(WT/DS293) First Presentation of the Argentine Republic …€¦ · European Communities –...

EUROPEAN COMMUNITIES - MEASURES AFFECTING THE APPROVAL AND

MARKETING OF BIOTECH PRODUCTS

(WT/DS293)

First Presentation of the Argentine Republic

(Courtesy Translation)

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page i

LIST OF ANNEXES

ARG-2 Healthy Food for Europe’s Citizens. The European Union and Food Quality, Publication of the Publications Office of the European Communities, Luxembourg, 2000

ARG-3 Directive 2001/18/EC of the European Parliament and of the Council of 12 March 2001 on the deliberate release into the environment of genetically modified organisms and repealing Council Directive 90/220/EEC, published in the Official Journal No. 106 dated 17-04-2001

ARG-4 Council Directive 90/220/EEC of 23 April 1990 on the deliberate release into the environment of genetically modified organisms, published in the Official Journal No. L 330 dated 08-05-1990

ARG-5 Regulation (CE) No. 258/97 of the European Parliament and of the Council of 27 January 1997 concerning novel foods and novel food ingredients, published in the Official Journal No. L 043 dated 14-02-1997

ARG-6 See list of biotech agricultural products approved by the EC in State of play on GMO authorizations under EU law, MEMO/04/17, Brussels, January 28, 2004

ARG-7 Communication from the Commission, Journal of the EuropeanCommunities C 55 dated Mach 2, 2002, COM(2002) 27 and Bulletin 1/2-2002

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ARG-8 “New Technologies in Agriculture” - Biotechnology, Annex Summary details of draft Regulations on GM Food/Feed and Traceability -European Commissioner David Byrne, dated September 18, 2001

ARG-9 Conference A European approach to food safety and GMOs, by David Byrne, dated October 9, 2001

ARG-10 Conference “Farm to Fork” - Risk versus benefit, by David Byrne,

dated November 22, 2001 ARG-11 Report by Antonios Trakatellis before the European Parliament, June

4, 2003, A5-0204, Recommendation for second reading on the common position of the Council with a view to adopting a European Parliament and Council regulation on traceability and labeling of genetically modified organisms and the traceability of food and feed products produced from genetically modified organisms and amending Directive 2001/18/EC

ARG-12 Declaration by the Danish, Greek, French, Italian and Luxembourg

delegations concerning the suspension of new GMO authorisations, 2194th Council Meeting -Environment-, Luxembourg, June 24/25, 1999

ARG-13 Bans imposed by EC Member States on specific biotech agricultural

products ARG-14 EU moratorium on GMOs could last until traceability, labeling regime

in place, International Trade Daily, October 30, 2001 ARG-15 Speeches and articles by Pascal Lamy, Steeling the EU-US

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Relationship for the challenge ahead, Woodrow Wilson International Center for Scholars, Washington DC, January 25, 2002

ARG-16 Glossary from the EC web page

ARG-17 Conference “Genetics and the future of Europe,” by David Byrne,

November 7, 2000 ARG-18 Conference “The right to know about genetically modified food,” by

David Byrne, July 25, 2001 ARG-19 Environment in the European Union at the turn of the century, Release

of genetically modified organisms into the environment ARG-20 Conference Proposal for a regulation on GM Food and Feed, by

David Byrne, September 11, 2001 ARG-21 Opinion of the Scientific Committee on Plants on the genetically

modified cotton line, insect-tolerant notified by the Monsanto company (notification C/ES/96/02) (Opinion expressed by SCP on 14 July 1998), under Directive 90/220/EEC

ARG-22 Advisory Committee on Novel Foods and Processes, Request of an

article 5 opinion on the substantial equivalence of cottonseed oil and food ingredients derived from insect protected cottonseed, under Regulation (EC) 258/97

ARG-23 Opinion of the Scientific Committee on Plants regarding the

genetically modified cotton, tolerant to glyphosate herbicide notified

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by the Monsanto Company (notification C/ES/97/01) (Opinion expressed by the SCP on 14 July 1998), under Directive 90/220/EEC

ARG-24 Advisory Committee on Novel Foods and Processes, Request of an

article 5 opinion on the substantial equivalence of cottonseed oil and food ingredients derived from roundup ready cotton, under Regulation (EC) 258/97

ARG-25 Opinion of the Scientific Panel on Genetically Modified Organisms on

a request from the Commission related to the Notification (Reference CE/ES/00/01) for the placing on the market of herbicide-tolerant genetically modified maize NK603, for import and processing, under Part C of Directive 2001/18/EC from Monsanto (Question No EFSA-Q-2003-003), under Directive 2001/18/EC

ARG-26 Assessment of safety for the consumer, in accordance with the

European Regulation 258/97 concerning Novel Foods and Novel Foods Ingredients. Health Council of the Netherlands: Committee on the Safety Assessment of Novel Foods N 2002/04VNV, The Hague, August 13, 2002, under Regulation (EC) 258/97

ARG-27 Opinion of the Scientific Panel on Genetically Modified Organisms on

a request from the Commission related to the safety of foods and food ingredients derived from herbicide-tolerant genetically modified maize NK 603, for which a request for placing on the market was submitted under Article 4 of the Novel Food Regulation (EC) No 258/97 by Monsanto (Question No EFSA-Q-2003-002), Opinion adopted on 25 November 2003

ARG-28 GM Science Review, First Report, An open review of the science

relevant to GM crops and food based on the interest and concerns of the public (July 2003), Executive Summary

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moratorium as illegal, dated July 17, 2000 ARG-30 Report of the Scientific Committee for Animal Nutrition on the safety

for animals of certain genetically modified maize lines notified by Cyba-Geigy in accordance with Directive 90/220/EEC for feedstuff use, dated December 13, 1996

ARG-31 Opinion of the Scientific Committee on Plants regarding “submission

for placing on the market of glufosinate tolerant maize (Zea mays) transformation event T25” by the Agrevo Company (Now Aventis Cropscience), (Notification C/F/95/12/07), SCP/GMO/299-Final, dated September 5, 2001

ARG-32 Opinion of the Scientific Committee on Food on a request to place

genetically modified sweet maize line Bt 11 on the market (expressed on 17 April 2002), SCF/CS/NF/DOS/14 ADD2 Final, dated May 6, 2002

ARG-33 Opinion of the Scientific Committee on Plants on the submission for

placing on the market of genetically modified insect resistant and glufosinate ammonium tolerant (Bt-11) maize for cultivation. Notified by Novartis Seeds SA Company (notification C/F/96/05-10) (opinion adopted by the Scientific Committee on Plants on 30 November 2000)

ARG-34 Tables of “non-biotech” products approved in the EC and products

pending approval under Regulation (EC) 258/97 ARG-35 Commission Decision of 22 April concerning the placing on the market

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of genetically modified maize (Zea mays L. T25), pursuant to Council Directive 90/220/EEC

ARG-36 Commission Decision of 22 April concerning the placing on the market

of genetically modified maize (Zea mays line MON 810), pursuant to Council Directive 90/220/EEC

ARG-37 97/98EC: Commission Decision of 22 January 1997 concerning the

placing on the market of genetically modified maize (Zea mays L), with the combined modification for insecticidal properties conferred by Bt-endotoxin gene and increased tolerance to the herbicide glufosinate ammonium pursuant to Council Directive 90/220/EEC

ARG-38 Commission Decision of 22 April concerning the placing on the market

of genetically modified maize (Zea mays line Bt-11), pursuant to Council Directive 90/220/EEC

ARG-39 GMOs: are there any risks? - Launch of a European Round Table on

GMO Safety, dated October 8, 2001 ARG-40 Clive James, International Service for the Acquisition of Agri-Biotech

Applications. Executive Summary. Preview Global Status of Commercialized Transgenic Crops: 2003.N. 30-2003

ARG-41 Opinion of the Scientific Committee on Plants on the submission for

placing on the market of genetically modified maize (Zea mays) line GA21 with tolerance to glyphosate herbicide notified by Monsanto, Notification C/ES/98/01)

ARG-42 Opinion of the Scientific Committee on Food on the safety assessment

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of the genetically modified maize line GA21, with tolerance to the herbicide glyphosate

ARG-43 Opinion on the invocation by Germany of Article 16 of Council

90/220/EEC regarding the genetically modified BT-MAIZE LINE CG 00256-176 notified by CIBA-GEIGY (now NOVARTIS), notification C/F/94/11-03 (SCP/GMO/276Final - 9 November 2000) Opinion adopted by written procedure following the SCP meeting of 22 September 2000

ARG-44 Opinion of the Scientific Committee on Plants on the Invocation by

Austria of Article 16 (“safeguard clause”) of Council Directive 90/220/EEC with respect to the placing on the market of the genetically modified maize (MON810) expressing the Bt cryia(b) gene, notification C/F/95/12-02, dated September 24, 1999

ARG-45 Opinion on the invocation by Austria of Article 16 of Council Directive

90/220/EEC regarding a genetically modified maize line T25, dated November 30, 2000

ARG-46 Opinion of the invocation by Austria of Article 16 of Council Directive

90/220/EEC regarding the genetically modified maize line T25 notified by Agrevo France, now Aventis Cropscience, ref. C/F/95/12-07 (Amended opinion adopted by the Scientific Committee on Plant, on 20 July 2001, replaces document SCP/GMO/289-Final adopted on 30 November 2000)

ARG-47 Opinion of the Scientific Committee on Food concerning a submission

from the Italian authorities raising concerns for the safety of certain products approved under the notification procedure of Regulation (EC) 258/97, CS/NF/DOS/11 ADD 4 REV 2 Final, expressed on September 7, 2000

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TABLE OF CONTENTS BACKGROUND -----------------------------------------------------------------------------------------------------------1

FACTS AND COMMUNITY LEGISLATION ON THE MATTER----------------------------------------------1

SUBJECT OF THE COMPLAINT BY THE ARGENTINE REPUBLIC--------------------------------------4

ORDER OF ANALYSIS--------------------------------------------------------------------------------------------------5

ARGUMENTS--------------------------------------------------------------------------------------------------------------7

I.- INTRODUCTION ----------------------------------------------------------------------------------------------------7 II.- INCONSISTENCY WITH THE SPS AGREEMENT -------------------------------------------------------- 12

A.- INCONSISTENCY OF THE “DE FACTO” MORATORIUM WITH THE SPS AGREEMENT ------- 12 1.- The “de facto” moratorium as a measure within the framework of the SPS Agreement -------------------------- 12

a.- The “de facto” moratorium is a sanitary or phytosanitary measure ----------------------------------------------- 13 i) The “de facto” moratorium fits into Annex A:1, first paragraph, of the SPS Agreement, according to its objective ------------------------------------------------------------------------------------------------------------------- 14 ii) The “de facto” moratorium fits in Annex A:1, second paragraph, of the SPS Agreement, according to its form------------------------------------------------------------------------------------------------------------------------- 21

b.- The “de facto” moratorium affects international trade-------------------------------------------------------------- 25 2.- All sanitary or phytosanitary measures must be based on scientific evidence and must not constitute a disguised restriction of international trade ----------------------------------------------------------------------------------- 26 3.- The relationship between Article 2 and Article 5 of the SPS Agreement-------------------------------------------- 28 4.- The “de facto” moratorium is inconsistent with Article 5.1 of the SPS Agreement-------------------------------- 29 5.- The “de facto” moratorium is inconsistent with Article 2.2 of the SPS Agreement-------------------------------- 33

The “de facto” moratorium is unjustifiable under the exception stipulated in Article 5.7 of the SPS Agreement---------------------------------------------------------------------------------------------------------------------------------- 36

First requirement---------------------------------------------------------------------------------------------------------- 38 Second requirement ------------------------------------------------------------------------------------------------------ 39 Third requirement--------------------------------------------------------------------------------------------------------- 40 Fourth requirement ------------------------------------------------------------------------------------------------------- 40

Conclusion regarding Article 5.7 of the SPS Agreement--------------------------------------------------------------- 40 6.- The “de facto” moratorium is inconsistent with Article 5.5 of the SPS Agreement-------------------------------- 41

a.- First element: application of distinct levels of protection to different situations -------------------------------- 42 i) Biotech products before and after the “de facto” moratorium --------------------------------------------------- 44 ii) New biotech agricultural products and new “non-biotech” products------------------------------------------- 46

b.- Second element: arbitrary and unjustifiable differences in protection -------------------------------------------- 47 i) Biotech products before and after the “de facto” moratorium --------------------------------------------------- 49 ii) New biotech agricultural products and new “non-biotech” products------------------------------------------- 49

c.- Third element: discrimination and a disguised restriction on international trade-------------------------------- 52 i) Biotech products before and after the “de facto” moratorium --------------------------------------------------- 53 ii) New biotech agricultural products and new “non-biotech” products------------------------------------------- 54

Conclusion regarding Art. 5.5 of the SPS Agreement ------------------------------------------------------------------ 54 7.- The “de facto” moratorium is incompatible with Article 2.3 of the SPS Agreement ------------------------------ 54 8.- The “de facto” moratorium is incompatible with Article 7 and Annex B:1 of the SPS Agreement-------------- 55 9.- The “de facto” moratorium is incompatible with Art. 10.1 of the SPS Agreement -------------------------------- 56

CONCLUSION ON THE INCONSISTENCY OF THE “DE FACTO” MORATORIUM WITH RESPECT TO THE SPS AGREEMENT --------------------------------------------------------------------------------------- 60 B.- INCONSISTENCY OF THE “SUSPENSION OF PROCESSING AND FAILURE TO CONSIDER INDIVIDUAL APPLICATIONS FOR APPROVAL OF SPECIFIC BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE SPS AGREEMENT -------- 60

1.- Suspension of the approval processes for biotech agricultural products of particular interest to Argentina ---- 61 2.- Inconsistency with the SPS Agreement ---------------------------------------------------------------------------------- 63 3.- The suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 5.1 of the SPS Agreement- 66

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Non-existence of a risk assessment: Analysis of specific products --------------------------------------------------- 69 Identification of the status of each of the biotech agricultural products covered under this complaint in terms of the existence of a risk assessment------------------------------------------------------------------------------------------ 70 (i) Products that received a favorable risk assessment without subsequent approval ------------------------------- 71 (ii) Products that have not been the subject of a risk assessment and have not been approved-------------------- 71 Absence of a risk assessment: Legal arguments ------------------------------------------------------------------------- 72

4.- The suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 2.2 of the SPS Agreement- 74 5.- The suspension of processing and the lack of consideration of individual requests for the approval of determined biotech agricultural products of particular interest to Argentina are inconsistent with Article 5.5 of the SPS Agreement ------------------------------------------------------------------------------------------------------------------ 77

a.- First element: application of different levels of protection for different situations ----------------------------- 78 i) Biotech products before and after 1998 ----------------------------------------------------------------------------- 79 ii) Novel biotech products and novel “non-biotech” products------------------------------------------------------ 80

b.- Second element: arbitrary and unjustifiable differences in protection -------------------------------------------- 81 i) Biotech products before and after 1998 ----------------------------------------------------------------------------- 83 ii) Novel biotech products and novel “non-biotech” products------------------------------------------------------ 83

c.- Third element: discrimination and disguised restriction of international trade ---------------------------------- 84 i) Biotech products before and after 1998 ----------------------------------------------------------------------------- 85 ii) Novel biotech agricultural products and novel “non-biotech” products --------------------------------------- 86

Conclusion regarding Article 5.5 of the SPS Agreement--------------------------------------------------------------- 87 6.- The suspension of processing and the lack of consideration of individual applications for the approval of determined biotech agricultural products of particular interest to Argentina are inconsistent with Article 5.6 of the SPS Agreement ------------------------------------------------------------------------------------------------------------------ 87

CONCLUSION WITH RESPECT TO THE INCONSISTENCY WITH THE SPS AGREEMENT OF THE “SUSPENSION OF PROCESSING AND FAILURE TO CONSIDER INDIVIDUAL APPLICATIONS FOR APPROVAL OF SPECIFIC BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” ------------------------------------------------------------------------------------- 92 C.- INCONSISTENCY OF THE “UNDUE DELAY” IN THE PROCESSING OF INDIVIDUAL APPLICATIONS FOR APPROVAL OF BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA WITH THE SPS AGREEMENT------------------------------------------------- 92

1.- Inconsistency of the “undue delay” in the completion of processing of the individual applications for approval of biotech agricultural products of particular interest to Argentina with Article 8 and Annex C of the SPS Agreement------------------------------------------------------------------------------------------------------------------------ 93

a.- Analysis of the relationship between Article 8 and Annex C 1 a), b), c) and e) of the SPS Agreement ----- 93 b.- Analysis of the inconsistencies of the “undue delay” in the processing of individual applications for approval of biotech agricultural products of particular interest to Argentina in light of the provisions of Article 8 and Annex C 1 a), b), C) and e)------------------------------------------------------------------------------------------ 95 c.- Status of the biotech products of particular interest to Argentina: Inconsistencies in the application of Community legislation in light of the provisions of Article 8 and Annex C:1(a), (b), (c) and (e) of the SPS Agreement -------------------------------------------------------------------------------------------------------------------103

i) GA 21 Maize-----------------------------------------------------------------------------------------------------------103 Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion ------------------------------------------------103

ii) RR 1445 Cotton ------------------------------------------------------------------------------------------------------106 Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion ------------------------------------------------106

iii) Bt-531 Cotton --------------------------------------------------------------------------------------------------------107 Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion ------------------------------------------------107

iv) NK 603 Maize--------------------------------------------------------------------------------------------------------108 Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion ------------------------------------------------108

v) Soy Lines A 2704-12 and A 5547-127 ----------------------------------------------------------------------------110 Procedure under which an application for approval was submitted. Status of the request and delay in processing.---------------------------------------------------------------------------------------------------------110

CONCLUSION REGARDING THE INCONSISTENCY OF THE “UNDUE DELAY” WITH THE SPS AGREEMENT-------------------------------------------------------------------------------------------------------111

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III.- INCONSISTENCY WITH THE GATT 1994----------------------------------------------------------------111 THE “SUSPENSION OF PROCESSING AND THE FAILURE TO CONSIDER INDIVIDUAL REQUESTS FOR APPROVAL OF DETERMINED AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” IS INCONSISTENT WITH THE GATT 1994-------------------------------111

Incompatibility with Article III:4 of GATT 1994--------------------------------------------------------------------------111 a.- “Like products” in the framework of Article III:4 of the GATT 1994-------------------------------------------113

i) Physical properties of imported biotech products and “non-biotech” domestic products -------------------116 ii) End-Use----------------------------------------------------------------------------------------------------------------117 iii) Consumer Perceptions ----------------------------------------------------------------------------------------------121 iv) Tariff classification--------------------------------------------------------------------------------------------------124

b.- The “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” are “requirements” affecting “the sale, offering for sale, purchase, transport, distribution and use of products on the domestic market” --------------------------125 c.- “Less favorable treatment” is accorded ------------------------------------------------------------------------------129

CONCLUSION WITH RESPECT TO THE INCONSISTENCY OF THE “SUSPENSION OF PROCESSING AND FAILURE TO CONSIDER INDIVIDUAL APPLICATIONS FOR APPROVAL OF SPECIFIC BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE GATT 1994 AGREEMENT--------------------------------------------------------------------------130

IV.- INCONSISTENCY WITH THE TBT AGREEMENT -----------------------------------------------------130 A.- ALTERNATIVE APPLICATION OF THE TBT AGREEMENT-------------------------------------------130 B.- INCONSISTENCY OF THE “APPLICATION OF COMMUNITY LEGISLATION IN RELATION TO THE APPROVAL OF BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE TBT AGREEMENT ----------------------------------------------------------------131

1.- EC legislation for approval of biotech agricultural products constitutes “technical regulations” pursuant to Annex 1, paragraph 1 of the TBT Agreement ------------------------------------------------------------------------------131 2.- The procedures under Community legislation for approval of biotech agricultural products constitute conformity assessment procedures-------------------------------------------------------------------------------------------134 3.- The application of Community legislation is inconsistent with the obligations set forth in the TBT Agreement------------------------------------------------------------------------------------------------------------------------------------136 4.- Application of Community legislation is inconsistent with Article 2.1 of the TBT Agreement-----------------136 5.- Application of Community legislation is inconsistent with Article 2.2 of the TBT Agreement-----------------137 6.- The application of Community legislation is inconsistent with Article 5.1.1 of the TBT Agreement ----------140 7.- The application of EC legislation is inconsistent with Article 5.1.2 of the TBT-----------------------------------141 8.- The application of EC legislation is inconsistent with Article 5.2.1 of the TBT-----------------------------------142 9.- Inconsistency of the application of Community legislation with Article 5.2.2 of the TBT Agreement --------143 10.- Inconsistency of the application of Community legislation with Article 12 of the TBT Agreement----------144

CONCLUSION WITH RESPECT TO THE INCONSISTENCY OF THE “APPLICATION OF COMMUNITY LEGISLATION TO BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE TBT AGREEMENT----------------------------------------------152

V.- BANS BY VARIOUS EC MEMBER STATES --------------------------------------------------------------152 1.- All involved products have prior approval by EC authorities --------------------------------------------------------154 2.- Rejection of the requests for special safeguard-------------------------------------------------------------------------154

A.- MEMBER STATE BANS ARE INCONSISTENT WITH THE SPS AGREEMENT----------------------156 1.- Framing of the EC Member State bans as measures under the SPS Agreement-----------------------------------156

a.- The Member State bans in question are sanitary or phytosanitary measures -----------------------------------157 i) The Member States bans fit into Annex A:1, first paragraph, of the SPS Agreement, according to their objective ------------------------------------------------------------------------------------------------------------------157 ii) The Member States bans fit into Annex A:1, second paragraph, of the SPS Agreement, according to their forms ----------------------------------------------------------------------------------------------------------------------160

b.- The Member State bans affect international trade ------------------------------------------------------------------162 2.- Each sanitary or phytosanitary measure must be based on scientific evidence ------------------------------------163 3.- The relation between Article 2 and Article 5 of the SPS Agreement------------------------------------------------163 4.- The Member State bans are inconsistent with Article 5.1 of the SPS Agreement ---------------------------------163 5.- The Member State bans are inconsistent with Article 2.2 of the SPS Agreement ---------------------------------165 6.- The Member State bans are inconsistent with article 5.5 of the SPS Agreement----------------------------------166

a.- First element: application of different levels of protection in different situations------------------------------167 b.- Second element: arbitrary and unjustifiable differences in protection -------------------------------------------169

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c.- Third element: discrimination and disguised restriction on international trade---------------------------------171 7.- Member State bans are inconsistent with Article 2.3 of the SPS Agreement --------------------------------------174 8.- The State bans are inconsistent with Article 5.6 of the SPS Agreement--------------------------------------------174

CONCLUSION REGARDING THE INCONSISTENCY OF THE STATE BANS WITH THE SPS AGREEMENT-------------------------------------------------------------------------------------------------------177 B.- BANS OF EC MEMBER STATES ARE INCONSISTENT WITH GATT 1994 --------------------------177

1.- Inconsistency with Article III:4 of GATT 1994------------------------------------------------------------------------177 a.- Like products in the sense of Article III:4 of GATT 1994---------------------------------------------------------178 b.- The bans of some EC Member States are a “law, regulation or requirement” affecting “the [products’] internal sale, offering for sale, purchase, transportation, distribution, or use”--------------------------------------179 c.- According of “less favorable treatment” -----------------------------------------------------------------------------179

CONCLUSION WITH RESPECT TO THE MEMBER STATE BANS BEING INCONSISTENT WITH THE GATT 1994 AGREEMENT ----------------------------------------------------------------------------------------180 C.- INCONSISTENCY OF THE BANS OF THE EC MEMBER STATES WITH THE AGREEMENT ON TECHNICAL BARRIERS TO TRADE -TBT---------------------------------------------------------------------180

1.- EC legislation for approval of biotech agricultural products constitutes “technical regulations” pursuant to Annex 1, paragraph 1 of the TBT Agreement ------------------------------------------------------------------------------181 2.- The Member State bans applied by some EC Member States to specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 2.1 of the TBT Agreement ----------------------------185 3.- The application of EC legislation is inconsistent with Article 2.2 of the TBT Agreement-----------------------185 4.- The bans of the Member States on specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 2.9 of the TBT Agreement ----------------------------------------------------------------------188

CONCLUSION WITH RESPECT TO THE MEMBERS STATE BANS BEING INCONSISTENT WITH THE TBT AGREEMENT-------------------------------------------------------------------------------------------190

VI.- REQUEST FOR FINDINGS -----------------------------------------------------------------------------------190

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BACKGROUND 1. On May 14, 2003, the Argentine Republic requested a consultation with the European Communities (hereinafter, the “EC”) in relation to certain measures that affect the approval and marketing of biotech agricultural products, pursuant to Article 4 of the Understanding on Rules and Procedures Governing the Settlement of Disputes (DSU), Article 11.1 of the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS), Article 19 of the Agreement on Agriculture (AA), Article 14.1 of the Agreement on Technical Barriers to Trade (TBT), and Article XXII.1 of the GATT 1994.1 The consultations were held on June 19, 2003, but failed to produce positive results. 2. On August 7, 2003, Argentina requested the establishment of a Panel to consider the measures relating to the approval and marketing of biotechnology products implemented by the EC2. 3. The Panel was established on August 29, 2003, and the Director-General of the WTO defined the composition of the Panel in March 2004. Christian Häberli was appointed Chairman, and Mohan Kumar and Akio Shimizu were appointed Members3. FACTS AND COMMUNITY LEGISLATION ON THE MATTER 4. The EC has affirmed their implementation of an oversight system for the approval and marketing of biotech agricultural products to ensure that food products that originate in non-member countries offer the same safety guarantees as food products that originate in the Member States4.

1 See WT/DS293, G/L629, G/SPS/GEN/399, G/AG/GEN/62, G/TBT/D/30 (May 21, 2003). 2 See WT/DS293/17 (August 8, 2003). 3 See WT/DS291/24, WT/DS292/18, WT/DS293/18 (March 5, 2004). 4 See Healthy Food for Europe’s Citizens. The European Union and Food Quality, Publication of the Publications Office of the European Communities, Luxembourg, 2000, page 4. See Annex ARG-2.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 2 5. The EC’s system for the approval of biotech agricultural products (“genetically modified organisms” or GMOs as they are designated in the EC legislation) or “novel foods” -designation used by the EC- requires that before said products can be marketed for consumption in Community territory, a specific procedure must be followed that governs “the deliberate release into the environment of genetically modified organisms for any other purposes than placing on the market within the Community, as well as placing on the market genetically modified organisms as or in products.” (Directive 2001/18/EC5 and its predecessor Directive 90/220/EEC6) and the placing on the market of “novel foods” and their ingredients (Regulation (EC) No. 258/977). 6. In particular, the above-referenced directives relate to biotech agricultural products that originate in non-member states, as indicated in Nos. 11 and 12 of the Preamble of Directive 2001/18/EC, which state: (11) Placing on the market also covers import. Products containing and/or consisting of GMOs covered by this Directive cannot be imported into the Community if they do not comply with its provisions. (12) Making GMOs available to be imported or handled in bulk quantities, such as agricultural commodities, should be regarded as placing on the market for the purpose of this Directive. 7. The EC regime operates as a system for approval of all biotech agricultural products prior to their release or placement on the market. Failing such approval, a biotech product may not be released or placed on the market in the EC. The legislation outlines the steps of the respective 5 Directive 2001/18/EC of the European Parliament and of the Council of 12 March 2001 on the deliberate release into the environment of genetically modified organisms and repealing Council Directive 90/220/EEC, published in the Official Journal No. 106 dated 17-04-2001, hereinafter “Directive 2001/18/EC.” See Annex ARG-3. 6 Council Directive 90/220/EEC of 23 April 1990 on the deliberate release into the environment of genetically modified organisms, published in the Official Journal No. L 330 dated 08-05-1990, p. 15, hereinafter “Directive 90/220/EEC.” See Annex ARG-4. 7 Regulation (CE) No. 258/97 of the European Parliament and of the Council of 27 January 1997 concerning novel foods and novel food ingredients, published in the Official Journal No. L 043 dated 14-02-1997, p. 0001-0006; hereinafter “Regulation (EC) 258/97.” See Annex ARG-5.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 3 procedures with which an applicant must comply in order to obtain approval for such a product in the market and the standards by which the application for approval shall be judged.

8. Community legislation provides different procedures: on one hand, for the case of the deliberate release of biotech agricultural products into the environment (for purposes other than their placement on the market) and for the placement on the market of biotech agricultural products as products or ingredients in products (Directive 2001/18/EC and its predecessor Directive 90/220/EEC), and on the other hand for “novel foods” and their ingredients (Regulation (EC) 258/97). Although each of the procedures established in the above-mentioned directives will be explained in greater detail below, they can be summarized by differentiating the principal steps in the respective approval processes, namely: 9. Notification. The manufacturer or importer of the biotech agricultural product submits a notification and accompanying dossier to the competent body of the Member State where the product is to be placed on the market for the first time. The legislation specifies that the notification and dossier must include information about the notifying party, the nature of the biotech product (for example, the method of genetic modification used, the traits or characteristics introduced or modified), the commercial names to be used, the likely uses of the product, proposals for labeling or for restrictions on use, and any data on potential impacts on health or the environment. 10. Member State Assessment. The competent body in the Member State where the biotech agricultural product is to be placed on the market is responsible for an assessment of the notification and dossier to ensure that they comply with the technical requirements of the relevant legislation and determine whether the product should be placed on the market. After completing this assessment, the Member State sends a copy of its report to the European Commission. 11. Circulation of Assessment for Comment. The Commission circulates copies of the assessment to the other Member States for their review and comment. If there is no objection made during this comment period, the competent body of the Member State from which approval was initially

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 4 sought consents in writing to placing the biotech agricultural product on the market. 12. Commission Decisions. If a Member State objects to placing the biotech agricultural product on the market, the Commission makes a ruling in accordance with specific procedures laid down in the approval legislation. First, the Commission requests an opinion from the relevant Scientific Committee. If the Committee renders a favorable opinion, the Commission proposes a draft measure to its Regulatory Committee, which delivers an opinion within a timeframe set by its chairman. If the Regulatory Committee’s opinion is favorable, the Commission adopts the authorization decision. 13. Council Actions. If the Regulatory Committee does not render an opinion, or if it renders an unfavorable opinion, the Commission refers a proposal to the Council, which may take action by qualified majority. If the Council has not acted within three months of the date of the referral, the Commission adopts the proposed measures. 14. Placing the Product on the Market. If, after consultation with the Regulatory Committee (and where necessary with the Council), the Commission decides to place the biotech agricultural product on the market, the Commission informs the applicant of the decision made, or the competent body of the Member State in which the approval process was initiated grants written consent for placing the product on the market. 15. Labeling. A product approved for placement on the market must also meet applicable labeling requirements. As mentioned above, proposals for labeling a product are typically required in the initial notification and accompanying dossier. At a minimum, a label is required to identify the product as containing genetically modified organisms. SUBJECT OF THE COMPLAINT BY THE ARGENTINE REPUBLIC 16. The complaint by the Argentine Republic is based on the following considerations:

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 5 1) Since October 1998, the EC has not considered or has suspended applications for approval of all biotech agricultural products under its system of approval prior to release or marketing, and in particular of products of interest to Argentina. The current suspension of procedures is demonstrated by the fact that prior to 1998, the EC had approved biotech agricultural products, while from 1998 to the present, the EC has not approved any biotech agricultural product. 2) Second, the EC has caused an undue delay by failing to consider and/or not completing the processing of applications submitted with regard to various biotech agricultural products. 3) The prohibitions adopted by some Member States on access of specific biotech agricultural products to the market. 17. In summary, these actions -suspension of consideration, lack of approval or undue delay- constitute individual expressions of a single measure which is the subject of this complaint -a “de facto” moratorium-. Likewise, several specific products of interest to Argentina have been affected by suspensions or the lack of consideration or undue delays -an argument that will be developed at the appropriate time- since no decision has been made on their approval to date. 18. The “de facto” moratorium implemented by the EC as well as the bans adopted by some of its Member States are measures inconsistent with the provisions of the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS), the General Agreement on Tariffs and Trade (GATT), or alternatively, the Agreement on Technical Barriers to Trade (TBT). ORDER OF ANALYSIS 19. Argentina will begin by establishing the inconsistency of the EC’s “de facto” moratorium with the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS). In other words, Argentina will demonstrate the substantive inconsistency of the EC’s measure affecting the approval of all biotech agricultural products since 1998 with the SPS. Specifically, it will

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 6 show that the “de facto” moratorium is inconsistent with the following provisions: - Articles 5.1, 2.2, 5.5, 2.3, 7 and Annex B:1, and 10.1 of the SPS 20. Furthermore, Argentina will demonstrate the inconsistency with the SPS of the EC’s “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina.” Specifically, it will demonstrate inconsistency with the following provisions: - Articles 5.1, 2.2, 5.5 and 5.6 of the SPS 21. Then, it will demonstrate the inconsistency with the SPS of the EC’s “undue delay in the processing of the various applications for approval of biotech agricultural products of particular interest to Argentina,” and specifically its inconsistency with the following provisions: - Article 8 and Annex C:1(a), (b), (c) and (e) of the SPS 22. Upon demonstrating the inconsistency with the SPS, Argentina will demonstrate the inconsistency of the “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” with the GATT 1994. Specifically, it will demonstrate inconsistency with the following provision: - Article III:4 of the GATT 1994 23. Alternatively, Argentina will demonstrate the inconsistency of the “application of Community legislation with respect to the system of approval of biotech agricultural products of particular interest to Argentina” with the following provisions of the Agreement on Technical Barriers to Trade (TBT): - Articles 2.1, 2.2, 5.1.1, 5.1.2, 5.2.1, 5.2.2 and 12 of the TBT, and 24. Finally, Argentina will demonstrate the inconsistency of the bans by

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 7 some EC Member States with the following provisions: - Articles 5.1, 2.2, 5.5, 2.3, and 5.6 of the SPS - Articles III:4 of the GATT 1994 - Alternatively, and should the Panel not consider the Member State bans under the SPS Agreement, with Articles 2.1, 2.2, 2.9.1, 2.9.2 and 2.9.4 of the TBT Agreement ARGUMENTS I.- INTRODUCTION 25. Since 1998 the EC has not approved any new biotech agricultural product, notwithstanding the validity of the above-referenced Community legislation -Directive 2001/18/EC and its predecessor, Directive 90/220/EEC, and Regulation (CE) No. 258/97- and since then the applications for approval for various products of interest to Argentina have been pending, either in procedures initiated under Regulation 258/97 or under any of the above-mentioned EC Directives8. 26. This repeated and systematic failure to approve new biotech agricultural products is what both the claimants and the EC have designated as a “de facto moratorium,” the existence of which the EC itself has admitted9. 8 See list of biotech agricultural products approved by the EC in State of play on GMO authorisations under EU law, MEMO/04/17, Brussels, January 28, 2004, Annexes 1 and 4, in Annex ARG-6. 9 By way of example, the see Communication from the Commission, Journal of the European Communities C 55 dated 02-03-2002, COM(2002) 27 and Bulletin 1/2-2002, Point 1.3.126, which states in its pertinent section:

“(...) With regard to the food supply, the Parliament fully shares the opinion that an end must be called to the current “de facto” moratorium that has been imposed on genetically modified foods since 1998, which should be lifted in 2003, to provide greater choice and increased benefits to the consumer as well as to promote innovation. (...)”

See Annex ARG-7. In addition, David Byrne, the European Commissioner for Health and Consumer Protection, said at the


27. The attitude of the EC by failing to approve any biotech agricultural products since 1998 -under Directive 2001/18/EC and its predecessor Directive 90/220/EEC and Regulation (EC) 258/97- is incompatible with WTO legislation. 28. In October 2002, Directive 2001/18/EC took effect, establishing that all the applications for which the approval process had not yet been completed -

conference entitled “New Technologies in Agriculture” - Biotechnology, Annex Summary details of draft Regulations on GM Food/Feed and Traceability - European Commissioner David Byrne, dated September 18, 2001:

“... In the EU, the Scientific Committees have already assessed a number of GMOs and concluded that they do not pose a danger to the environment or to human health. However, these GMOs are still pending final approval and some of them have now been awaiting approval for quite some time. (...)”

See Annex ARG-8. Likewise, the European Commissioner for Health and Consumer Protection said at the conference entitled A European approach to food safety and GMOs, on October 9, 2001:

“... The final point I wish to make on biotechnology relates to the effective moratorium on new approvals in the EU. This is an unfortunate situation and has helped nobody in my view. It is my firm hope and intention that we can get the approvals process working again. I have mandated my officials to start a dialogue with the Member States of the European Union with a view to re-starting approvals...”

See Annex ARG-9. David Byrne expressed the same idea at the conference entitled “Farm to Fork” - Risk versus benefit, on November 22, 2001:

“... The effective moratorium on new approvals in the EU is an unfortunate situation and its continuation, in my personal view, helps nobody. It has serious implications for European industry, agriculture and research. It creates legal uncertainty... (...) As a result, the authorisation of both pending and new products has come to a grinding halt...”

In this regard, see ARG-10.


in other words, all applications submitted since 1998- under Directive 90/220/EEC would have to begin the process all over again under the new Directive10. 29. This obligation to begin the process all over again led some of the applicants to withdraw their applications11. 30. Even among those applicants who decided to restart the procedure under Directive 2001/18/EC, none of them have received approval for their biotech agricultural products. On the contrary, the approval processes were further delayed after the EC began to indicate that before any approval would be granted, it would be necessary to finalize the approval at the level of the EC of a new directive on the traceability and labeling of biotech agricultural products12.

10 Directive 2001/18/EC stipulates in its Article 35:

“Pending notifications 1. Notifications concerning placing on the market of GMOs as or in products received pursuant to Directive 90/220/EEC, and in respect of which the procedures of that Directive have not been completed by 17 October 2002 shall be subject to the provisions of this Directive. (...)”

11 See point C.1.c) of this presentation. “Status of the biotech products of particular interest to Argentina: Inconsistencies in the application of Community legislation in light of the provisions of Article 8 and Annex C:1(a), (b), (c) and (e) of the SPS.” 12 See Report by Antonios Trakatellis before the European Parliament, June 4, 2003, A5-0204, Recommendation for second reading on the common position of the Council with a view to adopting a European Parliament and Council regulation on traceability and labeling of genetically modified organisms and the traceability of food and feed products produced from genetically modified organisms and amending Directive 2001/18/EC, in its pertinent section, (in the Spanish version):

“In addition, I take the view that (…) will lead to the removal of the de facto moratorium on the approval of new GMOs, (...)”

See Annex ARG-11. See also the statement by David Byrne at the conference entitled “Farm to Fork” - Risk versus benefit, on November 22, 2001:

“(...) The fact is that a number of EU Member States have since 1999 demanded a more stringent and transparent regulatory framework for marketing authorisations and a labelling and traceability regime for GMOs and GMO-derived products.


