apply to consultations and the settlement of disputes under the SPS Agreement, except as otherwise specifically provided in the Agreement.

 

Footnotes:

427. (footnote original) Appellate Body Report, US — Wool Shirts and Blouses, p. 17. back to text
428. Appellate Body Report, Australia — Salmon, para. 110. back to text
429. G/SPS/48, 16 May 2008. back to text
430. G/SPS/48, para. 1. back to text
431. G/SPS/48, para. 2. back to text
432. G/SPS/48, Section I. back to text
433. G/SPS/48, Section II. back to text
434. G/SPS/48, Section III. back to text
435. G/SPS/48, Section IV. back to text
436. See Section XVII. back to text
437. Panel Report, Japan — Agricultural Products II, para. 8.116. back to text
438. Appellate Body Report, Japan — Agricultural Products II, paras. 104 and 105. back to text
439. Appellate Body Report, Japan — Agricultural Products II, para. 108. back to text
440. Panel Report, Japan — Apples, paras. 8.23 and 8.24. back to text
441. Panel Report, Japan — Apples, para. 8.310. back to text
442. (footnote original) This approach is in line with the discussion of the concept of “significant effect on trade of other Members” in the notification procedures adopted and revised by the SPS Committee (G/SPS/7/Rev.2, para. 7). back to text
443. Panel Report, Japan — Apples, paras. 8.313–8.314. back to text
444. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1459. back to text
445. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.47, subpara. 85. back to text
446. Panel Report, Japan — Apples, para. 8.319. back to text
447. Panel Report, Japan — Apples, footnote 425. back to text
448. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.47, subpara. 85. back to text
449. G/SPS/R/1, paras. 8–11. The recommended procedures can be found in PC/IPL/6. back to text
450. G/SPS/R/5, para. 16. The revised procedures can be found in G/SPS/7. back to text
451. G/SPS/7/Rev.1, preamble. The revised procedures can be found in G/SPS/7/Rev.1. back to text
452. G/SPS/7/Rev.2 and G/SPS/7/Rev.2/Add.1. back to text
453. G/SPS/7/Rev.3. back to text
454. (footnote original) G/SPS/7/Rev.1. back to text
455. G/SPS/19, para. 11. back to text
456. G/SPS/33 and Add.1. back to text
457. G/SPS/33, Annex 1. back to text
458. G/SPS/33/Rev.1. back to text
459. G/SPS/7/Rev.3. back to text
460. G/SPS/7/Rev.3. back to text
461. G/SPS/7/Rev.3, paras. 1 and 2. back to text
462. G/SPS/7/Rev.3, para. 3. back to text
463. G/SPS/7/Rev.3, paras. 4 and 5. back to text
464. G/SPS/7/Rev.3, para. 43. back to text
465. See Section XVIII below. back to text
466. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1569. back to text
467. Panel Report, US — Poultry (China), para. 7.356. back to text
468. Appellate Body Report, EC — Hormones, paras. 205–206. back to text
469. Appellate Body Reports, US/Canada — Continued Suspension, paras. 541–542. back to text
470. WT/MIN(01)/17, para. 3.6 (i). back to text
471. WT/MIN(01)/17, para. 3.6 (ii). back to text
472. G/SPS/W/127. back to text
473. G/SPS/33. back to text
474. G/SPS/33, Step 5. back to text
475. G/SPS/33, Step 7. back to text
476. G/SPS/33/Add.1. back to text
477. G/SPS/33/Rev.1. back to text
478. G/SPS/33/Rev.1. back to text
479. G/SPS/33/Rev.1, p. 2. back to text
480. G/SPS/33/Rev.1, p. 3. back to text
481. G/SPS/33/Rev.1, pp. 2–3. back to text
482. G/SPS/33/Rev.1, p. 2. back to text
483. G/SPS/33/Rev.1, p. 3. back to text
484. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1620–7.1621. back to text
485. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1622. back to text
486. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1623–7.1624. back to text
487. Panel Report, EC — Approval and Marketing of Biotech Products, footnote 1330. back to text
488. WT/MIN(01)/17, para. 3.1. back to text
489. WT/MIN(01)/17, para. 3.1. back to text
490. Appellate Body Reports, US/Canada — Continued Suspension, para. 438. back to text
491. Panel Reports, US — Continued Suspension, para. 6.72; and Canada — Continued Suspension, para. 6.67. back to text
492. Appellate Body Reports, US/Canada — Continued Suspension, para. 480. back to text
493. Panel Report, Australia — Salmon (Article 21.5 — Canada), para. 6.1. back to text
494. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.16–7.18. back to text
495. Panel Report, Japan — Apples, para. 6.2. back to text
496. Appellate Body Reports, US/Canada — Continued Suspension, para. 436. back to text
497. Appellate Body Reports, US/Canada — Continued Suspension, para. 480. back to text
498. Appellate Body Reports, US/Canada — Continued Suspension, paras. 436 and 473. back to text
499. Panel Reports, EC — Hormones (Canada), para. 8.7; and EC — Hormones (US), para. 8.7. The Panel ruled:
