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US vs. EC Beef hormones DS26

US vs. EC Beef hormones DS26. Jocelyn Mason Kelly McFarlane Anita Nyaga. Involved Parties. US Complaint.

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US vs. EC Beef hormones DS26

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  1. US vs. ECBeef hormonesDS26 Jocelyn Mason Kelly McFarlane Anita Nyaga

  2. Involved Parties

  3. US Complaint • “The EC under the Council Directive Prohibiting the Use in Livestock Farming of Certain Substances Having a Hormonal Action restrict or prohibit imports of meat and meat products from the US” • Inconsistent with: • GATT Articles III and XI • SPS Agreement Articles 2, 3 and 5 • TBT Agreement Article 2 • Agreement on Agriculture Article 4.

  4. Timeline

  5. Panel Conclusions Panel found that the EC was banning the import of US beef from cattle treated with any of six growth hormones. Inconsistent with Articles 3.1, 5.1 and 5.5 of the SPS Agreement Panel conclusions were upheld despite EC’s appeal

  6. Implementation • April 8, 1998 - EC requests a reasonable period of time for implementation of the recommendations and rulings • The Arbitrator found the reasonable period of time for implementation to be 15 months from the date of adoption • Period of implementation was decided to expire on 13 May 1999. • The EC agreed to comply with the recommendations of the DSB within the implementation period.

  7. Changes in Implementation • April 28, 1999 - the EC informed the DSB that it would consider offering compensation as it did not expect to comply with the recommendations and rulings by the deadline • June 3, 1999 – US and Canada requested authorization from the DSB for the suspension of concessions to the EC in the amount of $202 million and $75 million, respectively. • The EC requested arbitration on the level of suspension of concessions requested by the US and Canada. The issue was referred to the original panel. • The level of nullification suffered by the US was determined to be $116.8 million, the level of nullification suffered by Canada was determined to be $11.3 million.

  8. Further Timeline

  9. The EC’s Solution • The Appellate Body, in its ruling against the EC, required the EC to carry out a risk assessment on the use of hormones in beef. When it failed to do so, the DSU commissioned such an assessment to be undertaken on behalf of the EC, by an independent scientific committee. The findings indicated that the hormones in question posed a risk for consumers. • The EC felt it had fulfilled its WTO obligations and was entitled to demand the immediate lifting of the sanctions imposed by the US and Canada. • The EC creates a new Directive (2003/74/EC) regarding the prohibition of the use of certain hormones, based on the finding of the study.

  10. The EC’s Solution • The US stated that a number of studies had found that there was no increased health risk from the consumption of meat from animals treated with growth-promoting hormones, and therefore the US would not agree to the EC request. • Canada stated that it doubted whether the new studies presented any new scientific basis for the ban of hormone-treated beef, and would not agree to the request of the EC. • The EC responded that on the basis of the negative position expressed by the US and Canada, it would reflect on the appropriate actions that would be necessary in order to preserve its rights under the WTO agreements.

  11. 2008 Continued Discussions • The EC stated that: in light of the disagreement between the parties, the matter should be referred to the WTO for a multilateral decision. • Canada claimed that they had requested discussions with the EC , however the EC had not responded therefore it was up to the EC to establish that it had complied with the WTO ruling • Canada remains open to discussions with the EC regarding its justification for its position. However, Canada did not see any basis for removal of its retaliatory measures . • The US stated that they failed to see how the revised EC measures could be considered implementation of the DSB’s recommendations. However, they remain open to discussion, though unwilling to consider removal of retaliatory measures.

  12. MAIN WTO ISSUES

  13. Main WTO IssuesREVIEW The EC banned US beef & beef products because they had been treated with specific growth hormones. EC was applying the precautionary principle Protectionism

  14. Main WTO Issues The panel found that EC’s ban on US beef that had any of the six growth hormones was inconsistent with: Article 3.1, 5.1and 5.5 of SPS Agreement Article 3.1: “To harmonize sanitary and phytosanitary measures on as wide a basis as possible, Members shall base their sanitary or phytosanitary measures on international standards, guidelines or recommendations, where they exist, except as otherwise provided for in this Agreement,…..” Article 3.3: “Members may introduce or maintain sanitary or phytosanitary measures which result in a higher level of sanitary or phytosanitary protection than would be achieved by measures based on the relevant international standards, guidelines or recommendations, if there is a scientific justification, or as a consequence of the level of sanitary or phytosanitary protection a Member determines to be appropriate in accordance with the relevant provisions……” Source:http://www.wto.org/english/res_e/booksp_e/analytic_index_e/sps_01_e.htm#article3