31. All these measures implemented by the EC (change in legislation, obligation to restart the processes, the unjustified failure to process applications, the pretext of the need to implement legislation on an aspect other than approval, etc.), the result of which is the lack of any approvals and the impossibility of importing any new biotech agricultural product into the EC since 199813 are evidence of a “de facto” moratorium. 32. Likewise, Argentina notes that biotech agricultural products have suffered an arbitrary and unjustified discrimination with regard to the application of Community legislation. In fact, Regulation (EC) 258/97 is applicable both to new biotech agricultural products and to new “non-biotech” products, among others. Nevertheless, only the biotech agricultural products have been subjected to this discrimination.

Their position is that pending the adoption of such rules, and in accordance with preventive and precautionary principles, new authorisations for growing and marketing GM products should remain suspended. (...)”

See Annex ARG-10. See also the Declaration by the Danish, Greek, French, Italian and Luxembourg delegations concerning the suspension of new GMO authorisations, 2194th Council Meeting -Environment-, Luxembourg, June 24/25, 1999:

“The Governments of the following Member States (Denmark, Greece, France, Italy and Luxembourg), in exercising the powers vested in them regarding the growing and placing on the market of genetically modified organisms (GMOs), given the need to put in place a tighter, more transparent framework, in particular for risk assessment, having regard to the specifics of European ecosystems, monitoring and labelling, given the need to restore public and market confidence, point to the importance of the Commission submitting without delay full draft rules ensuring labelling and traceability of GMOs and GMO-derived products and state that, pending the adoption of such rules, in accordance with preventive and precautionary principles, they will take steps to have any new authorisations for growing and placing on the market suspended.”

See Annex ARG-12. 13 See, for example, Annexes ARG-7, ARG-10 and ARG-12.


33. Argentina therefore considers that the EC has imposed and maintained a “de facto” moratorium on the approval of biotech agricultural products. 34. This “de facto” moratorium is a measure that has the following characteristics: a) it has never been set forth in the form of positive legislation –a regulation or directive- but it has been applied and maintained as a practice in the EC since 1998; b) from 1998 to the present, no new biotech agricultural product has been approved for placement on the market, which entails the systematic suspension of the processing and the failure to consider individual applications for authorization or approval of biotech agricultural products; c) the moratorium has affected the various applications for approval of individual biotech agricultural products, while causing an undue delay in the completion of the processing of said applications; d) it is not supported by scientific evidence; e) it has manifested itself in a repeated delay of deadlines by the EC since 1998, under the continued pretext of the approval of new legislation: amendment of Directive 90/220/EEC by Directive 2001/18/EC, the need to have additional legislation covering different aspects and new requirements, etc. f) reveals an arbitrary and unjustified discrimination against biotech agricultural products. 35. Apart from the market restrictions in the EC imposed on biotech agricultural products as a result of the “de facto” moratorium, various EC Member States (Germany, Austria, Italy and Luxembourg) have imposed bans on the sale14 of various biotech agricultural products of interest to Argentina, notwithstanding the fact that these products had previously been approved by the same Community authorities.

14 See Annex ARG-13.


II.- INCONSISTENCY WITH THE SPS AGREEMENT A.- INCONSISTENCY OF THE “DE FACTO” MORATORIUM WITH THE SPS AGREEMENT 1.- The “de facto” moratorium as a measure within the framework of the SPS Agreement 36. Argentina is of the opinion that the “de facto” moratorium constitutes a sanitary and phytosanitary measure within the meaning of the SPS, and pursuant to WTO jurisprudence15 it will begin with an analysis of the inconsistency of the “de facto” moratorium in the light of the SPS. 37. Article 1 of the SPS Agreement (General Provisions) states in Paragraph 1:

“This Agreement applies to all sanitary and phytosanitary measures which may, directly or indirectly, affect international trade. Such measures shall be developed and applied in accordance with the provisions of this Agreement.”

38. With respect to the requirements for the SPS to be applicable to a measure, the Panel in European Communities - Measures concerning meat and meat products (EC - Hormones) held that the measure in question has to meet two requirements: a) the measure in dispute must be a sanitary or phytosanitary measure, and b) the measure must be able to affect international trade16.

15 Appellate Body Report in European Communities - Regime for the Importation, Sale and Distribution of Bananas (“EC - Bananas III”), WT/DS27/AB/R, Adopted September 25, 1997, Paragraph 204:

“(...) the Panel, in our view, should have applied the (…) Agreement first, since this agreement deals specifically, and in detail, with the administration of (…) procedures. If (…) had done so, then there would have been no need for it to address the alleged inconsistency with (…) GATT 1994.”

16 Report of the Panel in European Communities - Measures concerning meat and meat products (Hormones), WT/DS48/R, Paragraph 8.39 (Canada), and WT/DS26/R, Paragraph 8.36 (United States),


a.- The “de facto” moratorium is a sanitary or phytosanitary measure 39. To analyze the first of these issues considered by the Panel, i.e. whether the measure in dispute is a sanitary or phytosanitary measure, reference must be made to Annex A (Definitions) of the SPS. Its paragraph 1, establishes:

“Sanitary or phytosanitary measure - Any measure applied: (a) to protect animal or plant life or health within the territory of the Member from risks arising from the entry, establishment or spread of pests, diseases, disease-carrying organisms or disease-causing organisms; (b) to protect human or animal life or health within the territory of the Member from risks arising from additives, contaminants, toxins or disease-causing organisms in foods, beverages or feedstuffs; (c) to protect human life or health within the territory of the Member from risks arising from diseases carried by animals, plants or products thereof, or from the entry, establishment or spread of pests; or (d) to prevent or limit other damage within the territory of the Member from the entry, establishment or spread of pests.”

40. On the basis of this legislation, for the “de facto” moratorium to meet the first of the requirements set by the SPS, it must satisfy two conditions: i) the objective of the “de facto” moratorium must be at least one of the objectives cited in letters a) to d) of Annex A:1 of the SPS Agreement, and ii) the “de facto” moratorium must also be reflected in one of the instruments cited in the second paragraph of Annex A:1 of the SPS Agreement:

“Sanitary or phytosanitary measures include all relevant

hereinafter EC-Hormones.


laws, decrees, regulations, requirements and procedures including, inter alia, end product criteria; processes and production methods; testing, inspection, certification and approval procedures; quarantine treatments including relevant requirements associated with the transport of animals or plants, or with the materials necessary for their survival during transport; provisions on relevant statistical methods, sampling procedures and methods of risk assessment; and packaging and labeling requirements directly related to food safety.”17

i) The “de facto” moratorium fits into Annex A:1, first paragraph, of the SPS Agreement, according to its objective 41. To analyze the first of these conditions, reference must be made to Annex A:1, first paragraph, of the SPS. Letters (a) to (d) establish the measures that cover issues such as the risks resulting from diseases and pests that can affect the health of humans, animals or plants; issues referred to the protection of human or animal life and health related to the food supply and to the prevention of other damage that may result from pests. 42. First, the EC itself has explicitly acknowledged that the purpose of the “de facto” moratorium is to protect against risks to life and health and to protect the environment18.

17 Annex A:1, paragraph 2, of the SPS. 18 Along these lines, an article entitled EU moratorium on GMOs could last until traceability, labeling regime in place, was published in the International Trade Daily on October 30, 2001:

“(...) French Environment Minister Yves Cochet, who said her country would insist on a liability scheme before it lifts its opposition to GMOs, defended the approach taken by many EU member states as one of caution designed to ensure the safety of citizens and the protection of the environment. (...)”

See Annex ARG-14. Likewise, the Declaration by the Danish, Greek, French, Italian and Luxembourg delegations concerning the suspension of new GMO authorisations, 2194th Council Meeting -Environment-, Luxembourg, June 24/25, 1999, states:

“The Governments of the following Member States (Denmark, Greece, France, Italy


43. In addition, the EC itself has admitted that its policy with regard to biotech agricultural products relates to the protection of life and health19, so,

and Luxembourg), in exercising the powers vested in them regarding the growing and placing on the market of genetically modified organisms (GMOs), given the need to put in place a tighter, more transparent framework, in particular for risk assessment, having regard to the specifics of European ecosystems, monitoring and labelling, given the need to restore public and market confidence, point to the importance of the Commission submitting without delay full draft rules ensuring labelling and traceability of GMOs and GMO-derived products and state that, pending the adoption of such rules, in accordance with preventive and precautionary principles, they will take steps to have any new authorisations for growing and placing on the market suspended.”

See Annex ARG-12. See also Speeches and articles by Pascal Lamy, Steeling the EU-US Relationship for the challenge ahead, Woodrow Wilson International Center for Scholars, Washington DC, January 25, 2002:

“(...) But the current moratorium is not plucked out of thin air by the Member States for protectionists reasons: it reflects the fact that food safety is a highly sensitive and political issue for European citizens: as I have said before, European perceptions of risk are very simply different from yours, and are driven also by the sad stories of contaminated blood and mad cow disease. (...)”

See Annex ARG-15. 19 The EC makes explicit reference to the protection of life and health in its definition of “genetically modified organisms” (GMOs), as it appears in the glossary on the EC website:

“(...) Genetically Modified Organisms (GMO) GMOs are organisms (...) (...) There has been Community legislation on GMOs since the early 1990s. EU action is designed to protect human health and the environment while following the rules of the single market. The Union has legislated on the use, dissemination, marketing and traceability of GMOs (...) The European Commission is questioning the de facto moratorium on the marketing and production of GMOs within the Union, introduced in 1999 by the Member States. It is examining the possibility of authorising GMOs once again, (...)”

See Annex ARG-16. In addition, David Byrne, the European Commissioner for Health and Consumer Protection, also said at the conference entitled “Genetics and the future of Europe” on November 7, 2000:

“(...)


apart from the already demonstrated, the applicability of the SPS Agreement appears obvious. 44. Second, given the fact that the “de facto” moratorium, as indicated by statements by the EC itself, was imposed in the context of the various Community regulations for the inspection and analysis of biotech products, and that each of these pieces of legislation has different mechanisms for evaluating the potential damage that can be caused to health or to the environment20, the “de facto” moratorium, in effect since 1998, fits with the

In the EU public concerns about the application of biotechnology in the agri-food sector have resulted in a de-facto moratorium on authorisations of new GMOs. In fact no GMOs have been approved over the past two years. (...)”

In this regard, see Annex ARG-17. Likewise, David BYRNE made the following statement at the conference entitled The right to know about genetically modified food on July 25, 2001:

“... providing a high level of protection for human health and the environment. This will contribute towards the lifting of the de facto moratorium on the commercial release of GMOs and the standstill on the authorisations of GMOs and GM-products in Europe. (...)”

In this regard, see Annex ARG-18. See also Annex ARG-8. 20 See Environment in the European Union at the turn of the century, Release of genetically modified organisms into the environment, page 24:

“(...)The EU has legislation (Directives 90/220 and 97/258) to regulate the release of GMOs – deliberate and accidental – and their safety in food. Most other European countries have either followed the EU approach or adapted existing laws. EU marketing consent for GMO products takes at least 1-2 years; and none has been approved unanimously so far. Some countries, including Austria and Denmark, have wanted to include the impacts on agriculture in their assessment of environmental harm, while the European Commission and some Member States, such as the UK and the Netherlands, have tended to define environmental harm more narrowly, restricting risk assessment to the direct effects associated with GMOs. The European Commission published proposals for new legislation in 1996, broadening the risk management strategy to include indirect effects. Safety assessments have also been criticised on the grounds that cumulative impacts are neglected and that small scale trials may not predict performance in the wider environment. (...)”


first paragraph of Annex A:1 of the SPS Agreement because it is structured in accordance with the objectives set forth in each of the legislative manifestations that have regulated the approval of biotech agricultural products. 45. Therefore the “de facto” moratorium fits the descriptions contained in letters a) to d), because it relates to the protection of life and health, as established by the Community legislation concerning the approval of biotech products: Directive 90/220/EEC, Directive 2001/18/EC and Regulation (EC) 258/97. 46. In this regard, it must be emphasized that Directives 90/220/EEC and 2001/18/EC indicate explicitly that their purpose is the “protection of human health and the environment”21. For its part, Regulation (EC) 258/97 stipulates

See Environment in the European Union at the turn of the century, Appendix to the Summary, Facts and Findings per Environmental Issues, European Environment Agency, Luxembourg, EC Publications Office, 1999, page 24. See Annex ARG-19. 21 Directive 90/220/EEC states in its Article 1:

“The objective of this Directive is to approximate the laws, regulations and administrative provisions of the Member States and to protect human health and the environment: - when carrying out the deliberate release of genetically modified organisms into the environment, - when placing on the market products containing, or consisting of, genetically modified organisms intended for subsequent deliberate release into the environment. (...)”

For its part, Directive 2001/18/EC states in its Article 1:

“Objective In accordance with the precautionary principle, the objective of this Directive is to approximate the laws, regulations and administrative provisions of the Member States and to protect human health and the environment when: - carrying out the deliberate release into the environment of genetically modified organisms for any other purposes than placing on the market within the Community, - placing on the market genetically modified organisms as or in products within the Community.”

Said Directive 2001/18/EC also states in its Article 23(1):


that foods and food ingredients must not present a danger for the consumer”22. 47. In addition, the EC has indicated that the treatment given to biotech agricultural products was related to the fact that the EC was protecting itself against the risk indicated in its legislation23, which strengthens the conviction

“Safeguard clause Where a Member State, as a result of new or additional information made available since the date of the consent and affecting the environmental risk assessment or reassessment of existing information on the basis of new or additional scientific knowledge, has detailed grounds for considering that a GMO as or in a product which has been properly notified and has received written consent under this Directive constitutes a risk to human health or the environment, that Member State may provisionally restrict or prohibit the use and/or sale of that GMO as or in a product on its territory. The Member State shall ensure that in the event of a severe risk, emergency measures, such as suspension or termination of the placing on the market, shall be applied, including information to the public. The Member State shall immediately inform the Commission and the other Member States of actions taken under this Article and give reasons for its decision, supplying its review of the environmental risk assessment, indicating whether and how the conditions of the consent should be amended or the consent should be terminated, and, where appropriate, the new or additional information on which its decision is based.”

22 Regulation (EC) 258/97 states in its Article 3(1):

“Foods and food ingredients falling within the scope of this Regulation must not:

- present a danger for the consumer,

- mislead the consumer,

- differ from foods or food ingredients which they are intended to replace to such an extent that their normal consumption would be nutritionally disadvantageous for the consumer.”

23 In this regard, it should also be noted that Regulation (EC) 258/97 states, in its Preamble, No. 2:

“Whereas, in order to protect public health, it is necessary to ensure that novel foods and novel food ingredients are subject to a single safety assessment through a Community procedure before they are placed on the market within the Community; (...)”

In the pertinent portion of No. 8 of its Preamble, Regulation (EC) 258/97 also states:

“foods and food ingredients which contain genetically modified organisms and which are placed on the market must be safe for human health; whereas this assurance is provided for through compliance with the authorization procedure contained in


that the “de facto” moratorium was implemented by the EC as a measure intended to provide protection for life and health. 48. The risks to which the Community legislation refers to, and which have been evaluated by the respective EC scientific committees, are included in the first paragraph of Annex A:1, first paragraph, of the SPS, because both the above-referenced legislation and the opinions of the Scientific Committees refer to or deal with, among other risks, those risks such as toxic or allergic effects in humans and animals24, the growth of antibiotic-resistant

Directive 90/220/EEC and/or by the single assessment procedure laid down in this Regulation; (...)”

Directive 2001/18/EC also states, in its Preamble, No. 5:

“The protection of human health and the environment requires that due attention be given to controlling risks from the deliberate release into the environment of genetically modified organisms (GMOs).”

24 Directive 2001/18/EC states in its Annex III.A (Information Required In Notifications Concerning Releases Of Genetically Modified Organisms Other Than Higher Plants), Part II.C(2) (Characteristics of the modified organism):

“i) considerations for human health and animal health, as well as plant health:

(i) toxic or allergenic effects of the GMOs and/or their metabolic products; (...)

(...)”

Likewise, the same Annex III.A states in its Part II.A.11 (Pathological, Ecological and Physiological traits of the organisms):

“d) pathogenicity: infectivity, toxigenicity, virulence, allergenicity, carrier (vector) of pathogen, possible vectors, host range including non-target organism. Possible activation of latent viruses (proviruses). Ability to colonise other organisms: (...)”

Finally, Annex III.B (Information required in the notification concerning releases of genetically modified higher plants (GMHP) - Gymnosperm -) states in its Part B - Information relating to (a) the recipient or (b) (where appropriate) parental plants:

“7. Other potential interactions, relevant to the GMO, of the plant with organisms in the ecosystem where it is usually grown, or elsewhere, including information on toxic effects on humans, animals and other organisms.”

http://www.biosafety.be/GB/Dir.Eur.GB/Del.Rel./90.220/TC.html


bacteria25 and cross-contamination26. 49. Consequently, the “de facto” moratorium falls within the definition of a measure under the SPS Agreement. For example, concerns that a biotech product might harm other organisms fall under Annex A:1(a), which covers measures applied to protect animal or plant life or health from risks arising from disease-causing or disease-carrying organisms. Concerns related to allergic or toxic reactions on the part of consumers fall under Annex A:1(b), which covers measures applied to protect human or animal life or health from risks arising from additives, contaminants or toxins in foods, beverages or feedstuffs. Similarly, concerns relating to the risks that can result from diseases propagated by animals, plants or products derived from them or from the entry, establishment or spread of pests falls under Annex A:1(c). On the other hand, concerns regarding the cross-contamination of biotech products to other organisms fall under Annex A:1(d), which regulates measures applied to prevent or limit other damage within the territory of the Member from the entry, establishment or spread of pests. 50. In summary, the “de facto” moratorium constitutes a measure that falls under the SPS, because, as indicated in Community legislation, its objective is clearly to identify and prevent risks such as those defined in the first

25 Directive 2001/18/EC states in its Annex III.A (Information required in the notification concerning releases of genetically modified organisms other than higher plants), Part II.A.11 (Pathological, ecological and physiological traits of the organisms):

“e) antibiotic resistance, and potential use of these antibiotics in humans and domestic organisms for prophylaxis and therapy; (...)”

26 Directive 2001/18/EC states in its Annex III.A (Information required in the notification concerning releases of genetically modified organisms other than higher plants) Part IV.B (Interactions with the environment):

“3. genetic transfer capability:

(a) post-release transfer of genetic material from GMOs into organisms in affected ecosystems; (...)

(...)”

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 21 paragraph of Annex A:1 of the SPS, independent of the fact that an absence of the risk factors to be prevented -which are explicitly indicated in the first paragraph of Annex A:1 of the SPS Agreement- be determined in the specific conclusions of the singular risk assessments of biotech agricultural products. ii) The “de facto” moratorium fits in Annex A:1, second paragraph, of the SPS Agreement, according to its form 51. In addition to the information presented above with respect to what we are calling the first condition (“The «de facto» moratorium fits in Annex A:1, first paragraph, of the SPS Agreement, according to its objective”) to be satisfied in order to constitute the first element of a measure under the SPS Agreement, a second condition must also be satisfied, which is related to the form the measure takes, i.e. the form in which it is set forth. For this second condition, reference is made to the SPS, Annex A:1, second paragraph, which states:

“Sanitary or phytosanitary measures include all relevant laws, decrees, regulations, requirements and procedures including, inter alia, end product criteria; processes and production methods; testing, inspection, certification and approval procedures; quarantine treatments including relevant requirements associated with the transport of animals or plants, or with the materials necessary for their survival during transport; provisions on relevant statistical methods, sampling procedures and methods of risk assessment; and packaging and labeling requirements directly related to food safety.”(emphasis added).

52. In that regard, it must be emphasized that the EC moratorium has been applied on a particular way: it has not been applied in the form of a law; in other words, it has not been applied on the traditional modes in which the WTO Members manifest their decisions (laws, decrees, regulations etc.), but it has been established “de facto” by the EC. Nevertheless, the Community’s


own authorities have acknowledged its existence27. 53. It must also be noted that the phrase in Annex A:1, second paragraph, of the SPS, “including, inter alia,” clearly indicates that the list that follows is not intended to be exhaustive. 54. Likewise, the GATT/WTO jurisprudence did deal with the issue of the scope of the concept of “measure”. For example, in Japan - Trade in Semiconductors, the Panel, in the context of Article XI:1 of the GATT, held that informal administrative measures that create incentives or disincentives for the private sector and that are based on governmental action can be considered a “measure”28. Elsewhere, in Japan - Measures concerning films and photographic paper for consumer use, the Panel, in the context of Article XXIII:1(b), held that a governmental action need not necessarily be binding to be considered a measure, and with respect to Article III:4 of the GATT 1994, it held that measures that are not binding may be included under the term “laws, regulations and requirements” of said article, because they must be interpreted as within the “broad spectrum of government action”29. 55. In this sense, the Appellate Body has established that:

“...In principle, any act or omission attributable to a WTO Member can be a measure of that Member for purposes of dispute settlement proceedings.78 The acts or omissions that are so attributable are, in the usual case, the acts or omissions of the organs of the state, including those of the executive branch.79.”30

27 See the information referenced above in Annexes ARG-7, ARG-8, ARG-9 and ARG-10. 28 Panel Report in Japan - Trade in Semiconductors, adopted May 4, 1988, L-6309, paragraphs 106-118, hereinafter Japan - Semiconductors. 29 Panel Report in Japan - Measures concerning films and photographic paper for consumer use, WT/DS44/R, paragraphs 10.42-10.51, hereinafter Japan - Film. 30 Appellate Body Report in United States - Sunset Review of Anti-Dumping Duties on Corrosion-Resistant Carbon Steel Flat Products from Japan (hereinafter USA - Sunset Review Japan), WT/DS244/AB/R, paragraph 81.


78 We need not consider, in this appeal, related issues such as the extent to which the acts or omissions of regional or local governments, or even the actions of private entities, could be attributed to a Member in particular circumstances. 79 Both specific determinations made by a Member's executive agencies and regulations issued by its executive branch can constitute acts attributable to that Member. See, for example, the Panel Report in US – DRAMS, where the measures referred to the panel included a USDOC determination in an administrative review as well as a regulatory provision issued by USDOC. (underlining added to indicate original text in italics)

56. The “de facto” moratorium has characteristics similar to those discussed in the above-referenced cases, given that it constitutes an omission attributed to the EC which results in a failure to meet its obligations under the WTO. This omission is expressed by the suspension of consideration and/or by the failure to give any consideration at all to applications for approval. 57. This non-exhaustive character of the list of the forms that a sanitary or phytosanitary measure can take was also interpreted by WTO jurisprudence in a discussion of Annex B:1 and its footnote:

“Members shall ensure that all sanitary and phytosanitary regulations which have been adopted are published promptly in such a manner as to enable interested Members to become acquainted with them5.” 5 Sanitary and phytosanitary measures such as laws, decrees or ordinances which are applicable generally. (emphasis added)

58. In fact, the Appellate Body has affirmed, in its discussion of issues related to the publication of the sanitary and phytosanitary regulations of Annex B:1 of the SPS:

“We consider that the list of instruments contained in the footnote to paragraph 1 of Annex B is, as is indicated by the words "such as", not exhaustive in nature. The scope of application of the publication requirement is not limited to "laws, decrees or ordinances", but also includes, in our


opinion, other instruments which are applicable generally and are similar in character to the instruments explicitly referred to in the illustrative list of the footnote to paragraph 1 of Annex B.”31 “The object and purpose of paragraph 1 of Annex B is "to enable interested Members to become acquainted with" the sanitary and phytosanitary regulations adopted or maintained by other Members and thus to enhance transparency regarding these measures. In our opinion, the scope of application of the publication requirement of paragraph 1 of Annex B should be interpreted in the light of the object and purpose of this provision.”32 “We note that it is undisputed that the varietal testing requirement is applicable generally. Furthermore, we consider in the light of the actual impact of the varietal testing requirement on exporting countries, as discussed by the Panel in paragraphs 8.112 and 8.113 of the Panel Report, that this instrument is of a character similar to laws, decrees and ordinances, the instruments explicitly referred to in the footnote to paragraph 1 of Annex B.”33 (emphasis added)

59. From these statements by the Appellate Body, it can be inferred that for an instrument to be considered a sanitary or phytosanitary measure, it must have certain defined characteristics, such as: general application and similarity with the instruments explicitly mentioned in Footnote 5 to Annex B:1 of the SPS. 60. The “de facto” moratorium has the necessary characteristics to be defined as a sanitary or phytosanitary measure. In fact, it has been applied in 31 Appellate Body Report in Japan-Measures affecting agricultural products (hereinafter Japan - Agricultural Products), WT/DS76/AB/R, Paragraph 105. 32 Appellate Body Report in Japan - Agricultural Products, WT/DS76/AB/R, Paragraph 106. 33 Appellate Body Report in Japan - Agricultural Products WT/DS76/AB/R, Paragraph 107.


a general manner and has had a “real effect,” in that there have been no approvals of biotech agricultural products since 1998 in the territory of the EC. 61. In addition, as a result of the above-mentioned effect, the “de facto” moratorium does fit in the sanitary and phytosanitary measures mentioned in the Footnote to Annex B:1 of the SPS, given the non-exhaustive character arising from the phrase “such as” in said footnote. In other words, it has a de facto effect which does not differ at all from the effect of a law, regulation or ordinance that might institute an absolute ban on imports. 62. For the reasons indicated above, Argentina believes that the “de facto” moratorium, although it has not been instituted by means of a formal resolution of the pertinent Community bodies, must be considered a sanitary or phytosanitary measure within the meaning of the SPS. 63. Consequently, in the opinion of Argentina, the “de facto” moratorium meets the first of the two requirements referred to by the Panel in EC-Hormones34. b.- The “de facto” moratorium affects international trade 64. With regard to the second requirement, Argentina believes that the “de facto” moratorium has undoubtedly had effects on international trade, especially with respect to developing countries using biotechnology that allows them to enhance their competitiveness. It should suffice to note that since 1998, various biotech agricultural products have not had access to the Community market, notwithstanding the fact that the corresponding procedures have been initiated through the submission of applications. 65. In this sense, the “de facto” moratorium functions as a ban on imports of biotech agricultural products that had not been approved at the time the moratorium was put in place.

34 Panel Report in EC - Hormones, WT/DS48/R, Paragraph 8.39 (Canada), and WT/DS26/R, Paragraph 8.36 (United States).

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 26 66. This attitude on the part of the EC affects the international trade of countries such as Argentina in a variety of ways. On one hand, it restricts the entry of biotech agricultural products into the EC, and on the other, it has a dissuasive effect on other potential international markets. In this regard, some states may be inclined to adopt attitudes similar to that of the EC, and may likewise begin to impose sanitary or phytosanitary measures without any scientific evidence. 67. In addition, this EC measure has the effect of acting as a disincentive to the development of biotechnology, which is particularly prejudicial to a developing country such as Argentina. 68. Therefore, in the opinion of Argentina, the “de facto” moratorium is an SPS measure because it meets the requirement of “objective” (Annex A:1.a) to A:1.d) of the SPS), the requirement of “form” (Annex A:1, second paragraph) and has an effect on international trade. 2.- All sanitary or phytosanitary measures must be based on scientific evidence and must not constitute a disguised restriction of international trade 69. The objective of the SPS is to prevent sanitary or phytosanitary measures from being used as disguised restrictions. In the Uruguay Round, many countries were concerned by the possible increased use of non-tariff barriers to trade, especially if they were applied under the pretext of protecting the food supply or protecting human or animal health. While those objectives may be legitimate, there was still a concern that sanitary and phytosanitary measures could be used for protectionist purposes. 70. This concern was the basis for the provision in the SPS that requires that any sanitary or phytosanitary measure must have a basis in science. In other words, the objective of protecting life and health must be achieved so that it does not imply any disguised restriction on trade. 71. In other words, an appropriate balance must be maintained between the right of the Member States to protect life and health and the right of the other WTO Member States not to have their trade unduly restricted. This


objective is reflected in Article 2.2 of the SPS, which states:

“Members shall ensure that any sanitary or phytosanitary measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is not maintained without sufficient scientific evidence, except as provided for in paragraph 7 of Article 5.”

72. Argentina considers that with this “de facto” moratorium, the EC has implemented a sanitary or phytosanitary measure which has no basis in scientific evidence35, and which even opposes to the scientific opinions issued by the EC itself -which endorsed the approval of biotech agricultural products36-.

35 In this regard, David Byrne, European Commissioner for Health and Consumer Protection, said at the conference entitled “New Technologies in Agriculture” - Biotechnology, Annex Summary details of draft Regulations on GM Food/Feed and Traceability - European Commissioner David Byrne, on September 18, 2001:

“... In the EU, the Scientific Committees have already assessed a number of GMOs and concluded that they do not pose a danger to the environment or to human health. However, these GMOs are still pending final approval and some of them have now been awaiting approval for quite some time. (...)”

See Annex ARG-8. The opinion expressed above was advanced by David Byrne at the conference entitled Proposal for a regulation on GM Food and Feed, on September 11, 2001:

“... In the EU, the Scientific Committees have already assessed a number of GMOs and concluded that they do not pose a danger to the environment or to human health. However, these GMOs are still pending final approval and some of them have now been awaiting approval for quite some time...”

See Annex ARG-20. 36 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26 and ARG-27.


3.- The relationship between Article 2 and Article 5 of the SPS Agreement 73. In line with WTO jurisprudence on the matter, Argentina would like to point out the relationship that exists between the obligations arising from Article 2 of the SPS (Basic rights and obligations) and Article 5 of the SPS (Assessment of Risk and Determination of the Appropriate Level of Sanitary or Phytosanitary Protection). 74. In this regard, it should be noted that:

“Articles 2.2 and 5.1 should constantly be read together. Article 2.2 informs Article 5.1: the elements that define the basic obligation set out in Article 2.2 impart meaning to Article 5.1”37.

75. Likewise,

“Article 5.5 must be read in context. An important part of that context is Article 2.3 of the SPS Agreement, which provides as follows:

«Members shall ensure that their sanitary and phytosanitary measures do not arbitrarily or unjustifiably discriminate between Members where identical or similar conditions prevail, including between their own territory and that of other Members. Sanitary and phytosanitary measures shall not be applied in a manner which would constitute a disguised restriction on international trade.»

When read together with Article 2.3, Article 5.5 may be seen to be marking out and elaborating a particular route leading to the same destination set out in Article 2.3.”38

37 Appellate Body Report in CE - Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 180. 38 Appellate Body Report in CE - Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 212.


76. Likewise,

“Article 5.5 and, in particular, the terms «discrimination or a disguised restriction on international trade», have to be read in the context of the basic obligations contained in Article 2.3”39,

77. and also, “Article 2.2 informs Article 5.1, and that similarly Article 2.3 informs Article 5.5 -- but believe that further analysis of their relationship should await another case”40.

78. Therefore, considering that, in Argentina’s opinion, the inconsistency of the “de facto” moratorium with respect to Article 2 of the SPS (more generic legislation) is partly due to an inconsistency of the “de facto” moratorium with Article 5 of the SPS, reference should first be made to the more specific requirement, i.e. that of Article 5 of the SPS. 79. On this way, we shall follow the method applied in the case Australia - Measures affecting importation of salmon, beginning with the allegations cited in the more specific standard41. 4.- The “de facto” moratorium is inconsistent with Article 5.1 of the SPS Agreement 80. Article 5.1 states:

“Members shall ensure that their sanitary or phytosanitary

39 Appellate Body Report in CE - Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 238. 40 Appellate Body Report in CE - Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 250. 41 Panel Report in Australia - Measures affecting the importation of salmon, WT/DS18/R, Paragraph 8.48, hereinafter Australia - Salmon.


measures are based on an assessment, as appropriate to the circumstances, of the risks to human, animal or plant life or health, taking into account risk assessment techniques developed by the relevant international organizations.”

81. This article establishes the obligation on the part of the Members to conduct a risk assessment, and has been interpreted by the Appellate Body in the following sense:

“...The requirements of a risk assessment under Article 5.1, as well as of «sufficient scientific evidence» under Article 2.2, are essential for the maintenance of the delicate and carefully negotiated balance in the SPS Agreement between the shared, but sometimes competing, interests of promoting international trade and of protecting the life and health of human beings...”42.

82. That means that, despite that the Members are entitled to set their own levels of protection, the Members may not ignore their obligation under the pertinent section of the SPS with regard to scientific justification of the measures. 83. In this particular case, the EC is required to conduct, as stipulated by Annex A.4 of the SPS (Risk assessment), at least one of the two types of risk assessment cited. One is described as follows: “The evaluation of the likelihood of entry, establishment or spread of a pest or disease within the territory of an importing Member […] and of the associated potential biological and economic consequences;”43 84. or the other, described as follows: “the evaluation of the potential for adverse effects on human or animal health arising from the presence of additives, contaminants, toxins or

42 Appellate Body Report in CE-Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 177. 43 SPS, Annex A:4, first definition.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 31 disease-causing organisms in food, beverages or feedstuffs”44. 85. What these assessments have in common is that neither of them requires the establishment of a minimum risk threshold. In other words, nothing about them requires a quantitative determination. 86. The Appellate Body has expressed its opinion on both types of risk assessment. With respect to the risk assessment defined first in Annex A:4 it said:

“...We agree, however, with the Panel's statements… that the SPS Agreement does not require that the evaluation of the likelihood needs to be done quantitatively. The likelihood may be expressed either quantitatively or qualitatively....”45.

87. With respect to the second definition in Annex A:4, it affirmed:

“...To the extent that the Panel purported to require a risk assessment to establish a minimum magnitude of risk, we must note that imposition of such a quantitative requirement finds no basis in the SPS Agreement....”46.

88. In this sense, Argentina wishes to point out that the claim is not related to the fact that the CE has not identified any quantitative threshold. What Argentina is claiming is that the EC had the obligation to carry out an adequate risk assessment as stipulated in Article 5.1 of the SPS. 89. To conduct a “risk assessment”, according to the first definition provided in Annex A;4, the WTO Member States must, within the meaning of Article 5.1 of the SPS:

44 SPS, Annex A:4, second definition. 45 Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, Paragraph 124. 46 Appellate Body Report in CE-Hormones, WT/DS/26/AB/R, WT/DS/48/AB/R, Paragraph 186.


“...1) identify the diseases whose entry, establishment or spread a Member wants to prevent within its territory, as well as the potential biological and economic consequences associated with the entry, establishment or spread of these diseases;

2) evaluate the likelihood of entry, establishment or spread of these diseases, as well as the associated potential biological and economic consequences; and

3) evaluate the likelihood of entry, establishment or spread of these diseases according to the SPS measures which might be applied.”47 (emphasis added)

90. The second definition of “risk assessment” from Annex A:4 of the SPS Agreement just requires the assessment of the possibility of adverse effects on human or animal health48. 91. The “de facto” moratorium was implemented by the EC without reference to any type of scientific evidence. Furthermore, the “de facto” moratorium has been applied even in cases where the EC had favorable scientific opinions from the pertinent scientific committees49. 92. Therefore Argentina is affirming that the EC has not fulfilled the obligations imposed by Article 5.1 and Annex A:4 of the SPS. 93. In addition, the Appellate Body has determined categorically that the risk to be assessed must be a verifiable risk, i.e. the risk cannot be simply theoretical:

“...In one part of its Reports, the Panel opposes a requirement of an "identifiable risk" to the uncertainty that theoretically

47 Appellate Body Report in Australia - Salmon, WT/DS18/AB/R, Paragraph 121, cited by the Appellate Body Report in Japan - Agricultural Products, WT/DS76/AB/R, Paragraph 112. 48 Appellate Body Report in CE - Hormones, WT/DS26/AB/R, WT/DS48/AB/R, paragraphs 184 and 186. 49 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26 and ARG-27.


always remains since science can never provide absolute certainty that a given substance will not ever have adverse health effects. We agree with the Panel that this theoretical uncertainty is not the kind of risk which, under Article 5.1, is to be assessed...”50 (underlining added to indicate words in italics in the original)

In other words, the risk must be verifiable. 94. As a consequence of the “de facto” moratorium, the EC is precisely in the situation condemned by the Appellate Body, because it has suspended its consideration of all applications submitted and has not approved any product since the moratorium is in force, without justifying said suspension on the basis of any assessment that would corroborate the level of risk. 95. Therefore Argentina claims that the EC has violated Article 5.1 of the SPS, and that, in accordance with WTO jurisprudence51, the violation of said article implies a violation of Article 2.2 of the SPS. 5.- The “de facto” moratorium is inconsistent with Article 2.2 of the SPS Agreement 96. As established above, the inconsistency of the “de facto” moratorium with Article 2.2 of the SPS (the more generic legislation than the provisions of Article 5.1 of the SPS) is partly the result of an inconsistency of the “de facto” moratorium with Article 5 of the SPS, and therefore Argentina did start its argument with regard to the more specific standard.