     “[W]e decided to request the opinion of experts on certain scientific and other technical matters raised by the parties to this dispute. For our examination of this dispute, we considered it more useful to leave open the possibility of receiving a range of opinions from individual experts on specific scientific and technical questions, rather than to establish an expert review group which would have been required to reach a consensus view on the basis of general terms of reference given to it by the Panel. We considered that neither Article 11.2 of the SPS Agreement nor Article 13.2 of the DSU limits our right to seek information from individual experts as provided for in Article 11.2, first sentence, of the SPS Agreement and Articles 13.1 and 13.2, first sentence, of the DSU. The procedures we adopted in this respect and the views expressed by the experts are set out in paragraphs 6.1 and following.” back to text
500. Appellate Body Report, EC — Hormones, para. 147. back to text
501. Panel Reports, EC — Hormones (Canada), para. 8.9; and EC — Hormones (US), para. 8.9. back to text
502. Panel Report, Australia — Apples, para. 7.20. back to text
503. Panel Report, Australia — Apples, para. 7.13. back to text
504. Panel Report, Australia — Apples, paras. 7.18–7.20. back to text
505. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.19. back to text
506. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.31. back to text
507. Appellate Body Reports, US/Canada — Continued Suspension, para. 450. back to text
508. Appellate Body Reports, US/Canada — Continued Suspension, para. 446. back to text
509. Appellate Body Reports, US/Canada — Continued Suspension, para. 459. back to text
510. Appellate Body Reports, US/Canada — Continued Suspension, para. 436. back to text
511. Appellate Body Reports, US/Canada — Continued Suspension, para. 445. back to text
512. In its report, the Panel reasoned that Drs. Boisseau and Boobis (the experts in question) may have contributed to the development of JECFA reports, but the nature of their participation ensured that they could remain independent and impartial. In response to objections from the European Communities during the interim review, the Panel explained:
     “Moreover, JECFA reaches its conclusions by consensus. So the opinions expressed by the two experts were given with regard to the consensual view of JECFA on this matter, not just their own personal positions in the past. This does not mean, however, that JECFA’s work is these particular experts’ own work: it is a joint work by several experts.”
     Panel Reports, US — Continued Suspension, para. 6.62; and Canada — Continued Suspension, para. 6.57. back to text
513. Appellate Body Reports, US/Canada — Continued Suspension, para. 472. back to text
514. (footnote original) Panel Report, US — Continued Suspension, para. 6.22; Panel Report, Canada — Continued Suspension, para. 6.21. back to text
515. Appellate Body Reports, US/Canada — Continued Suspension, paras. 474, 475 and 477. back to text
516. Panel Report, Australia — Apples, para. 7.32. back to text
517. Panel Report, Australia — Apples, paras. 7.24–7.28. back to text
518. Appellate Body Reports, US/Canada — Continued Suspension, para. 441. back to text
519. (footnote original) Rules of Conduct, Sections VI (Self-Disclosure Requirements by Covered Persons), VII (Confidentiality), and VIII (Procedures Concerning Possible Material Violations). back to text
520. Appellate Body Reports, US/Canada — Continued Suspension, paras. 442–443. back to text
521. Appellate Body Reports, US/Canada — Continued Suspension, para. 439. back to text
522. (footnote original) Appellate Body Report, Canada — Continued Suspension, para. 439. back to text
523. Panel Report, Australia — Apples, paras. 7.52–7.54. back to text
524. Appellate Body Report, Japan — Agricultural Products II, paras. 126 and 129. back to text
525. Panel Report, Australia — Apples, para. 7.81. back to text
526. (footnote original) Appellate Body Report, Canada — Continued Suspension, para. 435, where the Appellate Body explains that “due process considerations are reflected in the Rules of Conduct.” No reference is made to the DSU. Also, in India — Patents (US), para. 94, the Appellate Body recognizes that “…demands of due process … are implicit in the DSU…”. back to text
527. (footnote original) Appellate Body Report, Canada — Continued Suspension, para. 436. back to text
528. Panel Report, Australia — Apples, paras. 7.7–7.9. back to text
529. Panel Report, Australia — Apples, para. 7.67. back to text
530. Panel Reports, EC — Approval and Marketing of Biotech Products, paras. 7.13 and 7.15. back to text
