Overview of the WTO Agreement on Technical Barriers to Trade

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Presentation transcript:

Overview of the WTO Agreement on Technical Barriers to Trade Kent Shigetomi Office of the U.S. Trade Representative

Overview Brief Overview of the WTO Core Disciplines of the WTO Agreement on Technical Barriers to Trade (TBT Agreement) WTO TBT Committee Focus: Analyzing a Measure

What does the WTO do? Negotiate new trade rules through trade “Rounds” Implement and monitor adherence to rules in standing committees and councils Enforce trade obligations through “dispute settlement”

What is TBT? TBT = technical barrier to trade The WTO TBT Agreement provides disciplines technical regulations, standards, and conformity assessment procedures to ensure that they do not create unnecessary or discriminatory TBTs

TBT Agreement Objective: improve efficiency of production and facilitate trade by ensuring that regulations and standards do not create unnecessary obstacles to trade, and encouraging the development of international standards and conformity assessment systems Members have the right to regulate at levels they deem appropriate to achieve legitimate objectives, provided that they do not discriminate in an arbitrary or unjustified manner Coverage: all products (industrial/agricultural) except SPS and GPA

Core Disciplines of the TBT Agreement Objectives: improving efficiency of production and facilitating international trade by: ensuring that regulations and standards do not create unnecessary obstacles to trade, and encouraging the development of international standards and conformity assessment systems Members still have the right to regulate at levels they deem appropriate to achieve legitimate objectives, provided that they do not discriminate in an arbitrary or unjustified manner Coverage: all products (industrial and agricultural), excluding products specifications covered by the Agreement on Government Procurement and measures covered by the SPS Agreement

Core Disciplines of the TBT Agreement (continued) Key terms: Technical regulation (TR): a document setting out product characteristics or their related processes and production methods with which compliance is mandatory (includes labeling, packaging, symbols, etc.) Standard: a document approved by a recognized body that provides for common and repeated use, rules, guidelines, or characteristics for products or related processes and production methods, with which compliance is voluntary. Conformity assessment procedure (CAPs): a procedure used to determine that requirements in TRs and standards are met (includes sampling, testing, inspection, evaluation, registration, etc.) Note: Agreement only covers TRs and CAPs of governments

Core Disciplines of the TBT Agreement (continued) Ensure non-discrimination (MFN and national treatment) Measures must not be more trade restrictive than necessary to fulfill a “legitimate objective”

Core Disciplines of the TBT Agreement (continued) Legitimate Objectives under the TBT Agreement National security requirements Prevention of deceptive practices (e.g., misleading labeling) Protection of human health/safety, animal, plant life/health, environment

Core Disciplines of the TBT Agreement (continued) Assessment of Risk under the TBT Agreement Relevant elements of consideration include: Available scientific/technical information Related processing technology Intended end uses of products

Core Disciplines of the TBT Agreement (continued) Transparency in development of TRs and CAPs Establish and maintain a national enquiry point Notify draft TRs and CAPs, if not in accordance with relevant international standards, and if they may have a significant effect on trade, to the WTO Provide copies of TRs and CAPs (upon request) Allow for a comment period while amendments can still be introduced (minimum of 60 days is recommended) Take comments/discussions into account in finalizing the measure Publish measures promptly or otherwise make them available so that stakeholders can become acquainted with them Allow suppliers a reasonable interval to adapt to new requirements between publication and entry into force (minimum of 6 months is recommended)

Core Disciplines of the TBT Agreement (continued) Use of relevant international standards Relevance is key There could be more than one “International standard” is undefined

WTO TBT Committee Decisions and Recommendations adopted by the WTO Committee on Technical Barriers to Trade Since 1 January 1995 (G/TBT/1/Rev.12) Decisions and Recommendations Rules of Procedure

TBT Committee Decision No definition of international standards body in the text Committee Decision provides a list of principles that any organization may follow to develop international standards “International” refers to a process, not a body

Six Principles of International Standards Development Transparency: Notification/Publication of Standards and Standardization Activities Openness: Ensuring Access to the Process Impartiality and Consensus: Ensuring Fairness

Six Principles of International Standards Development Effectiveness and Relevance: Ensuring Market Relevance and the Use of Sound Science Coherence: Avoiding Duplication and Overlap Development Dimension: Encouraging Participation in Standards Development