50 Appellate Body Report in CE-Hormones, WT/DS26/48/AB/R, Paragraph 186. 51 Appellate Body Report in CE-Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 250:

“(...)We have affirmed the Panel's conclusion that the EC measures are inconsistent with Article 5.1 in view of the failure of the European Communities to provide a risk assessment that reasonably supports such measures. Under the circumstances, the necessity or propriety of proceeding to determine whether Article 2.2 of the SPS Agreement has also been violated is not at all clear to us. (...)” (underlining added to indicate original text in italics)


97. Article 2.2 of the SPS stipulates:


98. This article requires the Members to base their sanitary or phytosanitary measures on scientific principles. The EC has no scientific basis for the measure by which there is a lack of approval of biotech agricultural products. Moreover, there is no known scientific evidence that might support the EC ban on biotech agricultural products. In fact, the existing studies show that none of the biotech agricultural products currently being sold have any harmful effects52. 99. This lack of any scientific basis for the “de facto” moratorium means that the moratorium is inconsistent with Article 2.2 of the SPS. Moreover, there have been reports from the Community’s own authorities stating that the “de facto” moratorium is inconsistent with the EC’s international obligations53, as well as with the opinions expressed by the pertinent scientific committees which endorsed the approval of biotech agricultural products54. 100. It should also be recalled that the “de facto” moratorium has not only been applied in violation of Article 2.2 of the SPS, on account of its lack of

52 See, for example, GM Science Review, First Report, An open review of the science relevant to GM crops and food based on the interest and concerns of the public (July 2003). Executive Summary, page 10 under the title “Possible nutritional and toxicological differences in GM food (5.2)”:

“(…) To date world-wide there have been no verifiable untoward toxic or nutritionally deleterious effects resulting from the cultivation and consumption of products from GM crops. (…)”

See Annex ARG-28. 53 See Annex ARG-29. 54 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26 and ARG-27.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 35 any scientific basis, but that it has also been maintained for a period of more than five years (1998-2004) without sufficient scientific evidence. 101. Argentina is pointing out that there should be some reasonable relationship between the sanitary measure and the scientific evidence. The fact that the scientific evidence cannot be referenced to justify the “de facto” moratorium, together with the length of time the moratorium has been in effect, clearly conflict with this reasonable relationship required by the SPS. 102. This issue has also been discussed by the Appellate Body, which affirmed:

“Japan's appeal raises the issue of the meaning of the phrase 'maintained without sufficient scientific evidence' in Article 2.2 and, in particular, the meaning of the word 'sufficient'. The ordinary meaning of 'sufficient' is 'of a quantity, extent, or scope adequate to a certain purpose or object'. From this, we can conclude that 'sufficiency' is a relational concept. 'Sufficiency' requires the existence of a sufficient or adequate relationship between two elements, in casu, between the SPS measure and the scientific evidence.” 55

103. Argentina is also pointing out that the EC has not respected the restrictive character required by Article 2.2 of the SPS for any sanitary or phytosanitary measure. The above referenced article uses the terms “only to the extent necessary,” and also requires that the implementation or continuation of such measures be based on “sufficient scientific evidence.” These requirements apply to (and ultimately limit) the imposition of a measure and are valid for “any” sanitary or phytosanitary measure. 104. Consequently, Article 2.2 of the SPS stipulates that no sanitary or phytosanitary measure can be applied in such a general and comprehensive form as the EC has done with the “de facto” moratorium: even if there had been any scientific evidence demonstrating any risk from any biotech agricultural product (which is not the case), a sanitary or phytosanitary measure within the meaning of the SPS Agreement could never have been 55 Appellate Body Report on Japan - Agricultural Products, WT/DS76/AB/R, Paragraph 73.


implemented to the extent of all biotech agricultural products (it should also be indicated that the EC itself has affirmed that biotech products must be evaluated on a “case by case” basis”56). In fact, the “de facto” moratorium concluded in a ban on imports of biotech agricultural products that had not been approved prior to the imposition of the moratorium, whereby the EC has suspended and failed to consider individual applications for the approval of biotech agricultural products and has also unjustifiably delayed the completion of the processing of applications for approval of said products under Community legislation. 105. Argentina therefore believes that the “de facto” moratorium is a measure that has been applied not only without adequate justification, but also to an unjustifiably broad extent, since the applicable Community legislation itself states that the assessments must be conducted on a “case by case” basis. In other words, this unjustifiably broad application violates the requirement stipulated in Article 2.2 of the SPS, not to mention that it lacks any scientific basis. 106. On the grounds set forth above, Argentina claims that the “de facto” moratorium violates Article 2.2 of the SPS, independent of its analysis in light of Article 5.1 of the SPS. The “de facto” moratorium is unjustifiable under the exception stipulated in Article 5.7 of the SPS Agreement

56 Directive 90/220/EEC stipulates in No. 8 of its Preamble:

“Whereas it is necessary to establish harmonized procedures and criteria for the case-by-case evaluation of the potential risks arising from the deliberate release of GMOs into the environment;”

See Annex ARG-4. This provision is repeated by Directive 2001/18/EC in No. 18 of its Preamble:

“It is necessary to establish harmonised procedures and criteria for the case-by-case evaluation of the potential risks arising from the deliberate release of GMOs into the environment;”

See Annex ARG-5.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 37 107. Article 5.7 of the SPS establishes:

“In cases where relevant scientific evidence is insufficient, a Member may provisionally adopt sanitary or phytosanitary measures on the basis of available pertinent information, including that from the relevant international organizations as well as from sanitary or phytosanitary measures applied by other Members. In such circumstances, Members shall seek to obtain the additional information necessary for a more objective assessment of risk and review the sanitary or phytosanitary measure accordingly within a reasonable period of time.”

108. In this regard, the Appellate Body has expressed the following opinion:

“Article 5.7 of the SPS Agreement sets out four requirements which must be met in order to adopt and maintain a provisional SPS measure. Pursuant to the first sentence of Article 5.7, a Member may provisionally adopt an SPS measure if this measure is:

(1) imposed in respect of a situation where «relevant scientific information is insufficient»; and

(2) adopted «on the basis of available pertinent information».

Pursuant to the second sentence of Article 5.7, such a provisional measure may not be maintained unless the Member which adopted the measure:

(1) «seek[s] to obtain the additional information necessary for a more objective assessment of risk»; and

(2) «review[s] the ... measure accordingly within a reasonable period of time».

These four requirements are clearly cumulative in nature and are equally important for the purpose of determining


consistency with this provision. Whenever one of these four requirements is not met, the measure at issue is inconsistent with Article 5.7.”57 (underlining added to indicate italics in the original)

First requirement 109. First, Argentina claims that in the case at hand, the EC cannot justify the “de facto” moratorium on the pretext that the pertinent scientific evidence “is not sufficient”: a) Each and every one of the biotech agricultural products approved by the EC prior to the “de facto” moratorium were required to undergo a case-by-case scientific assessment, as required by Community legislation58, which means that we can reject prima facie the pretext of a lack of scientific evidence regarding these types of products, which have been sold for years in the EC and in the rest of the world. b) In this sense, the biotech agricultural products that have not been approved since 1998 would also have to be subject to an approval process that would include a risk assessment. Some of these products were assessed in the EC and received a favorable scientific opinion recommending their approval59. Consequently, there is no basis either in this case for the excuse of “insufficient scientific evidence” that might be put forward to support the “de facto” moratorium under Article 5.7 of the SPS. 110. For the reasons set forth above, Argentina points out that the EC could not use a hypothetical “insufficiency of scientific evidence” to justify its “de facto” moratorium.

57 Appellate Body Report in Japan - Agricultural Products, WT/DS76/AB/R, Paragraph 89. 58 See list of biotech agricultural products approved by the EC in State of play on GMO authorizations under EU law, MEMO/04/17, Brussels, January 28, 2004, Annexes 1 and 4, in Annex ARG-6. See also scientific opinions on some approved biotech agricultural products in Annexes ARG-30, ARG-31, ARG-32 and ARG-33. 59 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26 and ARG-27.


Second requirement 111. Second, even if the pertinent scientific evidence would have been insufficient -which, as noted above, is not the case- Argentina claims that the EC neither then was entitled under Article 5.7 of the SPS to impose a measure having the characteristics of the “de facto” moratorium: a sanitary or phytosanitary measure validly adopted under Article 5.7 of the SPS must be adopted “provisionally” and “on the basis of available pertinent information.” 112. The EC has adopted a measure that has been in effect for more than five years, and has been maintained under pretexts that go well beyond an alleged “lack of pertinent scientific evidence”60. Moreover, the EC has not based its actions on the information available because, as noted above, the EC has ignored the scientific evidence favorable to the approval provided by its own Community bodies61. 113. For the reasons set forth above, Argentina notes that the EC cannot seek protection under the exception permitted by Article 5.7 of the SPS, since the “de facto” moratorium fails to meet the two established requirements. This situation has been acknowledged by the Appellate Body in upholding the finding of the Panel in Japan - Agricultural Products:

“We, therefore, conclude that the Panel did not err in its application of Article 5.7 by first examining whether the varietal testing requirement meets the requirements of the second sentence of Article 5.7. Having established that the requirements of the second sentence of Article 5.7 are not met, there was no need for the Panel to examine the requirements of the first sentence.”62 (Footnotes omitted)

60 By way of example, the EC alleges that it was necessary to approve on the EC level new legislation concerning traceability and labeling of biotech agricultural products. See Annexes ARG-10, ARG-11 and ARG-12. 61 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26 and ARG-27. 62 Appellate Body Report in Japan - Agricultural Products, WT/DS76/AB/R, Paragraph 91.


Third requirement 114. Even on the hypothetical assumption that the EC alleges that the pertinent scientific evidence is not sufficient, Argentina claims that at no time has the EC attempted to obtain additional information to cease the application of a measure supposed to be provisional in order to be consistent with Article 5.7 of the SPS. On the contrary, the EC has only argued that it needs to impose even more requirements on applications, revise its legislation, or have additional legislation on another issue63. This conduct by the EC, which is strictly political in nature, is in violation of its obligation to attempt to obtain additional information to meet the third requirements of Article 5.7 of the SPS. Fourth requirement 115. Finally, and as a consequence of the previous paragraph, Argentina believes that the EC, by not making any attempt to obtain additional information, has also failed to review the sanitary or phytosanitary measure in a reasonable period of time. On the contrary, the “de facto” moratorium has been in place since 1998 and has never been reviewed. Conclusion regarding Article 5.7 of the SPS Agreement 116. Argentina reiterates its claim that the “de facto” moratorium is not based on scientific evidence, and that for the reasons set forth in this chapter the EC cannot justify this measure under the exception provided by Article 5.7 of the SPS. Consequently, Argentina requests that the “de facto” moratorium be found to be inconsistent with Article 2.2 of the SPS.

63 See the “BACKGROUND” section of this presentation.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 41 6.- The “de facto” moratorium is inconsistent with Article 5.5 of the SPS Agreement 117. The pertinent section of Article 5.5 of the SPS states:

“With the objective of achieving consistency in the application of the concept of appropriate level of sanitary or phytosanitary protection against risks to human life or health, or to animal and plant life or health, each Member shall avoid arbitrary or unjustifiable distinctions in the levels it considers to be appropriate in different situations, if such distinctions result in discrimination or a disguised restriction on international trade. (...)”

118. The Appellate Body has indicated that there are three elements that must be proven to claim a violation of this rule. It has also indicated that these three elements are cumulative in nature, in other words the existence of all three must be proven to support a claim of a violation of Article 5.5 of the SPS. In this regard, the Appellate Body has affirmed:

“Close inspection of Article 5.5 indicates that a complaint of violation of this Article must show the presence of three distinct elements. The first element is that the Member imposing the measure complained of has adopted its own appropriate levels of sanitary protection against risks to human life or health in several different situations. The second element to be shown is that those levels of protection exhibit arbitrary or unjustifiable differences («distinctions» in the language of Article 5.5) in their treatment of different situations. The last element requires that the arbitrary or unjustifiable differences result in discrimination or a disguised restriction of international trade. We understand the last element to be referring to the measure embodying or implementing a particular level of protection as resulting, in its application, in discrimination or a disguised restriction on international trade”.64 (underlining added to indicate words

64 Appellate Body Report in CE-Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 214.


in italics in the original)

“We consider the above three elements of Article 5.5 to be cumulative in nature; all of them must be demonstrated to be present if violation of Article 5.5 is to be found. In particular, both the second and third elements must be found. The second element alone would not suffice. The third element must also be demonstrably present: the implementing measure must be shown to be applied in such a manner as to result in discrimination or a disguised restriction on international trade. The presence of the second element -- the arbitrary or unjustifiable character of differences in levels of protection considered by a Member as appropriate in differing situations -- may in practical effect operate as a «warning» signal that the implementing measure in its application might be a discriminatory measure or might be a restriction on international trade disguised as an SPS measure for the protection of human life or health. Nevertheless, the measure itself needs to be examined and appraised and, in the context of the differing levels of protection, shown to result in discrimination or a disguised restriction on international trade.”65 (underlining added to indicate words in italics in the original)

a.- First element: application of distinct levels of protection to different situations 119. This element is, in turn, made up of two aspects: “distinct levels of protection” and “different,” yet comparable situations. 120. With respect to the concept of “distinct levels of protection,” Argentina notes that the level of protection of the “de facto” moratorium is equivalent to a “zero risk” level of protection. This has been expressly recognized by the EC in acknowledging the existence of the “de facto” moratorium.66 65 Appellate Body Report in CE-Hormones s, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 215. 66 See Annexes ARG-7, ARG-8, ARG-9 and ARG-10.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 43 121. Furthermore, this level of protection of the “de facto” moratorium may be inferred by the lack of access of biotech agricultural products to the EC market since 199867. 122. In other words, the “de facto” moratorium established a level of protection different from that which existed prior to 1998 -which was established by application of Community legislation (Directive 90/220/EEC and Regulation (EC) 258/97)-, under which there actually were approvals of biotech agricultural products. 123. With respect to the concept of “different situations,” the comparability of different situations arises from the fact that such situations share some common elements that make a comparison possible. 124. This has been recognized by the Appellate Body in the EC-Hormones68 case, on recognizing the existence of “some” common element or elements sufficient for the purpose of making a comparison. 125. In this regard, and with respect to the requirements for making this comparison, the Appellate Body specified that:

“...Clearly, comparison of several levels of sanitary protection deemed appropriate by a Member is necessary if a panel's inquiry under Article 5.5 is to proceed at all. The situations exhibiting differing levels of protection cannot, of course, be compared unless they are comparable, that is, unless they present some common element or elements sufficient to render them comparable. If the situations proposed to be examined are totally different from one another, they would not be rationally comparable and the

67 With regard to inferring the level of protection of sanitary or phytosanitary measures, the following was pointed out in the Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, Paragraph 197:

“We note that, in this case, the level of protection reflected in the SPS measure at issue, i.e., the import prohibition, is undisputedly a "zero-risk level" of protection (...)” (underlining added to indicate words in italics in the original)

68 Appellate Body Report in EC-Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 216/217.


differences in levels of protection cannot be examined for arbitrariness.”69 (underlining added to indicate words in italics)

126. Argentina affirms that the EC has established different levels of protection in “comparable” situations. In fact, it has established different levels of protection for the following situations: a) the situation of those biotech agricultural products prior to the “de facto” moratorium and the situation of the biotech agricultural products after the adoption of the “de facto” moratorium; and b) the situation of the new biotech agricultural products considered since 1998 with respect to the situation of the new “non-biotech” products -such as those produced using conventional plant breeding techniques- since 1998.70 127. Next, Argentina will make reference to the situations described above and to the different levels of protection applied by the EC in the consideration of said situations. i) Biotech products before and after the “de facto” moratorium 128. As indicated above, the EC has not approved any new biotech agricultural products from 1998 to the present. Independent of Community legislation related to the approval of biotech products (which, as indicated existed prior to 1998 and after 1998 in various successive versions resulting from different legislative reforms), from that year on, the EC changed the criteria for sanitary and phytosanitary protection with respect to what they had been using until that point. It can then be deduced that the EC considered that the level of protection was no longer adequate to regulate the consideration and approval of biotech agricultural products and, consequently, established a general moratorium on such products.

69 Opinion from the Appellate Body in EC – Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 217. 70 See Annex ARG-34.


129. Prior to the establishment of the “de facto” moratorium, the level of protection established for biotech products was different from the present-day level, due to the fact that until then, there had been approvals. However, once the “de facto” moratorium was established, an absolute ban on imports took place, suspending and failing to consider applications for the approval of biotech agricultural products, as well as the undue delay in completing the processing of applications for approval of those products under Community legislation. Consequently, there was an increase in the level of protection for non-approved biotech agricultural products with respect to the same products that were approved before the moratorium took effect. 130. This level of protection prior to the “de facto” moratorium can be confirmed in the opinions of the respective scientific committees71 and the decisions of the Commission approving biotech products.72 131. Within this framework, several biotech products received favorable assessments and were approved.73 These approvals were founded on the non-existence of evidence indicating that those products could negatively affect human or animal health or life, or the environment.74 132. The application of these levels of protection to comparable situations gave rise to a situation in which the same class of products obtained approval prior to the establishment of the “de facto” moratorium. Yet, afterwards -once the “de facto” moratorium was established- a ban on imports was established by suspending and failing to consider applications for the approval of biotech agricultural products, as well as an undue delay in completing the processing of applications for approval of those products under Community regulations.

71 See Annexes ARG-30, ARG-31, ARG-32 and ARG-33. 72 See Annexes ARG-35, ARG-36, ARG-37 and ARG-38. 73 See the list of approvals in State of play on GMO authorisations under EU law, MEMO/04/17, Brussels, January 28, 2004, Annexes 1 and 4, in Annex ARG-6. 74 See examples of opinions of the Scientific Committees on approved products in Annexes ARG-30, ARG-31, ARG-32 and ARG-33.


133. Furthermore, these biotech products, both before and after the moratorium, presented the same level of risk. This implies that the EC ignored the scientific evidence. This circumstance is endorsed by the very statements of Community authorities.75 ii) New biotech agricultural products and new “non-biotech” products 134. The EC has imposed distinct levels of protection, differentiating between new biotech agricultural products and new “non-biotech” products -such as those produced by conventional plant breeding techniques-, despite the fact that both types of products are regulated under the same Community legislation -Regulation (EC) 258/9776-. 135. In fact, these most recent “non-biotech” products are not subject to restrictions -not based on scientific evidence- on access into the EC market.77 For this reason, the level of protection applied by the EC to those products is

75 In this sense, the statement of David Byrne, European Commissioner for Health and Consumer Protection, in Proposal for a regulation on GM Food and Feed, SPEECH/01/378, European Parliament, Brussels, September 11, 2001:

“(...) In the EC, the Scientific Committees have already assessed a number of GMOs and concluded that they do not pose a danger to the environment or to human health. However, these GMOs are still pending final approval and some of them have now been awaiting approval for quite some time. (...)”

See Annex ARG-20. 76 Article 1.2 of Regulation (EC) 258/97 stipulates:

“This Regulation shall apply to the placing on the market within the Community of foods and food ingredients which have not hitherto been used for human consumption to a significant degree within the Community and which fall under the following categories:

(…)

e) foods and food ingredients consisting of or isolated from plants and food ingredients isolated from animals, except for foods and food ingredients obtained by traditional propagating or breeding practices and having a history of safe food use;

(…)” 77 See Annex ARG-34.


very low compared with the “zero risk” level sought by the “de facto” moratorium with respect to new biotech agricultural products after the “de facto” moratorium took place (by preventing the entry of these latter products into Community territory, having suspended and not considered applications for the approval of biotech agricultural products, as well as having unjustifiably delayed completing the processing of applications for approval of these products under Community legislation). 136. As in the case the biotech agricultural products both before and after the moratorium, the EC has also applied different levels of protection in comparable situations, i.e., the situation of the new biotech agricultural products since 1998 with respect to the situation of the new “non-biological” products since 1998 -both regulated by Regulation (EC) 258/97-. 137. As set forth in this section, the EC has applied distinct levels of protection to comparable situations, thus presenting the first element required for violation of Article 5.5 of the SPS Agreement. b.- Second element: arbitrary and unjustifiable differences in protection 138. The second element -that the levels of protection show arbitrary or unjustifiable differences in their treatment of comparable situations- is also present in the measure taken by the EC. This is the case because given the same risk levels, it is inconsistent to apply distinct levels of protection. This is precisely what the EC has done with new biotech products with respect to the new “non-biotech” products -such as those produced by conventional plant breeding techniques- and with the biotech products before and after the moratorium. 139. This circumstance implies an arbitrary and unjustifiable distinction, because it is not consistent with the SPS Agreement to establish such dissimilar levels of protection.78

78 In this sense, the observation by the Appellate Body in Australia – Salmon, WT/DS18/AB/R, is noted:

“154. With regard to the second element of Article 5.5, namely, the existence of arbitrary or unjustifiable distinctions in appropriate levels of protection in different situations, the Panel began its analysis by noting that in view of the difference in SPS measures and corresponding levels of protection for salmon products, on the one


hand, and the four categories of other fish and fish products, on the other, one might expect some justification for this difference, such as a higher risk from imported salmon. However, as the Panel noted:

“the arguments, reports, studies and expert opinions submitted to us in this respect - rather than pointing in the direction of a higher risk related to ...[ocean-caught Pacific salmon], in order to justify the stricter sanitary measures imposed for these products - all provide evidence that the two categories of non-salmonids [herring used as bait and live ornamental finfish], for which more lenient sanitary measures apply, can be presumed to represent at least as high a risk - if not a higher risk - than the risk associated with ... [ocean-caught Pacific salmon].”

155. The Panel, therefore, found that, on the basis of the evidence before it, the distinctions in levels of sanitary protection reflected in Australia's treatment of, on the one hand, ocean-caught Pacific salmon and, on the other, herring used as bait and live ornamental finfish, are "arbitrary or unjustifiable" in the sense of the second element of Article 5.5. 156. Australia argues that the Panel erred in determining that its examination under Article 5.5, second element, must be limited solely to those disease agents positively detected in ocean-caught Pacific salmon. Australia raises the same objections to this limitation as it did in the context of the first element discussed above. 157. We do not agree with Australia that the Panel excluded diseases of concern which have not been positively detected in ocean-caught Pacific salmon from its examination under Article 5.5. The Panel explicitly took into account diseases which have not been positively detected in ocean-caught Pacific salmon but had been detected in herring used as bait and live ornamental finfish. In addition, we observe that the inclusion in the examination under Article 5.5, second element, of all diseases of concern which have not been positively detected in ocean-caught Pacific salmon would logically have led to the inclusion of all diseases of concern which have not been positively detected in herring used as bait and live ornamental finfish. Due to the lack of reliable scientific information, this exercise would have become highly speculative and, moreover, would probably not have changed the Panel's finding in paragraph 8.141 on the "arbitrary or unjustifiable" character of the distinctions in the levels of protection. 158. Australia determined explicitly that its appropriate level of protection with respect to ocean-caught Pacific salmon is "a high or 'very conservative' level of sanitary protection aimed at reducing risk to 'very low levels', 'while not based on a zero-risk approach'." The level of protection reflected in Australia's treatment of herring used as bait and live ornamental finfish is definitely lower. We note the Panel's factual finding that herring used as bait and live ornamental finfish can be presumed to represent at least as high a risk - if not a higher risk - than the risk associated with ocean-caught Pacific salmon. Therefore, we uphold the Panel's finding in paragraph 8.141 of its Report to the extent that the Panel found that the second element of Article 5.5 is fulfilled.”


i) Biotech products before and after the “de facto” moratorium 140. The difference in the processing granted by the EC to the approval for placement of the biotech products on the market before and after the “de facto” moratorium, demonstrates a change by the EC with respect to the level of protection. 141. In spite that there is an equivalent level of risk between the pre- and post-moratorium products, we note that the biotech agricultural products affected by the “de facto” moratorium, and which had favorable scientific opinions for their approval, presented a risk equivalent to that of the pre-moratorium biotech agricultural products -which also had favorable scientific opinions for their approval, and were approved before the “de facto” moratorium79-. 142. Nevertheless, the EC has imposed such a high level of protection for the consideration and approval of biotech agricultural products, that it implied an absolute ban on imports thereof without any scientific evidence supporting such a ban, by having suspended and not considered several applications for the approval of biotech agricultural products, as well as having unjustifiably delayed completion of the processing of applications for such products under Community legislation. In other words, this level of protection was arbitrary and unjustifiable. 143. This situation was reached with no scientific evidence supporting it, since even the scientific evidence subsequent to the “de facto” moratorium endorses the opposite position.80 ii) New biotech agricultural products and new “non-biotech” products

79 See Annexes ARG-30, ARG-31, ARG-32 and ARG-33. 80 GM Science Review, First Report, An open review of the science relevant to GM crops and food based on the interest and concerns of the public (July 2003), Executive summary, in Annex ARG-28. See also opinions of the respective Scientific Committees in Annexes ARG-21, ARG-22, ARG-23, ARG-23, ARG-25, ARG-26 and ARG-27, on products pending approval.


144. With respect to new “non-biotech” products -such as those products by conventional plant breeding techniques- it is noted that this type of new product is regulated within the EC according to their claimed use: - in the event that these new products are not intended to be for human or animal consumption -for example, for industrial processing-, they shall not be subject to any Community approval regulations prior to market entry -that is, there are no regulations equivalent to Directives 90/220/EEC and 2001/18/EC which are applied only to biotech agricultural products-; - otherwise, these new products are subject to Regulation (EC) 258/97. Nevertheless, as an example, Regulation (EC) 258/97 expressly excludes those new products with records of safe use.81 145. Consequently, the new “non-biotech” products can be freely placed on the market within the EC without requiring a prior assessment procedure, except when intended for human or animal consumption, in which case they are assessed in accordance with Regulation (EC) 258/97. Nevertheless, Regulation (EC) 258/97 will not apply if these products have a history of safe use. 146. On the other hand, the new biotech agricultural products are affected by the “de facto” moratorium, no matter of the Community legislation that should be applied to them -that is, Regulation (EC) 258/97- and no matter their history of safe use in the territories of other WTO Members states.

81 Regulation (EC) 258/97 stipulates in its Article 1.2 as follows:

“This Regulation shall apply to the placing on the market within the Community of foods and food ingredients which have not hitherto been used for human consumption to a significant degree within the Community and which fall under the following categories: (...)

e) foods and food ingredients consisting of or isolated from plants and food ingredients isolated from animals, except for foods and food ingredients obtained by traditional propagating or breeding practices and having a history of safe food use;

(...)”


147. To date there is no scientific evidence supporting the difference between new biotech agricultural products and new “non-biotech” products. However, the latter are not subject to the ban on imports applied to the former, not approved prior to the “de facto” moratorium (having the EC suspended and not considered several applications for the approval of biotech agricultural products, as well as having unjustifiably delayed completion of processing of the applications). 148. This difference in the level of protection, notwithstanding the fact that the new biotech agricultural products and the new “non-biotech” products do not present different levels of risk,82 is “arbitrary and unjustified” as indicated by the Appellate Body in Australia – Salmon.83 149. In this sense, as indicated above, the Community authorities -the Commission and the Scientific Committees- have acknowledged that biotech agricultural products may actually be less risky than traditional products.84 150. In short, in Argentina’s opinion, the lack of scientific evidence in the opinions of the committees endorsing the differences in levels of protection imposed by the EC, demonstrates the second element for the violation of Article 5.5 of the SPS Agreement.

82 See Annex ARG-34. 83 See Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, Paragraphs 154-158. 84 See Annex ARG-28. In addition, see the press publication by the EC Commission entitled GMOs: are there any risks? - Launch of a European Round Table on GMO Safety, dated October 8, 2001:

“(...) Research on the GM plants and derived products so far developed and marketed, following usual risk assessment procedures, has not shown any new risks to human health or the environment, beyond the usual uncertainties of conventional plant breeding. Indeed, the use of more precise technology and the greater regulatory scrutiny probably make them even safer than conventional plants and foods; and if there are unforeseen environmental effects - none have appeared as yet - these should be rapidly detected by our monitoring requirements. (...)”

See Annex ARG-39.


c.- Third element: discrimination and a disguised restriction on international trade 151. The distinctions made by the EC have resulted in discrimination and a disguised restriction on international trade. 152. In the opinion of Argentina, this third element required under Article 5.5 of the SPS Agreement, is clearly demonstrated, because since 1998, no approvals of biotech products have been issued by the EC. 153. To determine whether a measure discriminates and disguises a restriction on international trade pursuant to Article 5.5 of the SPS Agreement, in the Australia – Salmon case, the Appellate Body considered three “warning signals” and some “additional factors”:85 a) the arbitrary and unjustifiable character of the distinctions in the levels of protection; b) a sufficient material difference in the levels of protection; c) the inconsistency of the sanitary or phytosanitary measure with Articles 5.1 and 2.2 of the SPS Agreement. 154. Among the “additional factors” considered by the Appellate Body in the Australia – Salmon case, Argentina considers the following applicable to this case: - the level of protection for the internal movement of the products compared to the level of protection on imported products. 155. The “de facto” moratorium applied by the EC possesses the 3 “warning signals” indicated above and an additional factor, all determined by the Appellate Body -giving rise to discrimination or a disguised restriction on international trade- as we will show below.

85 Appellate Body Report in Australia – Salmon, WT/DS18/AB/R, Paragraphs 159-177.


i) Biotech products before and after the “de facto” moratorium 156. As demonstrated above, there is a substantial degree of difference granted by the EC between the level of protection in the pre-moratorium period and the level of protection after the establishment of the “de facto” moratorium,86 without this distinction being justified in consideration of the level of risk involved. 157. In addition, the difference between the levels of protection applied before and after the establishment of the “de facto” moratorium is “arbitrary and unjustifiable.” 158. Finally, as demonstrated in the relevant part of this presentation, the EC has not based the “de facto” moratorium on a risk assessment. 159. The foregoing means that, on the one hand, the “de facto” moratorium presents the three “warning signals” determined by the Appellate Body in Australia – Salmon.87 160. In addition, the “de facto” moratorium presents an “additional factor” that corroborates the discrimination and disguised restriction on international trade. The additional factor is the disproportionate impact that the “de facto” moratorium has on producers of biotech agricultural products outside the EC vis-à-vis producers within the EC. 161. This is due to the scarce area planted with biotech products in Europe (Spain and Germany each have approximately 0.05 million hectares planted with biotech agricultural products) compared with the area that other nations outside the EC devote such crops (the United States has 42.8 million hectares planted with biotech agricultural products; followed by Argentina with 13.9 million, and Canada with 4.4 million).88 162. The effect of the EC’s “de facto” moratorium on biotech product

86 Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, Paragraphs 164. 87 Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, Paragraphs 159-177. 88 See Annex ARG-40.


producing countries is thus negative and particularly disproportionate, since it has an inequitably impact on imported products. ii) New biotech agricultural products and new “non-biotech” products 163. Like the situation of the biotech agricultural products before and after the moratorium, the degree of difference between the level of protection of some products and others is considerable, since it represents a low level of protection for new products and a level implying a ban on imports for new biotech agricultural products, having suspended and not considered several applications for the approval of these products, as well as having unjustifiably delayed the completion of processing of applications for approval of these same products under Community regulations. 164. In addition, the difference in the level of protection between the new “non-biotech” products and the new biotech agricultural products that exists within the framework of the “de facto” moratorium is arbitrary and unjustifiable, representing one of the “elements” needed to demonstrate infringement of Article 5.5 of the SPS Agreement. 165. Likewise, the “de facto” moratorium is not based on a risk analysis and has a negative effect on new biotech agricultural products, which in their vast majority are produced outside the EC.89 Conclusion regarding Art. 5.5 of the SPS Agreement 166. On the grounds set forth above, the “de facto” moratorium is inconsistent with Art. 5.5 of the SPS Agreement, since all three “elements” required under the Article have been verified in the two scenarios presented by Argentina: biotech products before and after the moratorium, and new biotech agricultural products with respect to new “non-biotech” products. 7.- The “de facto” moratorium is incompatible with Article 2.3 of the



SPS Agreement 167. Article 2.3 establishes that:

“Members shall ensure that their sanitary and phytosanitary measures do not arbitrarily or unjustifiably discriminate between Members where identical or similar conditions prevail, including between their own territory and that of other Members. Sanitary and phytosanitary measures shall not be applied in a manner which would constitute a disguised restriction on international trade.”

168. In this sense, the Appellate Body indicated the following:

“Furthermore, the Panel made it clear that it abstained from a separate examination of Article 2.3, first sentence, because it saw no need for such an examination, having already found that the measure in dispute is inconsistent with the requirements of Articles 5.1, 5.5 and 5.6 and is, on that ground, also inconsistent with the requirements of Articles 2.2 and 2.3 (...).”90 (Footnotes omitted)

169. Consequently, Argentina indicates that, once the fact that the “de facto” moratorium infringes upon Art. 5.5 of the SPS Agreement is confirmed, said measure is also incompatible with Art. 2.3 of the SPS Agreement. 8.- The “de facto” moratorium is incompatible with Article 7 and Annex B:1 of the SPS Agreement 170. Article 7 establishes that:

“Members shall notify changes in their sanitary or phytosanitary measures and shall provide information on their sanitary or phytosanitary measures in accordance with the provisions of Annex B.”

90 Appellate Body Report in Australia - Salmon, WT/DS18/AB/R, Paragraph 249.


171. This article likewise refers to Annex B:1 of the SPS Agreement, which provides that:

“Members shall ensure that all sanitary and phytosanitary regulations5 which have been adopted are published promptly in such a manner as to enable interested Members to become acquainted with them.”

5 Sanitary and phytosanitary measures such as laws, decrees or ordinances which are applicable generally

172. The analysis with respect to the “de facto” moratorium as an sanitary or phytosanitary measure was carried out in the first part of this presentation,91 and due to the phrase “such as” contained in Footnote 5 of Annex B:1 of the SPS Agreement, the “de facto” moratorium can be considered as one of the measures indicated in this provision. 173. The EC has not fulfilled the notification requirements of Annex B:1 of the SPS Agreement by not having published the measure, even at a late time. Likewise, there is no information submitted by the EC about the “de facto” moratorium within the framework of the WTO. 174. As indicated by Argentina92, the measure that the EC has implemented since 1998 is a “de facto” measure, which was never set forth in a regulation, or published, thus constituting a violation of Art. 7 and consequently, of paragraph 1 of Annex B of the SPS Agreement. 9.- The “de facto” moratorium is incompatible with Art. 10.1 of the SPS Agreement 175. Article 10.1. of the SPS Agreement establishes that:

91 See Point II.A.1. 92 See “BACKGROUND” and point II.A.1.a.ii, with regard to the form of implementation of the “de facto” moratorium.


“In the preparation and application of sanitary or phytosanitary measures, Members shall take account of the special needs of developing country Members, and in particular of the least-developed country Members.”

176. This provision is part of the “special and differentiated treatment” that the WTO agreements provide for in various terms. Such treatment can manifest itself in the form of: a) longer timeframes to fulfill obligations (pursuant to Article 10.2 of the SPS Agreement), b) exceptions benefiting developing nations (pursuant to Article 10.3 of the SPS Agreement), or c) positive actions from Members for the benefit of developing nations. 177. Article 10.1 of the SPS Agreement is clearly included within this last category. 178. This provision is mandatory (“Members shall take account of”) and not simply an obligation to cooperate. The obligation governs, on the one hand, matters related to the preparation of sanitary and phytosanitary measures. This means that in the formulation of such measures, the special needs of developing and the least-developed nations must be taken account of. On the other hand, the obligation extends to the application of sanitary and phytosanitary measures: the authority responsible for their application must also take account of such needs. 179. Consequently, a violation of the obligation under Article 10.1 occurs when (a) special needs have not been considered in the preparation of the measures or in their application, or (b) even when the needs were considered, if they were ignored in the measure prepared or in its application. 180. The expression “shall take account of” requires, in fact, more than mere attention to the problem; it implies that the obligation assumed by the

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 58 developed nations is to be undertaken in successive steps: the first step, at the time the sanitary and phytosanitary measures are prepared, and the second, during the phase of application of the measures. In both phases, developed nations must consider “the special needs” of developing nations. 181. In this case, compliance with this paragraph required a positive action (“shall take account of...”) by the EC, which, as will be shown, has not been taken. 182. A positive action of special and differentiated treatment may consist in providing assistance (Article 10.4 of the SPS Agreement alludes to measures to promote and facilitate participation in the competent international organizations). It can also be undertaken by preferential access to markets or by the implementation of Member obligations in a manner that is beneficial or less detrimental to the interests of the developing nations. The Argentine Republic understands that it is through this latter type of action that the obligation of the Article 10.1 of the SPS Agreement should have been fulfilled by the EC in ordering and applying a general moratorium to the consideration and approval of biotech agricultural products. 183. The suspension of consideration of the applications and the lack of approval of the biotech agricultural products by the EC or the unjustified delay in the processing thereof, constitute, in practice, a restraint of trade in said products amounting to an absolute ban on access, which had and continues to have a considerable effect on Argentina, a developing nation, thus disregarding the provisions of Article 10.1 of the SPS Agreement. 184. In fact, this breach is particularly severe for Argentina. 185. Argentina, like other developing nations, has special needs, which have been ignored by the EC. Argentina, like other developing nations, is highly dependent on agricultural production and exports. The survival of a large part of its population and the development of its economy depend on the access to markets of its primary products -including those biotech products-. 186. In the opinion of the Argentine Republic, the “de facto” moratorium applied by the European Communities implies a violation of Paragraph 1 of Article 10 of the SPS Agreement, by having suspended consideration of


several applications or by not having approved and consequently prevented the sale of biotech agricultural products. This has further worsened the situation for a country like Argentina where a significant part of its agricultural production is of biotech origin. 187. In fact, globally, Argentina93 is the number two producer of biotech agricultural products, following the United Status of America, and is the leading producer among developing nations.94 Argentina has 13,900,000 hectares devoted to the biotech crops of soybeans, corn and cotton. 188. For the Argentine Republic, the moratorium imposed by the EC beginning in 1998 has had the effect of closing the Community market to biotech agricultural products not approved prior to that date, with a double impact: the impossibility of access and placement on the market of the Argentine products of this type, and the resulting impact on potential economic growth and social improvement of our country. 189. The application of Article 10.1 of the SPS Agreement requires consideration in the decision and subsequent application of the “de facto” moratorium, of the fact that the developing nations have a special need to place their agricultural products in the Community market, through a system of regulations that facilitates the fulfillment of the established requirements and access to the market. 190. And in particular, in the case of the EC, the lack of consideration of the special needs of developing nations, is further aggravated by the fact that the EC constitutes a single market, in other words, it is not a question of a single country’s market, but rather of an integrated market made up of fifteen

93 According to data provided by the Secretariat of Agriculture, Livestock, Fisheries and Food (Sagypa), the total area planted with GMO soybeans in hectares went from 50,000 in 96/97 to 6,500,000 in 99/00 and for corn, it totaled 220,000 hectares for 99/00. 94 See Clive James, International Service for the Acquisition of Agri- Biotech Applications. Executive Summary. Preview Global Status of Commercialized Transgenic Crops: 2003.N. 30-2003, page 4. This study shows that Argentina is followed in developing nations by Brazil with 3,000,000 hectares, basically devoted to soybeans, with China in third position with 2,800,000 hectares devoted to cotton, South Africa with 400,000 hectares (corn, soybean and cotton), India with 100,000 hectares, Uruguay with more than 50,000 hectares (soybean and corn), Mexico with less 50,000 hectares (cotton and soybean), the Philippines with a sum lower than 50,000 hectares (corn) and Colombia with less than 50,000 hectares (cotton). See Annex ARG-40.


Member States -with 375,300,000 inhabitants and a per capita gross domestic product of 22,500 euros- and furthermore, as of May 1, 2004, it will include twenty-five Member States. CONCLUSION ON THE INCONSISTENCY OF THE “DE FACTO” MORATORIUM WITH RESPECT TO THE SPS AGREEMENT 191. On the grounds set forth above, the “de facto” moratorium is incompatible with the SPS Agreement, specifically with Articles 5.1, 2.2, 5.5, 2.3, 7, 10,1 and paragraph 1 of Annex B. B.- INCONSISTENCY OF THE “SUSPENSION OF PROCESSING AND FAILURE TO CONSIDER INDIVIDUAL APPLICATIONS FOR APPROVAL OF SPECIFIC BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE SPS AGREEMENT 192. The “de facto” moratorium has an effect on the consideration of various specific requests relating to biotech agricultural products by blocking the importation and placing on the market of said biotech agricultural products in the Community market. 193. Argentina is questioning the treatment given by the EC in the context of its system of approval of biotech agricultural products to various requests relating to products of interest to Argentina, thereby limiting the importation and placing on the market of said biotech agricultural products. 194. The Community procedure that governs the approval of biotech agricultural products is part of the legal framework that includes Directive 2001/18/EC95 and its predecessor, Directive 90/220/EEC96 as well as Regulation (EC) 258/9797.