531. Panel Reports, EC — Hormones (Canada), paras. 8.7–8.8; and EC — Hormones (US), paras. 8.7–8.8. back to text
532. Appellate Body Report, EC — Hormones, para. 148. back to text
533. (footnote original) Appellate Body Report, Japan — Agricultural Products II, para. 129. back to text
534. Appellate Body Reports, US/Canada — Continued Suspension, paras. 437–439. back to text
535. G/SPS/1, referenced in G/L/170. back to text
536. G/SPS/W/219; G/SPS/W/227; G/SPS/W/233; G/SPS/W/248; G/SPS/W/243/Rev.4; and Job/SPS/1. back to text
537. G/SPS/W/243. back to text
538. G/SPS/W/243/Rev.1; G/SPS/W/243/Rev.2; G/SPS/W/243/Rev.3; G/SPS/W/243/Rev.4; G/SPS/W/259; G/SPS/W/259/Rev.1. See also G/SPS/W/78/Rev.9. back to text
539. G/SPS/GEN/1112. For a list of bodies granted observer status, see G/SPS/GEN/1112, pp. 2–3. back to text
540. G/SPS/11. At its meeting of 8 July 1999, the Committee adopted the First Annual Report on the monitoring procedure. G/SPS/13. The Thirteenth Annual Report on the Procedure to Monitor the Process of International Harmonization was adopted by the Committee on 1 July 2011. back to text
541. G/SPS/R/9/Rev.1, para. 21. The text of the procedures can be found in G/SPS/11/Rev.1. back to text
542. G/SPS/11/Rev.1. back to text
543. G/SPS/40. back to text
544. G/SPS/R/9/Rev.1, paras. 35–37. The procedures can be found in G/SPS/10. back to text
545. G/SPS/12. back to text
546. WT/MIN(01)/17, para. 3.4. back to text
547. G/SPS/36. back to text
548. G/SPS/W/228. back to text
549. G/SPS/53. back to text
550. G/SPS/53, paras. 5 and 6. back to text
551. Panel Report, Australia — Salmon (21.5 — Canada), paras. 7.12–7.13. back to text
552. Panel Report, Australia — Salmon (Article 21.5 — Canada), para. 7.13. back to text
553. Panel Reports, EC — Hormones (US), para. 8.26, and EC — Hormones (Canada), para. 8.29. back to text
554. Appellate Body Report, EC — Hormones, footnote 99. back to text
555. Appellate Body Report, Australia — Apples, para. 172. back to text
556. Panel Report, Japan — Apples, para. 8.24. back to text
557. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.149. back to text
558. Panel Report, Australia — Apples, para. 7.116. back to text
559. Panel Report, Australia — Apples, paras. 7.144–7.145. back to text
560. (footnote original) The Vienna Convention on the Law of Treaties (the “Vienna Convention“), done at Vienna, 23 May 1969, 1155 U.N.T.S 331; 8 International Legal Materials 679, Article 33.3. back to text
561. (footnote original) Vienna Convention, Article 33.4. back to text
562. (footnote original) See the Marrakesh Agreement Establishing the World Trade Organization, Article II:2 and testimonium. back to text
563. Panel Report, Australia — Apples, paras. 7.146–7.150. back to text
564. Panel Report, Australia — Apples, para. 7.153. We observe that the Panel in US — Poultry (China) arrived at a similar conclusion. The Panel stated:
     “While we do not see the examination of whether a particular measure is an SPS measure as a rigid three-part test, as seems to have been adopted by the Panel in EC — Approval and Marketing of Biotech Products, we do agree that the Panel is to review carefully all aspects of a measure in order to determine whether it is an SPS measure. In our view, the nature of a measure is an intrinsic element of its form. Therefore, reading the second part of Annex A(1) as a whole, means that an examination of whether a measure is of the type set forth in Annex A(1) will encompass a holistic examination of the measure, including both its form and nature.” back to text
565. Panel Report, US — Poultry (China), paras. 7.97 and 7.100. back to text
566. Panel Report, US — Poultry (China), paras. 7.98–7.99. back to text
567. Panel Report, Australia — Apples, paras. 7.173–7.174. back to text
568. Appellate Body Report, Australia — Apples, para. 181. back to text
569. (footnote original) Panel Report, Australia — Salmon (Article 21.5 — Canada), para. 7.156. back to text
570. Panel Report, US — Poultry (China), para. 7.141. back to text
571. Appellate Body Report, Australia — Apples, para. 172. back to text
572. (footnote original) See, e.g., Appellate Body Reports, Japan — Alcoholic Beverages II, pp. 27–28 (including the statement that “[i]t is irrelevant that protectionism was not an intended objective if the particular tax measure in question is nevertheless, to echo Article III:1 [of the GATT 1994], “applied to imported or domestic products so as to afford protection to domestic production. This is an issue of how the measure in question is applied”); Chile — Alcoholic Beverages, paras. 62 and 71–72; and US — Offset Act (Byrd Amendment), para. 259. While these Appellate Body reports discussed claims under WTO agreements other than the SPS Agreement, the logic followed by the Appellate Body in these reports is applicable, in our view, to the issue we are considering here. back to text
573. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.2558. back to text
574. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.207. back to text
575. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.210. back to text
576. (footnote original) Uruguay Round document MTN.GNG/NG5/WGSP/7, p. 8. back to text
577. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.211. back to text
578. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.165–7.166. back to text
579. (footnote original) Article 2.1 of the SPS Agreement provides that “Members have the right to take “[SPS] measures necessary for the protection of human, animal or plant life or health, provided that such measures are not inconsistent with the provisions of [the SPS Agreement]”. back to text
580. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.168–7.169. back to text
581. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.170–7.171. back to text
582. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.213. back to text
583. (footnote original) Whilst we are mindful that caution must be exercised when referring to similar words and phrases in other provisions of the covered agreements for the purpose of determining the meaning of a particular word or phrase (Appellate Body Report, EC — Asbestos, para. 89), we also note that, because Annex A(1) to the SPS Agreement and Article III:1 of the GATT 1994 form part of the same treaty by virtue of Article II:2 of the WTO Agreement, each constitutes context relevant to the interpretation of the other. back to text
584. (footnote original) Appellate Body Report, Japan — Alcoholic Beverages II, p. 29, DSR 1996:I, 97, at 120. back to text
585. Appellate Body Report, Australia — Apples, para. 173. back to text
586. (footnote original) We note that the common definition of an “organism” is: “an organized living body; esp. (the material structure) of an individual animal, plant, bacterium, etc.”. The Shorter Oxford English Dictionary, L. Brown (ed.) (Oxford University Press, 2002), Vol. 2, p. 2019. back to text
587. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.218–7.219. back to text
588. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.224. back to text
589. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.231. back to text
590. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.240. back to text
591. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.238–7.239. back to text
592. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.351. back to text
593. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.277. back to text
594. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.287. back to text
595. (footnote original) The Panel recalls its view that the SPS Agreement explicitly covers risks to wild fauna and distinguishes neither among categories of animals (such as insects, birds, and mammals) nor between “target” and “non-target” species. back to text
596. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.291–7.292. back to text
597. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.297–7.298. back to text
598. In paragraph 7.299, the Panel notes “that the Codex definition of ‘food additives’ refers to additions made ‘in the manufacture’ of the food in question or at subsequent stages of food production. In the present dispute, the Panel considers that ‘food’ encompasses GM plants that are eaten as such or processed into products that are eaten”. That being said, the Panel went on to state that:
      “[T]he concept of ‘manufacture’ does not fit well with the first situation where plants are grown for food purposes (e.g., sweet maize for fresh consumption). As we see it, the farmer cannot add substances to a plant for a technological purpose in the same way that a manufacturer can add substances to a food product for a technological purpose (e.g., colouring to match the flavour of a yoghurt). If farmers wish to add a substance of the relevant type, we think they effectively have to do so at the stage of developing and producing the seeds of the plant. Therefore, we think that in the special case of ‘plant production’, substances intentionally added at the stage of seed development and production could be reasonably considered to be substances added in the manufacture of the food plant, if the substances are present in the harvested plant as a component or affect the characteristics of the harvested plant.”
