Disputes over food safety standards – what in the language of trade policy are called sanitary and phytosanitary standards (SPS) – have been at the heart of many transatlantic trade rows between the US and the EU. We can think of the EU bans on the import of hormone-treated beef, or pork treated with growth-promoting additives, or poultry washed in antimicrobial rinses to reduce the amount of microbes on meat. As a result, the potential impact of the ongoing negotiations to reach a Transatlantic Trade and Investment Partnership (TTIP) free trade agreement between the US and EU on EU food standards has, rightly, attracted a lot of attention and no little anxiety.
However, much of the commentary has not been well-informed and has contributed to a hysteria surrounding the TTIP in which SPS issues have achieved a cult status. The basic refrain repeated ad nauseum is that “TTIP will sacrifice food safety for faster trade, warn NGOs” (quoted from a Euractiv report) or in the words of Compassion in World Farming booklet “TTIP: a recipe for disaster” in part because it is deemed to threaten standards for healthy and safe food.
Possible procedural rules requiring transparency of decision-making and early warning mechanisms which would give interested parties (including of course business firms and lobby groups) the opportunity to comment on planned rule-making are condemned for giving business interests undue influence over food safety decision-making and for likely leading to ‘regulatory chill’. Proposals for a joint committee of the competent regulatory authorities to exchange information and discuss SPS issues which the other side believes are a trade concern are seen according to further scare-mongering from a Friends of the Earth Europe briefing as “transferring power from national authorities to a committee of experts, potentially including industry representatives”.
No matter that the Trade Commissioner Cecilia Malmström affirmed during her confirmation hearing before the Parliament and many times since (see this DG TRADE Factsheet on SPS issues) that TTIP “cannot be about lowering standards, but about avoiding extra costs – the costs entailed for example in the duplication of factory inspections and unnecessary divergences of approach.”
For the fact is that SPS regulations can be used to delay and add unnecessary costs to exporting without adding to consumer, animal or plant health and safety.
One example: the US re-opened the US market to EU beef starting with Ireland in January 2015 reversing the ban following the BSE outbreak in the 1990s. Each country’s food regulatory system must be certified by the USDA Food Safety and Inspection Service (FSIS) that it employs sanitary measures equivalent to US standards including on on-site inspection. Arguably, the EU’s controls for BSE have been sufficiently robust for many years now to permit exporting, and it may be no coincidence that the US turned into a net beef importer in 2014 which pushed the process forward. No-one argues that the US should relax its standards to protect its citizens from BSE, but having a system of regulatory co-operation as part of a TTIP agreement would have facilitated EU exporters in making the case that their control systems now met the US requirements.
But of course, it would be equally disingenuous to take the official viewpoint at face value. On May 2nd, Greenpeace Netherlands released the consolidated texts of a number of draft chapters of a possible TTIP agreement prepared prior to the start of the 13th round of negotiations at the end of April 2016. According to Greenpeace, the documents confirmed their worst fears. Jorgo Riss, the director of Greenpeace EU, is quoted as saying:
These leaked documents give us an unparalleled look at the scope of US demands to lower or circumvent EU protections for environment and public health as part of TTIP. The EU position is very bad, and the US position is terrible. The prospect of a TTIP compromising within that range is an awful one. The way is being cleared for a race to the bottom in environmental, consumer protection and public health standards.”
US proposals include an obligation on the EU to inform its industries of any planned regulations in advance, and to allow them the same input into EU regulatory processes as European firms.
American firms could influence the content of EU laws at several points along the regulatory line, including through a plethora of proposed technical working groups and committees.
“Before the EU could even pass a regulation, it would have to go through a gruelling impact assessment process in which the bloc would have to show interested US parties that no voluntary measures, or less exacting regulatory ones, were possible,” Riss said.