95 See Annex ARG-3. 96 See Annex ARG-4. 97 See Annex ARG-5.


195. Argentina is consequently not questioning the Community directives and regulations per se, but is merely pointing out the EC is failing to apply its own legislation, thus that failing to approve any biotech agricultural products since 1998. 1.- Suspension of the approval processes for biotech agricultural products of particular interest to Argentina 196. Since October 1998, the EC has suspended consideration of applications for approval of all biotech agricultural products under its system of pre-release or pre-marketing approval. The suspension of the procedures that were already underway is apparent from the fact that before the end of 1998 the EC had approved a considerable number of biotech agricultural products98, while since that date the EC has not approved a single biotech agricultural product99. 197. The unjustified suspension of the processing of applications for approval of biotech agricultural products is apparent from the fact that the European Communities have not approved any biotech agricultural products since 1998, even in cases where the risk assessment did not identify any reason to suspend the approval process. 198. Among the applications pending processing to permit access by biotech agricultural products to the EC market that are stalled at various stages of the approval process under Directive 2001/18/EC (and prior to October 17, 2002, under Directive 90/220/EEC) and Regulation (EC) 258/97, are: GA21 maize, NK-603 maize, Bt-531 cotton, RR 1445 cotton, and A2704-12 and A5547-127 soy. 199. Four biotech agricultural products that were initially submitted under Directive 90/220/EEC but have made no progress in the approval process since then are pending under Directive 2001/18/EC (GA21 maize was

98 See State of play on GMO authorisations under EU law, MEMO/04/17, Brussels, January 28, 2004, Annexes 1 and 4, in Annex ARG-6. 99 See State of play on GMO authorisations under EU law, MEMO/04/17, Brussels, January 28, 2004, Annex 3, in Annex ARG-6.


withdrawn in September 2003, in spite of a favorable opinion from the Scientific Committee on Plants100). 200. Of the five biotech agricultural products, the scientific committees issued favorable opinions on GA21 maize101, Bt 531 cotton102, RR 1445 cotton103 and NK 603 maize104, although to date, none of these products have been approved. 201. Under Regulation (EC) 258/97 there are four biotech agricultural products pending approval, after GA21 maize was withdrawn in September 2003, despite the fact that it had received a favorable opinion from the Scientific Committee on Foods105. 202. Of the four biotech agricultural projects pending approval, three received a favorable opinion from the respective scientific committees: Bt531 cotton106, RR 1445 cotton107 and NK603 maize108. The remaining

100 The Argentine request is in continuation of the claim regarding GA21 maize, despite the fact that the application has been withdrawn, because it constitutes undeniable evidence of the negative effect of the suspension of the processing of applications for approval. 101 See Opinion of the Scientific Committee on Plants on the submission for placing on the market of genetically modified maize (Zea mays) line GA21 with tolerance to glyphosate herbicide notified by Monsanto, Notification C/ES/98/01), in Annex ARG-41. 102 See Opinion of the Scientific Committee on Plants on the genetically modified cotton line, insect-tolerant notified by the Monsanto company (notification C/ES/96/02) (Opinion expressed by SCP on 14 July 1998), under Directive 90/220, in Annex ARG-21. 103 See Opinion of the Scientific Committee on Plants regarding the genetically modified cotton, tolerant to glyphosate herbicide notified by the Monsanto Company (notification C/ES/97/01) (Opinion expressed by the SCP on 14 July 1998), under Directive 90/220, in Annex ARG-23. 104 See Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the Notification (Reference CE/ES/00/01) for the placing on the market of herbicide-tolerant genetically modified maize NK603, for import and processing, under Part C of Directive 2001/1//EC from Monsanto (Question No EFSA-Q-2003-003), under Directive 2001/18/CE, in Annex ARG-25. 105 See Opinion of the Scientific Committee on Food on the safety assessment of the genetically modified maize line GA21, with tolerance to the herbicide glyphosate, in Annex ARG-42. 106 See Advisory Committee on Novel Foods and Processes, Request of an article 5 opinion on the substantial equivalence of cottonseed oil and food ingredients derived from insect protected cottonseed, under Regulation (EC) 258/97, in Annex ARG-22. 107 See Advisory Committee on Novel Foods and Processes, Request of an article 5 opinion on the


product is stalled in the first step of the procedure. 203. To determine the status of each of the biotech agricultural products under Directives 90/220/EEC and 2001/18/EC, and under Regulation (EC) 258/97, please refer to Points C.1.c.i), ii), iii), iv) and v). 2.- Inconsistency with the SPS Agreement 204. The EC’s suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina in each of the above-mentioned products, the status of which will be described in Section C, is inconsistent with the provisions of the SPS, as will be demonstrated below. 205. The objective of the EC legislation establishing the procedures for the approval of GMOs before they can be placed on the market (Directive 2001/18/EC and its predecessor Directive 90/200/EEC and Regulation (EC) 258/97) is to prevent risks that are governed by the SPS. In this context, it should be reiterated that Directives 90/220/EEC and 2001/18/EC explicitly stipulate that their purpose is the “protection of human health and the environment”109.

substantial equivalence of cottonseed oil and food ingredients derived from roundup ready cotton, under Regulation (EC) 258/97, in Annex ARG-24. 108 See Assessment of safety for the consumer, in accordance with the European Regulation 258/97 concerning Novel Foods and Novel Foods Ingredients. Health Council of the Netherlands: Committee on the Safety Assessment of Novel Foods N 2002/04VNV, The Hague, August 13, 2002, under Regulation (EC) 258/97, in Annex ARG-26. 109 Directive 90/220/CEE stipulates in its Article 1:

“The objective of this Directive is to approximate the laws, regulations and administrative provisions of the Member States and to protect human health and the environment:

- when carrying out the deliberate release of genetically modified organisms into the environment,

- when placing on the market products containing, or consisting of, genetically modified organisms intended for subsequent deliberate release into the environment.

(...)”


206. For its part, Regulation (EC) 258/97 stipulates that foods and their ingredients must not present “a danger for the consumer”110.

For its part, Directive 2001/18/CE stipulates in its Article 1:

“Objective In accordance with the precautionary principle, the objective of this Directive is to approximate the laws, regulations and administrative provisions of the Member States and to protect human health and the environment when: - carrying out the deliberate release into the environment of genetically modified organisms for any other purposes than placing on the market within the Community, - placing on the market genetically modified organisms as or in products within the Community.”

Likewise, said Directive 2001/18 stipulates in its Article 23(1):

“Safeguard clause 1. Where a Member State, as a result of new or additional information made available since the date of the consent and affecting the environmental risk assessment or reassessment of existing information on the basis of new or additional scientific knowledge, has detailed grounds for considering that a GMO as or in a product which has been properly notified and has received written consent under this Directive constitutes a risk to human health or the environment, that Member State may provisionally restrict or prohibit the use and/or sale of that GMO as or in a product on its territory. The Member State shall ensure that in the event of a severe risk, emergency measures, such as suspension or termination of the placing on the market, shall be applied, including information to the public.

The Member State shall immediately inform the Commission and the other Member States of actions taken under this Article and give reasons for its decision, supplying its review of the environmental risk assessment, indicating whether and how the conditions of the consent should be amended or the consent should be terminated, and, where appropriate, the new or additional information on which its decision is based.”

110 Regulation (EC) 258/97 stipulates in its Article 3(1):

“Foods and food ingredients falling within the scope of this Regulation must not: - present a danger for the consumer, - mislead the consumer, - differ from foods or food ingredients which they are intended to replace to such an extent that their normal consumption would be nutritionally disadvantageous for the consumer”


207. As noted above, Argentina is not questioning the legislation adopted by the EC per se, but the restriction of trade arising from the EC’s failure to process any requests for the approval of biotech agricultural products since 1998. 208. In this context, Article 1 of the SPS stipulates that:


209. EC legislation contains procedures for the approval of biotech agricultural products that are affected by the EC’s suspension and failure to consider their approval. Consequently, because the protection of health and life is the objective of Directives 90/220/EEC and 2001/18/EC and of Regulation (EC) 258/97, the suspension of approvals or failure to give due consideration to new applications must be analyzed in the light of the SPS. The suspension of proceedings in relation to specific products (GA21 Maize, NK603 Maize, Bt 531 Cotton, RR 1445 Cotton and A2407-12 and A5547-127 soy) must be analyzed in the light of the SPS, as stipulated in Article 1.1, because the suspension or lack of consideration is a form of application of a sanitary or phytosanitary measure. 210. In fact, the suspension or failure to consider approval proceedings of GA21 maize, NK603 maize, Bt 531 cotton, RR 1445 cotton and A2407-12 and A5547-127 soy constitutes a sanitary or phytosanitary measure111. In each of these cases, the EC has suspended the placing of these products on the market, given the suspension or failure of consideration of each of the applications112.

111 See Point II.A.1.a. 112 See Point II.A.1.b.


3.- The suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 5.1 of the SPS Agreement 211. The suspension since 1998, without any scientific foundation, of the procedures established by Directive 2001/18/EC and its predecessor Directive 90/220/EEC and Regulation (EC) 258/97 by the EC for the consideration of requests for approval, as well as the approval of biotech agricultural products, is in violation of Article 5.1 of the SPS, because it is not based on any risk assessment that might justify the suspension of the procedures established by EC legislation for the prior approval of the products. 212. In addition, for some of the biotech agricultural products covered under this complaint, the risk assessment required by the respective procedures has been completed, and the respective assessments indicate that said products have been given a favorable opinion, namely: - GA21 Maize, the approval process for which was initiated under Directive 90/220/EEC, received a favorable opinion from the Scientific Committee, which said in its conclusion:

“(...) The Committee, after examining the information and data provided in the dossier and using available background knowledge underpinning the areas concerned, considers that there is no evidence to indicate that the placing on the market of the modified maize line (Zea mays GA21) with tolerance to glyphosate herbicide is likely to cause any adverse effects on human health and the environment.”113

... and under the procedure stipulated by Regulation (EC) 258/97:

113 See Opinion of the Scientific Committee on Plants on the submission for placing on the market of genetically modified maize (Zea mays) line GA21 with tolerance to glyphosate herbicide notified by Monsanto, Notification C/ES/98/01), in Annex ARG-41.


“Having received all the information provided by the petitioner and in the light of current published scientific information it is concluded that from the point of view of consumer health maize grain from maize line GA21 and derived products that are the subject of this application are as safe as grain and derived products from conventional maize lines.” 114

- NK 603 maize, the approval procedure for which was initiated under Directive 90/200/EEC and re-initiated under Directive 2001/18/EC, received a favorable opinion from the scientific panel, which says in its conclusion:

“(...) Having considered the evidence, the GMO Panel is of the opinion that NK603 maize is as safe as conventional maize and therefore the placing on the market of NK603 maize for food or feed or processing is unlikely to have an adverse effect on human and animal health and, in that context, the environment.”115

...and under the procedure stipulated by Regulation (EC) 258/97:

“(...) The Committee is of the opinion that the information provided in the dossier provides a sufficient basis for a safety evaluation. The dossier contains a correct interpretation of the data submitted. Based on current scientific knowledge, the Committee's opinion is that the consumption of NK 603 maize and foods and food ingredients derived from this is just as safe for humans as the consumption of non-genetically modified maize and maize products.”116

114 See Opinion of the Scientific Committee on Food on the safety assessment of the genetically modified maize line GA21, with tolerance to the herbicide glyphosate, in Annex ARG-42. 115 Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the Notification (Reference CE/ES/00/01) for the placing on the market of herbicide-tolerant genetically modified maize NK603, for import and processing, under Part C of Directive 2001/18,EC from Monsanto (Question No EFSA-Q-2003-003), in Annex ARG-25. 116 Assessment of safety for the consumer, in accordance with the European Regulation 258/97 concerning Novel Foods and Novel Foods Ingredients. Health Council of the Netherlands: Committee on the Safety


- Bt 531 cotton received a favorable opinion under the procedure set forth in Directive 90/220/EEC:

“(...) the Committee, after examining and considering the existing information and data provided in the dossier, against the background of available knowledge in the areas concerned, considers that there is no evidence to indicate that the placing on the market of line IPC 531 (expressing a B.t.k. toxin) with the purpose to be used as any other cotton is likely to cause adverse effects on human health and on the environment.”117

...and under the procedure set forth in Regulation (EC) 258/97:

“33. The Committee is therefore of the opinion that oil derived from insect protected cottonseed line IPC 531 is substantially equivalent to oil from conventional cottonseed lines, in terms of composition, nutritional value, metabolism, intended use and level of undesirable substances.”118

- RR 1445 cotton received a favorable opinion under the procedure set forth in Directive 90/220/EEC:

“(...) The Committee, after examining and considering the existing information and data provided in the dossier, against the background of available knowledge in the areas concerned, considers that there is no evidence to indicate that the placing on the market of line RRC 1445 (...) with the

Assessment of Novel Foods N 2002/04VNV, Executive Summary, page 48, The Hague, August 13, 2002, in Annex ARG-26. 117 Opinion of the Scientific Committee on Plants on the genetically modified cotton line, insect-tolerant notified by the Monsanto company (notification C/ES/96/02) (Opinion expressed by SCP on 14 July 1998), Chapter “7. Overall assessment and conclusion”, in Annex ARG-21. 118 Advisory Committee on Novel Foods and Processes, Request of an article 5 opinion on the substantial equivalence of cottonseed oil and food ingredients derived from insect protected cottonseed, “Conclusion,” in Annex ARG-22.


purpose to be used as any other cotton is likely to cause adverse effects on human health and the environment.”119

... and under the procedure set forth in Regulation (EC) 258/97:

“35. The Committee is therefore of the opinion that oil derived from herbicide tolerant cottonseed line RRC 1445 is substantially equivalent to oil from conventional cottonseed lines, in terms of composition, nutritional value, metabolism, intended use and level of undesirable substances.”120

213. As established in Article 5.1 and Annex A.4 of the SPS, the following requirements must be met for a sanitary and phytosanitary measure to be consistent with the terms of the agreement121: - a risk assessment must exist, and - the measure must be “based” on said risk assessment. 214. Argentina considers that the suspension since 1998 of the approval procedures for biotech agricultural products in the context of the above referenced Community legislation is inconsistent with Article 5.1 of the SPS because neither the Member States nor the Community authorities have complied with the above referenced requirements, as will be described in the following point. Non-existence of a risk assessment: Analysis of specific products 215. Paragraph 4 of Annex A of the SPS has provided 2 different definitions

119 Opinion of the Scientific Committee on Plants regarding the genetically modified cotton, tolerant to glyphosate herbicide notified by the Monsanto Company (notification C/ES/97/01) (Opinion expressed by the SCP on 14 July 1998), “7. Overall assessment and conclusion,” in Annex ARG-23. 120 Advisory Committee on Novel Foods and Processes, Request of an article 5 opinion on the substantial equivalence of cottonseed oil and food ingredients derived from roundup ready cotton, “Conclusion,” in Annex ARG-24. 121 See Point II.A.4.


of risk assessment122. 216. For the risk assessment to be included in the first definition of Paragraph 4 of Annex A, it must: 1) identify the diseases or pests, the entry, establishment or spread of which a Member wishes to prevent within its territory, and of the potential biological and economic consequences associated with the entry, establishment or spread of said diseases or pests; 2) evaluate the potential for the entry, establishment or spread of said diseases or pests, as well as the potential associated biological and economic consequences; and 3) evaluate the potential for the entry, establishment or spread of said diseases or pests according to the sanitary or phytosanitary measures which might be applied. 217. For the risk assessment to be included in the second definition, it must: 1) identify the potential for adverse effects on human or animal health arising from the presence of additives, contaminants, toxins or disease-causing organisms in food, beverages or feedstuffs. 2) evaluate the possibility or probability of the occurrence of said effects. 218. The EC did not use any of the types of risk assessment as the basis for its suspension since 1998 of the procedures that were underway for applications that had already been submitted. Therefore, no scientific evidence whatsoever exists that might justify the restriction imposed. Nor has there been any risk assessment within the meaning of Article 5.1 of the SPS. Identification of the status of each of the biotech agricultural products covered under this complaint in terms of the existence of a risk

122 See Point II.A.4.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 71 assessment 219. In relation to the effects of the application of the “de facto” moratorium on specific products -which lead to the suspension and failure to consider applications for various biotech agricultural products- and the respective obligation to carry out a risk assessment to support it, a distinction must be made between the following cases: (i) Products that received a favorable risk assessment without subsequent approval 220. There are requests that have not been approved in spite of the fact that the Member States or Community scientific committees have conducted the necessary risk assessments and the assessments were favorable to the approval of the biotech agricultural product. 221. It should be noted in particular that for the procedures in the context of Directive 2001/18/EC (and its predecessor Directive 90/220/EEC), satisfactory risk assessments have been conducted for: Bt-531 cotton, RR 1445 cotton, GA-21 maize and NK 603 maize. These same products have received favorable opinions in the procedures conducted in the context of Regulation (EC) 258/97. In this respect, Argentina makes reference to the favorable opinions issued by the Scientific Committees cited in the previous section. 222. In these cases, i.e. those in which the applications have been the subject of risk assessment, said risk assessments fully met the requirements of the definitions contained in Paragraph 4 of Annex A of the SPS as well as the requirements of WTO jurisprudence in the matter. However, far from determining that the applications should not be approved, the assessments performed concluded that there was no evidence of risk to human health or life. Therefore, scientific evidence does exist to support the approval of the biotech agricultural products submitted to the respective processes, and the suspension or failure to consider them is not justified. (ii) Products that have not been the subject of a risk assessment and

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 72 have not been approved 223. There are applications whose processing has been suspended without the performance of any supporting pertinent risk assessment conducted either by the competent authorities of the EC Member States or by Community Scientific Committees. 224. Among the procedures in the context of Directives 90/220/EEC and 2001/18/EC, Argentina would like to call attention to the case of soy A 2701-12 and A 5547-127, with respect to which not only have the respective procedures been suspended, but the required risk assessments have not been conducted either. This violation has been repeated by the EC in the procedures within the context of Regulation (EC) 258/97 relating to the same product. 225. In conclusion, there are requests whose consideration has been suspended, and for which the pertinent risk assessments (as required by Article 5.1 and Paragraph 4 of Annex A of the SPS) have not been conducted. The EC’s suspension of processing and failure to consider the pending applications for approval have prevented the Community Scientific Committees and the competent national authorities from scientifically assessing the risks arising from placing the above-mentioned biotech agricultural product on the market. Absence of a risk assessment: Legal arguments 226. The suspension of processing and failure to consider individual applications for specific biotech agricultural products are inconsistent with Article 5.1 and related provisions of the SPS, because they are not “based on” a risk assessment for each of the requests filed. 227. With respect to the scope of this obligation, WTO jurisprudence has established that:

“We believe that «based on» is appropriately taken to refer to a certain objective relationship between two elements, that is to say, to an objective situation that persists and is


observable between an SPS measure and a risk assessment.”123 (underlining added to indicate italics in original)

“We believe that Article 5.1, when contextually read as it should be, in conjunction with and as informed by Article 2.2 of the SPS Agreement, requires that the results of the risk assessment must sufficiently warrant -- that is to say, reasonably support -- the SPS measure at stake. The requirement that an SPS measure be «based on» a risk assessment is a substantive requirement that there be a rational relationship between the measure and the risk assessment.”124

228. In the case at hand, for purposes of determining whether the failure to approve any biotech agricultural products of particular interest to Argentina since 1998 is based on a risk assessment, a distinction must be made between the two hypothetical cases described above: - absence of the necessary “rational and objective relationship” because the scientific assessment was not conducted, - absence of the necessary “rational and objective” relationship, in spite of the fact that the scientific assessment was conducted. 229. In cases where the Member States or the Community Scientific Committees have performed a risk assessment, the consistent result has been that they have not found any evidence that the biotech agricultural products in question are accompanied by any risk to human life or health or to the environment. Therefore, there clearly does not exist any rational relationship between the failure to issue approval and the risk assessment conducted. On the contrary, on the basis of the results of the above-mentioned risk assessments, “the rational course of action” would have been to approve the requests that were filed.

123 EC–Hormones, WT/DS26/AB/R, Paragraph 189. 124 EC–Hormones, WT/DS26/AB/R, Paragraph 193.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 74 230. Therefore, in either of the two cases cited above, the requirements established in the SPS have not been met. 231. In the first case, the requirements have not been met because no risk assessment was performed on account of the suspension of the approval procedures required by EC regulations, as a result of which there is no scientific evidence that could be used as a basis (Case of soy A2704-12 and A5547-127). 232. In the second case, the requirements have not been met because the favorable risk assessment has not been taken into consideration as a basis for the approval of the biotech agricultural products in question. In other words, due consideration has not been given to the scientific basis (as in the case of maize and cotton). 4.- The suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 2.2 of the SPS Agreement 233. Article 2.2 of the SPS establishes that:


234. It should also be noted that said article was discussed in the ruling on the case Japan – Measures Affecting Agricultural Products (Japan – Agricultural Products) in the following terms:

“In the light of the above considerations based on the text and context of Article 2.2 of the SPS Agreement, we agree with the Panel that the obligation in Article 2.2 that an SPS measure not be maintained without sufficient scientific


evidence requires that there be a rational or objective relationship between the SPS measure and the scientific evidence. Whether there is a rational relationship between an SPS measure and the scientific evidence is to be determined on a case-by-case basis and will depend upon the particular circumstances of the case, including the characteristics of the measure at issue and the quality and quantity of the scientific evidence.” (footnotes omitted)125

235. More specifically, with regard to the relationship between Articles 2.2 and 5.1 of the SPS, WTO jurisprudence has established that:

“The obligation to base a sanitary measure on a risk assessment may be viewed as a specific application of the basic obligations contained in Article 2.2 of the SPS Agreement which provides that «Members shall ensure that any sanitary ... measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is not maintained without sufficient scientific evidence ...»” (underlining added to indicate italics in original).126

236. This affirmation was ratified by the following:

“We agree with this general consideration and would also stress that Articles 2.2 and 5.1 should constantly be read together. Article 2.2 informs Article 5.1: the elements that define the basic obligation set out in Article 2.2 impart meaning to Article 5.1.”127 “(...)in the event a sanitary measure is not based on a risk assessment as required in Articles 5.1 and 5.2, this measure can be presumed, more generally, not to be based on

125 Japan–Agricultural Products, WT/DS76/AB/R, Paragraph 84. 126 EC–Hormones, WT/DS26/R/USA Paragraph 8.93 127 CE–Hormones, WT/DS26/AB/R, Paragraph 180.


scientific principles or to be maintained without sufficient scientific evidence. We conclude, therefore, that if we find a violation of the more specific Article 5.1 or 5.2 such finding can be presumed to imply a violation of the more general provisions of Article 2.2. We do recognize, at the same time, that given the more general character of Article 2.2 not all violations of Article 2.2 are covered by Articles 5.1 and 5.2.”128 “Since we have found that the measure in dispute is inconsistent with the requirements of Articles 5.1, 5.5 and 5.6 and is, on that ground, also inconsistent with the requirements of Articles 2.2 and 2.3, we see no need to further examine Canada's other claims under Article 2 nor its claims under Article 3.”129 “We agree with the Panel, and, therefore, conclude that, by maintaining an import prohibition on fresh, chilled or frozen ocean-caught Pacific salmon, in violation of Article 5.1, Australia has, by implication, also acted inconsistently with Article 2.2 of the SPS Agreement.”130

237. On the basis of the provisions of the above referenced Article 2.2 and the above referenced jurisprudence, it can therefore be concluded: - that there exists a strict relationship between the obligation to base the measures on sufficient scientific evidence (Article 2.2) and the obligation to base the measures on a risk assessment (Article 5.1), to the extent that the obligation to base a sanitary measure on a risk assessment can be considered a concrete application of the basic obligations established in Paragraph 2, Article 2 of the SPS, which stipulates that “the Members shall ensure that any sanitary ... measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is

128 Australia–Salmon, WT/DS18/R, Paragraph 8.52. 129 Australia–Salmon, WT/DS18/R, Paragraph 8.184. 130 Australia–Salmon, WT/DS18/AB/R, paragraph 138.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 77 not maintained without sufficient scientific evidence;” - if a sanitary measure is not based on a risk assessment as required in Paragraphs 1 and 2 of Article 5, it can be assumed more generally that said measure is not based on scientific principles and that it is being imposed without sufficient scientific evidence (as required by Article 2.2). 238. Having demonstrated that the suspension since 1998 of the approval procedures for the biotech agricultural products of interest to Argentina, as explained in the foregoing section, is not “based on a risk assessment,” Argentina trusts that it has duly proven that said suspension does not meet the requirements established in Article 2.2 of the SPS. 5.- The suspension of processing and the lack of consideration of individual requests for the approval of determined biotech agricultural products of particular interest to Argentina are inconsistent with Article 5.5 of the SPS Agreement 239. The suspension by the EC since 1998, without any scientific foundation, of the procedures established in Directive 2001/18/EC and its predecessor Directive 90/220/EEC and Regulation (EC) 258/97 referred to both the consideration of applications for approval, as well as the approvals themselves, with reference to biotech agricultural products, constitutes a violation of the obligations deriving from Article 5.5 of the SPS. 240. Article 5.5 of the SPS says:

“With the objective of achieving consistency in the application of the concept of appropriate level of sanitary or phytosanitary protection against risks to human life or health, or to animal and plant life or health, each Member shall avoid arbitrary or unjustifiable distinctions in the levels it considers to be appropriate in different situations, if such distinctions result in discrimination or a disguised restriction on international trade. Members shall cooperate in the Committee, in accordance with paragraphs 1, 2 and 3 of Article 12, to develop guidelines to further the practical


implementation of this provision. In developing the guidelines, the Committee shall take into account all relevant factors, including the exceptional character of human health risks to which people voluntarily expose themselves.”

241. The scope of said article has been the subject of repeated pronouncements in the context of the WTO Dispute Settlement System.131 Said pronouncements indicate that the Member that complains about a violation of Article 5.5 must demonstrate the existence of three distinct and cumulative elements: a) The Member that imposes the measure that is the subject of the complain must have adopted its own levels of sanitary protection against risks to human, animal or plant life or health in various different situations. b) It must be demonstrated that these levels of protection exhibit arbitrary or unjustifiable differences (“distinctions” is the term used in Article 5.5 of the SPS) in the treatment of different situations. c) These arbitrary or unjustifiable differences must result in discrimination or a restriction of international trade. a.- First element: application of different levels of protection for different situations 242. This element must in turn exhibit two aspects: “distinct levels of protection” and “different situations.” 243. With regard to the concept of “different situations”, the comparability of different situation results from the fact that the situations have one or more elements in common that make a comparison possible. 244. With regard to “distinct levels of protection,” Argentina calls attention to the fact that for the same reasons as explained in the section regarding the

131 See Section II.A.6


“de facto” moratorium, the EC has established different levels of protection in “comparable” situations. In fact, it has established levels of protection with respect to biotech products for the products before and after the moratorium, as well as different levels for novel non-biotech products and new biotech products.132 245. With regard to the requirements for proceeding with this comparison, the Appellate Body indicated:

“Clearly, comparison of several levels of sanitary protection deemed appropriate by a Member is necessary if a panel's inquiry under Article 5.5 is to proceed at all. The situations exhibiting differing levels of protection cannot, of course, be compared unless they are comparable, that is, unless they present some common element or elements sufficient to render them comparable. If the situations proposed to be examined are totally different from one another, they would not be rationally comparable and the differences in levels of protection cannot be examined for arbitrariness.133 (underlining added to indicate original text in italics)

i) Biotech products before and after 1998 246. As noted above, the EC has not approved any new biotech agricultural products since 1998. Independently of the Community legislation referring to the approval of biotech products (which existed prior to 1998 and has existed since 1998 in successive versions), from that year on the EC changed the level of sanitary and phytosanitary protection that it had been using: the EC apparently thought that the level of protection in place was no longer adequate to regulate the imports of biotech agricultural products, and consequently did not process or approve the applications presented with respect to the biotech agricultural products of particular interest to Argentina.

132 See Annex ARG-34. 133 Appellate Body Report in EC-Hormones, WT/DS26/AB/R, WT/DS48/AB/R, Paragraph 217.


247. It therefore caused an absolute ban on imports of the biotech products of particular interest to Argentina, so the level of protection was increased by the EC. 248. This level of protection prior to the moratorium can be found from the opinions of the respective scientific panels134 and in the decisions of the Commission approving biotech products135. 249. In the context of this mechanism, various biotech products received favorable assessments and were approved136. These approvals were based on the non-existence of evidence that indicated that these products could have a negative effect on human and animal life and health or on the environment137. 250. The application of these distinct levels of protection in comparable situations has become a situation in which the same class of biotech products submitted for approval before and after 1998 were treated differently. This treatment is apparent from the suspension of and failure to give consideration to individual applications for the approval of biotech agricultural products, as well in the undue delay in completing the processing of applications for approval of these products under Community legislation, which has become a ban on imports of products of particular interest to Argentina. ii) Novel biotech products and novel “non-biotech” products 251. The EC has established distinct levels of protection for biotech products that differ from the levels of protection for novel “non-biotech” products.

134 See Annexes ARG-30, ARG-31, ARG-32 and ARG-33. 135 See Annexes ARG-35, ARG-36, ARG-37 and ARG-38. 136 See list of approvals in State of play on GMO authorisations under EU law, MEMO/04/17, Brussels, January 28, 2004, Annexes 1 and 4, in Annex ARG-6. 137 See examples of opinions of Scientific Committees on approved products in Annexes ARG-30, ARG-31, ARG-32 and ARG-33.


252. In fact, the novel “non-biotech” products are not suffering any restrictions in access to the EC market that are not based on scientific evidence. Therefore, the level of protection is very low compared to the zero risk that results from blocking access to the market by novel biotech products. 253. Nevertheless, the risks posed by these products (novel biotech products and novel “non-biotech” products) are not different. This fact has been acknowledged by the Community authorities themselves, some of whom have not only pointed out this characteristic, but have also supported the opinion that the biotech products may be safer than some of the novel “non-biotech” products”138. 254. Once again, in this case the EC has applied different levels of protection in comparable situations. b.- Second element: arbitrary and unjustifiable differences in protection 255. The second element -that the levels of protection exhibit arbitrary or unjustifiable differences in their treatment of comparable situations- is also present in the measure adopted by the EC. That is because, given the existence of the same levels of risk, it is inconsistent to apply different levels of protection. That is precisely what the EC has done in its treatment of novel biotech products compared to novel “non-biotech” products, just like it did in its treatment of biotech products before and after the moratorium was instituted.

138 In this sense, reference is made to the press release entitled: GMOs: are there any risks? - Launch of a European Round Table on GMO Safety, dated October 8, 2001:


See Annex ARG-39.


256. This circumstance represents an arbitrary and unjustifiable distinction, because the establishment of such dissimilar levels of protection is not in accordance with the SPS Agreement.139

139 In this regard, reference is made to the remarks of the Appellate Body in Australia - Salmon, WT/DS18/AB/R:

154. With regard to the second element of Article 5.5, namely, the existence of arbitrary or unjustifiable distinctions in appropriate levels of protection in different situations, the Panel began its analysis by noting that in view of the difference in SPS measures and corresponding levels of protection for salmon products, on the one hand, and the four categories of other fish and fish products, on the other, one might expect some justification for this difference, such as a higher risk from imported salmon. However, as the Panel noted:

... the arguments, reports, studies and expert opinions submitted to us in this respect - rather than pointing in the direction of a higher risk related to ...[ocean-caught Pacific salmon], in order to justify the stricter sanitary measures imposed for these products - all provide evidence that the two categories of non-salmonids [herring used as bait and live ornamental finfish], for which more lenient sanitary measures apply, can be presumed to represent at least as high a risk - if not a higher risk - than the risk associated with ... [ocean-caught Pacific salmon].

155. The Panel, therefore, found that, on the basis of the evidence before it, the distinctions in levels of sanitary protection reflected in Australia's treatment of, on the one hand, ocean-caught Pacific salmon and, on the other, herring used as bait and live ornamental finfish, are "arbitrary or unjustifiable" in the sense of the second element of Article 5.5. 156. Australia argues that the Panel erred in determining that its examination under Article 5.5, second element, must be limited solely to those disease agents positively detected in ocean-caught Pacific salmon. Australia raises the same objections to this limitation as it did in the context of the first element discussed above. 157. We do not agree with Australia that the Panel excluded diseases of concern which have not been positively detected in ocean-caught Pacific salmon from its examination under Article 5.5. The Panel explicitly took into account diseases which have not been positively detected in ocean-caught Pacific salmon but had been detected in herring used as bait and live ornamental finfish. In addition, we observe that the inclusion in the examination under Article 5.5, second element, of all diseases of concern which have not been positively detected in ocean-caught Pacific salmon would logically have led to the inclusion of all diseases of concern which have not been positively detected in herring used as bait and live ornamental finfish. Due to the lack of reliable scientific information, this exercise would have become highly speculative and, moreover, would probably not have changed the Panel's finding in paragraph 8.141 on the "arbitrary or unjustifiable" character of the distinctions in the levels of protection.


i) Biotech products before and after 1998 257. The difference between these novel biotech products with regard to the level of protection is arbitrary and unjustifiable. 258. As noted above, the EC adopted and applied a higher level of protection which effectively resulted in a “de facto” prohibition against imports, without having detected an increase in the levels of risk. 259. This situation occurred in a context in which there was no scientific evidence to justify it; in fact, the scientific evidence obtained after 1998 supports the contrary position140. ii) Novel biotech products and novel “non-biotech” products 260. As indicated above, the novel “non-biotech” products are no different from the new biotech products. Nevertheless, the former are not subject to a ban on importation which is indeed applied to the latter not approved prior to 1998. 261. This difference in the level of protection, regardless of the fact that both categories of products carry the same level of risk, is “arbitrary and unjustified”.

158. Australia determined explicitly that its appropriate level of protection with respect to ocean-caught Pacific salmon is "a high or 'very conservative' level of sanitary protection aimed at reducing risk to 'very low levels', 'while not based on a zero-risk approach'." The level of protection reflected in Australia's treatment of herring used as bait and live ornamental finfish is definitely lower. We note the Panel's factual finding that herring used as bait and live ornamental finfish can be presumed to represent at least as high a risk - if not a higher risk - than the risk associated with ocean-caught Pacific salmon. Therefore, we uphold the Panel's finding in paragraph 8.141 of its Report to the extent that the Panel found that the second element of Article 5.5 is fulfilled.”

140 GM Science Review, First Report, An open review of the science relevant to GM crops and food based on the interest and concerns of the public (July 2003). See Annex ARG-28.


262. In this regard, as noted above, the Community authorities have acknowledged that the novel biotech products do not pose any greater risk than the novel non-biotech products141. c.- Third element: discrimination and disguised restriction of international trade 263. The distinctions made by the EC have resulted in discrimination or disguised restriction of international trade. 264. In Argentina’s opinion, this third element required by Article 5.5 is present, because since 1998 there have been no approvals of new biotech products in the EC. 265. To determine whether a measure discriminates and imposes a disguised restriction on international trade within the meaning of Article 5.5 of the SPS Agreement, the Appellate Body has taken account of three “warning signals” and several “additional factors” 142. 266. The warning signs taken into consideration are: a) the arbitrary and unjustifiable nature of the differences in the levels of protection;

141 See Annex ARG-28. In addition, see the press release by the EC Commission entitled GMOs: are there any risks? - Launch of a European Round Table on GMO Safety, dated October 8, 2001:


See Annex ARG-39. 142 Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, Paragraphs 159-177.


b) the degree of difference in the levels of protection; c) whether the measure in question is based on a risk assessment within the meaning of Articles 5.1 and 2.2 of the SPS Agreement. 267. Among the “additional factors” taken into consideration by the Appellate Body in the Australia-Salmon case, Argentina thinks the following factor is applicable: - the level of protection of the internal movement of products compared to the level of protection applied to imported products. 268. The moratorium applied by the EC has the three “warning signals” and one additional factor, as described in greater detail below. i) Biotech products before and after 1998 269. As demonstrated above, the difference between the levels of protection applied before and after 1998 is “arbitrary and unjustifiable”, given that there is no justification for this distinction, taking into consideration the level of risk involved. 270. In this regard, as was demonstrated in the pertinent portion of this presentation, the EC has changed in 1998 the level of protection without justification. 271. On the basis of the information presented above, the moratorium exhibits the three “warning signals” identified by the Appellate Body in Australia-Salmon143. 272. The moratorium also exhibits an “additional factor” which demonstrates the existence of discrimination and disguised restriction of international trade.

143 Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, Paragraphs 159 to 177.


273. This additional factor consists of the disproportionate impact of the suspension and failure to process the applications submitted from 1998 on for the approval of biotech products of particular interest to Argentina, if we compare the effect on the producers of biotech agricultural protects outside the EC with the effects on producers inside the EC. 274. The effect on producers inside the EC is small because of the small area planted with biotech products in Europe (only Spain and Germany, each of which has approximately 0.05 million hectares under cultivation), compared with the area dedicated to these crops in other countries (the US has an area of 42.8 million hectares cultivated with biotech agricultural products, followed by Argentina with 13.9 million hectares and Canada with 4.4 million hectares)144. 275. Consequently, the effect of the suspension and the failure to consider applications for the approval of biotech agricultural products after 1998 on the biotech producer countries is significant, negative and particularly disproportionate, because they are applied inequitably to imported products. ii) Novel biotech agricultural products and novel “non-biotech” products 276. Analogous to the situation of the biotech agricultural products before and after 1998, the degree of difference between the level of protection of some products and other products is considerable, because there is a low level of protection for the novel “non-biotech” product and a level that is equivalent to a ban on imports for the novel biotech agricultural product, given that the requests for approval of the latter products have been suspended or given no consideration at all. There has also been an undue delay in completing the processing of applications for the approval of biotech agricultural products under Community legislation. 277. Moreover, the difference in the level of protection between the new “non-biotech” products and the existing novel biotech agricultural products is arbitrary and unjustifiable, which represents one of the three “elements”



necessary for the existence of a violation of Article 5.5 of the SPS Agreement. 278. Likewise, the different treatment applied to some products as opposed to others, as indicated above, is not based on a risk assessment, and has a negative effect on the novel biotech agricultural products, the vast majority of which originate outside the EC145. Conclusion regarding Article 5.5 of the SPS Agreement 279. For the reasons indicated above, the suspension of processing and the failure to consider individual applications for the approval of determined biotech agricultural products of particular interest to Argentina are inconsistent with Article 5.5 of the SPS Agreement, because they have the three cumulative “elements” required by Article 5.5, under both the scenarios developed by Argentina: biotech products before and after 1998, and novel biotech agricultural products compared to novel “non-biotech” products. 6.- The suspension of processing and the lack of consideration of individual applications for the approval of determined biotech agricultural products of particular interest to Argentina are inconsistent with Article 5.6 of the SPS Agreement 280. Article 5.6 requires that:

“Without prejudice to paragraph 2 of Article 3, when establishing or maintaining sanitary or phytosanitary measures to achieve the appropriate level of sanitary or phytosanitary protection, Members shall ensure that such measures are not more trade-restrictive than required to achieve their appropriate level of sanitary or phytosanitary protection, taking into account technical and economic feasibility.3”



3 For purposes of paragraph 6 of Article 5, a measure is not more trade-restrictive than required unless there is another measure, reasonably available, taking into account technical and economic feasibility, that achieves the appropriate level of sanitary or phytosanitary protection and is significantly less restrictive to trade.

