WTO

1
WTOs Work on Private Standards
Gretchen H. Stanton Senior Counsellor Agriculture
and Commodities Division WTO
2
Chronology of Discussions on Private Standards
June 2005
October 2006
March 2007
June 2007
St. Vincent and the Grenadines raised concern in
SPS Committee about EurepGAP certification for
bananas
WTO Information Session with participation of
EurepGAP and UNCTAD. St. Vincent and the
Grenadines requested continued discussion by SPS
Committee
SPS Committee discussed private standards as
trade concerns
UNCTAD/ WTO joint Information Session on Private
Standards and discussions in SPS Com. as specific
agenda item
3
Chronology of Discussions on Private Standards
October 2008
October 2007
June 2008
Members invited to present specific examples of
products, markets and private standards which
have created difficulties or benefits for
their exports. UK presented study
(G/SPS/GEN/802).
WTO/STDF Information session on facilitating
compliance with private standards
Committee adopts work program (G/SPS/W/230)Compa
rative Study
4
Private Standards in International Trade Why
and How

• Food safety concerns
• Private companies liability for food safety risks
• Corporate Social Responsibility and Reputation
  Risks
• Vertical integration between suppliers and
  retailers
• Large food retailers
• Estimation of over 400 private schemes (UNCTAD)
• Private standards are global

Trade Creation Potential Vs. Trade Barriers
5
Examples of Private Standards

• Individual Firms Schemes
• Collective National Schemes
• Collective International Schemes

6
Examples of Private Standards

• Individual Firms Schemes
• Private firms set their own standards for
  products that they sell
• Can be based on national/ regional/international
  standards or exceed these
• Can include administration schemes, specific
  certifications and other requirements
• Usually applicable to fresh products
• E.g., Tesco Natures Choice, Carrefour Filière
  Qualité

7
Examples of Private Standards

• Collective National Schemes
• Set by national retailers associations and/or
  producers
• Establish specific standards for products they
  produce or sell
• Can be based on national/ regional/ international
  standards or exceed these
• Can include administration schemes, specific
  certifications and other requirements
• E.g., British Retail Consortium Global Standard
  Food, Assured Food Standards

8
Examples of Private Standards

• Collective International Schemes
• Refer to existing retailers food safety
  management systems according to established
  parameters which can encompass food safety,
  social responsibilities, environmental demands,
  labour requirements, etc.
• Requirements can be pre-farm gate (growers and
  farmers), post-farm gate (food packing and
  processing) and for retailers
• E.g., Global Food Safety Initiative, EurepGAP,
  ISO 22000

9
Government food safety requirements

• Separate food safety from quality requirements
• Based on Codex standards or
• Based on a risk assessment
• Consistent level of health protection
• Least restrictive of trade
• Recognize equivalence of other measures
• Notified in advance, with comment period
• Published, with reasonable interval before entry
  into force
• Subject to WTO formal dispute settlement
  procedures

10
(No Transcript)
11
Key Concerns Related to Private Standards

• Market access
• Developmental implications
• Legal aspects

12
Market Access Possible Implications

• Private Standards going beyond official food
  safety requirements
• (e.g., lower maximum pesticide residue levels -
  MRLs)
• Becoming de facto market access requirements
• - Blurring of private and official requirements
• Proliferation of different schemes
• Overlap and/or contradictions
• Lack of harmonization
• No equivalence
• Access to higher-priced markets
• Less competition in markets

13
Developmental Implications

• Costs associated with private standards
• Costs of compliance
• Certification costs
• Lack of price premium
• Impact on small- and medium- sized farmers and
  enterprises
• Driving supply chain modernization and
  investments
• Correcting underlying hygienic problems
• Faster upgrading

14
Legal Aspects

• Applicability of SPS Agreement
• Art. 1.1 and Annex A(1)
• Art. 13
• Scientific basis
• Equivalence
• Transparency
• Mechanism/forum to address concerns
• Mechanism/forum to resolve disputes

15
SPS Agreement - Article 13Implementation

• ... Members shall
• take such reasonable measures as may be available
  to them to ensure that non-governmental entities
  within their territories ... comply with the
  relevant provisions of this Agreement.
• ...not take measures which have the effect of,
  directly or indirectly, requiring or encouraging
  such ... non-governmental entities... to act in a
  manner inconsistent with the provisions of this
  Agreement.
• 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.

16
The TBT context

• Similar language
• Role of non-governmental bodies with respect to
  (mandatory) technical regulations
• Code of Good Practice
• For bodies setting (voluntary) standards
• Contains key principles of TBT Agreement

17
The Committee on Trade and Environment

• Environment requirements and market access
• Difficulties faced by developing countries
• Recently discussion on organic products
• Lack of harmonized standards

18
SPS Committee next steps

• Undertake study to compare private standards with
  international and official requirements (based on
  products / markets / standards/ data from WTO
  members)
• Encourage information sharing on studies
  regarding SPS-related private standards
• Organize ad hoc information sessions with private
  standards bodies and others
• (G/SPS/W/230 - agreed, with changes, 9 October
  2008)