by Martin Khor

Geneva 26 Oct 99 -- Recent proposals in the WTO by some developed
countries to establish special disciplines or a
working group for bio-technology products could seriously
undermine developing countries' efforts to ensure safety in the
trade in genetically-modified organisms and products.

As part of the preparatory process for the WTO's Seattle
Ministerial Meeting, and the drafting of an agenda and draft
ministerial declaration there, to launch a new round of
negotiations and a post-Seattle work programme, Canada and Japan
have proposed the setting up of a new WTO working group or forum
on biotechnology, whilst the US has proposed the WTO consider
additional disciplines for the trade in biotechnology products.

These proposals have now been included in the revised draft
Ministerial Text of 19 October in two places:

(a) Para 71 (in square brackets) entitled "Working Party on
Biotechnology" states: "We agree to establish a Working Party on
Biotechnology. The Working Party shall have a fact-finding
mandate to consider the adequacy and effectiveness of existing
rules as well as the capacity of WTO members to implement these
rules. It is appropriate for this Group to deliberate within an
X period of time."

This proposal has come from Canada and Japan, which have
submitted papers proposing to set up a working party or a forum
to deal with biotechnology (details are given below).

(b) In the draft Declaration's section on Agriculture, Para 29
(vi) deals with improving the rules and disciplines (of the WTO).
One of the proposals is for: "Disciplines to ensure that trade
in products of agricultural biotechnology is based on transparent,
predictable and timely processes."

The language of this para is similar to the US proposal (in its
paper WT/GC/W/288 dated 4 Aug 99) in the context of future
agriculture negotiations.

The proposals could have serious effects on the efforts made by
developing countries in the Biodiversity Convention to establish
a Biosafety Protocol which is aimed at preventing the
indiscriminate export to developing countries of potentially
hazardous genetically-modified organisms (GMOs) in products such
as seeds, food and animal feed.

It may be worth noting that the multilateral trading system's track
record on dealing with hazardous and dangerous products in
international trade is abysmal.

In 1982, at the ministerial meeting under the old GATT, this item
of prohibiting exports of hazardous and dangerous products,
banned or severely restricted by countries in their own internal
markets was put on the GATT work programme.

It was put on the back-shelf, as the US and EC pushed on with their
grand plans for the Uruguay Round, and almost disappeared from
the agenda. In 1990, it was revived, and a working party was
appointed, and was due to come up with some modest transparency
demands, namely, of notification obligations of countries.

The US blocked it, wanting to exclude auto-parts and
pharmaceutical and chemical products - so that its enterprises
would have the right to export what is viewed as hazardous and
dangerous in the US market itself. There have been some talk,
off and on, about this item, including in the WTO Committee on
Trade and Environment, but with no serious work or movement.

The export of GMOs could have an adverse effect on agriculture in
developing countries (as the genetically-engineered genes could
inadvertently contaminate local plants and crops) and could also
pose health hazards. To avoid these problems, almost all
developing countries of the Group of 77 have taken the lead in
fighting for a Biosafety Protocol (under the Biodiversity
Convention) with an "advanced informed agreement" (AIA) system in
which GMO products can only be exported if the importing country
is first informed and gives approval.

A handful of countries, the so-called Miami Group, led by the US (which are
the main producers of GM crops and food) are trying to delay and
water down the protocol.

The Miami Group comprises of the US, Canada, Australia, Argentina, Chile
and Uruguay.

The Miami Group in the CBD talks, have proposed only a limited
scope for products covered. They have also proposed that instead
of an AIA procedure (where exporters are obliged to get the
importing counties' permission), exporters should only put
information on an internet website and it is up to the importing
countries to seek the information themselves and to restrict
imports (if they so wish) within a specified period, after which
the product should be allowed to enter.

They are also insisting on a clause that the Biosafety Protocol
be in line with other international agreements (which refers
particularly to the WTO).

The proposals in the WTO are in line with these efforts to
subject the Biosafety Protocol to new disciplines in the WTO that
would restrict the ability of importing countries to regulate
imports of GMO products.