281. With respect to the elements that make up Article 5.6 of the SPS, WTO jurisprudence indicates that to establish the existence of a violation of Paragraph 6 of Article 5 of the SPS, it must be determined whether there exists another sanitary or phytosanitary measure that: 1) is reasonably available taking into account technical and economic feasibility; (2) achieves the Member's appropriate level of sanitary or phytosanitary protection; and (3) is significantly less restrictive to trade than the contested sanitary or phytosanitary measure. These three elements are cumulative.146 282. With respect to the first element, i.e. whether there exists another sanitary or phytosanitary measure that is reasonably available taking into account technical and economic feasibility, the following position is affirmed in the Australia-Salmon case:

“With regard to the first element of this test, we note the Panel's factual finding that there are alternative SPS measures that are reasonably available, taking into account technical and economic feasibility. We, therefore, consider that the first element of the test under Article 5.6 is met.”147

283. In the case of this claim, the suspension, without scientific justification, of the approval procedures established by EC legislation, results in a ban on

146 Australia–Salmon (WT/DS18/R) Paragraph 8.167 and (WT/DS18/AB/R) Paragraphs 180 and 194. 147 Australia–Salmon (WT/DS18/AB/R), Paragraph 195.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 89 access, in other words in a total and absolute restriction of the biotech agricultural products of special interest to Argentina that had not been approved prior to 1998. 284. The procedures established in EC legislation for the prior approval of biotech agricultural products (Directive 2001/18/EC, Directive 90/220/EEC and Regulation (EC) 258/97), as they were applied up to 1998, constitute the alternative “measure with technical and economic feasibility” to the suspension of procedures imposed by the EC. Therefore, in this case, the first element is present. 285. With respect to the second element, which requires that the other measure achieves the Member’s appropriate level of sanitary or phytosanitary protection, it was affirmed in the same case that:

“The «appropriate level of protection» established by a Member and the «SPS measure» have to be clearly distinguished. They are not one and the same thing. The first is an objective, the second is an instrument chosen to attain or implement that objective”.148 (underlining added to indicate italics in original)

“It can be deduced from the provisions of the SPS Agreement that the determination by a Member of the «appropriate level of protection» logically precedes the establishment or decision on maintenance of an «SPS measure». The provisions of the SPS Agreement also clarify the correlation between the «appropriate level of protection» and the «SPS measure».”149

“It is the appropriate level of protection which determines the SPS measure to be introduced or maintained, not the SPS measure introduced or maintained which determines the appropriate level of protection. To imply the appropriate

148 Australia–Salmon (WT/DS18/AB/R), Paragraph 200. 149 Australia–Salmon (WT/DS18/AB/R), Paragraph 201.


level of protection from the existing SPS measure would be to assume that the measure always achieves the appropriate level of protection determined by the Member. That clearly cannot be the case.”150 “We, therefore, conclude that the Panel's statement that «to determine whether any of the alternative measures meet Australia's appropriate level of protection, we should [...] examine whether these alternatives meet the level of protection currently achieved by the measure at issue» is wrong. What is required under Article 5.6 is an examination of whether possible alternative SPS measures meet the appropriate level of protection as determined by the Member concerned.”151 (underlining added to indicate italics in original)

“We recognize that the SPS Agreement does not contain an explicit provision which obliges WTO Members to determine the appropriate level of protection. Such an obligation is, however, implicit.”152 (underlining added to indicate italics in original)

“We thus believe that the SPS Agreement contains an implicit obligation to determine the appropriate level of protection. We do not believe that there is an obligation to determine the appropriate level of protection in quantitative terms. This does not mean, however, that an importing Member is free to determine its level of protection with such vagueness or equivocation that the application of the relevant provisions of the SPS Agreement, such as Article 5.6, becomes impossible.”153 (underlining added to indicate italics in

150 Australia–Salmon (WT/DS18/AB/R), Paragraph 203. 151 Australia–Salmon (WT/DS18/AB/R), Paragraph 204. 152 Australia–Salmon (WT/DS18/AB/R), Paragraph 205. 153 Australia–Salmon (WT/DS18/AB/R), Paragraph 206.


original)

“While in this case Australia determined its appropriate level of protection, and did so with sufficient precision to apply Article 5.6, we believe that in cases where a Member does not determine its appropriate level of protection, or does so with insufficient precision, the appropriate level of protection may be established by panels on the basis of the level of protection reflected in the SPS measure actually applied. Otherwise, a Member's failure to comply with the implicit obligation to determine its appropriate level of protection - with sufficient precision - would allow it to escape from its obligations under this Agreement and, in particular, its obligations under Articles 5.5 and 5.6.”154

286. The applicable EC legislation establishes prior approval procedures that presuppose the existence of a level of protection that prior to 1998 served as a basis for the approval of various products, some of them of particular interest to Argentina. Argentina is also claiming that, because the level of protection of the EC has been changed, the prior approval procedures for the biotech agricultural products should also have been changed accordingly to ensure that said adequate level was achieved. It should also be noted that the Appellate Body in the Australia-Salmon case affirmed that, if a Member has not declared its level of protection or has not done so with sufficient precision, the Panels may establish the adequate level of protection, taking as a basis the level of protection that reflects the sanitary or phytosanitary measure effectively applied155. 287. The suspension of consideration or the lack of approval by the EC shows that the EC is seeking to raise the level of protection to guarantee “zero risk” from the access of each of the biotech agricultural products specifically affected by this suspension or lack of consideration. 288. With respect to the third element, following the same Community

154 Australia–Salmon (WT/DS18/AB/R), Paragraph 207. 155 See previous citation.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 92 legislation, the prior approval procedures provided by said legislation for biotech products represented the measure with technical and economic feasibility which, once applied, would make it possible to achieve an adequate level of protection. Said procedures include all the steps necessary to assess the risks of the biotech agricultural products, thereby protecting human life and health and the environment from adverse effects. 289. In that sense, the legislation, as applied since 1998, allowed the approval and consequent access to the market of biotech agricultural products of interest to Argentina, while the suspension and failure to consider applications for approval from 1998 to the present has operated as a restriction of access to the Community market. CONCLUSION WITH RESPECT TO THE INCONSISTENCY WITH THE SPS AGREEMENT OF THE “SUSPENSION OF PROCESSING AND FAILURE TO CONSIDER INDIVIDUAL APPLICATIONS FOR APPROVAL OF SPECIFIC BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” 290. For all the reasons set forth above, Argentina requests that the “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” implemented by the EC from 1998 to the present be declared inconsistent with Articles 5.1, 2.2, 5.5 and 5.6 of the SPS. C.- INCONSISTENCY OF THE “UNDUE DELAY” IN THE PROCESSING OF INDIVIDUAL APPLICATIONS FOR APPROVAL OF BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA WITH THE SPS AGREEMENT 291. The Argentine Republic will now proceed to demonstrate the inconsistencies with the control, inspection and approval procedures set forth in Community legislation (Directives 90/220/EEC and 2001/18/EC and Regulation (EC) 258/97) with the provisions of Article 8 and Annex C of the SPS Agreement.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 93 1.- Inconsistency of the “undue delay” in the completion of processing of the individual applications for approval of biotech agricultural products of particular interest to Argentina with Article 8 and Annex C of the SPS Agreement a.- Analysis of the relationship between Article 8 and Annex C 1 a), b), c) and e) of the SPS Agreement 292. Article 8 of the SPS establishes that:

“Members shall observe the provisions of Annex C in the operation of control, inspection and approval procedures, including national systems for approving the use of additives or for establishing tolerances for contaminants in foods, beverages or feedstuffs, and otherwise ensure that their procedures are not inconsistent with the provisions of this Agreement.”

293. Article 8 refers to Annex C, which stipulates that:

“1. Members shall ensure, with respect to any procedure to check and ensure the fulfillment of sanitary or phytosanitary measures, that:

(a) such procedures are undertaken and completed without undue delay and in no less favourable manner for imported products than for like domestic products; (b) the standard processing period of each procedure is published or that the anticipated processing period is communicated to the applicant upon request; when receiving an application, the competent body promptly examines the completeness of the documentation and informs the applicant in a precise and complete manner of all deficiencies; the competent body transmits as soon as possible the results of the procedure in a precise and complete manner to the applicant so that corrective action may be taken if necessary; even when the application has deficiencies, the competent body proceeds


as far as practicable with the procedure if the applicant so requests; and that upon request, the applicant is informed of the stage of the procedure, with any delay being explained; (c) information requirements are limited to what is necessary for appropriate control, inspection and approval procedures, including for approval of the use of additives or for the establishment of tolerances for contaminants in food, beverages or feedstuffs; (e) any requirements for control, inspection and approval of individual specimens of a product are limited to what is reasonable and necessary;

294. The relationship between Article 8 and the requirements of Annex C and, in particular, Argentina’s allegations with respect to Paragraph 1, letters a), b), c) and e) of said Annex, is clearly established in the text of Article 8 that imposes a general obligation on all the Members to “observe the provisions of Annex C in the operation of control, inspection and approval procedures (...)”. In other words, if the Members are obligated to observe the provisions for the control, inspection and approval procedures in Annex C, a violation of the provisions of this Annex simultaneously represents a violation of the terms of Article 8. 295. Article 8 establishes two simultaneous obligations for Member States. First, it stipulates an obligation to observe the provisions of Annex C and second, it imposes an obligation to “(...) otherwise ensure that their procedures are not inconsistent with the provisions of this Agreement.” In other words, there is an obligation with specific reference to Annex C and a second obligation that stipulates the requirement that the procedures adopted by the Member State must not be in violation of any other provision of the SPS. 296. With regard to Annex C, Paragraph 1 stipulates the following obligations for the Members in letters a), b), c) and e), namely: - in letter a) of Paragraph 1, that the procedures must be undertaken and completed without undue delay and in no less favorable manner for imported

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 95 products than for like domestic products. In other words, the SPS imposes an obligation that “establishes” the requirement to prevent undue delays and adds the obligation to prevent any discriminatory treatment between the treatment accorded the imported product and the treatment accorded the similar domestic product. - the obligation in the preceding paragraph in the sense of avoiding undue delay is supplemented by other provisions such as, for example, letter b) of Paragraph 1, which stipulates “that the competent body promptly examines the completeness of the documentation”, “ ... the competent body transmits as soon as possible the results of the procedure...” and “the competent body proceeds as far as practicable with the procedure if the applicant so requests; and that upon request, the applicant is informed of the stage of the procedure, with any delay being explained.” In other words, the competent body must perform its obligations “promptly” and must also provide explanations of “any delay.” - in turn, letter b) of Paragraph 1 stipulates obligations of publication and notification of the applicant, and specifically requires that even when “the application has deficiencies, the competent body proceeds as far as practicable with the procedure if the applicant so requests”. - for its part, letter c) of Paragraph 1 concretely prohibits requiring more information than is necessary for the appropriate control, inspection and approval procedures. - letter e) of Paragraph 1 establishes the obligation to ensure that the requirements that may be set for the control, inspection and approval of individual samples of a product are limited to what is “reasonable and necessary.” b.- Analysis of the inconsistencies of the “undue delay” in the processing of individual applications for approval of biotech agricultural products of particular interest to Argentina in light of the provisions of Article 8 and Annex C 1 a), b), C) and e) 297. In the context of Community legislation currently in force, Directive

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 96 2001/18/EC as well as Regulation (EC) 258/97, there are provisions related to the system of control, inspection and approval. 298. For example, in the case of Directive 2001/18/EC, Nos. (32), (33), (34), (35), (36), (37), (38), (43), (44), (45), (47), (52), (53) of the Preamble and No. (48) of the Preamble contain an express provision regarding transparency and effectiveness that must govern the administrative procedure for the placement of GMOs on the market, in the terms cited below: “The administrative procedure for granting consents for the placing on the market of GMOs as or in products should be made more efficient and more transparent and first-time consent should be granted for a fixed period.” 299. The above obligation is supplemented by the provisions of Article 4, entitled “General Obligations”, and refers in its Paragraph 1 to Parts B and C of the same Directive which relates to, among other things, the standard authorization procedure (Article 6), differentiated procedures (Article 7), modifications and new information (Article 8), consultation of and information to the public (Article 9), reporting by notifiers on releases (Article 10), exchange of information between competent authorities and the Commission (Article 11), sectoral legislation (Article 12), notification procedure (Article 13), assessment report (Article 14) and standard procedure (Article 15), criteria and information for specific GMOs (Article 16), renewal of consent (Article 17), Community procedure in case of objection (Article 18), consent (Article 19), information to the public (Article 24), confidentiality (Article 25), consultation of Scientific Committee(s) (Article 28), consultation of Committees on Ethics (Article 29), committee procedure (Article 30), exchange of information and reporting (Article 31) and pending notifications (Article 35). There are other provisions relative to the system of inspection, control and approval in the Annexes and Subannexes, and in particular in Annex IV entitled “Additional information.” 300. In the opinion of Argentina, despite the complexity and the degree of detail of the system of control, inspection and approval designed by the EC in the above-referenced Directive to approve the release or sale of biotech agricultural products, the EC’s practices have not been appropriate in terms


of the obligations of Annex C set forth in Paragraph 1 and specifically in letters a), b), c) and e). As analyzed in greater detail below, in the case of each of the biotech agricultural products of particular interest to Argentina, the application of the Community legislation has involved violations of the above referenced provisions of Annex C of the SPS. 301. Regulation (EC) 258/97 also contains, among others, provisions applicable to inspection, control and approval procedures in Articles 4, 5, 6, 7, 9, 10, 11, 12, 13 and 14. 302. In the opinion of the Argentine Republic, and notwithstanding the complexity of the control, inspection and approval procedures designed and implemented by the EC by means of the above referenced Regulation, to approve novel foods and novel food ingredients, the implementation of said procedures by the Community authorities has not met the obligations of Annex C in Paragraph 1 and specifically in letters a), b), c) and e). As will be analyzed in greater detail below, in the case of each of the biotech agricultural products of particular interest to Argentina, the application of the Community legislation has involved violations of the above referenced provisions of Annex C of the SPS. 303. In addition to the complaints formulated above with respect to the provisions of the above-referenced Community legislation, Argentina notes that, in the first place, the “undue delay” by the EC has caused the deadlines to pass without any decision by the EC on the applications submitted, or in those cases where some of the required steps of the procedure had been completed, no applications submitted with respect to biotech agricultural products have been approved. 304. As indicated in the first part of this submission156, the moratorium is a sanitary or phytosanitary measure within the meaning of Annex A.1 of the SPS Agreement. In this sense, the Community approval procedures must comply with Article 8 and Annex C of the Agreement. In this context, and in light of the provisions of Directives 2001/18/EC (and its predecessor Directive 90/220/EEC) and Regulation (EC) 258/97 taken together, the delay has resulted from the complete suspension of consideration and

156 See Point II.A.1 of this presentation.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 98 ultimately the suspension of the application of the control, evaluation and approval procedures provided for biotech agricultural products of particular interest to Argentina. In other cases where the procedure had been initiated, it has never been “completed” within the meaning of Annex C, Paragraph 1, letter a). 305. The Community legislation that establishes the procedure for the prior approval of GMOs (Directive 90/220/EEC and subsequently Directive 2001/18/EC and Regulation (EC) 258/97) defines the procedures for the approval of biotech agricultural products of domestic or foreign origin. 306. Said procedures set deadlines for each of the required steps. Although it is not possible to define an estimated total length of time required for the completion of each of the procedures, because some steps do not have a predetermined time period, an approximate length of time can be estimated within which it seems “reasonable” that the procedures can be completed. 307. For example, the normal completion of the procedure defined in Regulation (EC) 258/97 (not counting any time required by comments and/or additional evaluations that may be required -Articles 6.3, 6.4 and 7-) requires a period of 240 days, plus the time required for the Standing Committee on Foodstuffs (since reorganized as part of the European Food Safety Authority) to issue the technical opinion, for which the Regulation does not stipulate any deadline because it is determined by the Chairman as a function of the urgency of the issue at hand (Article 13.3). 308. The normal completion of the procedures defined by Directive 90/220/EEC for the case of deliberate release into the environment requires 90 days, a deadline that can be extended as necessary, which does not take into consideration the time required to obtain additional information (Article 6.3) or the time required for consultation with the public (Article 6.3 and 7). For the placing on the market of products containing GMOs, the procedure takes 240 days, and does not include the time required by the competent body to obtain additional information (Article 12.5) or the time required by the respective Scientific Panel to issue its opinion, whose deadlines are set on a case-by-case basis by the Chairman, depending on the urgency of the matter (Article 21).

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 99 309. In the case of Directive 2001/18/EC, the procedure for release into the environment would require 120 days for the standard procedure, with a possible extension if the competent body requests additional information from the notifier (Article 6.6.a). 310. In the case of the differentiated procedure, the total amount of time available is 150 days, including the time required for comments from other competent bodies (Article 7.2.a), comments from the public (Article 7.2.b) and the report from the pertinent scientific committee or committees (Article 7.2.c.) 311. For the placement on the market of biotech agricultural products in the form of products or ingredients in products, the deadlines imposed call for a procedure lasting 285 days for the standard procedure (in which no objections are made). If additional information is needed, the time required to obtain such additional information is not counted as part of the stipulated period (Articles 14.4. and 15.1.4). 312. If an objection is made by a Member State or by the Commission, the Directive stipulates a period of 450 days, which does not count the time required for the presentation of additional information requested from the notifier (Article 18.1, second paragraph) or the period until the Commission receives the opinion of the Scientific Committee (Article 18.1, second paragraph, and Article 28), or the time it takes the Council to act (Article 18.1, third paragraph). 313. As explained above, the suspension of procedures since 1998 has resulted in delays that can in no case be justified in light of the periods of time stipulated in EC legislation. 314. The average length of the required procedures does not exceed one year -in terms of the definitions provided in Community legislation- and there is no justification for dragging them out for years and years, as has been done for each of the biotech agricultural products described below. The additional information that may have been required or delays in the Technical Reports from the respective Scientific Committees in no case justify said delays. 315. Another element that demonstrates that the EC has not ensured that


procedures are undertaken and completed without undue delay -as required by Annex C, paragraph 1, letter a)- is that the delays cited are not based on sufficient scientific evidence. The application of the inspection, control and approval procedures to ensure the compliance of a sanitary or phytosanitary measure must meet the requirements of the SPS Agreement, and in particular, pursuant to Article 2.2, which says that Members must ensure “... that any sanitary or phytosanitary measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is not maintained without sufficient scientific evidence (...).” As noted several times above, there are cases in which the risk assessment (conducted by the competent body of the Member State in question or by a Community Scientific Committee) has indicated that there are no risks that would prevent the approval of certain biotech agricultural products157. In other cases, the risk assessment was not conducted158. What these two cases have in common is that there is no scientific evidence that justifies the manner in which the EC has applied the procedures or the undue delays. 316. In other words, the “undue delay” on the part of the Community authorities is “undue” because they lack sufficient grounds to justify their failure to complete the procedures or their suspension of procedures for the approval of biotech agricultural products (either in the case of failure to process applications or the suspension thereof) with respect to the applications filed. 317. Likewise, it must be noted that the EC has invoked requirements based on subsequent legislation as grounds for its continued failure to process the applications. 318. That fact is reflected, for example, in the obligation that is imposed on notifiers under Directive 90/220/EEC to start the procedures all over again under the new Directive 2001/18/EC, when in various cases the procedures had already been in progress under the old legislation for three years, and by

157 See Point V.II.B.3.i) of this presentation and Annex ARG-6. 158 See Point V.II.B.3.ii) of this presentation.


the fact that no justification for this delay has been presented159. 319. In any case, that argument is unsustainable, because this new legislation was initially represented by Directive 2001/18/EC, which entered into force in October 2002. Immediately thereafter, the same argument was advanced regarding the need for new legislation that would be even more effective. That legislation would theoretically be the legislation on traceability and labeling.160 320. In other words, an obligation was imposed on notifiers to meet new requirements that did not exist at the time their applications were initially submitted, and the drafting and implementation of these new requirements are at the discretion of the Community authorities. Moreover, there is no guarantee at all that the Community authorities will be satisfied even by their own new requirements. 321. Annex C, Paragraph 1, letter a) of the SPS also stipulates that the Members must ensure “that such procedures are undertaken and completed without undue delay and in no less favorable manner for imported products than for like domestic products.” In other words, it establishes the obligation to avoid discriminatory treatment by differentiating the treatment granted to an imported product and to a similar domestic product. 322. In this case, to determine the similarity of treatment, we must evaluate the manner in which the system has been implemented for the inspection, control and approval of the biotech products and novel non-biotech products. For example, Regulation (EC) 258/97 defines a procedure that does not differ in terms of implementation between the two products. In practice, however, the undue delay has occurred only in the treatment of biotech agricultural products. 323. Another example of the distinctions made in the implementation of the procedure, one that illustrates how less favorable treatment has been given to

159 The extreme case to which Argentina refers later in this presentation is that of Bt 531 cotton, which has so far taken 7 years and 4 months. 160 See Annexes ARG-8 and ARG-12.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 102 biotech products, is the treatment given to products of this same type -i.e. biotech products- before and after the de facto moratorium, i.e. before and after 1998. Prior to 1998, approvals were issued; from 1998 to the present, approvals were suspended. 324. With regard to Annex C, Paragraph 1, letter b), Argentina has already presented its arguments concerning the obligations imposed on the competent bodies by the stipulation “that the competent body promptly examines the completeness of the documentation,” “... the competent body transmits as soon as possible the results of the procedure in a precise and complete manner to the applicant ...” and “upon request, the applicant is informed of the stage of the procedure, with any delay being explained.” In other words, the competent body must perform its obligations “promptly” and must also explain “any delays.” The EC has not been able to ensure compliance with these terms by the competent bodies, because in some cases the body did not promptly determine whether the documentation was complete, and in other cases did not inform the applicant of the results of the procedure or of the current stage of the procedure. This paragraph of Annex C also requires that if the application contains deficiencies, the competent body must proceed as far as practicable with the procedure if the applicant so requests. 325. For its part, Paragraph 1, letter c) concretely limits information requirements to what is necessary for appropriate control, inspection and approval procedures, and in that sense, the conduct of the EC in delaying the examination of the applications submitted or in requiring successive submissions under the terms of subsequent legislation is in violation of the provisions of this paragraph. 326. Paragraph 1, letter e) establishes the obligation to ensure that the requirements for control, inspection and approval of individual specimens of a product are limited to what is “reasonable and necessary”. In this regard, the detailed Community requirements provided by Directive 2001/18/EC (and its predecessor Directive 90/220/EEC) and Regulation (EC) 258/97 do not seem to meet the criteria of “reasonableness and necessity” established by the SPS. Moreover, the legislation stipulates deadlines, as noted above, which have not been met by the EC’s own bodies in practice. The EC has failed to act, i.e. the Community’s own bodies have not exercised the

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 103 authority granted to them by the legislative framework, and said failure cannot be deemed reasonable or necessary. Furthermore, when the EC pursued its policy of replacing Directive 90/220/EEC with its successor 2001/18/EC, and even when the latter Directive was in force, no consideration was given to the new applications that were submitted, nor were the applications that had already been submitted approved. And in that regard, the EC is unable to present any arguments in support of its own attitude. In this case, moreover, the application of the EC’s control, inspection and approval procedures as they have been applied since 1998 does not meet the requirement of a limitation to what is reasonable and necessary for the control, inspection and approval of a product. 327. In conclusion, in Argentina’s opinion, the EC has imposed an “undue delay” by failing to comply with the provisions of Annex C and Article 8 of the SPS Agreement. 328. The following section includes a description of the status of the applications for approval of each of the biotech agricultural products of particular interest to Argentina. This description will indicate, specifically for each product, the undue delay that has been caused by the EC in the implementation of the control and approval procedures stipulated in Directive 2001/18/EC (and its predecessor Directive 90/220/EEC) and Regulation (EC) 258/97. c.- Status of the biotech products of particular interest to Argentina: Inconsistencies in the application of Community legislation in light of the provisions of Article 8 and Annex C:1(a), (b), (c) and (e) of the SPS Agreement i) GA 21 Maize Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion 329. The application for approval was first submitted under Directive 90/220/EEC, and was then resubmitted for the procedure stipulated by


Directive 2001/18/EC. The application was also submitted under Regulation (EC) 258/97. A.- On November 6, 1997, an application for approval was submitted to Great Britain in the context of Directive 90/220/EEC. The application was withdrawn in March 2001. Under Directive 90/220/EEC, the application was submitted to the appropriate body in Great Britain on November 6, 1997, and the procedure was abandoned on March 29, 2001, so the procedure had taken 3 years and 5 months without a definitive decision on its approval. 161 B.- On July 13, 1998, the definitive notification under Directive 90/220/EEC was submitted to the competent body in Spain. With regard to the application for approval submitted to Spain under Directive 90/220/EEC, the procedure followed the standard route until September 22, 2000, when the Scientific Committee on Plants issued an opinion indicating that, on the basis of the study it had conducted, there was no evidence to indicate that placing modified maize line GA21 (with glyphosate tolerance) on the market would have adverse affects on human health or the environment. Under Directive 90/220/EEC, the definitive notification was submitted to the competent body in Spain on July 13, 1998, and the procedure was suspended on September 22, 2000. Two years and two months had elapsed between the submission of the application and its suspension. 162 Because Directive 2001/18/EC replaced Directive 90/220/EEC, the cases that were pending on the date the new directive entered into force had to be resubmitted under the procedure stipulated by the new directive (Article 35 of Directive 2001/18/EC). On January 15, 2002, the requester submitted additional information and the approval process has not made any progress since then. One year and eight months elapsed from the initial application

161 See C/GB/97/M3/2. 162 See C/ES/98/01.


until September 2003, when the application was withdrawn. In total, counting the time that elapsed under Directives 90/220/EEC and 2001/18/EC, the procedure dragged on for 5 years and 2 months without a definitive response concerning approval. With regard to the scientific basis, in the case of the application filed under Directives 2001/18/EC and its predecessor Directive 90/220/EEC with the appropriate body in Spain, on September 22, 2000, the Scientific Committee on Plants said that:

“The Committee, after examining the information and data provided in the dossier and using available background knowledge underpinning the areas concerned, considers that there is no evidence to indicate that the placing on the market of the modified maize line GA21 with tolerance to glyphosate herbicide is likely to cause any adverse effects on human health and the environment”.163

C.- On July 24, 1998, an application was submitted to the appropriate body in the Netherlands under Regulation (EC) 258/97. Since February 27, 2002, the date on which the Scientific Committee on Foods expressed its favorable opinion on the safety of GA21164, there has been no further progress in the approval process. The application was withdrawn in September 2003. The application under Regulation (EC) 258/97 was submitted on July 24, 1998, and was withdrawn in September 2003, because no progress had been made by February 27, 2002, which means that the process took 3 years and 8 months, having dragged on for a total of 5 years and 2 months since its initial submission without a definitive response to the application for approval .

163 Opinion of the Scientific Committee on Plants on the Submission for placing on the market of genetically modified maize (zea mays) with tolerance to glyphosate herbicide notified by Monsanto- Notification C/ES/98/01. Opinion adopted by the Scientific Committee on Plants SCP/GMO/232-Final 22/09/2000. See Annex ARG-41. 164 See Opinion of the Scientific Committee on Food on the safety assessment of the genetically modified maize line GL21 with tolerance to the herbicide glyophosphate, in Annex ARG-42.


ii) RR 1445 Cotton Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion 330. On June 30, 1997, the initial submission requesting approval of RR 1445 cotton was submitted under Directive 90/220/EEC to the competent body in Spain. On July 14, 1998, the Scientific Committee on Plants issued a favorable opinion on the request submitted. The Commission presented draft measures to the Regulatory Committee, which rejected said measures without any supporting written opinion on February 11, 1999. Since then, the procedure under Directive 90/220/EEC has been stalled, because the Commission refused to submit the draft measure to the Council of Ministers. 165 The procedure under Directive 2001/18/EC was initiated on January 16, 2003, although the application has not progressed since that date, which means that it has been inactive for 1 year and 3 months as of April 2004. The total time consumed by the procedures under Directives 90/220/EEC and 2001/18/EC has been 6 years and 9 months. With regard to the scientific assessment under Directives 2001/18/EC and 90/220/EEC, on July 14, 1998, the Scientific Committee on Plants issued a favorable opinion on placing genetically modified cotton RR 1445, with tolerance to glyphosate herbicide, on the market, stating that:

“The Committee, after examining and considering the existing information and data provided in the dossier, against the background of available knowledge in the areas concerned, considers that there is no evidence to indicate that the placing on the market of line RRC 1445 (expressing the CP4 EPSPS ENZYME) with the purpose to be used as

165 C/ES/97/01.


any other cotton is likely to pose adverse effects on human health and the environment”166

iii) Bt-531 Cotton Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion 331. On December 3, 1996, the initial application for the approval of Bt-531 cotton was submitted to the competent body in Spain under Directive 90/220/EEC. On July 14, 1998, the Scientific Committee on Plants issued a favorable opinion on the request submitted. The Commission presented draft measures to the Regulatory Committee, which rejected said measures without any supporting written opinion on February 11, 1999. Since then, the procedure under Directive 90/220/EEC has been stalled, because the Commission refused to submit the draft measure to the Council of Ministers. 167 The procedure under Directive 2001/18/EC was initiated on January 16, 2003, although the request has not progressed since that date, which means that it has been inactive for 1 year and 3 months as of April 2004. The total time consumed by the procedures under Directives 90/220/EEC and 2001/18/EC as of April 2004 has been 7 years and 4 months. With regard to the scientific assessment under Directives 2001/18/EC and 90/220/EEC, on July 14, 1998, the Scientific Committee on Plants issued a favorable opinion on placing insect-tolerant genetically modified Bt-531 cotton on the market, stating that:

166 Opinion of the Scientific Committee on Plants on the Submission for placing on the market of the genetically modified cotton tolerant to glyphosate herbicide notified by the Monsanto Company (Notification C/ES/97/01) (Opinion expressed by the SCP on 14 July 1998). See Annex ARG-23. 167 C/ES/96/02.


“The Committee, after examining and considering the existing information and data provided in the dossier, against the background of available knowledge in the areas concerned, considers that there is no evidence to indicate that the placing on the market of line IPC 531 (expressing a B.t.K. toxin) with the purpose to be used as any other cotton is likely to pose adverse effects on human health and the environment”168

iv) NK 603 Maize Procedure under which an application for approval was submitted. Status of the application and delay in processing. Scientific basis and favorable opinion 332. A.- The dossier (for importation and use, excluding cultivation) was initially submitted on August 4, 2000, to the competent body in Spain under the terms of Directive 90/220/EEC. Said application was once again submitted under Directive 2001/18/EC on August 29, 2002. 169 With regard to the request for importation and use (Directives 90/220/EEC and 2001/18/EC), the GMO Panel issued a favorable opinion on November 25, 2003:

“Having considered the evidence, the GMO Panel is of the opinion that NK603 maize is as safe as conventional maize and therefore the placing on the market of NK603 maize for food or feed or processing is unlikely to have an adverse effect on human and animal health and, in that context, the

168 Opinion of the Scientific Committee on Plants on the Submission for placing on the market of the genetically modified cotton insect-tolerant notified by the Monsanto Company (Notification C/ES/96/02) (Opinion expressed by the SCP on 14 July 1998). See Annex ARG-21. 169 C/ES/00/01.


environment.”170 With respect to the procedures required under Directives 90/220/EEC and 2001/18/EC (for importation and use), the procedure was initiated on August 4, 2000, and is still pending, which means that 3 years and 8 months have elapsed as of April 2004, without a final decision on the application for approval. B.- The initial submission (for importation, use and cultivation) under Directive 2001/18/EC was made to the competent body in Spain on January 31, 2003171. With regard to the application for approval under Directive 2001/18/EC (for cultivation), on July 24, 2003, the competent body requested additional information from the requester, which was submitted by the latter on February 11, 2004. No further progress has been made on the application. With respect to the procedures required under Directive 2001/18/EC (for cultivation), the procedure was initiated on January 31, 2003, and is still pending, which means that 1 year and 3 months have elapsed as of April 2004, without a final decision on the request for approval. C.- The application for approval under Regulation (CE) 258/97 was submitted to the competent body in the Netherlands on April 24, 2001. The Scientific Panel on Genetically Modified Organisms issued a favorable opinion as required under Regulation (EC) 258/97 on November 25, 2003. With respect to the delay, under Regulation (EC) 258/97 the procedure was initiated on April 24, 2001, and is still pending, which means that 3 years have elapsed as of April 2004, without a final decision on the application for approval.

170 Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the Notification (Reference CE/ES/00/01) for the placing on the market of herbicide- tolerant genetically modified maize NK603, for import and processing, under Part C of Directive 2001/18 from Monsanto (Question No. EFSA-Q-2003-003). See Annex ARG-25. 171 C/ES/03/01.


With regard to the scientific assessment of the submission under Regulation (EC) 258/97, the Scientific Panel on Genetically Modified Organisms issued a favorable opinion on its approval on November 25, 2003, and said that:

“Having considered the evidence, the GMO Panel is of the opinion that NK603 maize is as safe as conventional maize and therefore the placing on the market of NK603 maize for food or feed or processing is unlikely to have an adverse effect on human and animal health and, in that context, the environment.”172

v) Soy Lines A 2704-12 and A 5547-127 Procedure under which an application for approval was submitted. Status of the request and delay in processing. 333. A.- The application was submitted to the competent body in Belgium under Directive 90/220/EEC on October 13, 1998. The above-referenced application was re-submitted to the competent body in Belgium under Directive 2001/18/EC in January 2003.173 With regard to the application submitted under Directives 90/220/EEC and subsequently under 2001/18/EC, 5 years and 8 months have elapsed -as of April 2004- without a final decision on its approval. B.- The application was submitted to the competent body in Belgium under Regulation (EC) 258/97 on October 13, 1998.

172 Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the safety of foods and food ingredients derived from herbicide- tolerant genetically modified maize NK603, for which a request for placing on the market was submitted under Article 4 of the Novel Food Regulation (EC) No 258/97 by Monsanto (Question No. EFSA-Q-2003-002). See Annexes ARG-25 and ARG-26. 173 C/BE/98/01

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 111 Five years and eight months have elapsed -as of April 2004- since the application was submitted under Regulation (EC) 258/97, without a final decision on its approval. CONCLUSION REGARDING THE INCONSISTENCY OF THE “UNDUE DELAY” WITH THE SPS AGREEMENT 334. On the grounds set forth above, Argentina claims that the “undue delay” on the part of the EC in each of the respective approval procedures for biotech agricultural products of particular interest to Argentina is inconsistent with the SPS Agreement, and in particular with Article 8 and Annex C: 1:a), b), c) and e). III.- INCONSISTENCY WITH THE GATT 1994 335. In the following sections, Argentina will present its claims of inconsistencies with the GATT 1994. To this end, Argentina will examine the inconsistency of the “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina.” THE “SUSPENSION OF PROCESSING AND THE FAILURE TO CONSIDER INDIVIDUAL REQUESTS FOR APPROVAL OF DETERMINED AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” IS INCONSISTENT WITH THE GATT 1994 Incompatibility with Article III:4 of GATT 1994 336. Article III of GATT 1994 (National Treatment on Internal Taxation and Regulation) stipulates in its Paragraph 4:

“The products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favourable than that


accorded to like products of national origin in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use.. (...)”

337. The “suspension of processing and the failure to consider individual applications for the approval of determined biotech agricultural products of particular interest to Argentina” is inconsistent with Article III:4 of GATT 1994, because it gives less favorable treatment to biotech agricultural products than to “non-biotech” agricultural products. Said incompatibility results from the fact that the situation meets the requirements indicated by the Appellate Body in finding a violation of Article III:4 of the GATT 1994:

“For a violation of Article III:4 to be established, three elements must be satisfied: that the imported and domestic products at issue are «like products»; that the measure at issue is a «law, regulation, or requirement affecting their internal sale, offering for sale, purchase, transportation, distribution, or use»; and that the imported products are accorded «less favourable» treatment than that accorded to like domestic products. (...)”174

338. In this regard, Argentina considers that: a) the products are “like products” within the meaning of Paragraph 4 of Article III of GATT 1994; b) “suspension of processing and the failure to consider individual applications for the approval of determined biotech agricultural products of particular interest to Argentina” are “requirements” that affect “the sale, offering for sale, purchase, transportation, distribution or use of these products in the internal market”, and c) the according of “less favorable treatment”.

174 Appellate Body Report in Korea – measures affecting imports of fresh, chilled and frozen beef, WT/DS161/AB/R, WT/DS169/AB/R, Paragraph 133 (hereinafter Korea-Beef).

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 113 a.- “Like products” in the framework of Article III:4 of the GATT 1994 339. When analyzing the issue of similarity, it is first necessary to understand that “like” does not mean “identical.” That is that, for a product to be similar, it need not have each and every one of another [product’s] characteristics. 340. Analysis of the GATT/WTO regulations shows that this reading is correct. In European Communities - Measures Affecting Asbestos and Asbestos-Containing Products, the Appellate Body set forth:

“This meaning suggests that “like” products are products that share a number of identical or similar characteristics or qualities. The reference to ‘similar’ as a synonym of ‘like’ also echoes the language of the French version of Article III:4, ‘produits similaires’ and the Spanish version, ‘productos similares,’ which, together with the English version, are equally authentic.62” 62 WTO agreement, final, authenticating clause. See, also, Article 33(1) of the Vienna Convention of the Law of Treaties, done at Vienna, 23 May 1969, 1155 U.N.T.S. 331 [1155 U.N.T.S. 443 for the Spanish text cited in the Spanish document]; 8 International Legal Materials 679. (underlining added to indicate words in italics in the original) 175

341. Indeed, the texts in French and Spanish (also official languages of the WTO) refer to “like product[s]” as “produits similaires” and “productos similares,” respectively. This clearly shows that two products need not be absolutely identical to be classified as “like.” Moreover, if the drafters of the Agreements had intended to require that products be identical in order to determine likeness, they would have used different terminology. 342. This criterion is reinforced by the Appellate Body’s determination that the expression “like products” in Article III:4 has “a relatively broad product

175Appellate Body Report, European Communities - Measures Affecting Asbestos and Asbestos-Containing Products, WT/DS135/AB/R, paragraph 91 (hereinafter CE-Asbestos).