     Panel Report on EC — Approval and Marketing of Biotech Products, para. 7.299. back to text
599. (footnote original) It is useful to recall that the Appellate Body has established that for an SPS measure to be “based on” an international standard the measure need not necessarily “conform to”, or comply with, that standard. Appellate Body Report, EC — Hormones, para. 163. Therefore, even if the meaning and scope of the term “additives” as it appears in the SPS Agreement and in the Codex standard did not correspond exactly, it would still be possible for Members to “base” their SPS measure on the Codex standard. back to text
600. (footnote original)We find instructive in this regard the provisions of Article 1.1 of the TBT Agreement. Article 1.1 provides that “[g]eneral terms for standardization and procedures for assessment of conformity shall normally have the meaning given to them by definitions adopted within the United Nations system and by international standardizing bodies taking into account their context and in the light of the object and purpose of this Agreement”. back to text
601. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.300. back to text
602. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.312–7.313. back to text
603. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.321. back to text
604. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.322. back to text
605. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.339. back to text
606. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.334–7.335. back to text
607. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.336–7.337. back to text
608. Panel Report, Australia — Salmon, para. 8.34. back to text
609. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.350. back to text
610. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.355, 7.357 and 7.359. back to text
611. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.369–7.370. back to text
612. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.370. back to text
613. Appellate Body Report, Australia — Apples, para. 175. back to text
614. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1334. back to text
615. Because the Panel in EC — Approval and Marketing of Biotech Products found that the general moratorium on approvals was not an SPS measure, the Panel rejected all of the claims of violations under Articles 5.1, 5.5, 5.6, 2.2, 2.3 and Article 7/Annex B(1) of the SPS Agreement. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1395, 7.1407, 7.1421, 7.1441, 7.1448 and 7.1465. back to text
616. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1335 and 7.382–7.383. back to text
617. (footnote original) We note in this respect that the footnote to Annex B(1) defines “[SPS] regulations” as “[SPS] measures … which are applicable generally”. It follows, a contrario, that there can be SPS measures which are not applicable generally. back to text
618. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1336. back to text
619. According to the Panel, “labelling requirements related to food safety are labelling requirements which are applied to protect human health from risks arising from additives, contaminants, toxins or disease-causing organisms in foods.” Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.410. back to text
620. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.390–7.391. back to text
621. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.392. back to text
622. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.390. The Panel stated:
     “We note that Annex A(1) to the SPS Agreement specifies that SPS measures include, ‘inter alia’, ‘packaging and labelling requirements directly related to food safety’. As is indicated by the term ‘inter alia’ in Annex A(1), the requirements specifically mentioned are not necessarily intended to exclude similar requirements. Hence, while recognizing that labelling requirements imposed on food safety grounds may be more common, we consider that labelling requirements imposed for the purpose of protecting plant, animal or human health from the risks covered in Annex A(1)(a) and (c), or for the purpose of preventing or limiting other damage from the risk covered in Annex A(1)(d), would likewise be subject to the disciplines of the SPS Agreement.” back to text
623. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.387–7.388. back to text
624. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.410. back to text
625. Appellate Body Reports, US/Canada — Continued Suspension, para. 693. back to text
626. Appellate Body Report, Australia — Apples, para. 245. back to text
627. Panel Report, Australia — Salmon (Article 21.5 — Canada), paras. 7.68–7.70. back to text
628. Appellate Body Report, Australia — Salmon, para. 123, footnote 69. back to text
629. Appellate Body Report, Australia — Salmon, para. 120. back to text
630. Panel Report, Australia — Salmon, paras. 8.72 and 8.116. back to text
631. Panel Report, Australia — Salmon, para. 8.74. back to text
632. Appellate Body Report, Australia — Salmon, paras. 123–124. back to text
633. Panel Report, Japan — Apples, para. 8.273, referring to Appellate Body Report, EC — Hormones, para. 184. back to text
634. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.3046. back to text
635. Appellate Body Report, Japan — Apples, paras. 207–208. back to text
636. Appellate Body Report, US/Canada — Continued Suspension, para. 531. back to text