Not surprisingly, the Commission negotiators had a different perspective. In a blog post the following day, Trade Commissioner Malmström described the Greenpeace leaks as ‘a storm in a teacup’. She reiterated, once again, that “No EU trade agreement will ever lower our level of protection of consumers, or food safety, or of the environment. Trade agreements will not change our laws on GMOs, or how to produce safe beef, or how to protect the environment.”
Given these opposing viewpoints, the obvious course of action is to examine the leaked documents, bearing in mind that these are consolidated texts and not negotiated outcomes. A consolidated text simply arranges in a systematic way the negotiating positions of both Parties under each topic. Nonetheless, the text allows us to see what each side is demanding and how it is approaching the negotiations. It allows us to see the size of the gap that exists, but not necessarily where, and whether, that gap will be bridged.
The bottom line, for those who do not want to read to the end of the post: neither the TTIP Agreement nor trade officials in future under a TTIP Agreement would make decisions on food safety standards. These will continue to be taken, as of now, by the member states or the Commission taking into account the advice of the European Food Safety Agency (EFSA). The Commission is fully vindicated in its position on this matter.
What TTIP seeks to do is to agree common rules on how aspects of the standard-setting process in each Party might work in the future, particularly in terms of good regulatory practice. The EU already adheres to many of the required procedures in its current practice. Many of the provisions would help EU firms to challenge US rules which add additional costs to EU exports without contributing to improving food safety in the US.
It is possible to see bogeymen behind every paragraph where particular obligations are mentioned, and this seems the preferred approach of anti-TTIP activists. But NGOs, trade unions and activists already clash with business interests when debating new standards in the EU, and the steady strengthening in food, environmental, social and other standards shows that business is far from successful in always getting its way. The new procedures would provide for more information and regulatory exchange, more consultation and more reasoned evidence, but, in the language of the EU proposal, they would respect “each Party’s regulatory systems, risk assessment, risk management and policy development processes”.
Food safety in the architecture of the TTIP agreement
In this post, we pay particular attention to the SPS Chapter. However, commitments made in the SPS Chapter must be read in the light of commitments in other chapters in a possible TTIP agreement, particularly the chapter on Regulatory Cooperation or Regulatory Coherence (RC) and the chapter on Dispute Settlement to the extent that it will cover commitments in the SPS Chapter. Further light is thrown on the state of play in the negotiations by the release of an internal EU document on the ‘Tactical State of Play of the TTIP Negotiations’ as of March 2016.
We can leave the consolidated text on Dispute Settlement to one side. It mainly describes the institutional procedures to handle disputes and the approaches of both Parties are closely modelled on existing WTO procedures. As in the WTO, if there is a finding against a Party, it is expected to bring itself into compliance but there is no obligation to do so. A trade panel cannot force a Party to change its regulations against its will, although as in the WTO an adverse finding allows the other Party to suspend concessions to an equivalent value in retaliation.
In the Regulatory Cooperation (RC) chapter, the EU proposal notes that the general objective is “To reinforce regulatory cooperation thereby facilitating trade and investment in a way that supports the Parties’ efforts to stimulate growth and jobs, while pursuing a high level of protection of, inter alia, the environment, consumers, working conditions, human, animal and plant life; health and safety, personal data, cybersecurity, cultural diversity, or preserving financial stability.” It also notes that, in cases of inconsistency, the more detailed commitments in specific or sectoral provisions should prevail.
The main purpose of the proposed RC chapter is to affirm that both Parties will adhere to good regulatory practice. This includes giving information on planned regulatory acts, providing opportunity for stakeholder consultation, undertaking an impact assessment, engaging in regulatory exchanges of information, encouraging the pursuit of regulatory compatibility where mutual benefits can be realised without compromising the achievement of legitimate public policy objectives, and promoting international regulatory cooperation. The US proposal on these matters is more detailed and prescriptive than the EU one, but as the EU’s tactical assessment notes: “it is safe to say that provisions tabled by both the EU and US are complementary in many respects and could form the basis for identifying common ground”.