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 114 scope.”176 Similarly, the Appellate Body affirmed that “a determination of similarity in the framework of this paragraph (Article III:4) is fundamentally a determination of the nature and scope of the competitive relationship between two or more products.”177 343. Moreover, similarity must be determined on a case-by-case basis, using four general criteria pursuant to the provisions of GATT/WTO jurisprudence:178:

“(...) The Report of the Working Party on Border Tax Adjustments outlined an approach for analyzing “likeness” that has been followed and developed since by several panels and the Appellate Body.73 This approach has, in the main, consisted of employing four general criteria in analyzing ‘likeness’: (i) the properties, nature and quality of the products; (ii) the end-uses of the products; (iii) consumers’ tastes and habits - more comprehensively termed consumers’ perceptions and behaviour - in respect of the products; and (iv) the tariff classification of the products.74 We note that these four criteria comprise four categories of ‘characteristics’ that the products involved might share: (i) the physical properties of the products; (ii) the extent to which the products are capable of serving the same or similar end-uses; (iii) the extent to which consumers perceive and treat the products as alternative means of performing particular functions in order to satisfy a particular want or demand; and (iv) the international classification of the

176 Appellate Body Report, EC-Asbestos, WT/DS135/AB/R, paragraph 100:

“We recognize that, by interpreting the term “like products” in article III:4 in this way, we give that provision a relatively broad product scope (...)”

177 Appellate Body Report, EC-Asbestos, WT/DS135/AB/R, paragraph 99:

“Thus, a determination of "likeness" under Article III:4 is, fundamentally, a determination about the nature and extent of a competitive relationship between and among products. (...).”

178 Appellate Body Report in EC-Asbestos, WT/DS135/AB/R, paragraph 101.


products for tariff purposes. 73 See, further, Appellate Body Report, Japan - Alcoholic Beverages, supra, footnote 58, at 113 [136 for the Spanish text cited in the Spanish document] and, in particular, footnote 46. See, also, Panel Report, United States - Gasoline, supra, footnote 15, para. 6.8, where the approach set forth in the Border Tax Adjustment case was adopted in a dispute concerning Article III:4 of the GATT 1994 by a panel. This point was not appealed in that case. 74 The fourth criterion, tariff classification, was not mentioned by the Working Party on Border Tax Adjustments, but was included by subsequent panels (see, for instance, EEC - Animal Feed, supra, footnote 58, para. 4.2, and 1987 Japan - Alcoholic Beverages, supra, footnote 58, para. 5.6). (...)” (underlining added to indicate words in italics in the original)

344. Therefore, Argentina indicates four criteria to be examined: i) the physical properties of the products; ii) the extent to which the products may have the same or similar end-uses; iii) the extent to which consumers perceive and use the products as potentially different ways of fulfilling particular functions in order to satisfy a particular need or demand; and iv) the international tariff classification of the products. 345. The Appellate Body also affirmed that each of the criteria must be analyzed, and that it would be inappropriate to reach a finding based on only one of them.179

“(…) It is our view that, having adopted an approach based on the four criteria set forth in Border Tax Adjustments, the Panel should have examined the evidence relating to each of those four criteria and, then, weighed all of that evidence, along with any other relevant evidence, in making an overall

179 Appellate Body Report, EC-Asbestos, WT/DS135/AB/R, paragraph 109.


determination of whether the products at issue could be characterized as ‘like’ (…)” (underlining added to indicate words in italics in the original)

i) Physical properties of imported biotech products and “non-biotech” domestic products 346. With regard of the properties of the product, the Appellate Body has set forth that the product’s potential health risks may be a defining aspect of that product’s properties.180 347. The purpose of the approval procedures in EC regulations is to provide protection from health and environmental risks. Therefore, EC regulations have established an approval procedure to identify and evaluate the potential risks posed by biotech agricultural products. Given that (pursuant to EC regulations) the evaluation is carried out on a “case by case” basis, the question of whether a “particular” product does or does not pose risks must be answered. 348. It can therefore be deduced that once the risks have been evaluated scientifically, and it has been proven that the product does not pose any risk that is different from [that posed by] its “non-biotech” counterparts, there is no basis for considering that biotech agricultural product to be different from its “non-biotech” counterpart. 349. In the case of each of the biotech agricultural products of particular interest to Argentina, a risk assessment has determined that the risks presented by these products are no different than those of their “non-biotech” counterparts181. It has therefore been shown that, from the point of view of their physical properties, the biotech products of particular interest to Argentina are no different than their “non-biotech” counterparts.

180 EC-Asbestos, Appellate Body, paragraph 114. 181 In this respect, reference is made to the arguments concerning like risk set forth in Point B.3, with the relative scientific opinions in Annexes ARG-41, ARG-42, ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26, ARG-27.


ii) End-Use 350. Both biotech products and their counterpart “non-biotech” products have similar end-uses, as has been determined by the EC's Scientific Committees. Indeed, when the scientific committees were asked to evaluate the respective biotech agricultural products, they were required to submit an opinion regarding the intended use of these products.182 The resulting

182 See Annex ARG-31: Opinion of the Scientific Committee on Plants regarding “submission for placing on the market of glufosinate tolerant maize (Zea mays) transformation event T25,” SCP/GMO/299-Final, September 5, 2001, point 2 “Terms of reference”:

“The Scientific Committee on Plants was asked to consider whether there is any reason to believe that the placing on the market of the T25 genetically modified maize with the purpose to be used as any other maize, is likely to cause any adverse effects on human health and the environment.”

Note that T25 maize has been approved by the EC. See Annex ARG-33: Opinion of the Scientific Committee on Plants on the submission for placing on the market of genetically modified insect resistant and glufosinate ammonium tolerant (Bt-11) maize for cultivation. Notified by Novartis Seeds SA Company (notification C/F/96/05-10) (opinion adopted by the Scientific Committee on Plants on November 30, 2000), point 2 “Terms of reference”:

“The Scientific committee on Plants is asked to consider if the cultivation of this line of genetically modified maize within the European Community, and every variety derived by sexual reproduction with this line, is likely to cause any adverse effects on human health and the environment.”

Note that Bt 11 maize was approved by the EC as well. See also Annex ARG-21: Opinion of the Scientific Committee on Plants on the genetically modified cotton line, insect-tolerant notified by the Monsanto company (notification C/ES/96/02) (Opinion expressed by SCP on July 14, 1998), point 2 “Terms of reference”:

“The Scientific Committee on Plants (...) is asked to consider whether there is any reason to believe that the production and marketing of varieties of seed from IPC 531 cotton line (...) is likely to cause any adverse effects on human health and on the environment.”

Note that Bt 531 cotton is affected by the “suspension of processing and failure to consider the individual applications for the approval of determined biotech agricultural products of particular interest to Argentina.”. See also in Annex ARG-23: Opinion of the Scientific Committee on Plants regarding the genetically modified cotton, tolerant to glyphosate herbicide notified by the Monsanto Company (notification C/ES/97/01) (Opinion expressed by the SCP on July 14, 1998), point 2 “Terms of reference”:

“The Scientific Committee on Plants (...) is asked to consider whether there is any


opinions confirmed that the end-use [of biotech agricultural products] could be the same as that accorded to “non-biotech products.183

reason to believe that production and marketing of varieties of Roundup Ready Cotton line RRC 1445 (...) is likely to cause any adverse effects on human health and on the environment.”

Note that RRC 1445 cotton is affected by the “suspension of processing and failure to consider the individual applications for the approval of determined biotech agricultural products of particular interest to Argentina.”. See also Annex ARG-25: Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the Notification (Reference CE/ES/00/01) for the placing on the market of herbicide-tolerant genetically modified maize NK 603, for import and processing, under part C of Directive 2001/18 from Monsanto (Question No EFSA-Q-2003-003), Opinion adopted on November 25, 2003, in the point entitled “Terms of reference”:

“(...) EFSA is therefore required (...) to provide a scientific opinion (...) as to whether there is any scientific reason to believe that the placing on the market of the NK603 maize, for import and processing, is likely to cause any adverse effects on human health and the environment (...).”

For NK 603 maize see also Annex ARG-27: Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the safety of foods and food ingredients derived from herbicide-tolerant genetically modified maize NK 603, for which a request for placing on the market was submitted under Article 4 of the Novel Food Regulation (EC) No 258/97 by Monsanto (Question No EFSA-Q-2003-002), Opinion adopted on November 25, 2003, in the point entitled “Terms of reference”:

“(...) the European Commission requests the European Food Safety Authority to issue a scientific opinion on the use of glyphosinate-tolerant genetically modified (GM) maize NK603 or products derived from it as foods or food ingredients (...) EFSA is asked to specify whether the authorisation of foods and food ingredients derived from NK603 is likely to have an effect on public health.”

Note that NK 603 maize is affected by the “suspension of processing and failure to consider the individual applications for the approval of determined biotech agricultural products of particular interest to Argentina.”. 183 See Exhibit ARG-31: Opinion of the Scientific Committee on Plants regarding “submission for placing on the market of glufosinate tolerant maize (Zea mays) transformation event T25”, SCP/GMO/299-Final, September 5, 2001, point 4 “Proposed uses”:

“... The genetically modified maize plant is proposed to be used as any other maize.” Confirmed in point 7 “Overall assessment”:

“(...) The Committee after examining and considering the existing information and data provided in the dossier, against the background of available knowledge in the areas concerned, considers that there is no evidence to indicate that the use of the genetically modified maize as any other maize, is likely to cause adverse effects on human or animal health and the environment.”

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 119 Note that T25 maize has been approved by the EC. See Annex ARG-32: Opinion of the Scientific Committee on Food on a request to place genetically modified sweet maize line Bt11 on the market, SCF/CS/NF/DOS/14 ADD2 Final, May 6, 2002, point 3.3.1 “Proposed uses”:

“Sweet maize is grown exclusively for human consumption although processing by-products are used as animal feedstuffs. (...).”

Confirmed in point 4 “Conclusions”:

“On the basis of the information supplied in the application and further material supplied by the applicant in response to queries raised by Member States and in the light of the published literature, the Committee concludes that Bt11 sweet maize is as safe for human food use as its conventional counterparts.”

For Bt11 maize see also Annex ARG-33: Opinion of the Scientific Committee on Plants on the submission for placing on the market of genetically modified insect resistant and glufosinate ammonium tolerant (Bt-11) maize for cultivation. Notified by Novartis Seeds SA Company (notification C/F/96/05-10) (opinion adopted by the Scientific Committee on Plants on November 30, 2000), point 4.1 “Proposed uses”:

“The application is for the cultivation and marketing of genetically modified [sic] maize seed for all types of use (processing, food and feed production) like any other variety of conventional maize. (...)”

Confirmed in point 4.6 “Conclusion (overall assessment)”:

“(...) The Committee is of the opinion that there is no evidence to indicate that the placing on the market for cultivation purposes of maize line Bt-11 and varieties derived from this line by conventional crosses between Bt-11 line and maize lines other than genetically modified ones, is likely to cause adverse effects on human health and the environment. (...)”

Note that Bt11 maize was also approved by the EC. See also Annex ARG-21: Opinion of the Scientific Committee on Plants on the genetically modified cotton line, insect-tolerant notified by the Monsanto company (notification C/ES/96/02) (Opinion expressed by SCP on July 14, 1998), point 4 “Proposed uses”:

“Seeds shall be imported, planted, grown harvested, and processed to non-viable products. Cottonseed from insect-protected cotton will be utilised in the same manner as other cottonseed products from cotton varieties produced or imported to the European Union (EU).”

Confirmed in point 7 “Overall assessment and conclusion”:

“1. The Committee, after examining and considering the existing information and data provided in the dossier, against the background of available knowledge in the areas concerned, considers that there is no evidence to indicate that the placing on the market of line IPC 531 (expressing B.t.k. toxin) with the purpose to be used as any other cotton is likely to cause adverse effects on human health and on the environment. (...)”

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 120 For Bt531 cotton, see also Annex ARG-22: Advisory Committee on Novel Foods and Processes, Request for an Article 5 opinion on the substantial equivalence of cottonseed oil and food ingredients derived from insect protected cottonseed, in the point entitled “Conclusion”:

“33. The Committee is therefore of the opinion that oil derived from insect protected cottonseed line IPC 531 is substantially equivalent to oil from conventional cottonseed lines, in terms of composition, nutritional value, metabolism, intended use and level of undesirable substances.”

Note that Bt 531 cotton is affected by the “suspension of processing and failure to consider the individual applications for the approval of determined biotech agricultural products of particular interest to Argentina.”. See also Annex ARG-23: Opinion of the Scientific Committee on Plants regarding the genetically modified cotton, tolerant to glyphosate herbicide notified by the Monsanto Compan[y] (notification C/ES/97/01) (Opinion expressed by the SCP on July 14, 1998), point 4 “Proposed uses”:

“Seeds shall be imported, planted, grown, harvested, and processed to non-viable products. Cottonseed from glyphosinate-tolerant cotton will be utilised in the same manner as other cottonseed products from cotton varieties produced or imported into the European Union (EU).”

Confirmed in point 7 “Overall assessment and conclusion”:

“(...) The Committee, after examining and considering the existing information and data provided in the dossier, against the background of available knowledge in the areas concerned, considers that there is no evidence to indicate that the placing on the market of line RRC 1445 (...) with the purpose to be used as any other cotton is likely to cause adverse effects on human health and the environment. (...)”

For RRC 1445 cotton see also Annex ARG-24: Advisory Committee on Novel Foods and Processes, Request for an Article 5 opinion on the substantial equivalence of cottonseed oil and food ingredients derived from roundup ready cotton, in the point entitled “Conclusion”:

“35. The Committee is therefore of the opinion that oil derived from herbicide tolerant cottonseed line RR[C] 1445 is substantially equivalent to oil from conventional cottonseed lines, in terms of composition, nutritional value, metabolism, intended use and level of undesirable substances.”

Note that RRC 1445 cotton is affected by the “suspension of processing and failure to consider the individual applications for the approval of determined biotech agricultural products of particular interest to Argentina.” See also Annex ARG-25: Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the Notification (Reference CE/ES/00/01) for the placing on the market of herbicide-tolerant genetically modified maize NK 603, for import and processing, under part C of Directive 2001/18 from Monsanto (Question No EFSA-Q-2003-003), Opinion adopted on November 25, 2003, in the point entitled “Conclusions”:

“(...) Having considered the evidence, the GMO Panel is of the opinion that NK603 maize is as safe as conventional maize and therefore the placing on the market of

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 121 iii) Consumer Perceptions 351. With respect to this criterion, there is no proof of a negative consumer perception by which there is a distinction between “non-biotech” bred products and biotech products and that could negatively affect the latter. 352. However, it must be noted that GATT/WTO jurisprudence has dealt with this matter, indicating that:

“(...) we decline to take a static view of the term ‘directly competitive or substitutable.’ The object and purpose of Article III confirms that the scope of the term ‘directly competitive or substitutable’ cannot be limited to situations where consumers already regard products as alternatives. If reliance could be placed only on current instances of substitution, the object and purpose of Article III:2 could be defeated by the protective taxation that the provision aims to prohibit. Past panels have, in fact, acknowledged that consumer behaviour might be influenced, in particular, by protectionist internal taxation. Citing the panel in Japan - Customs Duties, Taxes and Labeling Practices on Imported Wines and Alcoholic Beverages (‘1987 Japan - Alcohol’),99

NK603 maize for food or feed or processing is unlikely to have an adverse effect on human and animal health and, in that context, the environment.”

For NK 603 maize, see also Annex ARG-27: Opinion of the Scientific Panel on Genetically Modified Organisms on a request from the Commission related to the safety of foods and food ingredients derived from herbicide-tolerant genetically modified maize NK 603, for which a request for placing on the market was submitted under Article 4 of the Novel Food Regulation (EC) No 258/97 by Monsanto (Question No EFSA-Q-2003-002), Opinion adopted on November 25, 2003, in the point entitled “Conclusions”:

“(...) Having considered the evidence, the GMO Panel is of the opinion that NK603 maize is as safe as conventional maize and therefore the placing on the market of NK603 maize for food or feed or processing is unlikely to have an adverse effect on human and animal health and, in that context, the environment use.”

Noted that NK 603 maize is affected by the “suspension of processing and failure to consider the individual applications for the approval of determined biotech agricultural products of particular interest to Argentina.”.


the panel in Japan - Alcoholic Beverages observed that ‘a tax system that discriminates against imports has the consequence of creating and even freezing preferences for domestic goods.’100 The panel in Japan - Alcoholic Beverages also stated that ‘consumer surveys in a country with & a [protective] tax system would likely understate the degree of potential competitiveness between substitutable products.’ 101 (...).Accordingly, in some cases, it may be highly relevant to examine latent demand. 99 Japan - Customs Duties, Taxes and Labeling Practices on Imported Wines and Alcoholic Beverages, adopted 10 November 1987, BISD 34S/83 [BISD 34S/94 for the Spanish text cited in the Spanish document]. The panel in Japan - Alcoholic Beverages, supra, footnote 16, cited para. 5.9 of this panel report. 100 Panel Report, Japan - Alcoholic Beverages, supra, note 16, para. 6.28. This passage was expressly approved by the Appellate Body in its Report in this case (p. 25). [p. 30 for the Spanish text cited in the Spanish document] 101 Ibid. (...)”184 (underlining added to indicate words in italics in the original)

353. On this occasion the Appellate Body, in citing another dispute, was addressing the matter of “potential competition” and within the framework of Article III:2 of the GATT 1994. However, we cannot overlook the fact that the subject is directly linked to the potential influence of government measures on consumer perception. That is, the encouragement -through government action- of a negative consumer perception regarding certain products. 354. Similarly, in the case Korea - Alcoholic Beverages, the Appellate Body affirmed: 184 Appellate Body Report, Korea - Taxes on Alcoholic Beverages, WT/DS75/AB/R, WT/DS84/AB/R, paragraph 120 (hereinafter Korea-Alcoholic Beverages).


“(...) It is also true that consumer responsiveness to products may vary from country to country.123 This does not, however, preclude consideration of consumer behaviour in a country other than the one at issue. It seems to us that evidence from other markets may be pertinent to the examination of the market at issue, particularly when demand on that market has been influenced by regulatory barriers to trade or to competition. (...) 123 Panel Report, Japan – Alcoholic Beverages, supra, note 16, para. 6.28, with reference to Working Party Report on ‘Border Tax Adjustments,’ L/3464, adopted 2 December 1970, BISD 18S/97 [BISD 18S/106 for the Spanish text cited in the Spanish document], p. 102, para 18, affirmed by the Appellate Body Report Japan – Alcoholic Beverages, supra, footnote 20, p. 25 [p. 30 for the Spanish text cited in the Spanish document]. (...)”185 (underlining added to indicate words in italics in the original)

355. In the EC market, the “de facto” moratorium and the “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” have had the effect of obstacles to trade and competition. These types of measures can induce or lead to consumer error, and create utterly baseless preferences for and attitudes toward certain products. Because they are baseless -scientifically, in this case- these measures could only create a negative image in the mind of the consumer. That, of course, would occur if a negative and, moreover, uniform image existed in the [mind of] the European consumer, which Argentina considers not to be the case. 356. Similarly, the Panel found in European Communities - Trade Description of Sardines:

“The European Communities acknowledged that it is the Regulation which in certain member States ‘created’ the consumer expectations which it now considers require the

185 Appellate Body Report, Korea-Alcoholic Beverages, WT/DS75/AB/R, WT/DS84/AB/R, paragraph 137.


maintenance of that same Regulation. Thus, through regulatory intervention, the European Communities consciously would have ‘created’ consumer expectations which now are claimed to affect the competitive conditions of imports. If we were to accept that a WTO Member can ‘create’ consumer expectations and thereafter find justification for the trade-restrictive measure which created those consumer expectations, we would be endorsing the permissibility of ‘self-justifying’ regulatory trade barriers. Indeed, the danger is that Members, by shaping consumer expectations through regulatory intervention in the market, would be able to justify thereafter the legitimacy of that very same regulatory intervention on the basis of the governmentally created consumer expectations. (...)”186

357. Moreover, it is Argentina’s hypothesis that if we were to accept that European consumers feel a certain reluctance toward biotech products, this can only be attributed to the attitude of the EC authorities themselves, through their systematic refusal (since 1998) to approve biotech agricultural products, despite these products having received a favorable opinion from the respective EC Scientific Committees.187 iv) Tariff classification 358. There is no difference in tariff classification between biotech products and their “non-biotech” counterparts. The EC itself uses the same

186 Panel Report, European Communities - Trade Description of Sardines, WT/DS231/R, paragraph 7.127 (hereinafter CE-Sardines). 187 In this regard, it is important to note the following: “Independent Scientific Advice One of the most important means the European Union uses to create policies relating to foodstuffs is the reliance on independent scientific advice. If the Union is to take the appropriate decisions to protect public health, the advice has to be from the best experts in the field. It must also be totally impartial and free from political interference. To provide this advice, the EU has appointed nine scientific committees made up of 131 leading experts in a range of relevant fields to provide advice on all questions relating to food safety and animal and plant health.” Source: Healthy food for Europe’s citizens. The European Union and food quality (Luxembourg: Office for Official Publications of the European Communities, 2000), p. 12


nomenclature for maize,188 soy189 and cotton,190 in the Integrated Tariff of the Community (TARIC [French Acronym]), regardless of whether it is applied to a biotech product or not. 359. In the foregoing, Argentina has shown that biotech and “non-biotech” agricultural products share the four criteria established by GATT/WTO jurisprudence for being considered “like products” pursuant to article III:4 of the GATT 1994. b.- The “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” are “requirements” affecting “the sale, offering for sale, purchase, transport, distribution and use of products on the domestic market” 360. The “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” are requirements pursuant to Article III:4 of the GATT 1994. A government action that imposes no legal obligation may be considered a requirement under the terms of this regulation:

“An ordinary meaning of the term ‘requirement,’ as

188 See Integrated Tariff of the Community (TARIC), Section II (“Vegetable Products”), chapter 10 (“Cereals”) or chapter 14 (“Vegetable Plaiting Materials; Vegetable Products Not Elsewhere Specified or Included”). Note that the same tariff nomenclature is used for biotech agricultural products as for their “non-biotech” counterparts: - “non-biotech” Maize, “GA-21” Maize, “T-14” Maize, and “NK-603” Maize are classified under nomenclature 1005.90.10 - “non-biotech” Soy, and “A2704-12” and “A5547-127” Soy are classified under nomenclature 1201.00.90 - “non-biotech” Cotton, “Bt-531” Cotton and “RR 1445” Cotton are classified under nomenclature 5201.00.20 189 Ibid. 190 See Integrated Tariff of the Community (TARIC), Section XI (“Textiles and Textile Articles”), chapter 52.


articulated in the New Shorter Oxford Dictionary, is ‘Something called for or demanded; a condition which must be complied with.’ The Canada - FIRA [Foreign Investment Review Act] panel further suggested that there must be a distinction between ‘regulations’ and ‘requirements’ and that requirements could not be assumed to mean the same, i.e. ‘mandatory rules applying across the board.’ (underlining added to indicate words in italics in the original)191

361. It similarly held that:

“In previous instances, the term ‘requirement’ has been interpreted to encompass commitments entered into on a voluntary basis by individual firms as a condition to obtaining an advantage.391 Under GATT 1947, in EEC - Parts and Components (emphasis added), the panel noted that:

“Article III:4 refers to ‘all laws, regulations or requirements affecting the internal sale, offering for sale, purchase, transportation or use.’ The Panel considered that the comprehensive coverage of ‘all laws, regulations or requirements affecting’ (emphasis added) the imported [sic] sale, etc. of imported products suggests that not only requirements which an enterprise is legally bound to carry out, such as those examined by the ‘FIRA panel’ (BISD 30S/140, 171) [BISD 30S/151, 171 for the Spanish text cited in the Spanish document], but also those which an enterprise voluntarily accepts in order to obtain an advantage from the government constitute ‘requirements’ within the meaning

191 Panel Report, India- Measures Affecting the Automotive Sector, WT/DS146/R, WT/DS175/R, paragraph 7.181 (hereinafter India-Automotive).


of that provision.392” 391 See Canada - FIRA [Foreign Investment Review Act]: “As both parties had agreed that the FIRA and the FIR Regulations - whilst providing for the possibility of written undertakings - did not make their submission obligatory, the question remained whether the undertakings given in individual cases are to be considered ‘requirements’ within the meaning of Article III:4. In this respect the Panel noted that Section 9(c) of the Act refers to ‘any written undertakings & relating to the proposed or actual investment given by any party thereto conditional upon the allowance of the investment’ and that Section 21 of the Act states that ‘where a person who has given a written undertaking & fails or refuses to comply with such undertaking’ a court order may be made ‘directing that person to comply with the undertaking.’ The Panel further noted that written purchase undertakings - leaving aside the manner in which they may have been arrived at (voluntary submission, encouragement, negotiation, etc.) once they were accepted, became part of the conditions under which the investment proposals were approved, in which case compliance could be legally enforced. The Panel therefore found that the word ‘requirement’ as used in Article III:4 could be considered a proper description of existing undertakings.” (emphasis added) 392 Panel Report, EEC - Parts and Components, para. 5.21, BISD S37/132 [BISD S37/147 for the Spanish text cited in the Spanish document]. (emphasis added)

(...)”192

362. In addition:

“GATT jurisprudence thus suggests two distinct situations which would satisfy the term “requirement” in Article III:4: i) obligations which an enterprise is “legally bound to carry out”;

ii) those which an enterprise voluntarily accepts in order to obtain an advantage from the government.”193

363. Finally:

“This interpretation was confirmed in the panel report on Canada – Autos) under the WTO. In that instance, «letters of undertaking» submitted by certain firms at the request of the

192 Panel Report, India-Automotive, WT/DS146/R, WT/DS175/R, paragraph 7.183. 193 Panel Report, India-Automotive, WT/DS146/R, WT/DS175/R, paragraph 7.184.


Canadian Government were considered to be «requirements». That panel stated in particular that:

«We note that it has not been contested in this dispute that, as stated by previous GATT and WTO panel and appellate body reports, Article III:4 applies not only to mandatory measures but also to conditions that an enterprise accepts in order to receive an advantage, including in cases where the advantage is in the form of a benefit with respect to the conditions of importation of a product. The fact that compliance with the CVA requirements is not mandatory but a condition which must be met in order to obtain an advantage consisting of the right to import certain products duty-free therefore does not preclude application of Article III:4.»393

393 Panel Report, Canada - Automobiles, WT/DS139/R, WT/DS142/R, adopted June 19, 2000, as modified by the Appellate Body Report, para. 10.73.

(...)”194

364. Similarly, note the arguments developed in the first part of this presentation, which state that the “de facto” moratorium is a measure. Thus, it was held that a measure does not need to be enacted through traditional means in order to be considered to be one.195 This observation also applies to the “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina.” 365. Following the same line of reasoning, then, the “suspension of

194 Panel Report, India-Automotive, WT/DS146/R, WT/DS175/R, paragraph 7.185. 195 See paragraph II.A.1.a, especially section ii).


processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” [are] capable of affecting the sale, offering for sale, etc., as required in Article III:4, because they affect the conditions of competition. This is so because through the “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” modify the conditions of competition, given that the biotech agricultural product was not approved. 366. The foregoing shows that the “suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” satisfy the second element of a violation of Article III:4 of the GATT 1994. c.- “Less favorable treatment” is accorded 367. The Appellate Body has set forth that:

“ (...) Whether or not imported products are treated ‘less favourably’ than like domestic products should be assessed instead by examining whether a measure modifies the conditions of competition in the relevant market to the detriment of imported products.” 196

368. The conditions that the Appellate Body affirmed are necessary for determining the existence of “less favorable treatment” -that is, modification of the conditions of competition in the relevant market to the detriment of imported products- could not be more clear. As a result of the “suspension of processing and failure to consider the individual applications for approval of specific biotech agricultural products of particular interest to Argentina,” these products are not approved even when some of them have been subjected to case-by-case assessment and have received a favorable opinion from the Scientific Committee. 369. The foregoing shows that the “suspension of the processing and failure

196 Appellate Body Report, Korea-Meat, WT/DS161/AB/R, WT/DS169/AB/R, paragraph 137.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 130 to consider the individual applications for authorization or approval of specific biotech agricultural products of particular interest to Argentina” violate Article III:4 of the GATT 1994. CONCLUSION WITH RESPECT TO THE INCONSISTENCY OF THE “SUSPENSION OF PROCESSING AND FAILURE TO CONSIDER INDIVIDUAL APPLICATIONS FOR APPROVAL OF SPECIFIC BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE GATT 1994 AGREEMENT 370. On the grounds set forth above, Argentina considers that the “suspension of processing and failure to consider individual requests for approval of specific biotech agricultural products of particular interest to Argentina” violate Paragraph 4 of Art. III of GATT 1994. IV.- INCONSISTENCY WITH THE TBT AGREEMENT A.- ALTERNATIVE APPLICATION OF THE TBT AGREEMENT 371. As demonstrated in the pertinent part of this presentation, the moratorium constitutes a sanitary or phytosanitary measure, for which reason the SPS Agreement is applicable. 372. It must be emphasized that the SPS and TBT Agreements are mutually exclusive, as specified by the pertinent regulations in each of them. Thus, article 1.5 of the TBT Agreement sets forth that:

“The provisions of this Agreement do not apply to sanitary and phytosanitary measures as defined in Annex A of the Agreement on the Application de Sanitary and Phytosanitary Measures.”

373. The SPS Agreement sets forth in article 1.4 that:

“Nothing in this Agreement shall affect the rights of


Members under the Agreement on Technical Barriers to Trade with respect to measures not within the scope of this Agreement.”

374. Nevertheless, if the Panel considers that it should not analyze Argentina’s claim under the SPS Agreement, Argentina will argue alternatively under the TBT Agreement. 375. In that case, it should be indicated that the TBT Agreement applies to “Technical regulations” and “conformity assessment procedures” as defined in Annex 1, Paragraphs 1 and 3 of the TBT Agreement, respectively. 376. In this regard, Directive 2001/18/EC (and its predecessor Directive 90/220/EEC) and Regulation (EC) 258/97 are “technical regulations” pursuant to Annex 1, Paragraph 1 of the TBT Agreement; and the approval procedures of this same regulation constitute “conformity assessment procedures” pursuant to Annex 1, Paragraph 3 of the TBT. B.- INCONSISTENCY OF THE “APPLICATION OF COMMUNITY LEGISLATION IN RELATION TO THE APPROVAL OF BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE TBT AGREEMENT 1.- EC legislation for approval of biotech agricultural products constitutes “technical regulations” pursuant to Annex 1, paragraph 1 of the TBT Agreement 377. Annex 1, Paragraph 1 of the TBT Agreement sets forth:

“Technical regulation “Document which lays down product characteristics or their related processes and production methods, including the applicable administrative provisions, with which compliance is mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labeling requirements as they apply to a product, process


or production method.” 378. EC Legislation for approval of biotech agricultural products is a “technical regulation” pursuant to the referenced provision of the TBT Agreement. 379. The Appellate Body has established three criteria for determining whether a document fits the definition of “technical regulation” in the TBT Agreement.197 These criteria are: a) the document must apply to an identifiable product or group of products. That product or group of products need not, however, be expressly identified in the document; b) the document must lay down one or more characteristics of the product. These characteristics may be intrinsic, or they may be related to the product. They may be prescribed in either positive or negative form; and, c) compliance with the product characteristics must be mandatory. 380. Directive 2001/18/EC (as well as its predecessor Directive 90/220/EEC) and Regulation (EC) 258/97 are technical regulations that possess the three requirements established by the Appellate Body. 381. With regard to the first of these criteria, that is, that the product be “identifiable,” this requirement is met since the regulation in question refers to “genetically modified organisms.”198 382. With regard to the second criterion, the “establishment of characteristics,” is also present, since the characteristics established by Community legislation is the absence of adverse effects on human health and the environment.

197 Appellate Body Report, EC-Asbestos, WT/DS135/AB/R, paragraphs 66/70; Appellate Body Report, EC-Sardines, WT/DS231/AB/R, paragraph 176. 198 See Directive 2001/18/EC, Article 2(2), Part I, in Annex ARG-3 (Directive 90/220/EEC, Article 2(2), Annex IA, Part I, in Annex ARG-4); Regulation (EC) 258/97, Article 1(2)(a), in Annex ARG-5.


383. For example, Directive 2001/18/EC (as well as Directive 90/220/EEC) establishes: “The competent authority should give its consent only after it has been satisfied that the release will be safe for human health and the environment.”199 384. In this sense, the Community legislation requires the competent authority to perform an assessment with respect to possible adverse effects, considering allergenic and toxic effects.200 385. For its part, Regulation (EC) 258/97 establishes that: “Foods and food ingredients falling within the scope of this Regulation must not: -present a danger for the consumer;...”.201 386. Thus, the analysis of Community legislation shows that the second requirement for constituting a technical regulation is met. In this case, this requirement is the existence of no adverse effects for human health or the environment. It must also be taken into account that a product’s effect or impact may be considered according to the effect of said product’s characteristics. 387. In fact, the Appellate Body noted in EC - Asbestos that product characteristics include all “features”, “qualities” or “attributes.”202 Likewise, in said case and within the analytical framework of Article III:4 of GATT 1994, it indicated that all relevant evidence must also be evaluated, including

199 Directive 2001/18/EC, paragraph 47 and Article 4.1 (Annex ARG-3); similarly, Directive 90/220/EEC, paragraph 17 (Annex ARG-4). 200 Directive 2001/18/EC, Annex II.C1 and 2 (Annex ARG-3); similarly, Directive 90/220/EEC (Annex ARG-4). 201 Regulation (EC) 258/97, Art. 3(1), in Annex ARG-5. 202 Appellate Body Report in EC - Asbestos, WT/DS135/AB/R, Paragraph 67.


evidence relating to a product’s health risks.203 388. Finally, the third requirement, mandatory compliance with the characteristics established by the document, is present in Community legislation. 389. In fact, said legislation clearly establishes their mandatory compliance. Directive 2001/18/EC establishes that: “The notifier may proceed with the placing on the market only when he has received the written consent of the competent authority… and in conformity with any conditions required in that consent.”204 390. While Regulation (EC) 258/97 establishes that: “...This Regulation shall be binding in its entirety...”205 391. A mere reading of the Community legislation, clearly indicates that the requirement of mandatory compliance is met. 392. On the grounds set forth above, we conclude that the pertinent Community legislation, Directive 2001/18/EC (and its predecessor Directive 90/220/EEC) and Regulation (EC) 258/97 are technical regulations, because they meet the three requirements necessary to be considered as such. 2.- The procedures under Community legislation for approval of biotech agricultural products constitute conformity assessment procedures 393. The procedures under Community legislation for approval of biotech agricultural products constitute conformity assessment procedures as established by the TBT Agreement.

203 Appellate Body Report in EC - Asbestos, WT/DS135/AB/R, Paragraph 113. 204 Directive 2001/18/EC, Art. 19(2), in Annex ARG-3; similarly, Directive 90/220/EEC, in Annex ARG-4. 205 Regulation (EC) 258/97, Art. 15 (Annex ARG-5).


394. Point 3 of Annex 1 of the TBT Agreement and its Explanatory Note establish that:

“3. Conformity assessment procedures

Any procedure used, directly or indirectly, to determine that relevant requirements in technical regulations or standards are fulfilled.

Explanatory note

Conformity assessment procedures include, inter alia, procedures for sampling, testing and inspection; evaluation, verification and assurance of conformity; registration, accreditation and approval as well as their combinations.

395. The Community legislation establishes procedures for approval of biotech agricultural products. In following said procedures, the petitioner must basically complete the following steps: a) file an application or notification for the placement of a product on the market;206 b) the biotech product must undergo an assessment to confirm that it meets the requirements established by the legislation;207 c) the biotech product must be approved prior to being placed on the market.208 396. These requirements show that they have been established “to determine that the pertinent requirements of the technical regulations have been met” (in this case, Directive 2001/18/EC -and its predecessor Directive 90/220/EEC- as well as Regulation (EC) 258/97). Especially considering the

206 Directive 2001/18/EC, Art. 13(1) (similarly, Directive 90/220/EEC); Regulation (EC) 258/97, Art. 4(1). 207 Directive 2001/18/EC, Art. 14(2) (similarly, Directive 90/220/EEC); Regulation (EC) 258/97, Art. 4(2). 208 Directive 2001/18/EC, Art. 19(2) (similarly, Directive 90/220/EEC); Regulation (EC) 258/97, Art. 7.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 136 explanatory note, which refers to “evaluation, verification and assurance of conformity” and “registration, accreditation and approval.” 397. As shown above, the approval mechanisms contained in Community legislation are “conformity assessment procedures.” 3.- The application of Community legislation is inconsistent with the obligations set forth in the TBT Agreement 398. Since 1998 the EC has been applying its legislation for approval of biotech agricultural products in a manner that is inconsistent with the obligations of the EC under the TBT Agreement. 399. In fact, the EC has applied its legislation in a way that violates the obligations of the TBT Agreement and its own legislation. Below, Argentina will demonstrate the EC’s nonperformance with respect to specific regulations of the TBT Agreement. 4.- Application of Community legislation is inconsistent with Article 2.1 of the TBT Agreement 400. Article 2.1 of the TBT Agreement establishes that:

“Members shall ensure that in respect of technical regulations, products imported from the territory of any Member shall be accorded treatment no less favourable than that accorded to like products of national origin and to like products originating in any other country.”

401. The way in which the EC has applied its legislation to biotech agricultural products of particular interest to Argentina is inconsistent with Article 2.1 of the TBT Agreement. Since Article 2.1 of the TBT Agreement basically develops the same national treatment obligations as Article III.4 of GATT 1994, we refer to the arguments made in the relevant part of this


presentation.209 402. As shown, the EC’s application of its regulation is inconsistent with Article 2.1 of the TBT Agreement. 5.- Application of Community legislation is inconsistent with Article 2.2 of the TBT Agreement 403. Article 2.2 of the TBT Agreement requires that:

“Members shall ensure that technical regulations are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. For this purpose, technical regulations shall not be more trade-restrictive than necessary to fulfill a legitimate objective, taking account of the risks non-fulfillment would create. Such legitimate objectives are, inter alia: national security requirements; the prevention of deceptive practices; protection of human health or safety, animal or plant life or health, or the environment. In assessing such risks, relevant elements of consideration are, inter alia: available scientific and technical information, related processing technology or intended end-uses of products.”

404. In this case, the EC has applied its technical regulations in a way that constitutes a ban on imports of biotech agricultural products of particular interest to Argentina. 405. Indeed, for the application of a technical regulation to be consistent with Article 2.2 of the TBT Agreement, it must comply with three requirements: a) pursue a legitimate objective; b) must fulfill that objective; and,

209 See Point III of this presentation.


c) must not be more trade-restrictive than is necessary to fulfill that legitimate objective, taking into account the risks non-fulfillment would create. 406. With respect to the first requirement, bearing in mind the objective of the Community legislation,210 which is to protect against risks to human, animal and plant health, it is clear that the way in which the EC regulation has been and continues to be applied to the processing of biotech agricultural products, is inconsistent with this provision. 407. This appraisal is justified since, although the technical regulations at issue, as set forth in Article 2.2 of the TBT Agreement, include health among their legitimate objectives, this circumstance does not authorize the EC to avoid the assessment of existing risks with respect to specific biotech products (or to make decisions no based on risk assessments) with the purpose of fulfilling the legitimate objectives that those technical regulations may have, pursuant to the TBT Agreement. 408. Moreover, the risk assessment must take into account “available scientific and technical information.” As was shown in the pertinent part of this presentation,211 all scientific information invalidates the EC’s application of its own legislation. It is necessary to reiterate that a large part of this scientific information comes from the EC’s own Scientific Committees and that, in all cases, they have found no health or environmental risks. 212 409. Despite the existence of scientific evidence demonstrating that the biotech products pose no risks that differ from their “non-biotech” counterparts, the application of the EC’s technical regulations for approval of biotech products of particular interest to Argentina has become an absolute ban on imports of these products.