Annex 3: The Code of Good Practice Annex 3 sets out principles for the preparation, adoption and application of standards Members must ensure that central government standardizing body accepts and complies (Art 4.1) Members must take reasonable measures to ensure non-governmental standardizing bodies in their territories and regional bodies accept and comply (Art 4.1) ANSI accepted the CGP on behalf of its accredited SDOs

Annex 3: The Code of Good Practice Publish work program every 6 months (para J) 60-day notice and comment before adoption of new standard (para L) On request, provide draft of standard (para M) Take account of comments (para N) Promptly publish adopted standard (para O)

WTO TBT Committee Monitors implementation and administration of the TBT Agreement Provides Members the opportunity to raise specific trade concerns, either in the full Committee or in informal bilateral meetings Meets three times per year (March, July, November) Other activities: Triennial Review of operation and implementation/workshops

Focus: Analyzing a Measure Country A regulates toy safety by mandating that all toys meet the terms of the XYZ international standard, which requires that magnets be properly fastened to toys to ensure that children cannot swallow them The requirement to ensure that magnets are properly fastened is a technical regulation (it mandates that toys containing magnets have a particular performance characteristic) In this case, the technical requirement is contained in a standard, a voluntary document developed by XYZ that becomes mandatory once compliance with its terms is incorporated in the technical regulation A conformity assessment procedure (e.g., testing) is a procedure to ensure that a technical requirement – the need to secure magnets properly -- is met Once you’ve established that a measure is covered by the TBT Agreement, the question becomes whether it is an unnecessary TBT

Key TBT Agreement Obligations Four key questions to ask when determining whether a TBT is an unnecessary TBT and, thus, raises WTO concerns: Does the measure treat an imported product less favorably than a like domestic product or a like imported product from another country? Is the measure “more trade restrictive than necessary to fulfill a legitimate objective”? Was the measure developed in a transparent manner? Does the measure use a relevant international standard as a basis, unless such standard is ineffective/inappropriate to fulfill the objective?

“Not More Trade Restrictive Than Necessary” What is the measure’s objective? Legitimate Objectives under the TBT Agreement include: National security requirements Prevention of deceptive practices (e.g., misleading labeling) Protection of human health/safety, animal, plant life/health, environment

“Not More Trade Restrictive Than Necessary” (continued) Key questions for probing whether a measure may be more trade restrictive than necessary: Are the requirements clear? Does the proposed measure appear to address the stated or implied objective? What available scientific/technical information did the regulator consider? (Did they miss anything?) Is there potential overlap/duplication with another regulation/regulator? Is there a less trade restrictive alternative we can identify? What’s happening on the ground (e.g., costs, delays, burdens, trade disruption/substitution)? Did the regulator take into account the intended end uses of the product?

“Not More Trade Restrictive Than Necessary” (continued) For conformity assessment procedures, are they “more strict or applied more strictly than necessary to give the importing country adequate confidence that products conform with the applicable requirements”? A few additional issues to look for: How long do the procedures take? Are the procedures clear and easy to follow? Information requirements: do they go beyond what is necessary to assess conformity and determine fees? Is confidential information respected in the same way as for domestic products and so that legitimate commercial interests are protected? Are fees equitable? Does the placement of facilities and selection of samples cause unnecessary inconvenience?

Transparency Have the TBT transparency provisions been followed? Was the measure notified to the WTO? If so was it notified at a stage where amendments can still be introduced and taken into account in finalizing the measure? How long was provided for comments (minimum of 60 days is recommended)? Is the measure (and any related documents necessary to understand the measure) published or otherwise available so that stakeholders can become acquainted with it? When does/did the measure enter into force? Does it allow suppliers a reasonable interval to adapt to new requirements between publication and entry into force (minimum of 6 months is recommended)?

Use of International Standards Are there relevant int’l standards? If so, did the regulator use one of them as a basis for its measure? If not, was the standard ineffective/ inappropriate to fulfill a legitimate objective? Relevance is key There could be more than one “International standard,” “international standards body” undefined in the Agreement text TBT Committee Decision Principles for Development of International Standards Openness, Transparency, Consensus, Effectiveness/Relevance, Coherence, Development