The EU proposal is to encourage greater regulatory compatibility through joint examination “provided mutual benefits can be realised without compromising the achievement of legitimate public policy objectives”. Regulatory compatibility might be pursued through mutual recognition of equivalence, harmonisation, or simplification of regulatory acts. In any case, the only obligation on the other Party is to provide a substantiated response. Also under this heading are EU proposals on information and regulatory exchanges which would require the regulatory authorities to inform each other of proposed regulatory acts and upon request to enter into a regulatory exchange with the other Party. Again, the only obligation is to enter into these exchanges constructively and to provide responses to points of substance raised by the other Party.
A Regulatory Cooperation Body would be established consisting of representatives of trade and regulatory officials to monitor the implementation of the agreement and to stimulate joint initiatives, but importantly (in the EU proposal) would not have the power to adopt legal acts. This underlines that rule-making would continue to be the responsibility of the respective regulatory and legislative processes in each jurisdiction, which would be bound only by the commitments to good regulatory practice contained in an eventual agreement.
Key outstanding issues in this chapter for the EU include the scope of the agreement (the US proposal limits its scope to regulatory acts of the Federal government and its agencies, while the EU also wants to cover the regulatory powers of US states), the question of what regulatory activities would be covered, and the relationship between the regulatory cooperation chapter and other chapters, including sector chapters and the overall institutional mechanism. As the SPS chapter would establish its own SPS joint committee, and is likely to have its own rules on transparency, early warning, consultation and information exchange, it is unlikely that the RC chapter as such will impose additional obligations on the process of food safety decision-making.
The SPS chapter
The March 2016 consolidated text contains 22 articles plus an introduction setting out the objectives of the chapter which has been proposed by the EU. In addition, the EU has proposed an article on anti-microbial resistance within the SPS chapter which does not appear in the consolidated text. A brief summary of the content of each article follows.
Objectives. The EU’s proposal for Chapter Objectives sets out its view that the purpose of the SPS Chapter is to facilitate trade by removing unnecessary barriers while “while preserving each Party’s right to protect human, animal or plant life and health in its territory and respecting each Party’s regulatory systems, risk assessment, risk management and policy development processes”.
1. Scope and coverage. This article specifies that the Chapter applies to all SPS measures between the parties (US would like to add, “unless specifically noted”, while EU wants animal welfare matters also to be covered).
2. Affirms each Party’s rights and obligations under the WTO SPS Agreement. The EU wants to add “Nothing in this Chapter shall limit the rights or obligations of the Parties under the Agreement established by the World Trade Organization and its Annexes.”
3. Competent Authorities. This article commits each Party to notify the other of the competent authorities for SPS matters.
4. Equivalence. Both parties recognise that determining equivalence can facilitate trade. Both parties agree to an annex which would set out the procedures to be followed to determine equivalence (though the annex itself is not yet agreed) and the EU, in addition, would like an annex setting out specific areas where agreement on equivalence has been reached. This annex would presumably contain the 1998 Veterinary Equivalency Agreement and the Organic Equivalency Agreement agreed in 2012, but is unlikely to contain more at this point in time,
5. Science and risk. This article is tabled by the US with the proviso that additional provisions aimed at improving the use of science in SPS decision-making will be considered. As this article drew the particular ire of the Greenpeace director, it is considered in more detail later.
6. Adaptation to regional conditions in case of a pest or disease outbreak. In principle both Parties are in favour and seek to better operationalise how this should work in practice.
7. Transparency. This is mainly about notifying the status of SPS issues and communicating the results of SPS decisions to the other Party. The US side, in addition, proposes that the text of proposed SPS regulations should be made available for comment prior to adoption in line with its general approach to science and risk set out in Article 5.