210 See Section II.A. of this presentation. 211 See Section II.6 of this presentation. 212 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26, ARG-27, ARG-41 and ARG-42.


410. The foregoing shows that EC legislation is not being applied to fulfill the legitimate objective that the EC is authorized to pursue under the technical regulations pursuant Article 2.2 of the TBT Agreement. As the scientific evidence demonstrates, this is because the biotech agricultural products of particular interest to Argentina are as safe as their “non-biotech” counterparts. 411. With regard to the second requirement of Article 2.2 of the TBT Agreement (fulfillment of that legitimate objective), the objective of protecting against the potential risks associated with the products has already been satisfied by the opinion of the respective Scientific Committees213 and thus the legitimate objective has already been fulfilled. Nonetheless, the EC failed to consider this scientific evidence produced by its own experts. 412. Therefore, in applying its own regulation as it did, the EC has not pursued fulfillment of the legitimate objective (which has already been fulfilled) set forth therein and, therefore has acted in a manner inconsistent with Article 2.2 of the TBT Agreement. 413. Finally, the regulations should not be applied in such as way as to restrict trade more than necessary in order to fulfill a legitimate objective, taking into account the risks such non-fulfillment creates. In this sense, it is once again necessary to emphasize that the biotech products of particular interest to Argentina have already received a favorable scientific opinion, implying that said products do not pose risks that differ from their “non-biotech” counterparts. 414. Therefore, the legitimate objective (protection of health) is satisfied, which also bars any hypothesis on the risks posed by not fulfilling a legitimate objective. 415. Nonetheless, the biotech agricultural products of particular interest to Argentina have not been approved, which in practice implies a ban on imports that is clearly more restrictive than necessary, thus creating barriers

213 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26, ARG-27, ARG-41 and ARG-42.


to international trade. 416. As set forth above, the EC has applied its own regulation in a way that is inconsistent with Article 2.2 of the TBT Agreement. 6.- The application of Community legislation is inconsistent with Article 5.1.1 of the TBT Agreement 417. Article 5.1.1 establishes that:

“conformity assessment procedures are prepared, adopted and applied so as to grant access for suppliers of like products originating in the territories of other Members under conditions no less favourable than those accorded to suppliers of like products of national origin or originating in any other country, in a comparable situation; access entails suppliers' right to an assessment of conformity under the rules of the procedure, including, when foreseen by this procedure, the possibility to have conformity assessment activities undertaken at the site of facilities and to receive the mark of the system;”

418. The application of European legislation is inconsistent with this provision since it is applied in such a way that implies a less favorable treatment [than that applied] to like products originating in the territories of other Members. 419. In fact, biotech products are those subject to this less favorable treatment compared to “non-biotech” products, which no have problems of access to the Community market when the situation between both is perfectly comparable. In fact, biotech products and “non-biotech” products are like products.214 420. Despite the foregoing, the EC has applied its conformity assessment procedures in a way that has implied an absolute ban on imports of biotech

214 See Section III of this presentation.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 141 products since 1998. 421. As shown above, the EC has violated Article 5.1.1 of the TBT Agreement. 7.- The application of EC legislation is inconsistent with Article 5.1.2 of the TBT 422. Article 5.1.2 of the TBT establishes that:

“conformity assessment procedures are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. This means, inter alia, that conformity assessment procedures shall not be more strict or be applied more strictly than is necessary to give the importing Member adequate confidence that products conform with the applicable technical regulations or standards, taking account of the risks non-conformity would create.”

423. The application of EC legislation is inconsistent with this provision that establishes that conformity assessment procedures will not be applied with the effect of creating unnecessary obstacles to international trade. 424. This is precisely the situation caused by the application of the conformity assessment procedures, since it produces absolute ban on imports of biotech products. 425. Furthermore, conformity assessment procedures shall not be applied more strictly than is necessary, taking account of the risks non-conformity would create. 426. The EC has definitely applied the procedures for biotech products more strictly [than necessary] by establishing a ban on imports of the biotech agricultural products of particular interest to Argentina, without the existence of risks that justify it. In fact, such as explained herein, the EC’s own scientific committees have determined that biotech products do no pose


risks to health or the environment distinct from their “non-biotech” counterparts.215 Therefore, there are not even any risks to consider in the event that they were not in conformity with the procedures, which is not the case. 427. As shown above, the EC has violated Article 5.1.2 of the TBT Agreement. 8.- The application of EC legislation is inconsistent with Article 5.2.1 of the TBT 428. Article 5.2.1 of the TBT establishes:

“conformity assessment procedures are undertaken and completed as expeditiously as possible and in a no less favourable order for products originating in the territories of other Members than for like domestic products”

429. In Argentina’s opinion, the obligation to complete the procedures “as expeditiously as possible” has not been fulfilled by the EC. This is because since 1998 there have been neither approvals nor processing of the applications. 430. The EC’s application of its conformity assessment procedures is inconsistent with the TBT Agreement. 431. Moreover, in the treatment of Article 8 and Annex C of the SPS Agreement with respect to “undue delay,” the non fulfillment by the EC of the requirements of “expeditiousness” has been demonstrated, since the SPS Agreement requires that the procedures be initiated and completed without undue delays, that is, for the delay to be undue, it must be “excessive” and “unjustified.” In this regard, we note that within the scope of the TBT Agreement, Members are required to initiate and complete the procedures “as expeditiously as possible.” Therefore, if the time used to initiate and complete the procedures is “excessive” or “unjustified,” the procedures

215 See Annexes ARG-21, ARG-22, ARG-23, ARG-24, ARG-25, ARG-26, ARG-27, ARG-41 and ARG-42.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 143 would necessarily not be initiated or finalized “as expeditiously as possible.” 432. Furthermore, biotech agricultural products and “non-biotech” products are like products and only with respect to the former have the procedures not been completed “as expeditiously as possible,” implying a less favorable treatment for the biotech agricultural products. 433. As shown above, the EC has acted in a manner inconsistent with Article 5.2.1 of the TBT Agreement. 9.- Inconsistency of the application of Community legislation with Article 5.2.2 of the TBT Agreement 434. Article 5.2.2 of the TBT Agreement stipulates that:

“When implementing the provisions of paragraph 1, Members shall ensure that: 5.2.2. the standard processing period of each conformity assessment procedure is published or that the anticipated processing period is communicated to the applicant upon request; when receiving an application, the competent body promptly examines the completeness of the documentation and informs the applicant in a precise and complete manner of all deficiencies; the competent body transmits as soon as possible the results of the assessment in a precise and complete manner to the applicant so that corrective action may be taken if necessary; even when the application has deficiencies, the competent body proceeds as far as practicable with the conformity assessment if the applicant so requests; and that, upon request, the applicant is informed of the stage of the procedure, with any delay being explained;

435. The obligation under Art. 5.2.1 of the TBT Agreement regarding undue delays is complemented by other provisions considered in Art. 5.2.2 of same TBT Agreement.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 144 436. These provisions establish that “...the competent body promptly examines the completeness of the documentation,” “...the competent body proceeds as far as practicable with the conformity assessment...,” “...that, upon request, the applicant is informed of the stage of the procedure, with any delay being explained...”, that is, the competent body must fulfill its obligations “promptly” and further provide explications of “any delay,” coinciding with the provisions of Annex C.1.b of the SPS Agreement. 437. The way in which the EC has applied Community procedures to the processing of applications for approval of the biotech agricultural products since 1998 to the present, fails to meet the requirements of the foregoing paragraph, since the decision to suspend or postpone the processing of application does not fulfill the obligations such as to “proceed as far as practicable with the conformity assessment” (for example, as in the case of A 2704-12 and A 5547-127 Soy, product of particular interest to Argentina); nor have the competent EC bodies fulfilled the obligations “promptly.” In this regard, we refer to the discussion on the analysis of the time of processing applications for approval of each of the biotech agricultural products of particular interest to Argentina, detailed in Point C.1.c hereof. Solely as an example, Argentina cites the paradigmatic case of Bt 531 cotton, delayed for 7 years and 4 months. 438. On these grounds, Argentina considers that the EC has violated Art. 5.2.2 of the TBT Agreement. 10.- Inconsistency of the application of Community legislation with Article 12 of the TBT Agreement 439. Article 12 of the TBT Agreement states:

“Special and Differential Treatment of Developing Country Members 12.1 Members shall provide differential and more favourable treatment to developing country Members to this Agreement, through the following provisions as well as through the relevant provisions of other Articles of this Agreement.


12.2 Members shall give particular attention to the provisions of this Agreement concerning developing country Members' rights and obligations and shall take into account the special development, financial and trade needs of developing country Members in the implementation of this Agreement, both nationally and in the operation of this Agreement's institutional arrangements. 12.3 Members shall, in the preparation and application of technical regulations, standards and conformity assessment procedures, take account of the special development, financial and trade needs of developing country Members, with a view to ensuring that such technical regulations, standards and conformity assessment procedures do not create unnecessary obstacles to exports from developing country Members. 12.4 Members recognize that, although international standards, guides or recommendations may exist, in their particular technological and socio-economic conditions, developing country Members adopt certain technical regulations, standards or conformity assessment procedures aimed at preserving indigenous technology and production methods and processes compatible with their development needs. Members therefore recognize that developing country Members should not be expected to use international standards as a basis for their technical regulations or standards, including test methods, which are not appropriate to their development, financial and trade needs. 12.5 Members shall take such reasonable measures as may be available to them to ensure that international standardizing bodies and international systems for conformity assessment are organized and operated in a way which facilitates active and representative participation of relevant bodies in all Members, taking into account the special problems of developing country Members.


12.6 Members shall take such reasonable measures as may be available to them to ensure that international standardizing bodies, upon request of developing country Members, examine the possibility of, and, if practicable, prepare international standards concerning products of special interest to developing country Members. 12.7 Members shall, in accordance with the provisions of Article 11, provide technical assistance to developing country Members to ensure that the preparation and application of technical regulations, standards and conformity assessment procedures do not create unnecessary obstacles to the expansion and diversification of exports from developing country Members. In determining the terms and conditions of the technical assistance, account shall be taken of the stage of development of the requesting Members and in particular of the least-developed country Members. 12.8 It is recognized that developing country Members may face special problems, including institutional and infrastructural problems, in the field of preparation and application of technical regulations, standards and conformity assessment procedures. It is further recognized that the special development and trade needs of developing country Members, as well as their stage of technological development, may hinder their ability to discharge fully their obligations under this Agreement. Members, therefore, shall take this fact fully into account. Accordingly, with a view to ensuring that developing country Members are able to comply with this Agreement, the Committee on Technical Barriers to Trade provided for in Article 13 (referred to in this Agreement as the «Committee») is enabled to grant, upon request, specified, time-limited exceptions in whole or in part from obligations under this Agreement. When considering such requests the Committee shall take into account the special problems, in the field of preparation and application of technical regulations, standards and


conformity assessment procedures, and the special development and trade needs of the developing country Member, as well as its stage of technological development, which may hinder its ability to discharge fully its obligations under this Agreement. The Committee shall, in particular, take into account the special problems of the least-developed country Members. 12.9 During consultations, developed country Members shall bear in mind the special difficulties experienced by developing country Members in formulating and implementing standards and technical regulations and conformity assessment procedures, and in their desire to assist developing country Members with their efforts in this direction, developed country Members shall take account of the special needs of the former in regard to financing, trade and development. 12.10 The Committee shall examine periodically the special and differential treatment, as laid down in this Agreement, granted to developing country Members on national and international levels.”

440. This provision is part of the various types of “special and differential treatment” envisaged in WTO agreements. Article 12.8 of the TBT Agreement is based on recognition of two specific [points]: a) that developing countries may face special problems, including “institutional and infrastructural problems,” in the field of preparation and application of technical regulations, standards and conformity assessment procedures; b) that developing countries have special needs “in development and trade (…)”; 441. In detailed form, and pursuant to the text of Article 12, we can distinguish a series of rights and obligations that the Members must observe in the treatment accorded to development countries, as follows:

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 148 a) the obligation to provide differential and more favorable treatment not only by virtue of the provisions of Article 12, but also by virtue of the other provisions in other articles of the TBT Agreement (Article 12.1). In that regard, another provision of the TBT Agreement that covers this matter is Article 11 “Technical Assistance to Other Members”; b) the obligation to give “particular attention” to the provisions of the Agreement concerning developing country Members’ rights and obligations. This obligation is accompanied by or must be implemented jointly with the obligation to consider or “take into account” the “special development, financial and trade needs of [developing country Members]” in the implementation phase of the Agreement. -Article 12.2 uses the word “and” to express the relationship between the two obligations-. These obligations apply both nationally and in the operation of this Article’s institutional arrangements. c) the obligation to take into account the special needs of developing countries appears in the section of Article 12 of the TBT Agreement that refers to “special development, financial and trade needs...” The itemization of the areas for which the needs of developing countries must be taken into account is a difference set forth in the TBT Agreement (paragraphs 2, 3, 4 and 9, with regard to the more generic references in other Agreements covered, such as for example the SPS Agreement). d) the Members’ obligation to take into account the special development, financial and trade needs of developing countries, both in the preparation phase and in the application phase for technical regulations, standards and conformity assessment procedures. The purpose is to avoid creating unnecessary obstacles to exports from developing countries, pursuant to Article 12:3. d) the right of developing countries, given their particular technological and socio-economic conditions, to adopt technical regulations, standards or conformity assessment procedures aimed at preserving indigenous technology and production methods and processes compatible with their development needs. This right of developing countries is further reinforced based on the provision that “developing country Members should not be

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 149 expected to use international standards as a basis for their technical regulations or standards, including test methods, which are not appropriate to their development, financial and trade needs,” pursuant to Article 12.4. e) to facilitate active and representative participation by appropriate developing country institutions in international standardizing bodies and international systems for conformity assessment (Article 12.5). This point is made taking into account “the special problems” that may be incurred by developing countries; f) with particular reference to products of “special interest” to developing countries, Members are urged to take “reasonable” measures to [ensure] that international standardizing bodies will examine the possibility of formulating international standards for these products, pursuant to Article 12.6. g) the obligation to [provide] technical assistance in both preparation and application of technical regulations, standards and conformity assessment procedures. Article 12.7 refers to Article 11 of this Agreement in order to ensure that no unnecessary obstacles are created to the expansion and diversification of exports from developing countries. This obligation makes specific reference to least-developed countries. h) in virtue of the recognition agreed in Article 12.8 regarding special problems and needs of developing countries, two obligations are set forth. The first involves Members, who must take into account the special development and trade needs of developing countries, as well as their stage of technological development and whether it may hinder their ability to discharge fully their obligations under this Agreement. The second obligation enables the Committee on Technical Barriers to Trade to grant, upon request, specified, time-limited exceptions in whole or in part from obligations under the TBT Agreement to developing countries. i) the specific obligations of developed countries, pursuant to the terms of Article 12.9. First is the obligation to bear in mind the special difficulties experienced by developing countries in formulating and implementing standards, technical regulations and conformity assessment procedures. Second, if developed countries decide to assist developing countries, they

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 150 must also take into account the special needs with regard to financing, trade and development. j) the obligation set forth for the Committee on Technical Barriers to Trade to examine periodically the special and differential treatment granted to developing countries on national and international levels, pursuant to Article 12.10. 442. Therefore, the provisions included in the paragraphs of Article 12 that were analyzed are mandatory (“the Members shall provide…” - paragraph 1; “shall give special attention…”, pursuant to paragraph 2; “…shall take into account…”, pursuant to paragraphs 2, 3, 8; “…shall take…”, paragraph[s] 5 and 6; “…shall provide,” paragraph 7; “…shall bear in mind…,” paragraph 9. They indicate more than a mere obligation to cooperate. Part of their validity lies in the preparation of the technical regulations, standards and conformity assessment procedures. This means their formulation must take into account the special trade, financing and development needs of developing and least-developed countries, particularly their special problems, pursuant to Article 12.8. In addition, the obligation extends to the application of the technical regulations, standards and conformity assessment procedures, which in this case must also take into account the aforementioned needs. 443. Therefore, violation of an obligation under Article 12 may be considered to have occurred when (a) the aforementioned special needs are not taken into account for the preparation or application of technical regulations, standards and assessment procedures; or (b) in the particular case of Article 12.3, the aforementioned special needs are not taken into account for the preparation or application of the technical regulations, standards and assessment procedure, and no consideration is given to the goal of not creating unnecessary obstacles to exports from developing country members. 444. Indeed, the expression “shall take into account” requires more than giving the problem attention. It assumes that developed countries meet their obligation in successive stages. The first involves preparation of the technical requirements, standards and assessment procedures, and the second involves applying them. In both phases, the developed countries must take


into account “the special trade, development and financing needs” of the developing countries. 445. The Republic of Argentina understands that the EC should have fulfilled its obligation under Article 12.3 of the TBT Agreement when it prepared and applied its legislation with regard to biotech agricultural products. The EC’s suspension of consideration or processing of applications for and failure to approve biotech agricultural products under Article 5.2.1 (“…the conformity assessment procedures are undertaken and completed as expeditiously as possible…”) in practice constitutes a restriction on trade in these products that took effect as an absolute ban on access. This had and [continues to] have a considerable effect on Argentina, which is a developing country, [thus] disregarding the provisions of Article 12.3 of the TBT Agreement 446. In fact, this breach is particularly serious for Argentina. As do other developing countries, Argentina has special trade, financing and development needs that have been ignored by the EC. As do other developing countries, Argentina is highly dependent on agricultural production and exports. The livelihood of a large percentage of the country’s population and the development of its economy depends on access to markets for its primary products, which include biotech agricultural products 447. In the opinion of the Republic of Argentina, the EC, while it did suspend the consideration of applications or while it did not approve [any applications] and thus did impede trade in biotech agricultural products, it aggravates even more the situation for a country such as Argentina, whose agricultural sector has a significant number of biotech products. As indicated previously, Argentina is the world’s second-largest producer of biotech agricultural products after the United States, and it is the first among developing countries216. Argentina has 13,900,000 hectares devoted to

216 See Clive James, International Service for the Acquisition of Agri-, Biotech Applications. Executive Summary. Preview Global Status of Commercialized Transgenic Crops: 2003.N. 30-2003, p. 4. This study shows that Argentina is followed among the developing countries by Brazil with 3,000,000 hectares, basically devoted to the cultivation of soybeans, then in third place by China with 2,800,000 hectares devoted to the cultivation of cotton, South Africa with 400,000 hectares (maize, soybeans and cotton), India with 100,000 hectares (soybeans and maize), Uruguay with more than 50,000 hectares (soybeans and maize), Mexico with fewer than 50,000 hectares (cotton and soybeans), the Philippines with fewer than 50,000 hectares (maize) and Colombia with fewer than 50,000 hectares (cotton).


CONCLUSION WITH RESPECT TO THE INCONSISTENCY OF THE “APPLICATION OF COMMUNITY LEGISLATION TO BIOTECH AGRICULTURAL PRODUCTS OF PARTICULAR INTEREST TO ARGENTINA” WITH THE TBT AGREEMENT

cultivation of biotech soy, maize and cotton. 448. For the Republic of Argentina, the moratorium enacted by the EC beginning in 1998 has had the effect of closing the EC market to biotech agricultural products of particular interest to our country that had not been approved prior to that date. 449. And in particular, in the case of the EC, the failure to consider the special needs of developing countries has been aggravated because the EC constitutes a single market. That is, it is not a market belonging to one country, but a combined market arising from the fifteen Member States, which have a population of 375,300,000 and a per capita gross domestic product of 22,500 euros. Moreover, on May 1, 2004, the EC will include twenty-five Member States.

450. On the grounds set forth above, if the Panel considers that Argentina's claim is not to be analyzed under the SPS Agreement, we request alternatively that EC’s application of its own legislation to biotech agricultural products of particular interest to Argentina be declared inconsistent with the TBT Agreement, specifically with Articles 2.1, 2.2, 5.1.1, 5.1.2, 5.2.1, 5.2.2 and 12 of the TBT Agreement. V.- BANS BY VARIOUS EC MEMBER STATES 451. Finally, Argentina requests that the specific bans that Germany, Austria, Italy and Luxembourg have applied to the entry of biotech agricultural products be declared inconsistent with WTO regulations. 452. This is because, even when the EC lifts the “de facto” moratorium, the Member States would continue to apply the bans in violation of the Community’s own legislation and WTO obligations.


453. Specifically, we request that the following regulations be determined inconsistent with WTO obligations:217 - Regulation No. 45 of the Federal Ministry for Consumer Health and Protection (“45. Verordnung der Bundesministerien für Gesundheit und Konsumentenschutz”), dated February 13, 1997, prohibiting the entry of Bt-176 maize into Austria; - Modification notice issued by the Robert Koch Institute (“Änderungsbescheid vom Robert Koch Institut”), dated March 31, 2000, suspending the entry of Bt-176 maize into the country; - Ministerial Order dated February 7, 1997, published in the Official Gazette of the Grand Duchy, dated February 28, 1997, prohibiting the entry of Bt-176 maize into Luxembourg; - Regulation No. 175 of the Federal Ministry for Women’s Issues and Consumer Protection (“175. Verordnung der Bundesministerien für Frauenangelegenheiten und Verbraucherschutz”), dated June 10, 1999, prohibiting the entry of MON-810 maize into Austria; - Decree of the Office of the Chairman of the Council of Ministers, dated August 4, 2000, suspending the entry of MON-810 maize, T-25 maize and Bt-11 maize into Italy; - Regulation No. 120 of the Federal Ministry for Social Protection and Generations (“120. Verordnung der Bundesministerien für soziale Sicherheit und Generationen”), dated April 28, 2000, prohibiting the entry of the T-25 maize into Austria; 454. Furthermore, said bans have been adopted by those States in violation of the EC’s own legislation, whereby the affected biotech agricultural products had already been approved by the Community authorities for their placement on the market.

217 See the provisions of these Member States in Annex ARG-13.


1.- All involved products have prior approval by EC authorities 455. Argentina notes that all products in question have been approved by the EC authorities, pursuant to the pertinent legislation -Directive 90/220/EEC and Regulation (EC) 258/97-:218 - Bt-176 maize was also authorized by Commission Ruling dated January 23, 1997, pursuant to the conformity assessment procedures of Directive 90/220/EEC,219 - MON-810 maize was also authorized pursuant to the conformity assessment procedures of Directive 90/220/EEC, by Commission Ruling dated April 22, 1998,220 - T-25 maize was also authorized on the same date pursuant to the same conformity assessment procedures,221 - Bt-11 maize was been authorized on the same date, pursuant to the procedure of Directive 90/220/EEC222. 2.- Rejection of the requests for special safeguard 456. Community legislation recognizes the right of Member States to provisionally restrict or prohibit the use and/or sale of a product in their

218 See listing of biotech agricultural products approved by the EC en State of play on GMO under EU law, MEMO/04/17, Brussels January 28, 2004, in Annex ARG-6. 219 Commission Ruling dated January 23, 1997, published in Official Journal L 031, dated February 1, 1997. See Annex ARG-37. 220 Commission Ruling dated April 22, 1998, published in Official Journal L 131, dated May 5, 1998. See Annex ARG-36. 221 Commission Ruling dated April 22, 1998, published in Official Journal L 131, dated May 5, 1998. See Annex ARG-35. 222 Commission Ruling dated April 22, 1998, published in Official Journal L 131, dated May 5, 1998. See Annex ARG-38.


territory (safeguard), until the Commission makes a decision on the matter.223 457. In this regard, various Member States have sought to protect themselves under this provision: - Germany invoked Art. 16 of Directive 90/220/EEC against Bt-176 maize. The opinion of the respective Committee was contrary to this country’s request.224 - Austria invoked Art. 16 of Directive 90/220/EEC to justify the ban under Regulation No. 175 of the Federal Ministry for Women’s Issues and Consumer Protection on MON-810 maize. The respective Committee issued an opinion contrary to Austria’s request.225 - Austria invoked Art. 16 of Directive 90/220/EEC to justify its prohibition under Regulation No. 120 of the Federal Ministry for Social Protection and Generations on T-25 maize. Several Committees issued opinions contrary to Austria’s request.226 - Italy invoked Art. 12 of Regulation (EC) 258/97 to justify its Decree from the Office of the Chairman of the Council of Ministers dated August 4, 2000 against MON-810 maize, T-25 maize, and Bt-11 maize. The respective

223 Directive 90/220/EEC establishes the specific safeguard in its Art. 16, and the procedures for Decisions by the Commission in its Art. 21 (See Annex ARG-4). Directive 2001/18/EC establishes the special safeguard in its Art. 23, and the procedures for Decisions by the Commission in its Art. 30 (See Annex ARG-3). Finally, Regulation (EC) 258/97 establishes the safeguard in its Art. 12, and the procedures for Decisions by the Commission in its Art. 13 (See Annex ARG-5). 224 Opinion on the invocation by Germany of Article 16 of Council 90/220/EEC regarding the genetically modified BT-MAIZE LINE CG 00256-176 notified by CIBA-GEIGY (now NOVARTIS), notification C/F/94/11-03 (SCP/GMO/276 Final - 9 November 2000) Opinion adopted by written procedure following the SCP meeting of 22 September 2000). See Annex ARG-43. 225 Opinion of the Scientific Committee on Plants on the Invocation by Austria of Article 16 (“safeguard clause”) of Council Directive 90/220/EEC with respect to the placing on the market of the genetically modified maize (MON810) expressing the Bt cryia(b) gene, notification C/F/95/12-02, dated September 24, 1999. See Annex ARG-44. 226 Opinion on the invocation by Austria of Article 16 of Council Directive 90/220/EEC regarding a genetically modified maize line T25, dated November 30, and modified July 20, de 2001. See Annexes ARG-45 and ARG-46.


Committee issued an opinion contrary to Italy’s request.227 A.- MEMBER STATE BANS ARE INCONSISTENT WITH THE SPS AGREEMENT 458. EC Members States have imposed bans on several biotech agricultural products after said products were approved under the relevant Community legislation (Directive 90/220/EEC and Regulation (EC) 258/97). 459. Said measures (imposed seeking protection as a “safeguard” measure) have been declared unsubstantiated by the respective competent Committees. Nonetheless, all have been maintained to date. 460. Given that these measures have been adopted under the pertinent Community legislation -legislation that, as shown above,228 refers to the protection of human life and health- (although this legislation was subsequently violated), they constitute “sanitary and phytosanitary” measures that violate the SPS Agreement. 1.- Framing of the EC Member State bans as measures under the SPS Agreement 461. Article 1 of the SPS Agreement (General Provisions) establishes in paragraph 1 that:


227 Opinion of the Scientific Committee on Food concerning a submission from the Italian authorities raising concerns for the safety of certain products approved under the notification procedure of Regulation (EC) 258/97, CS/NF/DOS/11 ADD 4 REV 2 Final, issued September 7, 2000. See Annex ARG-47. 228 See Section II.A.1 herein.


462. As indicated above, the Panel in EC - Hormones held that the measure in question ought to rely on two elements: a) the disputed measure must be a sanitary or phytosanitary measure; and b) the measure must be able to affect international trade.229 a.- The Member State bans in question are sanitary or phytosanitary measures 463. To be considered as such, the sanitary and phytosanitary measures must contain two elements. The first of those elements is that its purpose be at least one of the issues included in letters a) through d) of Annex A:1 of the SPS Agreement. The second consists in the fact that it also reflected in one of the instruments included in the second paragraph of said Annex A:1. i) The Member States bans fit into Annex A:1, first paragraph, of the SPS Agreement, according to their objective 464. To analyze the first of these conditions, we must demonstrate that the Member State measures in question were established to protect “human, animal or plant life or health” from the risks resulting from the “entry, establishment or spread” of “pests, diseases, disease-carrying organisms or disease-causing organisms”, arising from the “additives, contaminants, toxins or disease-causing organisms in foods, beverages or feedstuffs” or to “prevent or limit other damage” within their territory. 465. It is necessary to stress that the purpose of the measures applied by Germany, Austria, Italy and Luxembourg may be inferred from very Community legislation under which the bans were adopted. This legislation expressly indicates that its purpose is the “protection of human health and the environment.” In this regard, Directive 90/220/EEC establishes among its objectives the protection of “human health and the environment.”230 For

229 Report from the Panel in EC – Hormones, WT/DS48/R, Paragraph 8.39 (Canada), and WT/DS26/R, Paragraph 8.36 (United States). 230 Article One of Directive 90/220/EEC, See Annex ARG-4.


its part, Regulation (EC) 258/97 establishes that the foods and food ingredients “must not present a danger for the consumer.”231232 466. Furthermore, the specific articles of Community legislation under which the EC Member States adopted the bans establish that the Member States may provisionally or temporarily, restrict, suspend or prohibit the product in the event that it has detailed grounds that “human health or the environment” would be endangered -that is, the right of the Member States to recourse to the “special safeguard”-233. 467. In particular, it is noted that: - Italy based its Decree making reference to Art. 12 of Regulation (EC) 258/97:

“Ritenuto che, a norma dell’articolo 12 del citato regolamento (CE) n. 258/97, qualora a seguito di nuove informazioni o di a nuova valuazioni di informazioni gia’ esistenti, uno Stato membro abbia fondato motivi per ritenere che l’utilizzazione di un prodotto o ingrediente alimentari presenti rischi per la salute umana o per l’ambiente, detto Stato puo’ limitare temporalmente o sospedere la commercializzazione e l’utilizzazione sul proprio territorio del prodotto o ingrediente in questione;”234

As indicated above, Italy’s ban was declared as unsubstantiated by the respective EC scientific committee.235 - Luxembourg referred explicitly to Art. 16 of Directive 90/220/EEC, in Art. 3 of the Ministerial Order:

231 Article 3(1) of Regulation 258/97, see Annex ARG-5. 232 See also Part II.A.1.a.i. 233 Article 16 of Directive 90/220/EEC and Article 12 of Regulation (EC) 258/97. 234 See Annex ARG-13. 235 See Annex ARG-47.


“(...) sont informés du présent arrêté, qui restera en vigueur jusqu’a EC qu’une décision ait été prise en vertu de l’article 16 paragraphe 2 de Directive du Conseil 90/220/CEE du 23 avril 1990 relative a la dissémination volontaire d’organismes génétiquement modifiés dans l’environnement.”236

- Germany also refers to Art. 16 of Directive 90/220/EEC:

“Hiermit wird in Abänderung des Bescheides (...) bis zur Entscheidung des Rates der Europäischen Gemeinschaften nach Art. 16 in Verbindung mit Art. 21 der Richtlinie 90/220/EWG das Ruhen der Genehmigung für das Inverkehrbringen der Maislinie CG 00256-176 einschließlich ihrer Abkömmlinge angeordnet, (...)”237

Months later, the opinion of the EC’s competent scientific committee disqualified the German ban on Bt-176 maize.238 - Austria’s ban was faced with contrary reports by the EC’s scientific committees.239 468. Inasmuch as each EC Member State has established the bans on the grounds of Article 16 of Directive 90/220/EEC or Article 12 of Regulation (EC) 258/97, it is clear that the bans were imposed with the purpose of protecting human health or the environment. 469. Consequently, the measures of the EC Member States were established in accordance with the objective of letters a) through d) of Annex A:1 of the SPS Agreement.

236 See Annex ARG-13. 237 See Annex ARG-13. 238 See Annex ARG-43. 239 See Annexes ARG-44, ARG-45, ARG-46.


ii) The Member States bans fit into Annex A:1, second paragraph, of the SPS Agreement, according to their forms 470. In addition to the foregoing with respect to the first condition to be met to establish the first element of a sanitary or phytosanitary measure, a second condition must also exist, linked with the form of the measure, or how the measure is set forth. For this second condition, Paragraph Two of Annex A:1 of the SPS Agreement must be considered, establishing, in its relevant part, that “sanitary or phytosanitary measures include all relevant laws, decrees, regulations, requirements and procedures... .” 471. This second condition is met by the Member State bans in question: Germany - In the case of Germany, the measure against Bt-176 maize was implemented by means of an amendment notice (“Änderungsbescheid”), by which it suspends entry of Bt-176 maize into the country. Although the term used explicitly in said measure refers to a “suspension” (“das Ruhen”) until there is a decision by the EC pursuant to Art. 16 de Directive 90/220/EEC, the German measure has not been lifted in practice -notwithstanding the subsequent scientific opinion which declared it unsubstantiated- and continues restricting the entry of Bt-176 maize into Germany. - In this regard, Argentina reiterates its foregoing arguments,240 with respect to the non-exhaustive nature of the hypotheses listed in the second paragraph of Annex A:1 of the SPS Agreement. - Germany’s measure possesses the characteristics necessary to be considered sanitary or phytosanitary measure. In fact, it has been applied in a general way and has had the “real effect” of prohibiting the placement on the market of Bt-176 maize in that country with respect to the level prior to the measure.

240 See Point II.A.1.a.ii) of this presentation.


- In addition, given the indicated effect, the German ban is similar to the sanitary measures mentioned (“such as”) in the footnote in Annex B:1 of the SPS Agreement. In other words, it has governed with an effectiveness identical to a law, regulation, order or requirement. - Finally, Germany’s measure explicitly establishes “Es wird die sofortige Vollziehung des Bescheides angeordnet” (“This notice is effective immediately”),241 so its binding nature is clear. - On the grounds set forth above, Argentina considers that Germany’s measure is a sanitary or phytosanitary measure according to the requirements of the SPS Agreement. Austria In the case of Austria, the ban on “placing on the market”, “use” and “marketing” of three biotech products (Bt-176, MON-810 and T-25) approved under Directive 90/220/EEC, was established through “ordinances”.242 Thus, the form in which the measure was adopted is one of the forms included under the second paragraph of Annex A:1 of the SPS Agreement. - In fact, according to the New Shorter Oxford English Dictionary, an “ordinance” is an “authoritative decree or command.” A “decree” is one of the types of measures specifically mentioned in the second paragraph of Annex A:1 of the SPS Agreement, for which reason the Austrian bans meet the requirement of form of the SPS Agreement. Italy - In the case of Italy, a “decree”243 was imposed, suspending “the placement

241 See Amendment Notice issued by the Robert Koch Institute (“Änderungsbescheid vom Robert Koch Institut”), dated March 31, 2000, titled “Änderungsbescheid,” final Paragraph (page 2). 242 Federal Gazette of the Republic of Austria, Ordinance No. 45 dated February 13, 1997 (Bt-176 maize); Ordinance No. 175 dated June 10, 1999 (MON-810 maize); Ordinance No. 120 dated April 28, 2000 (T-25 maize). 243 Official Gazette of the Republic of Italy, Decree of the Office of the Chairman of the Council of Ministers, dated August 4, 2000.


on the market and use” of four biotech products (Bt-11, MON-809, MON-810 and T-25). The form in which the Italian ban is established is a “decree.” Consequently the measure is among those explicitly considered in the second paragraph of Annex A:1 of the SPS Agreement. Luxembourg - With respect to Luxembourg, it established a “provisional” ban on “the use” and “sale” of biotech product Bt-176 maize through a ministerial “arrêté.” - According to the Dictionnaire Français Larousse an arrêté is a “written decision by an administrative authority.” For its part, the term “décret” (decree) (according to the same dictionary) means “a decision by the governmental authority by which the effects are similar (like, resembling) to those of laws.” From this we can infer that an “arrête ministériel” is perfectly comparable to a decree, and thus the measure established by Luxembourg is included among those explicitly considered in the second paragraph of Annex A:1 of the SPS Agreement. 472. On the grounds set forth above, the measures established by the EC Member States have been established by means of one of the forms considered in the second paragraph of Annex A:1 of the SPS Agreement, thereby meeting the second condition of the SPS Agreement. b.- The Member State bans affect international trade 473. With respect to the second element, the measures established by the Member States affect international trade. This is because each and every one of them prevent access of the affected biotech products to said Member States, resulting in the absence of imports of such products. 474. As shown, these measures affect international trade.


2.- Each sanitary or phytosanitary measure must be based on scientific evidence 475. As maintained herein244, each sanitary or phytosanitary measure must have a scientific basis, so that the measure does not represent a disguised restriction of international trade. This concept is reflected in Art. 2.2 of the SPS Agreement. 476. Argentina considers that, through the application of specific bans, some EC Member States have implemented sanitary or phytosanitary measures that are not based on scientific evidence245 and that even run contrary to the EC’s own scientific opinions.246 3.- The relation between Article 2 and Article 5 of the SPS Agreement 477. As indicated above,247 Articles 2.2 and Article 5.1 of the SPS Agreement must be read together. In fact, Article 2 of the SPS Agreement contains basic obligations, which are more generic than those mentioned in Article 5 of said Agreement. For this reason, we will argue first with respect to the more specific regulation, that is, Article 5 of the SPS Agreement in accordance with WTO jurisprudence in the Australia – Salmon case.248 4.- The Member State bans are inconsistent with Article 5.1 of the SPS Agreement 478. As indicated above,249 pursuant to Article 5.1 of the SPS Agreement, EC

244 See I.A.2. 245 See Point II.A.2 of this presentation. 246 See Points V.1 and V.2. 247 See II.A.3. 248 Idem. 249 See II.A.4.


Member States are required to perform a risk assessment, that is, provide the measure with a scientific basis. In addition, in performing the risk assessment, they must comply with the provisions of Annex A:4 of said Agreement, that is, performing one of the two possible risk assessments considered therein (none of which have a quantitative requirement). 479. Pursuant to Annex A:4, EC Member States must have performed at least one of the two types of risk assessments considered therein: either an “evaluation of the likelihood of entry, establishment or spread of a pest or disease within the territory of an importing Member … and of the associated potential biological and economic consequences.”250 or: “the potential for adverse effects on human or animal health arising from the presence of additives, contaminants, toxins or disease-causing organisms in food, beverages or feedstuffs.”251 480. The Member States have failed to fulfill the obligations arising from Article 5.1 and of Annex A:4 of the SPS Agreement, by not having performed the applicable risk assessment established therein. 481. On the contrary, these bans have been established without reference to any type of scientific evidence. 482. Furthermore, these bans were established even when the respective scientific committees ruled against them. In fact, these committees ruled twice on each product: first, when the products were approved, prior to the establishment of the Member State bans; and second, when the committees were called on to analyze the lawfulness of the application of the safeguard clauses (considered in Community legislation) established the Member States.