If the proposals are adopted in Seattle, they would adversely
affect the efforts of developing country delegations in the
Biosafety Protocol to adequately regulate the (now unregulated)
trade in GMOs and GM products.

At present, GMOs and genetically-modified seeds and other
materials are already entering developing countries, often
without the knowledge of the authorities of importing countries.
There is grave concern among environmental, agricultural and
health authorities in many developing countries over the
potentially serious problems this may cause. They are thus
pushing hard for a good biosafety protocol, now scheduled for
completion next year.

There are strong grounds to believe that the recent proposals in
the WTO are aimed at countering the Biosafety Protocol, or to
prevent it from being able to adequately regulate the trade in
GMO products, and to seriously limit the scope of national laws
regulating imports.

As part of the WTO's process for preparing for Seattle, Canada
and Japan have put forward proposals that the Ministers at
Seattle decide to set up a new working group in the WTO to deal
with GMOs and biotechnology. Canada (in its paper WT/GC/W/359
dated 12 Oct 99) proposes a "working party on biotechnology",
whilst Japan (in its paper WT/GC/W/365 dated 12 Oct 99) calls it
an "examination group for new issues including GMOs".

Meanwhile, the United States (in its paper WT/GC/W/288 dated 4
Aug 99) in the context of future agriculture negotiations, has
proposed to address WTO disciplines "to ensure trade in
agricultural biotechnology products is based on transparent,
predictable and timely processes."

To avoid the potential damage of the above proposals, developing
countries could object to the proposals. They could argue that
the present rules in WTO are adequate to deal with biotech
products and thus there is no reason to grant such special status
to biotech products. Moreover, agreement to give such special
treatment to biotech products would open the door to demands for
similar treatment for other products in future.

This issue has been analysed in a Discussion Paper by the Centre
for International Environmental Law (CIEL) on the implications
for developing countries of proposals to consider trade in GMOs
at the WTO. This paper is authored by Matthew Stilwell,
managing attorney at CIEL.

According to CIEL, the proposals' aim is to further constrain the
ability of importing countries to regulate GMO products.

"Currently, the WTO includes no explicit disciplines on national
measures to regulate GMOs," says the CIEL paper. However, it is
clear that GMO-exporting countries consider the existing WTO
obligations (on importing countries) to be insufficient and are
thus seeking new WTO disciplines.

Whilst the ultimate form of these is unclear, says CIEL,
nevertheless, it is likely they are intended to further constrain
the ability of importing countries to regulate GMO products. They
could include:

* Further disciplines on national GMO approvals to ensure, what
is termed as, "transparent, predictable and timely" processes.
This may involve re-interpretation of the SPS and/or TBT
Agreements. The terms "timely" and "predictable" may, for
example, mean undue constraints for national regulators, who
would face deadlines for dealing with GMO products that may need
time consuming testing procedures to avoid unpredictable
consequences for biodiversity and the environment;

* Additional, so-called "science-based" disciplines on national
GMO regulatory and labelling schemes. This may, again, involve
a re-interpretation of the SPS and/or TBT Agreements;

The CIEL paper also warns that the proposals may adversely affect
the Biosafety Protocol negotiations and final outcome, because:

(a) The argument could then be advanced that the protocol should
be delayed until the proposed WTO Working Party in the WTO makes
its conclusions;

(b) WTO disciplines (existing or new) could be used to further
reduce the SCOPE of the Protocol. During the Biosafety Protocol
negotiations, the Miami Group sought to narrow the scope of the
Protocol by excluding GMO commodities. A broad definition of
"agricultural biotechnology products" at the WTO may be used to
exert further pressure to reduce the protocol's scope;

(c) WTO discussions could be used to weaken the protocol's
PROVISIONS. For example, new WTO disciplines to ensure the
"timely" approval of shipments of GMO products may cut against
the Biosafety Protocol's provisions on "advanced informed
agreement". During the biosafety negotiations, Miami Group
members argued that these provisions may lead to unnecessary

(d) New so-called "science-based" disciplines may be promoted by
these countries in the WTO which may then be used to counter the
Biosafety Protocol's use of the precautionary principle. In
addition, new obligations to prove risk before regulating GMO
products may be especially burdensome for developing countries,
which may lack the scientific and technical capacity to test
shipments of GMO products.

