Saturday, 26 August 2017

The Myth of Global Regulations - SPS Measures

In a previous post, I looked at the claim made by supporters of the EFTA EEA option that the EU's technical regulations were simply a "rubber stamp" of global regulations and concluded:
  • There are no "global" regulations, just international standards which are voluntary and only have legal force when implemented in binding regulations in national (or EU) legislation - giving scope for "gold-plating" and regulatory barriers to trade. 
  • The EU's regulations are not fully harmonised with international standards bodies recognised by the WTO. In particular, only 24% of European CEN standards cited in EU law are identical to ISO standards.
  • The EU adopts a protectionist regulatory stance: refusing to recognise international standards that provide equivalent or higher safety levels;  insisting on withdrawal of existing regulations and replacement with European standards in trade relations with third countries - effectively exporting the EU acquis and shutting out other international trade.
A similar story is seen with respect to Sanitary & Phyto-Sanitary (SPS) regulations - i.e. regulations covering animal and plant health. The WTO SPS agreement encourages the use of international SPS standards (Article 3.1), in a similar manner to WTO TBT agreement Article 2.4 and international technical standards. The WTO recognises three international SPS standards organisations:
Codex is also party to an agreement with UNECE (the "Geneva Understanding") to avoid duplication and adopt each others standards where they overlap. Between them, Codex and UNECE provide a large proportion of  international food safety standards.

SPS regulations are cited as the best example of how EU regulations are essentially "global". There are no hard and fast figures available, but it does seem likely that the great majority of the EU's SPS regulations are based on international standards (primarily from Codex and UNECE). Tabloid claims regarding barmy Brussels laws on curvy cucumbers and bent bananas turn out to be international standards with a sensible, trade facilitating purpose behind them.

There are notable exceptions to the EU's acceptance of international standards though. The EU's resistance to Genetically Modifed Organisms (GMO) has held back scientific and agricultural development in Europe and resulted in WTO rulings against the EU from cases brought by US, Canada, Australia, New Zealand. Argentina, Brazil, India and Mexico.

But even though the majority of EU SPS regulations are based on international standards, there is still significant scope for barriers under the WTO SPS Agreement. In particular Article 3.3 allows circumstances where members can introduce SPS measures resulting in a higher level of protection than international standards.

As Derrick Wilknson explains in his blog, there is a wide range of plant protection products (PPPs), veterinary pharmaceuticals (VPs) and biotechnologies, that are severely restricted or banned in the EU. Although international standards have been agreed on maximum allowable residue limits for the PPPs and VPs on food,  the actual limits enforced vary significantly from jurisdiction to jurisdiction.

The recent publicity over "chlorinated chicken" is also informative. The USA puts chicken carcasses through a disinfectant chlorine wash to prevent salmonella. This is a perfectly safe procedure and there is no Codex, UNECE or other international standard prohibiting this. In fact prepared salads sold in the EU are often subjected to a chlorine wash. The EU does not regard the chicken chlorine-wash as unsafe - nevertheless imports of US chicken to the EU are blocked.

The EU's regulatory approach is based on the "precautionary principle" and a "farm-to-fork" approach to secure food safety throughout the supply chain - rejecting the US use of disinfectants. It has been claimed that the EU's approach is a superior form of food safety control, although recent salmonella outbreaks across the EU have rather undermined that claim. What is clear that the EU's approach creates a major non-tariff barrier to trade in agriculture with non-EU nations.

Packaging regulations also provide a major non-tariff barrier for agricultural exports. Combined with onerous rules of origin, they restrict African countries exporting to the EU despite benefiting from a zero-tariff rate for Least Developed Countries (LDC's). Canadian exporters complain that meat exports to the EU require the EU's own health mark on a tamper proof belt applied in the processing plant.

The fact that the EU's SPS regulations are based primarily on international standards from Codex and UNECE does not prevent regulatory barriers to trade.  Choosing the EFTA EEA option means permanently adopting the EU's particular SPS regulations, with all the barriers and protectionism that brings. The claim that EU SPS regulations are simply a "rubber stamp" of global SPS standards is a myth.

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