637. (footnote original) Indeed, we are of the view that, as a general matter, “risk” cannot usually be understood only in terms of the disease or adverse effects that may result. Rather, an evaluation of risk must connect the possibility of adverse effects with an antecedent or cause. For example, the abstract reference to the “risk of cancer” has no significance, in and of itself, under the SPS Agreement; but when one refers to the “risk of cancer from smoking cigarettes”, the particular risk is given content. back to text
638. (footnote original) Appellate Body Report, para. 199. (original italics) In other words, the risk assessment proffered by the importing Member in EC — Hormones considered the relationship between the broad grouping of hormones that were the subject of the measure and cancer. back to text
639. Appellate Body Report, Japan — Apples, paras. 202–203. back to text
640. Appellate Body Report, Australia — Salmon, footnote 69. back to text
641. Appellate Body Report, EC — Hormones, paras. 183–184. back to text
642. (footnote original) The Appellate Body found in EC — Hormones that the term “potential” in the second sentence of paragraph 4 of Annex A refers to the “possibility” of occurrence of adverse effects, which implies a lower degree of potentiality than “probability”. (Appellate Body Report, EC — Hormones, para. 184). back to text
643. Appellate Body Reports, US/Canada — Continued Suspension, paras. 569 and 575. back to text
644. Appellate Body Reports, US/Canada — Continued Suspension, paras. 574–575. back to text
645. Panel Reports, EC — Hormones (Canada), para. 8.101; and EC — Hormones (US), para. 8.98. back to text
646. Appellate Body Report, EC — Hormones, para. 184. back to text
647. Appellate Body Report, Japan — Apples (Article 21.5 — US), para. 204. back to text
648. Appellate Body Report, EC — Hormones, para. 181. back to text
649. (footnote original) Appellate Body Report, EC — Hormones, para. 181. back to text
650. Appellate Body Reports, US/Canada — Continued Suspension, para. 535. back to text
651. Appellate Body Reports, US/Canada — Continued Suspension, paras. 541–542. back to text
652. Appellate Body Reports, US/Canada — Continued Suspension, para. 553. back to text
653. Panel Report, US — Poultry (China), para. 7.174. back to text
654. Panel Report, US — Poultry (China), para. 7.177. back to text
655. Appellate Body Report, Australia — Salmon, para. 199. back to text
656. (footnote original) We recall, however, that the scientific process must not be understood narrowly as being confined to matters that are “susceptible of quantitative analysis by the empirical or experimental laboratory methods commonly associated with the physical sciences.” Instead, the risk to be evaluated also includes the “risk in human societies as they actually exist, in other words, the actual potential for adverse effects on human health in the real world where people live and work and die”. (Appellate Body Report, EC — Hormones, para. 187) back to text
657. Appellate Body Reports, US/Canada — Continued Suspension, para. 534. back to text
658. Appellate Body Report, Australia — Salmon, para. 200. back to text
659. Appellate Body Report, Australia — Salmon, para. 201. back to text
660. Panel Report, Australia — Apples, para. 7.974. back to text
661. Appellate Body Report, Japan — Agricultural Products II, paras. 105–107. back to text
662. Panel Report, Japan — Agricultural Products II, para. 8.109. back to text
663. Panel Report, Japan — Agricultural Products II, para. 8.111. back to text
664. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1455 and 7.1458. back to text
665. Panel Report, Japan — Agricultural Products II, para. 8.115. back to text
666. WT/MIN(01)/17, para. 3.2. back to text
667. Panel Report, Australia — Salmon, para. 7.15. back to text
668. Appellate Body Report, Australia — Salmon, para. 205. back to text
669. (footnote original) This approach is in line with the discussion of the concept of “significant effect on trade of other Members” in the notification procedures adopted and revised by the SPS Committee (G/SPS/7/Rev.2, para. 7). back to text
670. This approach is in line with the discussion of the concept of “significant effect on trade of other Members” in the notification procedures adopted and revised by the SPS Committee (G/SPS/7/Rev.2, para. 7). back to text
671. Panel Report, Japan — Apples, paras. 8.313–8.314. back to text
672. (footnote original) Appellate Body, Korea — Dairy, para. 139. back to text
673. (footnote original) Appellate Body Report, Japan — Agricultural Products II, para. 126. back to text
674. Panel Report, Japan — Apples, paras. 8.316–8–318. back to text
675. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1455. back to text
676. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1777. back to text
677. Panel Report, Australia — Apples, para. 7.1462. back to text
678. Panel Report, Australia — Apples, para. 7.1463. back to text
679. Panel Report, US — Poultry (China), paras. 7.363–7.364. back to text
680. Panel Report, US — Poultry (China), para. 7.372. back to text
681. Appellate Body Report, Australia — Apples, para. 438. back to text
682. Appellate Body Report, Australia — Apples, para. 436. back to text
683. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1498. back to text
684. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1499. back to text
685. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1494. See also Panel Report, US — Poultry (China), para. 7.353. back to text
