ICTSD Outputs and Activities on Biotechnology, Trade and Sustainble Development

Biotechnology: Addressing Key Trade and Sustainability Issues

B.2 Multilateral trade rules

Q9 What issues are raised by the application of WTO rules in biotechnology?

The WTO rules that apply to a particular measure are significant given that the GATT, the SPS Agreement and the TBT Agreement each have different requirements that must be fulfilled for conformity. Moreover, the nature of biotechnology products raises particular challenges and opportunities in the context of each of these agreements.

In the GATT, several provisions are likely to be particularly relevant to trade in biotechnology. First, two of the core principles of the agreement – the national treatment and the ‘most favoured nation’ obligations – require countries to grant equal treatment (in terms of laws and regulations, for instance) to products of national and foreign origin, and products originating in or destined for the territories of different WTO Members, considered ‘like products’. Whether genetically modified products and other non-modified products are ‘like products’ has been particularly controversial, as will be seen below.

Another important issue in the context of the GATT is whether biotechnology-related measures can be considered necessary “to protect public morals”, “ protect human, animal or plant life or health” or “relating to the conservation of exhaustible natural resources” and thus fall within the exceptions to GATT provisions established by Article XX. Moreover, even if Article XX is found to include such measures, they would still be subject to the requirement that they are not applied in a manner that would constitute “a means of arbitrarily or unjustifiable discrimination between countries where the same conditions prevail”, or “a disguised restriction on international trade”.

The SPS Agreement is perhaps the most relevant legal framework for biotechnology-related measures in the WTO context insofar these measures are generally aimed at safeguarding food safety or plant and animal health. Moreover, given its science-based approach to ensuring measures relating to human, animal, and plant health do not represent unnecessary, arbitrary, or disguised restrictions on international trade, it also poses the most difficult challenges for biotechnology-related measures. As will be further described below, the SPS Agreement encourages countries to base their measures on international standards, guidelines and recommendations, granting measures based on these standards the presumption of consistency with its provisions. However, where no standards exist or a country chooses to adopt a stricter standard than the one established internationally, measures must be based on a risk assessment – thus the SPS Agreement aims to prevent the use of SPS measures for protectionist purposes.

Another significant element of the SPS Agreement is Article 5.7 of the SPS Agreement, which recognises the right of countries, in cases where relevant scientific evidence is insufficient, to provisionally adopt sanitary or phytosanitary measures on the basis of available pertinent information (see Section B.3).

The TBT Agreement could present a number of advantages from the perspective of countries implementing biotechnology-related measures. For instance, the TBT Agreement, while requiring these measures to be no more trade-restrictive than necessary to achieve a legitimate objective, does not require the same rigorous standard of scientific basis demanded in the SPS Agreement. Moreover, the open list of legitimate objectives in Article 2 includes the “protection of human health or safety, animal or plant life or health, or the environment”. Another potentially important justification for GMO labelling that would also fall under the scope of the TBT Agreement is the right of consumers to information and choice. In addition, the TBT Agreement is open-ended as to the international standards on the basis of which WTO Members can prepare, adopt or apply a technical regulation that will be rebuttably presumed not to create an unnecessary obstacle to international trade. As a result, the provisions of the Cartagena Protocol on Biosafety, for instance, could be used as a basis for technical regulations. Nevertheless, because the TBT Agreement does not allow for discrimination between ‘like products’, similar problems as in the GATT context may arise given the lack of agreement on how this concept applies to biotechnology products. Finally, it is worth noting that technical regulations can include “terminology, symbols, packaging, marking or labelling requirements that apply to a product, process or production method”, whose relevance in the context of biotechnology is discussed below.