250 SPS Agreement, Annex A:4, first definition. 251 SPS Agreement, Annex A:4, second definition.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 165 483. In other words, existing scientific evidence disqualifies the Member State bans. In fact, in the second ruling by the Scientific Committees (after the State bans were established), disqualified the bans on the grounds that they lacked any scientific basis.252 484. Notwithstanding the foregoing, the Member States have not lifted the bans, and have thus violated Article 5.1 of the SPS Agreement. 5.- The Member State bans are inconsistent with Article 2.2 of the SPS Agreement 485. Article 2.2 of the SPS Agreement establishes that:

“Members shall ensure that any sanitary or phytosanitary measure is applied only to the extent necessary to protect human, animal or plant life or health, is based on scientific principles and is not maintained without sufficient evidence, except as provided for in paragraph 7 of Article 5.”

486. As indicated above, the inconsistency of the Member State bans with Article 2 of the SPS Agreement (the more generic regulation) arises due to an inconsistency of these bans with Article 5 of the SPS Agreement, and for this reason Argentina has started its argument with the more specific regulation. 487. Now then, the inconsistency of the Member State bans do not arise solely from the inconsistency with Article 5 of the SPS Agreement, but rather, the bans also violate Article 2 of the SPS Agreement on the grounds set forth below. 488. As indicated above,253 this agreement requires Member States to base their sanitary or phytosanitary measures on scientific principles. However, the EC Member States have not provided scientific grounds for the measure

252 See Point V.2. 253 See II.A.5.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 166 that resulted in the lack of approval of biotech agricultural products. Furthermore, existing scientific evidence is contrary to these Member State bans. In fact, the Scientific Committees issued favorable opinions on each one of these products on at least two occasions.254 489. The Member State bans’ lack of scientific grounds renders the above-mentioned measures inconsistent with Article 2.2 of the SPS Agreement. 490. On the other hand, the fact that a sanitary or phytosanitary measure cannot be applied without being based on scientific evidence or be maintained without adequate scientific evidence, implies that a rational relationship must exist between the sanitary measure and the scientific evidence.255 491. This rational relationship clearly does not exist in this case, since the Member State bans not only have no scientific evidence to support them, but also, in addition scientific evidence exists against them. 492. Finally, Article 2.2 of the SPS Agreement requires that a measure be applied “only to the extent necessary,” while also requiring that it be based on “sufficient scientific evidence,” whether to be implemented or to be maintained. In this regard, we reiterate our foregoing assertions on the restrictive nature of Art. 2.2 of the SPS Agreement for every sanitary or phytosanitary measure256. 493. Consequently, the Member State bans also conflict in this aspect with Article 2.2 of the SPS Agreement, and cannot be justified under the exception of Art. 5.7 of the SPS Agreement. 6.- The Member State bans are inconsistent with article 5.5 of the SPS 254 Bt-176 maize has two favorable opinions: See Annexes ARG-30 and ARG-43; T25 maize has four favorable opinions: See Annexes ARG-31, ARG-45, ARG-46 and ARG-47; Bt-11 sweet maize has three favorable opinions: See Annexes ARG-32, ARG-33 and ARG-47; Finally, MON810 maize has two favorable opinions: See Annexes ARG-44 and ARG-47. 255 See the Appellate Body Report in Japan – Agricultural products, WT/DS76/AB/R, paragraph 73. 256 See point II.A.5.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 167 Agreement 494. Article 5.5 requires in its pertinent part that:

“With the objective of achieving consistency in the application of the concept of appropriate level of sanitary or phytosanitary protection against risks to human life or health, or to animal and plant life or health, each Member shall avoid arbitrary or unjustifiable distinctions in the levels it considers to be appropriate in different situations, if such distinctions result in discrimination or a disguised restriction on international trade (...)”

495. As stated in the first part of this presentation, the Appellate Body indicated three elements that must be shown in order to establish that this regulation has been violated. It also indicated that these elements are cumulative, that is, all three must be shown if violation of [article] 5.5 of the SPS Agreement is to be found.257 a.- First element: application of different levels of protection in different situations 496. This element comprises two aspects: “different levels of protection” and “different situations.” 497. The “situations” in “different situations” must be comparable. That is, for there to be a comparison, they must have elements in common so as to enable a comparison. There must be the same risks to be evaluated.258 498. EC Member States that maintain bans have established different levels of protection for “comparable” situations. Indeed, they have established levels of protection with respect to biotech products with EC approval and later approved in EC territories and those banned in the EC territories

257 See point II.A.6. 258 Appellate Body Report, EC-Hormones, WT/DS26/AB/R, WT/DS48/AB/R, paragraph 216/217.


regardless of EC approval. 499. With respect to the requirements for making this comparison, the Appellate Body specified:

“...Clearly, comparison of several levels of sanitary protection deemed appropriate by a Member is necessary if a panel's inquiry under Article 5.5 is to proceed at all. The situations exhibiting differing levels of protection cannot, of course, be compared unless they are comparable, that is, unless they present some common element or elements sufficient to render them comparable. If the situations proposed to be examined are totally different from one another, they would not be rationally comparable and the differences in levels of protection cannot be examined for arbitrariness.”259 (underlining added to indicate words in italics in the original)

500. All biotech agricultural products affected by the bans of some Member States have been authorized under the procedure indicated by EC regulations.260 Moreover, the Member States that today have bans in place have participated in the approval processes pursuant to the authorizations granted.261 501. This confirms that the Member States with bans currently in place initially accepted the EC’s level of sanitary and phytosanitary protection -given that they respected the procedure pursuant to EC regulations regarding product approval, as well as invocation of a “special safeguard”-. 502. Therefore, if some Member States maintain their bans despite the provisions of EC regulations and the level of protection, it is undoubtedly

259 Appellate Body Report, EC-Hormones, WT/DS26/AB/R, WT/DS48/AB/R, paragraph 217. 260 See point V.1. 261 Pursuant to EC regulations, Member States may object to applications for approval of biotech products. See Articles 13, 16 of Directive 90/220/EEC (Annex ARG-4), Article 18 of Directive 2001/18/EC (Annex ARG-3), and Article 6.4 of Regulation (EC) 258/97 (Annex ARG-5).

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 169 because they justify their measures with a different level of protection than that used by the EC for the same products. This level of protection, which originates in the bans of these Member States, is “zero risk.” 503. However, given that the biotech agricultural products involved have the same level of risk, they are applied different levels of protection. Therefore, the Member States are applying different levels of protection to comparable situations. This satisfies the first requirement for establishing a violation of Article 5.5 of the SPS Agreement. 504. The foregoing shows that the Member States that have established bans have applied different levels of protection in comparable situations. 505. Therefore, Argentina considers that in this case the EC Member States with bans in place “adopted their own levels of sanitary protection from risks to human life or health in various different situations,” thereby satisfying the first element required for claiming inconsistency with article 5.5 of the SPS Agreement. b.- Second element: arbitrary and unjustifiable differences in protection 506. The second element -that the levels of protection involve arbitrary or unjustifiable differences in their treatment of comparable situations- is also present in the bans maintained by some EC States. Given that the levels of risk are the same, it is inconsistent to apply different levels of protection. Yet this is exactly what some EC Member States have done with biotech agricultural products approved pursuant to EC procedure and those banned under national regulations. 507. The difference between these biotech products with regard to the level of protection is arbitrary and unjustifiable. 508. The Member States that currently have bans in place participated in the EC approval procedure for biotech products. This demonstrates an acceptance of the level of sanitary and phytosanitary risk considered in this regulation.


509. However, by implementing bans regardless of the approval of biotech agricultural products at the EC level and regardless of the denial of applications for “special safeguards”, the Member States arbitrarily and unjustifiably departed from the level of sanitary and phytosanitary risk contemplated by EC regulations. 510. This departure from EC regulations occurred without any increase in the level of risk associated with the biotech agricultural products involved. The scientific evidence was clear with regard to each one of the biotech agricultural products involved: Bt-176 maize, MON-810 maize, T-25 maize and Bt-11 maize.262

262 See point V.2, with respect to the denial of the applications for “special safeguard” with respect to each biotech agricultural product. Specifically, for Bt-176 maize, see Annex ARG-43, Opinion on the Invocation by Germany of Article 16 of Council 90/220/EEC Regarding the Genetically Modified BT-MAIZE LINE CG 00256-176 Notified by CIBA-GEIGY (now NOVARTIS), Notification C/F/94/11-03 (SCP/GMO/276Final - 9 November 2000) Opinion adopted by written procedure following the SCP meeting of September 22, 2000), point 4.4.5 “Conclusion”:

“Although the frequency (...), the significance of such an event in this particular case would be negligible given regard to the high background presence (...) in the environment. Consequently there is no need to reconsider previous Committee opinion on CG-00256-176 in this respect.”

For MON810 maize, see Annex ARG-44, Opinion of the Scientific Committee on Plants on the Invocation by Austria of Article 16 (“safeguard clause”) of Council Directive 90/220/EEC with Respect to the Placing on the Market of the Genetically Modified Maize (MON810) Expressing the Bt cryia(b) Gene, Notification C/F/95/12-02, point “Conclusion”:

“In the context of accepted practices (...) the Committee concludes that there is no reason to change its previous advice to the Commission on the risk assessment of the Bt crops which it has evaluated to date. (...)”

In the case of T25 maize, see Annex ARG-45, Opinion on the Invocation by Austria of Article 16 of Council Directive 90/220/EEC Regarding a Genetically Modified Maize line T25, [in the point] entitled “Genetic transfer,” dated November 30, 2000, final paragraph:

“In view of the remote chance of the transfer into the environment (...), there is no evidence that this transgenic maize will pose any problem to the ecology (...).”

This was reiterated in the text modified on July 20, 2001; see Annex ARG-46. Finally, see Annex ARG-47, Opinion of the Scientific Committee on Food Concerning a Submission from the Italian Authorities Raising Concerns for the Safety of Certain Products Approved Under the Notification Procedure of Regulation (EC) 258/97, CS/NF/DOS/11 ADD 4 REV 2 Final, referring to MON-810 maize, T25 maize and Bt-11 maize, [in the point] entitled “Conclusion”:


511. Therefore, the difference in the levels of protection with regard to products that have the same level of risk is “arbitrary and unjustified.” c.- Third element: discrimination and disguised restriction on international trade 512. The distinctions made by these EC Member States have resulted in discrimination or disguised restriction on international trade. 513. By analyzing the actual text of the regulation at issue, it can be shown that the regulations in Austria and Luxembourg explicitly use the terms “verboten” (“prohibited” or “banned”)263 and “sont interdites” (“are prohibited [or “are banned]”),264 respectively, while the Decree from Italy specifically reads “sono sospese” (“are suspended”)265 and measure from

“The Committee is of the opinion that the information provided (...) does not provide detailed scientific grounds for considering that the use of the novel foods in question endangers human health.”

263 See Regulation 45 of the Federal Ministry for Health and Consumer Protection (“45. Verordnung der Bundesministerien für Gesundheit und Konsumentenschutz”), paragraph 1:

“Das Inverkehrbringen (...) in Österreich wird verboten: (...)” In Regulation 175 of the Federal Ministry for Women’s Issues and Consumer Protection (“175. Verordnung der Bundesministerien für Frauenangelegenheiten und Verbraucherschutz”), see paragraph 1:

“(1) Das Inverkehrbringen (...) ist verboten: (...)” In Regulation 120 of the Federal Ministry for Social Security and Generations (“120. Verordnung der Bundesministerien für soziale Sicherheit und Generationen”), see paragraph 1:

“(1) Das Inverkehrbringen (...) ist verboten: (...)”

264 In the Ministerial Order dated February 7, 1997, see in Article 1:

“Sont interdites a titre provisoire l’utilisation et la vente (...)”

265 The Decree of the Office of the Chairman of the Council of Ministers dated August 4, 2000, Article 1, sets forth:

“La commercializzazione e l’utilizzazione dei prodotti transgenici (...) sono sospese ai sensi di (...)”


Germany refers to “das Ruhen” (“the suspension”).266 A specific restriction on international trade is therefore found, thus constituting the third element required for a violation of article 5.5 of the SPS Agreement. 514. Moreover, as stated above,267 in order to determine whether a measure is discriminatory and constitutes a disguised restriction on international trade pursuant to Article 5.5 of the SPS Agreement, the Appellate Body in the Australia-Salmon case took into account three “warning signals” and some “additional factors”268: a) the arbitrary and unjustifiable nature of the differences in levels of protection; b) considerably substantial difference in the levels of protection; c) the inconsistency of the sanitary or phytosanitary measure with Articles 5.1 and 2.2 of the SPS Agreement. 515. Of the “additional factors” taken into account by the Appellate Body in the Australia-Salmon case, Argentina considers the following applicable to this case: - the level of protection for internal movement of national products compared with the level of protection for imported products. 516. The Member State bans have the 3 aforementioned “warning signals” and one additional factor, as determined by the Appellate Body. These give rise to discrimination or disguised restriction on international trade, and will be discussed in more detail below.

266 In the Amendment Notice issued by the Robert Koch Institute (“Änderungsbescheid vom Robert Koch Institut”), see after the title “Änderungsbescheid,” p. 1:

“Hiermit wird (...) das Ruhen der Genehmigung für das Inverkehrbringen (...) angeordnet, (...)”

267 See point II.A.6.c. 268 Appellate Body Report, Australia-Salmon, WT/DS18/AB/R, paragraphs 159-177.


517. As demonstrated above, the difference between the levels of protection applied by the EC Member States is “arbitrary and unjustified.” 518. Furthermore, there is a considerable degree of difference between the level of protection used for biotech agricultural products authorized by the Member States and the level of protection used for those products approved at the EC level prior to the “de facto” moratorium but banned in the Member States, with no justification for that difference. 519. Finally, as demonstrated in the pertinent part of this presentation, the Member States have not based these bans on a risk assessment. Furthermore, the risk assessments carried out during the approval process and “special safeguard” analysis do not support the ban. 520. Pursuant to the foregoing, the Member State bans demonstrate the three “warning signals” identified by the Appellate Body in Australia-Salmon.269 521. With regard to the “additional factor” that demonstrates discrimination and disguised restriction on international trade, we refer to the information set forth above.270 Moreover, the effect of bans enacted by some Member States on biotechnology-producing countries is therefore considerable and negative, because it falls inequitably on imported products. 522. Similarly, the bans of some EC Member States are not based on a risk assessment, because the assessments are done at the EC level and give completely contrary results. The bans have a negative effect on biotech products, the vast majority of which originate outside the EC.271 523. Therefore, Argentina contends that the bans on the aforementioned biotech agricultural products by some EC Member States are inconsistent with Article 5.5 of the SPS Agreement. Violation of the three “elements” in article 5.5 has been verified cumulatively. It has been established that biotech agricultural products approved at the EC level and authorized in the


269 Appellate Body Report, Australia-Salmon, WT/DS18/AB/R, paragraphs 159-177. 270 See point II.A.6.c.


offending Member States receive different treatment than products approved at the EC level and banned by these same States. 7.- Member State bans are inconsistent with Article 2.3 of the SPS Agreement 524. Article 2.3 requires:

“Members shall ensure that their sanitary and phytosanitary measures do not arbitrarily or unjustifiably discriminate between Members where identical or similar conditions prevail, including between their own territory and that of other Members. Sanitary and phytosanitary measures shall not be applied in a manner which would constitute a disguised restriction on international trade.”

525. In this regard, Argentina reiterates the point made by WTO jurisprudence:

“Furthermore, the Panel made it clear that it abstained from a separate examination of Article 2.3, first sentence, because it saw no need for such an examination, having already found that the measure in dispute is inconsistent with the requirements of Articles 5.1, 5.5 and 5.6 and is, on that ground, also inconsistent with the requirements of Articles 2.2 and 2.3. (...).”272 (footnotes omitted)

526. Pursuant to the foregoing, Argentina requests that the Member State bans be found to violate Article 2.3 of the SPS Agreement, just as they have been shown to be inconsistent with Article 5.5 of the SPS Agreement. 8.- The State bans are inconsistent with Article 5.6 of the SPS Agreement

272 Appellate Body Report in Australia-Salmon, WT/DS18/AB/R, paragraph 249.


527. Article 5.6 sets forth:

“Without prejudice to paragraph 2 of Article 3, when establishing or maintaining sanitary or phytosanitary measures to achieve the appropriate level of sanitary or phytosanitary protection, Members shall ensure that such measures are not more trade-restrictive than required to achieve their appropriate level of sanitary or phytosanitary protection, taking into account technical and economic feasibility.”3 3 For purposes of paragraph 6 of Article 5, a measure is not more trade-restrictive than required unless there is another measure, reasonably available, taking into account technical and economic feasibility, that achieves the appropriate level of sanitary or phytosanitary protection and is significantly less restrictive to trade.

528. We reiterate the foregoing assertions with respect to the requirements under this Article,273 as indicated by the Appellate Body:

“... the three elements of this test under Article 5.6 are that there is an SPS measure which: 1) is reasonably available taking into account technical and economic feasibility; 2) achieves the Member’s appropriate level of sanitary and phytosanitary protection; and 3) is significantly less restrictive to trade than the SPS measure contested. These three elements are cumulative in the sense that, to establish inconsistency with Article 5.6, all of them have to be met. If any of these elements is not fulfilled, the measure in dispute would be economic feasibility, or if the alternative

273 See point II.B.7.


measure does not achieve the Member's appropriate level of sanitary or phytosanitary protection, or if it is not significantly less trade-restrictive, the measure in dispute would be consistent with Article 5.6.”274

529. With regard to the first element (existence of another available measure that is technically and economically feasible), it should also be noted here that the EC Member States in question -Germany, Austria, Italy and Luxembourg- had recourse to alternative measures before going to the extreme of an absolute ban on biotech agricultural products already approved at the EC level. Indeed, the EC’s own regulations consider the possibility of establishing a temporary “special safeguard” subject to a scientific opinion. 530. With regard to the second element, we consider that an adequate level of protection has been established by the EC’s own regulations as they functioned until 1998. This is true both for the approval process for biotech products and for the “special safeguard”. If a Member State considered it necessary to redefine the adequate level, it could invoke the “special safeguard,” but always subject to a final scientific opinion that would justify the different level of protection. It could never be applied in the way these Member States have applied it. 531. The third element (that [the measure] be significantly less restrictive to trade) is also established, because any measure other than a ban would have a less restrictive effect. The “special safeguard,” given its provisional nature, undoubtedly has a less restrictive effect. 532. Therefore, Argentina considers that a) the EC Member States have alternative sanitary or phytosanitary measures available, other than implementing bans with no scientific justification; b) it was possible to achieve an adequate level of protection using these alternative measures; and c) these alternative measures would be significantly less restrictive than a ban on biotech agricultural products already approved by the European Communities. 274 Appellate Body Report, Australia-Salmon, WT/DS18/AB/R, paragraph 194.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 177 533. Therefore, Argentina contends that the bans at the level of some Member States violate Article 5.6 of the SPS Agreement. 534. Pursuant to all of the foregoing, the bans of some EC Member States are inconsistent with the SPS Agreement, specifically with Articles 5.1, 2.2, 5.5, 2.3, and 5.6. CONCLUSION REGARDING THE INCONSISTENCY OF THE STATE BANS WITH THE SPS AGREEMENT 535. On the grounds set forth above, Argentina contends that the bans established by Germany, Austria, Italy, and Luxembourg on the aforementioned biotech agricultural products already approved by the European Communities are inconsistent with Articles 5.1, 2.2, 5.5, 2.3 and 5.6 of the SPS Agreement. B.- BANS OF EC MEMBER STATES ARE INCONSISTENT WITH GATT 1994 1.- Inconsistency with Article III:4 of GATT 1994 536. Article III of GATT 1994 (National Treatment on Internal Taxation and Regulation) sets forth in paragraph 4:

“The products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favourable than that accorded to like products of national origin in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use. (...)”

537. The bans of some EC Member States infringe article III:4 of GATT 1994, because they accord biotech agricultural products less favorable treatment than “non-biotech” agricultural products. This incompatibility occurs because the requirements are met, as indicated by the Appellate Body


to establish a violation of Article III:4 of the GATT 1994:

“For a violation of Article III:4 to be established, three elements must be satisfied: that the imported and domestic products at issue are “like products”; that the measure at issue is a “law, regulation, or requirement affecting their internal sale, offering for sale, purchase, transportation, distribution, or use”; and that the imported products are accorded “less favourable” treatment than that accorded to like domestic products. (...)”275

538. Thus, we consider that: a) products are like as defined pursuant to Article III:4 of GATT 1994; b) the bans of some EC Member States are a “law, regulation or requirement” affecting “the [products’] internal sale, offering for sale, purchase, transportation, distribution, or use,” and c) “less favorable treatment” has been accorded the imported (biotech) product than the (“non-biotech”) domestic product. 539. With regard to inconsistency with article III:4 of GATT 1994, Argentina reiterates the foregoing argued in the inconsistency of the “suspension of processing and failure to consider individual applications or authorizations for approval of specific biotech agricultural products of particular interest to Argentina”.276 a.- Like products in the sense of Article III:4 of GATT 1994 540. In analyzing the issue of “likeness” between biotech agricultural products and “non-biotech” agricultural products, we reiterate the pertinent argument regarding the “suspension of processing and failure to consider

275 Appellate Body Report, Korea-Beef, WT/DS161/AB/R, WT/DS169/AB/R, paragraph 133. 276 See point III of this presentation.


individual applications or authorizations for approval of specific biotech agricultural products of particular interest to Argentina.”277 b.- The bans of some EC Member States are a “law, regulation or requirement” affecting “the [products’] internal sale, offering for sale, purchase, transportation, distribution, or use” 541. The Member State bans have clearly been implemented through positive legislation: “regulations,” “ministerial orders,” [and] “decrees”278 that refer explicitly to the restriction on entry of biotech agricultural products into the respective markets.279 542. Just as the “suspension of processing and failure to consider individual applications or authorizations for approval of specific biotech agricultural products of particular interest to Argentina” by its very nature affects the conditions of competition, the bans by certain EC Member States -by their very nature- contain the second element required for establishing a violation of Article III:4 of GATT 1994. c.- According of “less favorable treatment” 543. We reiterate what the Appellate Body set forth:

“(...) Whether or not imported products are treated “less favourably” than like domestic products should be assessed instead by examining whether a measure modifies the conditions of competition in the relevant market to the detriment of imported products.” 280

277 See point III of this presentation. 278 See point V.A.1.a.ii). 279 See point V.A.6.c. 280 Appellate Body Report, Korea-Beef, WT/DS161/AB/R, WT/DS169/AB/R, paragraph 137.


544. As set forth above,281 the bans on certain biotech agricultural products by some EC Member States constitute an absolute ban on imports of these products, while like “non-biotech” products and other biotech products are not subject to restrictions in the internal markets of these Member States. 545. Pursuant to the foregoing, we consider that the bans by some EC Member States violate Article III:4 of GATT 1994. CONCLUSION WITH RESPECT TO THE MEMBER STATE BANS BEING INCONSISTENT WITH THE GATT 1994 AGREEMENT 546. On the grounds set forth above, Argentina contends that the bans established by Germany, Austria, Italy and Luxembourg are inconsistent with Article III:4 of GATT 1994. C.- INCONSISTENCY OF THE BANS OF THE EC MEMBER STATES WITH THE AGREEMENT ON TECHNICAL BARRIERS TO TRADE -TBT- 547. As demonstrated in the pertinent part of this presentation, the bans of the EC Member States282 that affect specific biotech agricultural products of particular interest to Argentina constitute sanitary or phytosanitary measures. Therefore, the SPS Agreement applies to them. 548. It must be emphasized that the SPS and TBT Agreements are mutually exclusive, as specified by the pertinent regulations in each of them. Thus, article 1.5 of the TBT Agreement sets forth that:

“The provisions of this Agreement do not apply to sanitary and phytosanitary measures as defined in Annex A of the Agreement on the Application of Sanitary and Phytosanitary Measures.”

281 See point III of this presentation. 282 See Annex ARG-13.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 181 549. The SPS Agreement sets forth in article 1.4 that:

“Nothing in this Agreement shall affect the rights of Members under the Agreement on Technical Barriers to Trade with respect to measures not within the scope of this Agreement.”

550. However, if the Panel considers that it should not analyze the matter under the SPS Agreement, Argentina will alternatively argue under the TBT Agreement. 551. In that case, it should be indicated that the TBT applies to the “technical regulations” as defined in Annex 1, paragraph 1 of the TBT Agreement. 552. In that sense, the bans established by Germany, Austria, Italy and Luxembourg on specific biotech agricultural products of particular interest to Argentina are “technical regulations” pursuant to Annex 1, paragraph 1 of the TBT Agreement. 1.- EC legislation for approval of biotech agricultural products constitutes “technical regulations” pursuant to Annex 1, paragraph 1 of the TBT Agreement 553. Annex 1, paragraph 1 of the TBT sets forth:

“Technical Regulation Document which lays down product characteristics or their related processes and production methods, including the applicable administrative provisions, with which compliance is mandatory. It may also include or deal exclusively with terminology, symbols, packaging, marking or labeling requirements as they apply to a product, process or production method.”


554. The bans established by various EC Member States (Germany, Austria, Italy and Luxembourg) are “technical regulations” arising from the very regulations under which these bans are applied. 555. The Appellate Body has established three criteria for determining whether a document fits the definition of “technical regulation” in the TBT Agreement.283 These criteria are: a) the document must apply to an identifiable product or group of products. That product or group of products need not, however, be expressly identified in the document284; b) the document must lay down one or more characteristics of the product. These characteristics may be intrinsic, or they may be related to the product. They may be prescribed in either positive or negative form; and, c) compliance with the product characteristics must be mandatory. 556. The Member State bans are technical regulations that satisfy the three requirements set forth by the Appellate Body. 557. With regard to the first of these criteria, that is, that the product be “identifiable,” the bans at issue are found to refer specifically to certain biotech agricultural products. 558. Indeed, each of the instruments under which the bans were established have clearly identified the product to which the bans apply. 559. For example, the measure imposed by Germany clearly indicates: “Hiermit wird (...) das Ruhen der Genehmigung für das Inverkehrbringen der Maislinie CG 00256-176 (...) angeordnet, (...)”285

283 Appellate Body Report, EC-Asbestos, WT/DS135/AB/R, paragraphs 66/70; Appellate Body Report, EC-Sardines, WT/DS231/AB/R, paragraph 176. 284 Appellate Body Report, EC-Asbestos, WT/DS135/AB/R, paragraph 70. 285 See in the Amendment Notice issued by the Robert Koch Institute, in Annex ARG-13.


560. The regulations under which the bans were applied in Austria set forth that: “Das Inverkehrbringen des im folgenden beschriebenen Erzeugnisses und jede Verwendung dieses Erzeugnisses (...) in Österreich wird verboten: 1. Das Erzeugnis besteht aus (...) von einer Mais (Zea Mays L.)-Linie (CG 00256-176), (...)”286 Similarly: “(1) Das Inverkehrbringen des im folgenden beschriebenen Erzeugnisses ist verboten: 1. Dieses Erzeugnis besteht aus Inzuchtlinien und Hybriden der Zea Mays L., Linie MON 810, (...)”287 Also: “(1) Das Inverkehrbringen des im folgenden beschriebenen Erzeugnisses ist verboten: Samen und Körner von genetisch verändertem Maiz (Zea Mays L.) (...), Transformationsereignis T25, (...)”288 561. Another example is the regulation under which the ban was applied in Italy, which sets forth: “La commercializzazione e l’utilizzazione dei prodotti transgeneci Mais BT11, Mais MON 810, Mais MON 809 e MAIS T25 sono sospese ai sensi di cui aile premesse”289

286 45. Verordnung dated February 13, 1997, see Annex ARG-13. 287 175. Verordnung dated June 10, 1999, see Annex ARG-13. 288 120. Verordnung dated April 28, 2000, see Annex ARG-13. 289 Decree of the Office of the Chairman of the Council of Ministers, August 4, 2000, see Annex ARG-13.


562. Luxembourg sets forth in the regulation that establishes the ban: “Sont interdites à titre provisoire l’utilisation et la vente du produit identifié ci-après, 1. Le produit...(Zea maysI..) (CG 00256-176)...” 563. With regard to the second criterion, the “establishment of characteristics,” the Appellate Body in EC-Sardines has set forth that the product characteristics may be imposed in positive or negative form.290 In the case of the Member State bans at issue, [the States] have opted for a negative description, that is, that the products specified in the bans may not be placed on the market.291 564. Therefore, the Member State regulations that establish the bans satisfy the second requirement, which means that each one of them constitutes a technical regulation. 565. Finally, each of the Member State bans satisfies the third requirement, that is, mandatory compliance with the product characteristics. 566. Indeed, the regulations that established the Member State bans clearly set forth their mandatory nature.292 567. A mere reading of the regulations under which the State bans were established clearly indicates that the requirement of mandatory [compliance] is present. 568. The foregoing shows that the regulations under which the State bans were established, which Argentina is challenging, are technical regulations, because they meet the three requirements necessary to be considered as

290 Appellate Body Report, EC-Sardines, WT/DS231/AB/R, paragraph 176. 291 See regulation challenged, Annex ARG-13. 292 See regulation challenged, Annex ARG-13.


such. 2.- The Member State bans applied by some EC Member States to specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 2.1 of the TBT Agreement 569. Article 2.1 of the TBT Agreement requires that:

“Members shall ensure that in respect of technical regulations, products imported from the territory of any Member shall be accorded treatment no less favourable than that accorded to like products of national origin and to like products originating in any other country.”

570. The Member State bans applied to specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 2.1 of the TBT Agreement. Since Article 2.1 of the TBT Agreement basically develops the obligations concerning treatment in Article III:4 of the GATT 1994, we refer to the arguments made in the pertinent part of this presentation.293 Therefore, the way in which the aforementioned EC Member States (Germany, Austria, Italy and Luxembourg) have applied their regulations is inconsistent with Article 2.1 of the TBT Agreement. 3.- The application of EC legislation is inconsistent with Article 2.2 of the TBT Agreement 571. Article 2.2 of the TBT agreement requires that:

“Members shall ensure that technical regulations are not prepared, adopted or applied with a view to or with the effect of creating unnecessary obstacles to international trade. For this purpose, technical regulations shall not be more trade-restrictive than necessary to fulfill a legitimate objective, taking account of the risks non-fulfillment would create. Such

293 See Section III of this presentation.


legitimate objectives are, inter alia: national security requirements; the prevention of deceptive practices; protection of human health or safety, animal or plant life or health, or the environment. In assessing such risks, relevant elements of consideration are, inter alia: available scientific and technical information, related processing technology or intended end-uses of products.”

572. It is clear that the aforementioned Member States have applied their technical regulations in a way that constitutes a ban on imports of the biotech products included thereunder. 573. Indeed, for the application of a technical regulation to be consistent with Article 2.2 of the TBT Agreement, it must comply with three requirements: a) pursue a legitimate objective; b) must fulfill that objective; and, c) must not be more trade-restrictive than is necessary to fulfill that legitimate objective, taking into account the risks non-fulfillment would create. 574. With regard to the first requirement, and bearing in mind the objective of the Member State bans,294 which is to protect against risks to human, animal and plant health, it is clear that the bans are inconsistent with this regulation. 575. It is inconsistent because although the legitimate objectives of the technical regulations include health, as provided in Article 2.2 of the TBT Agreement, this does not authorize the European Communities to ignore the risk assessments of specific biotech products in order to achieve the potential legitimate objectives of the technical regulations as required by the TBT

294 The Member State bans make specific reference to and/or were proposed to the European Communities to obtain a “special safeguard”; [that is], a measure applied to protect life and health, according to Article 16 of Directive 90/220/EEC and Article 12 of Regulation (EC) 258/97.


Agreement. 576. Moreover, the risk assessment must take into account “available scientific and technical information.” As was shown in the pertinent part of this presentation,295 all the scientific information invalidates the Member State bans. The EC’s Scientific Committees have rendered opinions about the products covered by the bans at least twice each time296 (before and after the bans were established) and that, in all cases, they have found no health or environmental risks. 577. Despite the existence of scientific evidence demonstrating that the biotech products pose no risks that differ from their “non-biotech” counterparts, the application of these prohibitions to biotech agricultural products has become an absolute ban on imports of these products. 578. The foregoing shows that the Member State bans are not being applied to fulfill the legitimate objective pursuant to Article 2.2 of the TBT Agreement. As the scientific evidence demonstrates, this is because the biotech agricultural products of particular interest to Argentina that are covered by these bans are as safe as their “non-biotech” counterparts. 579. With regard to the second requirement of Article 2.2 of the TBT Agreement (fulfillment of that legitimate objective), the objective of protecting against the potential risks associated with the products has already been satisfied by the opinion of the respective Scientific Committees. However, the Member States in question did not take this scientific evidence from EC experts into account, nor did they present evidence that would contradict those opinions. 580. Therefore, in applying its own regulations, the EC has not achieved the legitimate objective these regulations require. Thus, the action it has taken has not been consistent with Article 2.2 of the TBT Agreement.

295 See point V.A.5. 296 Bt-176 maize has two favorable opinions: see Annexes ARG-30 and ARG-43; T25 maize has four favorable opinions: see Annexes ARG-31, ARG-45, ARG-46 and ARG-47; Bt-11 maize has three favorable opinions: see Annexes ARG-32, ARG-33 and ARG-47. Finally, MON810 maize has two favorable opinions: see Annexes ARG-44 and ARG-47.

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 188 581. Finally, the regulations should not be applied in such as way as to restrict trade more than necessary in order to fulfill a legitimate objective, taking into account the risks such non-fulfillment creates. In this sense, it is once again necessary to emphasize that the biotech products of particular interest to Argentina had already received a favorable scientific opinion. 582. Therefore, the legitimate objective (protection of health) is satisfied, which also bars any hypothesis on the risks posed by not fulfilling a legitimate objective. Nonetheless, the biotech agricultural products of particular interest to Argentina have been subject to a ban on imports that is clearly more restrictive than necessary, thus creating barriers to international trade. 583. By virtue of the foregoing, the bans of the EC Member States in question are inconsistent with Article 2.2 of the TBT Agreement. 4.- The bans of the Member States on specific biotech agricultural products of particular interest to Argentina are inconsistent with Article 2.9 of the TBT Agreement 584. The Member State bans of the aforementioned EC Member States are inconsistent with Articles 2.9.1, 2.9.2 and 2.9.4 of the TBT. 585. The aforementioned regulation sets forth:

“Article 2.9.1 publish a notice in a publication at an early appropriate stage, in such a manner as to enable interested parties in other Members to become acquainted with it, that they propose to introduce a particular technical regulation; Article 2.9.2 notify other Members, through the Secretariat, of the products to be covered by the proposed technical regulation, together with a brief indication of its objective and rationale. Such notifications shall take place at an early appropriate stage, when amendments can still be introduced and comments taken into account;


Article 2.9.4 without discrimination, allow reasonable time for other Members to make comments in writing, discuss these comments upon request, and take these written comments and the results of these discussions into account;”

586. Article 2.9 of the TBT Agreement always applies when two conditions are present: a) in cases where there is no relevant international regulation...; and, b) whenever the technical regulation may have a significant effect on other Members’ trade. 587. Both conditions are present in the case of the Member State bans in question. Indeed, no relevant international regulation exists. In addition, the bans have a significant effect on other Members’ trade, because they have prevented the entry of the products into the markets of the Member States that established the bans. 588. It is clear that the general conditions for applying article 2.9 of the TBT Agreement are present in this case. In fact, there is still no relevant international regulation, and the Member State bans have a significant effect on trade with other Members. 589. With respect to article 2.9.1 of the TBT Agreement, our country has received no notice in any publication, at any stage (early or otherwise). Rather, we learned of the existence of the State bans when they took effect. This, in turn, prevented us from becoming informed of their content. Therefore, Article 2.9.1 of the TBT Agreement has clearly been violated. 590. For similar reasons, the Member State bans are inconsistent with Article 2.9.2 of the TBT Agreement. This is because there is no knowledge of any notification made to the WTO Secretariat required under this regulation, which necessarily impedes compliance with the requirements that such notification must be made (indication of the products to which the regulation will be applied, indication of the objective and purpose of the regulation). By not having complied with this regulation, which requires a

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 190 “notification at an early appropriate stage,” it was not possible to introduce modifications or make comments that could be taken into account as this article requires. 591. Nor was there compliance with the requirement in Article 2.9.4 of the TBT Agreement, because the Members were not accorded reasonable time to make comments in writing. For this reason, it was not possible to discuss the comments, because the comments were never made. 592. None of the EC Member States that established bans on products of particular interest to Argentina have alleged any of the circumstances in Article 2.10 of the TBT Agreement that would allow the Member States to avoid the requirements in Article 2.9 of the Agreement. CONCLUSION WITH RESPECT TO THE MEMBERS STATE BANS BEING INCONSISTENT WITH THE TBT AGREEMENT 593. For the reasons explained above, if the Panel considers that it is not required to analyze the question under the SPS Agreement, Argentina thinks that the aforementioned EC Member States, by the institution of bans on determined biotech agricultural products, have violated Articles 2.1, 2.2, 2.9.1, 2.9.2 and 2.9.4 of the TBT Agreement. VI.- REQUEST FOR FINDINGS 594. For the reasons set forth in the foregoing paragraphs, the Republic of Argentina respectfully requests that the Panel find: I) the inconsistency of the EC “de facto” moratorium with the Agreement on the Application of Sanitary and Phytosanitary Measures (SPS Agreement). In other words, the substantive inconsistency of the EC measure which has affected approval of all biotech agricultural products since 1998 with Articles 5.1, 2.2, 5.5, 2.3 [and] 7 of the SPS [Agreement] and Annexes B:1 and 10.1 of the SPS Agreement; II) the inconsistency of “the EC’s suspension of processing and failure to

European Communities – Measures Affecting the First Presentation of the Approval and Marketing of Argentine Republic Biotech Products (WT/DS293) (Courtesy Translation) Page 191 consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” with Articles 5.1, 2.2, 5.5 [and] 5.6 of the SPS Agreement; III) the inconsistency of the “undue delay by the EC in the processing of the various requests for approval of biotech agricultural products that are of particular interest to Argentina” [and] decided by the EC, specifically with Article 8 and Annex C:1(a), (b), (c) and (e) of the SPS Agreement; IV) the inconsistency of the “the suspension of processing and failure to consider individual applications for approval of specific biotech agricultural products of particular interest to Argentina” with Article III:4 of the GATT 1994; V) Alternatively, in the event that the Panel does not analyze Argentina’s claim with respect to the EC’s inconsistencies under the SPS Agreement, Argentina respectfully requests that the Panel find that “the application of Community legislation in relation to the approval system for specific biotech agricultural products of particular interest to Argentina” is inconsistent with Articles 2.1, 2.2, 5.1.1, 5.1.2, 5.2.1, 5.2.2 and 12 of the TBT Agreement: VI) Similarly, the Republic of Argentina requests that the Panel find that the bans of some EC Member States are inconsistent with Articles 5.1, 2.2, 5.5, 2.3 [and] 5.6 of the SPS Agreement, Article III:4 of the GATT 1994 and, alternatively, with Articles 2.1, 2.2, 2.9.1, 2.9.2 and 2.9.4 of the TBT Agreement.

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