WTO Agreement on Sanitary and Phytosanitary Standards

The Agreeement on Agriculture is not the only WTO policy which impacts on agricultural trade. The Agreeement on Sanitary and Phytosanitary Measures, usually know as the SPS Agreement, is another important agreement which governs the measures governments can take to regulate trade in agri-food products on health and safety grounds. Such measures increase the cost of market access and can be a significant non-tariff barrier to trade.

Objectives of the SPS Agreement

Every country adopts regulations to protect consumers from unsafe food and to prevent the dissemination of pests, parasites or invasive species. However, there is suspicion that such regulatons may also be used for protectionist purposes.

The WTO SPS Agreement was designed to regulate the possible abuse of SPS regulations and their use as non-tariff barriers.Under the SPS Agreement, countries cannot be accused of imposing illegitimate barriers to imports if they follow international standards. If they wish to go beyond these standards in protecting plants, animals or citizens, they must provide scientific evidence to support their measures. The SPS Agreement therefore gives great importance to international bodies such as Codex Alimentarius, an international code of standards for human health protection and fair practices, the Office International des Epizooties (animal health) and the organisations operating in the framework of the International Plant Protection Convention. The requirement for transparent risk-based assessment of threats to human, animal and plant health is an important protection for all WTO members against the arbitrary use of food safety or health measures as a protectionist device.

WTO Disputes on SPS Measures

The text of the SPS agreement in very short. Thus, the WTO dispute settlement procedure has developed a significant jurisprudence in interpreting this agreement. A first dispute where the United States, and then Canada, challenged the EU ban on hormone-treated beef generated much controversy. The conclusions of the 1997 panels, which ruled against the EU, appeared unfair to many, since the ban was also applied to domestic beef. The SPS Agreement was criticised for prioritising international standards over decisions of legitimate national institutions, and for contradicting the precautionary principle which plays an important role in EU food safety policy..

However, the Appellate Body defended the right of each country to define its own level of consumer protection, and stated that the opinion of even a minority of scientists could be a legitimate basis for protective action. But it also asserted that a well-defined procedure of risk analysis was necessary if a country wanted to apply measures more protective than international standards, and the EU had failed to do this in the beef case.Because the EU refused to alter its ban, the US has maintained sanctions in the form of higher tariffs on imports of EU food products up to the value of its loss. Following further EU legislation and resort to the WTO dispute settlement mechanism, both parties reached a settlement in 2009 which could finally lead to a resolution of this dispute.

Several other disputes have led to a more precise interpretation of the SPS agreement, and is now widely accepted by WTO members. While the number of SPS disputes has been limited, many issues have been resolved at the consultation phase. The major impact of the agreement is that it has deterred countries from using SPS measures for protectionist purposes, and has encouraged the use of science-based measures.

Links:

Agritrade – Food Safety Website
Agritrade-CTA’s web portal on Food Safety which reviews the possible impact of EU food safety regulations on ACP-EU agricultural and food trade.

WTO Website – Understanding the WTO Agreement on Sanitary and Phytosanitary Measures
WTO website page which discusses the text of the SPS Agreement in a question-and-answer format

World Bank Challenges and Opportunities Associated with International Agro-Food Standards
Describes the World Bank research programme to better understand the impact of food standards on international trade

Resources:

Broberg, M., European Food Safety Regulation and Developing Countries: Regulatory Problems and Possibilities (PDF), 2009.
A research paper which identifies the most important EU food safety barriers from a developing country perspective and suggests possible steps by the EU to address these.

IFPRI, Food Safety in Food Security and Trade, 2003
Series of ten briefs examining the impact of food safety regulations on developing countries, including a number of case studies

InBrief, Negotiating Economic Partnership Agreements: Sanitary and Phytosanitary Measures (PDF), 2006
A brief which highlights some of the problems raised by SPS measures specifically for ACP countries

Jensen, M.F., Reviewing the SPS Agreement: A Developing Country Perspective (PDF), 2002
Paper presents a clear outline of the SPS Agreement and its pros and cons from a developing country perspective