686. Panel Report, Australia — Apples, para. 7.1472. back to text
687. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1501. back to text
688. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1502. back to text
689. (footnote original) Indeed, if this had been the intended result, the text of Annex C(1)(a), first clause, would have stated that approval procedures must be undertaken and completed “without any delay”. back to text
690. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1495. back to text
691. Appellate Body Report, Australia — Apples, para. 437. back to text
692. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1496–7.1497. See also Appellate Body Report, Australia — Apples, para. 441. back to text
693. (footnote original) This could be the case, for example, if a delay is caused by a request for additional information which has nothing to do with the issue of whether the relevant product meets the SPS requirements concerned. back to text
694. (footnote original) Needless to say, it is Members’ responsibility to allocate sufficient resources to their competent authorities so that they are in a position to discharge the obligations they have assumed under the WTO Agreement. back to text
695. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1500. back to text
696. Appellate Body Report, Australia — Apples, para. 437. back to text
697. (footnote original) We recall that pursuant to Annex C(1)(c) of the SPS Agreement information requirements must be limited to what is necessary for appropriate approval procedures. back to text
698. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1522. back to text
699. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1523. back to text
700. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1524–7.1525. back to text
701. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1526. back to text
702. (footnote original) Indeed, if a Member could delay a final approval decision on the grounds that available scientific evidence is insufficient, that Member could avoid the disciplines imposed by Article 5.7, including the requirement to seek to obtain additional information and to conduct a review of a provisional measure within a reasonable period of time. back to text
703. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1527. back to text
704. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1513 and 7.1516. back to text
705. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1517. back to text
706. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.2400. back to text
707. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.2408. back to text
708. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1582. back to text
709. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1574. back to text
710. Panel Report, EC — Approval and Marketing of Biotech Products, paras. 7.1587–7.1589. back to text
711. (footnote original) It is well to recall that the United States itself has stated that “the moratorium was a decision by the EC not to move products to a final decision in the approval process. Certain progress in the process, short of final decision, is not the least bit inconsistent with a moratorium on final approvals”. US second written submission, para. 51 (emphasis in original). back to text
712. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1592. back to text
713. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1595. back to text
714. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1598. back to text
715. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1601. back to text
716. Panel Report, Australia — Salmon (Article 21.5 — Canada), paras. 7.154–7.157. back to text
717. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.2494. back to text
718. Panel Report, US — Poultry (China), paras. 7.371 and 7.374. back to text
719. Panel Report, EC — Approval and Marketing of Biotech Products, para. 7.1569. See also Panel Report, US — Poultry (China), paras. 7.393–7.395; and Appellate Body Report, Australia — Apples, para. 434. back to text
720. Appellate Body Report, EC — Hormones paras. 128–129. back to text
721. Panel Reports, EC — Hormones (Canada), para. 8.45; and EC — Hormones (US), para. 8.42. back to text
722. Panel Report, Australia — Salmon, para. 8.39. back to text
723. Panel Report, EC — Hormones (Canada), para. 8.275. The Panel in EC — Hormones (US), exercised judicial economy with respect to the US claim under Articles I and III. Panel Report, EC — Hormones (US), para. 8.272. back to text
724. Panel Report, Australia — Salmon, para. 8.185. back to text
725. Panel Reports, EC — Hormones (Canada), para. 8.39; and EC — Hormones (US), para. 8.36. back to text
726. (footnote original) Preambular para. 6 of the SPS Agreement. back to text
727. (footnote original) Preambular para. 2 of the SPS Agreement. back to text
728. Panel Reports, EC — Hormones (Canada), para. 8.41; and EC — Hormones (US), para. 8.38. See also Panel Report, US — Poultry (China), para. 7.473. back to text
729. Panel Report, US — Poultry (China), paras. 7.471–7.472. back to text
730. (footnote original) MTN./GNG/NG5/10, para. 3. back to text
731. (footnote original) MTN./GNG/NG5/WGSP/1. back to text
732. Panel Report, US — Poultry (China), paras. 7.478–7.479. back to text
733. Panel Report, US — Poultry (China), paras. 7.481–7.482. back to text

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