8 and 9. Elimination of redundant control measures and audits and inspections. Under this title is an EU proposal that each Party would accept that the other Party’s competent authority is responsible for ensuring that products and establishments meet the SPS standards of the importing Party and would not require re-inspection, third party certification or additional guarantees. Of course, this could not be a carte blanche, and hence Article 9 provides for a system of audit and verification of the control systems implemented by these competent authorities.
10. Export certificates. This article deals with the matter of certificates that should accompany the export of an agri-food product (e.g. health certificates for live animals) and aims to ensure that certificates should be as simple as possible and only used when necessary.
11. Trade facilitation. This article proposed by the EU deals with trade facilitation procedures, or what happens to an agri-food consignment when it enters the importing country. Inspection and control procedures should be kept to a minimum. Specifically, the EU proposes that the Parties would adopt the tolerances and maximum residue levels adopted by the Codex Alimentarius Commission unless the importing Party has signalled a reservation in the Codex.
12. Regulatory approvals for products of modern agricultural technology. This article proposed by the US deals with GMOs (or what the article refers to as the products of modern agricultural technology). As fears that TTIP would overturn EU rules on GMOs are widespread, I also discuss this proposal in more detail later in this post.
13. Import checks and fees. This article deals with the question of import checks, and sets out principles for the frequency rate, notification obligations and the level of fees that can be charged.
14. Application of SPS measures. This article proposed by the EU seeks to make clear that SPS decisions apply across the whole territory of each partner. The EU wants to avoid a situation where individual US states might introduce additional SPS restrictions.
15 and 16. Joint SPS Committee and technical working groups. These articles set out each Party’s views of how a joint committee on SPS matters might function, with the US proposing (in Article 16) a number of additional technical working groups on specific issues (the EU also proposes technical working groups but in Article 15). The intention is that the Committee and/or its working groups would provide a forum where trade concerns arising from SPS measures could be discussed. The Committee would not be a decision-making body but it would be expected to trigger initiatives which would be taken up by the competent authorities of both Parties using their regular procedures.
17. Technical consultation. Alternative proposals are made by the EU and the US. Technical consultations are essentially the same idea as regulatory exchanges in the RC chapter although the obligations would go further for SPS exchanges. The article proposed by the EU proposes that the other Party can request technical consultations if “it has significant concerns regarding food safety, plant health, or animal health, or regarding a measure proposed or implemented by the other Party”. However, under the EU proposal not only is the Party required to give a response, but this should be made within 15 days. Also, there would be an obligation that “Each Party shall endeavour to provide all relevant information necessary to avoid unnecessary disruption to trade and to reach a mutually acceptable solution”.
The US proposal is, typically, more prescriptive. Apart from a longer timeframe for consultations than in the EU proposal, it introduces the idea of a facilitator. This would be an expert brought in to help the parties to resolve the concerns expressed. However, this expert would be expressly forbidden from commenting on the consistency of the measure at issue with either the TTIP or WTO Agreements. The only obligation on a Party is to seek to resolve concerns over an SPS measure through technical consultations prior to initiating dispute settlement proceedings under the TTIP Agreement.
18. Emergency measures. Allows for provisional emergency measures necessary for the protection of human, animal or plant health.
19. Animal welfare. This is of course an EU proposal. It is a short article with three substantive obligations based on the recognition that animals are sentient beings. Parties undertake to respect trade conditions for live animals and animal products that are aimed to protect their welfare. Parties undertake to exchange information, expertise and experiences in the field of animal welfare with the aim to align regulatory standards related to breeding, holding, handling, transportation and slaughter of farm animals. And Parties will strengthen their research collaboration in animal welfare.
20. Collaboration in international fora. This EU proposal commits the Parties to collaborate in international fora with a view to reaching mutually satisfactory outcomes.
21 and 22 are technical articles which terminate the Veterinary Agreement and set out definitions, respectively.
Anti-microbial resistance (AMR). Though not included in the consolidated text, the EU made a proposal on AMR at the end of last year. This recognises the serious and transnational nature of AMR, and proposes a technical working group charged with a dedicated work plan on reduced use of antibiotics in animal production to combat antibiotic resistance.
