SPS Agreement
I. Introduction of the SPS Agreement
The SPS Agreement, short for the Agreement on the Application of Sanitary and Phytosanitary Measures, is an important agreement of the World Trade Organization (WTO) on trade in goods for its members. Negotiations on the SPS Agreement began with negotiations on the Agreement on Agriculture, with the intention of "reducing the negative impact of barriers of sanitary and phytosanitary regulations on agricultural trade". We can say that the SPS Agreement is a derivative of the Agreement on Technical Barriers to Trade (TBT). It arises, as the TBT Agreement is unable to adapt to the technical complexity, regional diversity and country particularity of sanitary and phytosanitary measures. The SPS Agreement aims to avoid its members’ unnecessary barriers of the sanitary and phytosanitary measures to international trade so as to promote international trade liberalization and facilitation. When formulating the sanitary and phytosanitary measures, international coordination is carried out on the basis of the standards of the Codex Alimentarius Commission, the International Bureau of Veterinary Diseases and the International Convention on Plant Protection, to curb protectionism in the main form of discriminatory sanitary and phytosanitary measures, to minimize and eliminate technical barriers in international trade and to serve the globalization of the world economy.
II. Background of the SPS Agreement
In the Uruguay round negotiations, agricultural negotiations were initiated primarily to reduce trade barriers created by countries who aim to protect their domestic markets. However, some contracting parties to the General Agreement on Tariffs and Trade (hereinafter referred to as “GATT”) concerned that the reduction of tariffs and the elimination of special non-tariff for agriculture will lead to adopting the concealed protection measures in the form of sanitary and phytosanitary regulations. It is this concern that has prompted all GATT negotiators to reach a separate agreement on the implementation of sanitary and phytosanitary measures, namely, the SPS Agreement, when the parties were holding major agricultural trade negotiations.
1. Relationship between the SPS Agreement and the Agreement on Agriculture
The SPS Agreement and the Agreement on Agriculture are complementary. In fact, both agreements are administered by the Agriculture and Commodities Branch of the WTO Secretariat.
Although the two agreements are complementary, they are designed for different purposes. The Agreement on Agriculture contains not only regulatory-based commitments, but detailed and specific quantitative requirements for agricultural products so as to eliminate trade barriers and monitor the implementation of agreements. The SPS Agreement does not dictate a quantitative and legally binding schedule of concessions. It is only a set of rules, principles and norms that WTO members should follow to ensure that sanitary and phytosanitary measures are reasonable and do not constitute disguised restrictions on international trade.
2. From the TBT Agreement to the SPS Agreement
Prior to the negotiation of the SPS Agreement, many regulations relating to food safety and animal and plant health were under the jurisdiction of the Technical Barriers to Trade Agreement (hereinafter referred to as “TBT Agreement”) signed in 1979. The TBT Agreement, also known as the Standards Code, was the result of the Tokyo round of multilateral negotiations at GATT. The code allows a limited number of signatories to adopt the technologies or sanitary and phytosanitary regulations that are potentially restrictive to trade with "reasonable" objectives, such as protection of human, animal or plant health, protection of the environment, animal welfare, and religious purposes, for national security reasons. The latest results of the agricultural trade negotiations have made member countries realized that a more specific and comprehensive provision than the Standard Code is needed to clarify the relationship between health protection and trade measures.
3. Clause (b), Article 20 of GATT 1947
Clause (b), Article 20 of the GATT 1947, signed in 1947, provides that "measures necessary to protect the life or health of human beings, animals or plants" can be exempted from other provisions of the GATT 1947. However, the GATT 1947 fails to provide a clearer and more specific definition of the scope to which measures are allowed. This makes it possible for the government of the signatories to the GATT to use sanitary and phytosanitary measures as tools to protect its domestic enterprises from competition and to impede the liberalization of agricultural trade. Therefore, it is more necessary to formulate an independent agreement, providing more detailed and clear provisions and principles for the implementation of sanitary and phytosanitary measures.
III. Application Range of the SPS Agreement
The SPS Agreement clarifies that the scope of its jurisdiction is divided according to the purpose of implementing sanitary and phytosanitary measures, namely whether the purpose of implementing measures is to ensure food safety and the health of animals and plants, rather than by the type of measures. Therefore, the provisions of the SPS Agreement cover products, processes and production methods, etc. For example, if the ultimate consumer wants to buy safe meat products, the slaughterhouse must operate according to strict sanitary standards. Sanitary and phytosanitary measures apply not only to domestic food or local animal and plant diseases, but also to products from other countries. Different measures can be taken for different products from different places of production because of different animal and plant diseases. However, scientific assessments must be made to justify different measures.