(e) Moving GMO issues into the WTO may change the negotiating
dynamic. Considering GMO issues at the WTO may allow GMO-
exporting nations to take advantage of the WTO's pro-trade (and
pro-corporate) orientation, to exploit developing countries
limited capacity to coordinate activities in numerous
international fora, and to undermine developing countries' strong
position for the Biosafety Protocol by negotiating anew with trade
delegates who have not closely followed these negotiations.

(f) It would increase the likelihood of using the "uncertainty"
of WTO rules (this has already been used by a few countries
during recent biosafety protocol negotiations) to undercut the
protocol. The CIEL paper concludes that the existing rules in WTO
are sufficient to deal with GMO and biotechnology products, and
that the proposals to negotiate additional disciplines should not
be accepted.

The paper makes the following recommendations:

A. Recommendations related to the WTO:

* Characterize existing WTO disciplines as adequate to deal with
GMO-related issues, and argue that further disciplines are not

* Note that Article 5.7 of the SPS Agreement allows countries to
invoke the precautionary principle and take provisional measures
to stop imports. It is then incumbent on them to substantiate
their action with the necessary risk assessment. In the area of
GMOs, it should be understood that the burden of proof is on the
exporter to provide adequate scientific evidence that the
products are safe;

* Agree that GMO products cannot be treated as 'like products'
under the provisions of the TBT Agreement. Therefore, labelling
of GMO products cannot be challenged as discriminatory under that
Agreement. GMO products are unlike non-GMO products on the basis
of the traditional WTO test for determining likeness of products
-- consumer's tastes and habits; the products' physical
characteristics; and, the products properties, nature and

* Insist that, in view of the linkages between GMOs and IPR
protection, the mandated substantive review of Article 27.3 (b)
should be completed soon, and that sufficient time (i.e. 5 years
from the date of completion of the review) should be given to
developing countries to implement this Article. This review
should clarify that plants and animals and micro-organisms and
other living organisms and their parts, as well as natural
processes for their production are not patentable. Moreover,
national sui generis systems to protect plant varieties should
be compatible with the obligations of countries under the Convention
on Biological Diversity and the FAO International Undertaking for
Plant Genetic Resources;

* Note Japan's characterization of GMOs as a "new issue" and
argue against the inclusion, through a Working Group or other
mechanism, of such a complex and multifaceted new issue into the
WTO at short notice. The introduction of broad discussions on
GMOs threatens to overburden developing countries and create
imbalance in the agenda of future negotiations;

* Consider any proposals (such as that of the United States) to
negotiate new rules on agricultural biotechnology products in
light of the broader context of cross-issue and cross-
institutional linkages. Consideration of possible new
disciplines, if any, should be preceded by a successful
conclusion of the Biosafety Protocol and balanced by a
comprehensive package of measures for developing countries;

B. Recommendations related to other organizations/initiatives:

* Support the Biosafety Protocol negotiations and push for an
early conclusion of this agreement. The Biosafety Protocol
provides the appropriate forum for dealing with the GMO-related
threats to biodiversity and the environment;

* Ensure full coordination at both the national and international
level between trade negotiators that attend the WTO, and
environmental negotiators that attend the Biosafety Protocol as
well as other relevant international fora. Such coordination is
essential to ensure that trade negotiators are fully informed of
the implications of agreeing to consider GMO-related issues at
the WTO;

* Take measures to ensure that developing country interests are
adequately considered in ongoing discussions at the OECD, and by
the European Communities and the United States in bilateral
discussions. (SUNS4539)

Martin Khor is the Director of the Third World Network.

The above article first appeared in the South-North
Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief
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