Science and risk
The US proposal on science and risk deals both with risk assessment (identifying the extent of any risk) and risk management (identifying the appropriate response to the risk). In the EU these responsibilities are divided between EFSA (responsible for risk assessment) and the Commission supervised by the member states (responsible for risk management) but together they are referred to as the competent authorities.
The US article would require the competent authorities (a) to take into account comments from interested parties (b) to discuss comments made by the other Party (c) and give reasons when making its decisions including why alternatives put forward by other parties were rejected. Note that there is no reference to eliminating the precautionary principle in the US proposal; indeed, there is no attack on the precautionary principle at all.
A rather intrusive proposal (paragraph 6 of this Article), in cases where “a regulatory authority of a Party submits a proposal for an SPS measure for approval by a committee comprising national representatives” (which is a clear reference to the EU comitology procedure for risk management), and the committee rejects or modifies the proposal, would require each individual member of the committee to give a public explanation of why it has rejected or modified the proposal. Although this is often the case at present, it should be sufficient for the regulatory authority itself to provide this explanation on behalf of the body as a whole.
Greenpeace and co-conspirators are alarmed that this consultation requirement “would allow American firms to influence the content of EU laws”, but they ignore that this would be a two-way street. The provision (which at this stage is just a US proposal) would also give EU firms (and NGOs) the right to intervene in the US rule-making process which to my mind would be an important plus.
Risk management in the EU is a political process with the ultimate power in the hands of the member states. The fear of the conspiracy-minded NGOs such as Greenpeace and its fellow-travellers is that allowing US firms and lobby groups to submit comments to EFSA during its risk assessment process and requiring the EU Commission to publicly state the reasons for adopting one form of regulation rather than another will lead to a weakening of EU standards of food safety. While it would be naïve to dismiss the self-interest of US firms and their formidable lobbying capacity, the EU accepted obligations in the WTO SPS Agreement (e.g. Article 5.4 provides that when adopting SPS measures Members should take into account the objective of minimising negative trade effects, while Article 5.8 provides that a Member must provide an explanation where another Member disagrees with an SPS decision that it has made and requests it) without any evident diminution of food standards since 1995 (when these obligations took effect).
Why a requirement to allow US firms and regulators to comment on potential EU regulations in return for allowing EU firms and regulators to comment on future US regulations should be seen as an assault on food safety standards is hard to understand. Only someone ignorant of recent regulatory history on both sides of the Atlantic would presume that EU standards (and enforcement) are always superior to US standards (think of Dieselgate). While comparative figures on the incidence of food-borne diseases are not very reliable and are subject to a wide margin of error, they suggest that the US record is better than the EU one.
Nonetheless, the EU has a robust risk analysis system (including risk assessment, risk management and risk communication). If there is a fear that this system can be unduly influenced by industry lobbying, this surely applies to EU firms as much as US firms. The solution should be to strengthen the independence and integrity of the EU risk analysis system where this is warranted, rather than to exclude particular viewpoints from the process ex ante.
Regulation of GMOs
The US proposal is that each Party should make its risk assessments of GM traits publicly available (as is already the case in the EU) and to keep to the timeline set out for authorisation or approval (which in the EU process has been prone to arbitrary delays). It also proposes a joint working group on products of modern agricultural technology made up of officials from the competent authorities including the regulatory agencies to discuss trade issues that might arise as well as to consult on future standard-setting efforts.
It is hard to make the case that these US proposals would overturn the existing EU GM regulatory regime or even significantly affect it. While maintaining the prescribed timeline for approvals would be a departure from current practice, in the case where this does not happen the draft US text merely requests that the other Party should provide an explanation for the delay and update the timeline for the remaining steps. The US draft proposal makes no mention of the opt-outs that EU member states now have for GM crop cultivation and which the Commission tried to introduce also for GM imports until the Parliament overwhelmingly rejected it last October.
