ICTSD Outputs and Activities on Biotechnology, Trade and Sustainble Development

Biotechnology: Addressing Key Trade and Sustainability Issues

B.2 Multilateral trade rules

Q10 What is the EC-Biotech case about?

In August 2003, a Panel was established under the WTO dispute settlement process to address claims by the US, Argentina and Canada that various measures allegedly taken by the EU and EU member states were inconsistent with WTO rules. These measures included:

An alleged general de facto moratorium on the approval of biotechnology products in the EU since October 1998,
The EU’s failure to complete approval procedures for certain specific applications (so-called ‘product-specific measures’) – in total, 27 of these product-specific measures were challenged, and
nine safeguard measures in the form of import and/or marketing bans applied to specific biotech products (‘nation-level bans’) adopted by six EU member states (Austria, France, Germany, Greece, Italy and Luxembourg).

The complaining parties and the panel stressed that it was not the WTO-consistency of the EU approval legislation as such that was being questioned, but rather the manner in which the legislation was being applied. EU approval legislation relevant for the case included Directive 2001/18/EC on the deliberate release into the environment of genetically modified organisms, which repealed Directive 90/220/EEC; and Regulation 258/97 on novel foods and novel food ingredients.

On 29 September 2006, the Panel issued its final report, ruling in favour of the complainants. In particular, the Panel concluded that a general de facto moratorium did exist and resulted in an “undue delay” in the application of approval procedures, thus violating Article 8 and Annex C of the SPS Agreement. The Panel also found that there was “undue delay” in the completion of the approval procedure with respect to 24 of the 27 specific product applications. Finally, the Panel found that the nine safeguard measures taken by some EU member states failed to meet the science-related requirements of the SPS Agreement. Nevertheless, the European Commission has depicted the results as “largely of historical interest” and highlighted they will not affect or alter European legislation on biotechnology products.

The situation in relation to the national safeguard measures seems to be the most complex. Under EU legislation, these measures are provisional and subject to an assessment at European level that either modifies the EU approval or terminates the measure. In June 2005, the EU Environmental Ministers had in fact rejected European Commission proposals that these national measures be lifted (ICTSD, 2005a). Nevertheless, the Panel’s findings do not in themselves require a withdrawal of the safeguard measures. EU member states would be able to bring these measures in compliance with the ruling by conducting or putting forth risk assessments as defined by the SPS Agreement.