IV. Definition of SPS Measures
For the purposes of the SPS Agreement, sanitary and phytosanitary measures (SPS measures) may be defined as any measure applicable to the following situations:
Here, sanitary measures refer to those related to human or animal health, while phytosanitary measures refer to those related to plant health. These include measures taken to protect the health of fish and wild animals, as well as the health of forests and wild plants.
Measures taken to protect the environment, consumer interests or animal welfare are beyond the scope of the SPS Agreement. However, other agreements of WTO deal with these issues (such as the TBT Agreement or Article 20 of GATT 1994).
V. Type of SPS Measures
The SPS Agreement applies to any type of measures taken to achieve one of the objectives defined above. SPS measures can take many forms, such as enforcing special product and process standards, requiring products to come from pest-free areas, quarantine protocols, certification or inspection procedures, sampling and testing requirements, health-related labeling measures, determination of the maximum allowable pesticide residue level, or provisions for the use of a single additive in food, etc. Some of these measures, such as process requirements or certification, are implemented primarily in the exporting country, rather than after arriving in the importing country. Although the measures are enforced outside the territory of the importing country, they must be designed to protect the health of human beings, animals and plants within the territory of the importing country.
VI. The Differences between SPS and TBT
The measures provided in the TBT Agreement and the SPS Agreement are implemented in different scopes. SPS measures include measures taken to achieve the following purposes:
but do not consider whether these measures are technical requirements.
Unless the SPS measures have been defined by the SPS Agreement, the TBT Agreement covers all technical regulations, voluntary standards and procedures to ensure that these technical regulations and standards are met. Therefore, the type of measure determines whether it is a TBT measure or a SPS measure, and the purpose of the measure determines whether the measure belongs to the SPS measures.
TBT measures cover everything from car safety to energy-efficient devices and the shape of food packaging boxes. Here are some examples of human health. Restrictions on medicine or labeling requirements for cigarettes are TBT measures. Most measures related to the prevention and control of human diseases are subject to the TBT Agreement, unless these diseases are carried by animals or plants (e.g., infection with rabies virus). For food, most labeling requirements, nutrition instructions and related requirements, and quality and packaging regulations are not generally considered to be SPS measures and are therefore subject to the jurisdiction of the TBT Agreement.
On the other hand, the definition of SPS measures indicates that the laws and regulations enacted in response to food microbial contamination, the allowance of pesticide or veterinary drug residues and the identification of permissible food additives fall under the jurisdiction of the SPS Agreement. If packaging and labeling requirements are directly related to food safety, these measures also fall under the jurisdiction of the SPS Agreement.
The two agreements have the same elements, including the basic obligations of the non-discriminatory principle, notifications of measures formulated and revised in advance, and the establishment of counseling offices (enquiry points) and similar requirements. However, many of the substantive rules of the two agreements are different. For example, both agreements encourage adopting international standards. However, under the SPS Agreement, the only basis for judging whether SPS measures without international standards are reasonable is the scientific basis of risk assessment for potential risks. On the contrary, under the TBT Agreement, member governments may argue that international standards are inappropriate on other grounds, including basic technical issues or geographical factors.
SPS measures must be implemented on the basis of scientific information, to the extent necessary to protect human, animal and plant health. However, when multiple objectives need to be achieved, such as national security or prevention of fraud, member governments can adopt TBT regulations. It is essential to identify a measure as an SPS measure or a TBT measure, since member countries have different degrees of acceptance of their obligations under the two agreements
VII. SPS Enquiry Points and Notification
The transparency articles of the SPS Agreement ensure that interested public and trading partners understand measures aim at protecting human, animal and plant health. The agreement requires member governments to issue all SPS regulations promptly and to provide explanations of any special food safety or animal and plant health requirements at the request of other member governments.
All WTO member governments must establish an enquiry point as an office to receive and respond to questions relating to the country's SPS measures. These questions may be requests for copies of newly enacted or existing regulations, information on bilateral agreements signed between the two countries or relevant information on risk analysis, etc. The address of the enquiry point can be found on the website of the World Trade Organization (“Documents on Line” section on http://www.wto.org.og, document code, SPS/ ENQ/).
When a member government intends to draft a new regulation (or to amend an enacted regulation) that differs from international standards, and has an impact on trade, the member shall notify the WTO Secretariat, which shall distribute the notification to the other members (there are more than 700 notifications in the first three years of the implementation of the SPS Agreement). Interested public members can also receive notifications and make inquiries on the WTO website (document code G/SPS/N/). In addition, notifications can be obtained from the member's inquiry points that developed the measure.
Member governments should notify proposed regulations prior to their implementation to give trading parties opportunities for feedback. The SPS Committee has made recommendations on how to deal with these feedbacks.
In an emergency, members of the government may take immediate action, but notification to other members through the WTO Secretariat must be made immediately; feedback from other member governments in this regard should also be taken into account at the same time.