One potentially controversial element in this article is that the US proposes that each Party should participate in the Global Low Level Presence Initiative (GLLPI) to develop an approach to manage low-level presence in order to reduce unnecessary disruptions affecting trade. The GLLPI was initiated by Canada and now has 14 member countries, with the EU currently participating as an observer. Its objectives are set out in a statement agreed at the founding meeting in 2012. Low-level presence (LLP) refers to the unintentional or inadvertent mixing of a transgenic crop (for example, through dust or residues in a transport container) not approved in the importing country in a shipment that otherwise would be permitted. With a growing number of GM crop varieties being approved around the world, risks of LLP increase.
The EU currently has a zero-tolerance of LLP for GM varieties approved in other countries but not approved in the EU (technically, the threshold is set at 0.1% as the lowest amount that has to be reliably detected). Countries in the GLLPI are pushing for significantly higher thresholds, perhaps up to 5% under specified conditions. Whether the EU should take a more relaxed view of LLP in future is clearly a matter for the competent authorities in the EU as well as the legislature. Obligating the EU to take part in GLLPI discussions on this issue might be seen as the thin end of the wedge by those opposed to any relaxation of the current zero-tolerance threshold, even if it does not in itself predetermine the outcome. I suspect the EU negotiators will not give way on this and will be unlikely to agree to this proposal.
In discussing the significance of the SPS Chapter in the proposed TTIP Agreement for EU food safety standards, one cannot emphasise enough that all we have at the moment is a consolidated text setting out the views of both Parties. We do not have a final negotiated outcome. There could be novelties in a final agreement that are not yet flagged in the consolidated text. On the other hand, the US position in the consolidated texts is its initial starting point in the negotiations, so we might expect the consolidated text to be even more demanding and extreme that what the EU might accept as part of the final outcome.
With these qualifications in mind, my overwhelming response to reading the consolidated SPS chapter (also in the light of the chapters on regulatory cooperation and dispute settlement) is how banal it all is. There is not a phrase in this consolidated text that would require the EU to change any of its current food standards. There are obligations around procedures and process, but it is my opinion that anti-TTIP activists have blown these obligations up out of all proportion to what a plain reading of the text would imply.
There would be additional obligations on the regulatory agencies to exchange information and to consult each other. There would be additional obligations to allow for comments from interested parties (including US firms and NGOs in the case of EU proposed regulations, but also from EU firms and NGOs on proposed US regulations), but the agreement would not alter in any way the actual risk analysis decision-making in the EU which would remain fully accountable to EU law-makers. On the other hand, a TTIP agreement does hold out the opportunity to reduce some of the unnecessary costs from trade procedures that do nothing to enhance food safety on either side of the Atlantic. And for this it should be welcomed.
A final footnote
It helps to understand why we have such an uninformed and hysterical discussion around TTIP when we look at how the Greenpeace TTIPLeaks were handled by the mainstream media. A gullible media helped to fan the flames by publishing uncritical verbatim reports of the Greenpeace claims without seeking comments from those who may have another point of view or even trying to read the texts themselves. Two examples can be taken from the so-called UK quality newspapers, the Guardian and the Independent.
The Guardian report of the story on May 1, by Arthur Neslan, made no attempt to seek a comment from the EU Trade Commissioner or to provide balance. It just ran the Greenpeace side of the story verbatim. The Independent story the following day by Andrew Griffen had remarkably similar quotes from Greenpeace and had plenty of space for comments from campaigners who supported the Greenpeace line, but the journalist made no effort to seek a comment from the Commission or other sources which might have put the claims in context.
Press coverage like this is simply irresponsible journalism and may help to explain the decline of the mainstream media. If they are simply going to parrot what they are fed by experienced lobbyists (whether they are NGOs or US business firms), it is hard to see what added value they provide.
This post was written by Alan Matthews
Picture credit: One-Europe Info