  15. Main WTO Issues Article 5.1: “Members shall ensure that their sanitary or phytosanitary measures are based on an assessment, as appropriate to the circumstances, of the risks to human, animal or plant life or health, taking into account risk assessment techniques developed by the relevant international organizations.” Article 5.5 “With the objective of achieving consistency in the application of the concept of appropriate level of sanitary or phytosanitary protection against risks to human life or health, or to animal and plant life or health, each Member shall avoid arbitrary or unjustifiable distinctions in the levels it considers to be appropriate in different situations, if such distinctions result in discrimination or a disguised restriction on international trade. ……” Source:http://www.wto.org/english/res_e/booksp_e/analytic_index_e/sps_02_e.htm#article5

  16. Main WTO Issues The EC appealed and the Appellate Body Upheld the panel’s decision in regard to articles 3.3 and 5.1 of the SPS Agreement BUT……. It reversed the panel’s decision in relation to articles 3.1 and 5.5 of the SPS agreement

  17. US Position US believes that EC’s ban on US beef and beef products was inconsistent with: GATT Articles III or XI SPS Agreement Articles 2,3 and 5 TBT Agreement Article 2 Agreement on Agriculture Article 4

  18. US Position US argued that: EC’s standards on the ban on growth hormones was inconsistent with international standards EC’s ban on US beef was not actually scientifically based EC’s ban was inconsistent with the Uruguay Round SPS Agreement.

  19. EC’s Position EC was protecting the health of consumers EC was applying the precautionary principle EC had funded several scientific researches which concluded that the hormones had some effect on consumers EC did not have enough funding to continue with the research

  20. Where Things Currently Stand Sanctions are still in place Beef ban is still in effect Requests for consultations have been made

  21. BROADER ISSUES AND IMPLICATIONS

  22. Broad Issues and Implications Protectionism vs. Precautionary Principal Issues in International Food Safety

  23. Protectionism v. Precautionary Principle • Consumer safety can be used as a legitimate escape clause in trade agreements • Consumer safety can also be taken advantage of to engage in protectionism

  24. Protectionism v. Precautionary Principle The EC has a long documented history of applying the precautionary principle to consumer food safety issues Cultural differences are part of the difficulties that the WTO must deal with when negotiating trade disputes The sovereignty issue: this was a consumer driven push for import restrictions

  25. Issues in International Food Safety International Harmonization of Food Safety and Labeling Standards Codex Alimentarius Commission (CAC) • An intergovernmental body • Over 170 members • Established 1963

  26. Issues in International Food Safety • Effects on developing countries • Food exports are the primary driver of economic growth in most developing countries • Conforming to strict food safety standards can be prohibitively expensive • The FAO Pro-Poor Livestock Policy Initiative • PPLPI aims to facilitate and support the formulation and implementation of livestock-related policies and institutional changes that have a positive impact on the world’s poor

  27. Sources Alderson, Elizabeth. “The economic importance of demonstrable local and national systems for food safety hazard analysis, control and monitoring.” http://www.cabicompendium.org/ahpc/Library/HTML/Production/fsq_haccp_importance.htm#FoodSafety Halderman, Michael and Michael Nelson. “EU Policy-Making: Reform of the CAP and EU Trade in Beef & Dairy with Developing Countries.” Pro-Poor Livestock Policy Initiative. Food and Agriculture Organization of the United Nations.http://www.fao.org/ag/againfo/programmes/en/pplpi/docarc/wp18.pdf Johnson, Renee and Charles E. Hanrahan. “The U.S.-E.U Beef Hormone Dispute.” CRS Report for Congress. Congressional Research Service R40449. 5 May 2009. http://www.nationalaglawcenter.org/assets/crs/R40449.pdf The World Trade Organization. “European Communities – Measures Concerning Meat and Meat Product (Hormones).”http://www.wto.org/english/tratop_e/dispu_e/cases_e/ds26_e.htm U.S. Food and Drug Administration. International Harmonization.http://www.fda.gov/Food/InternationalActivities/ucm103013.htm

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