Questions and Answers January 2006
The WTO dispute panel in the case brought by the United States, Canada and Argentina against the European Union's position on GM crops is expected to make its interim decision on Thursday 5th January 2006. Some commentators are already claiming that the USA has 'won' and that the bans on GM crops in some EU member states will be found to violate WTO rules. Other information suggests that the WTO will confirm that GM crops and foods are not the same as conventional non-GM crops and foods, a major blow for the USA and its allies. Whatever the outcome (and it is likely to be mixed), GM crops and foods will not be flooding into Europe.
When the decision emerges, the WTO's credibility will be even further eroded if it is seen to be forcing GM foods on Europe. The resolve of the European Union and the European Commission will be put to the test as they decide how to respond and whether to act in the interests of Europe's citizens or the biotech industry. This question and answer briefing explains why.
What is the WTO GMO dispute about?
How has the European Union responded?
How have other countries been affected?
What is at stake from the decision?
What are the implications for the WTO?
What will happen if the ruling goes against the European Union?
Will people in Europe have to eat GM foods?
Will GM crops be grown in the European Union?
Can the European Union fight the ruling?
What will happen if the ruling goes against the USA, Canada and Argentina?
What is the WTO GMO dispute about?
The US-led coalition of the major GM crop growing countries is trying to use the WTO to force the European Union (and thereby the rest of the world) to accept GM food. They have challenged Europe's moratorium on GM crops and food, evidenced by the EU's
- refusal to approve a number of new GM foods,
- delays in processing the applications for new GMOs,
- inaction to stop EU member states banning GM products.
The US argues that Europe's position on GMOs is a barrier to trade and violates WTO rules. In particular, it claims that US farmers have lost exports because they grow GM crops not approved in Europe. President Bush later added that the EU's moratorium was impeding efforts to feed the world. He stated that "European governments should join - not hinder -- the great cause of ending hunger in Africa."
Canada and Argentina have also argued that GM products should not be treated any differently from non-GM products.
How has the European Union responded?
In its formal response to the WTO, the European Union has argued that countries must be able to make their own decisions about what level of risk is acceptable. GMOs have characteristics which are recognised internationally to pose potential threats to human health and the environment and, because environments and diets differ across the world, an assessment that they are safe in one place does not mean they will be safe elsewhere. Europe also argues that GMOs cannot be treated as "like" or "equivalent to" their non-GMO counterparts, because they raise the potential for new types of harm. Europe has taken a precautionary approach to protecting human health, the environment and to conserve biodiversity in a reasonable and legitimate manner.
However, in relation to GM crop and food approvals, since the beginning of the WTO case, the European Commission has used its legal powers to end the six-year long moratorium and begun promoting GM foods despite the massive objection from its citizens. Therefore, by bringing the dispute, the USA has had a positive outcome even before the decision is made.
How have other countries been affected?
The impact of the trade dispute is being felt well beyond Europe's shores. The case serves as a warning to other countries, particularly developing countries, not to restrict access to their markets by banning or restricting GMOs. In a similar case over beef hormones, once the US had started a WTO trade complaint no other country in the world banned them. Although the US is hoping that this is also the case with GMOs, it is unlikely to be so easy. Public protest against GM foods is worldwide and another international law, the United Nation's Cartagena Protocol on Biosafety, allows nations to take a precautionary approach and consider the socio-economic effects of trade in GMOs.
What is at stake from the decision?
The outcome could affect whether:
- countries have the ability to determine their own approaches on GM crops and food, and whether citizens are able to engage fully in these processes, without pressure from large economic interests. This may not affect only European Union countries, but also other countries, especially developing countries, who are considering how to manage GM crops and foods.
- a precautionary approach to new technological developments is allowable under 'free trade' rules. The WTO has recognised that regulators commonly adopt a precautionary perspective where risks of irreversible damage to human health are concerned. Other international laws, such as the Biosafety Protocol, state that a lack of evidence of harm to human health or the environment shall not prevent governments from taking precautionary measures to avoid harm.
- GM crops and foods can be treated differently in terms of imports, sale and labelling requirements that inform consumer choice.
What are the implications for the WTO?
The WTO is struggling with its public credibility. If the decision in any way compromises the ability of countries to make decisions based on the precautionary principle and determine what level of protection to give their own environments and citizens, its standing will be further eroded. Its version of 'free trade' will be seen as 'unfair trade' stacked in favour of the big business interests of the USA.
What will happen if the ruling goes against the European Union?
The European Union can:
- appeal the ruling within 60 days of receiving the final report of the panel. The January 2006 report is the interim report and could be modified although this is unlikely to be substantial. The appeal has to be based on points of law only;
- decide that it will not alter its approach to GMOs and pay for lost trade;
- bow down to the USA and push ahead with approvals for importing GM crops for food, feed and seed. The European Commission, always a supporter of GM crops despite a lack of support from Europe's citizens, has already approved the import of several GM crops despite lack of agreement between member states.
Will people in Europe have to eat GM foods?
No. Just because it may appear that the USA and others must be allowed to import GM crops, this does not mean food producers of citizens have to buy it. There is no evidence that people in Europe are changing their minds on GM foods and crops. In a recent referendum, the Swiss voted for a five year moratorium on commercial growing of GM crops. A 2005 European Commission opinion poll showed that 54% of citizens consider GM foods to be dangerous. Food companies are unlikely to start using GM ingredients in the face of consumer rejection of GM food - and even if they did, EU labelling laws mean that people will still be able to choose the non-GM option.
Will GM crops be grown in the European Union?
Not necessarily. Even if GM seed can be imported into the European Union this does not mean that it will or can be grown. Most farmers will not want to buy it and there are other rules that have to be complied with before a GM crop can be sold, including plant variety registration and a license for herbicide use in the case of herbicide tolerant crops.
The GM-free regions movement is likely to be bolstered by a decision in favour of the US and its allies. People will be angry and unwilling to have GM crops forced upon them.
Can the European Union fight the ruling?
Yes. The European Union can appeal against the ruling if it thinks it is wrong. The European Union can also decide to support its EU Member States in their rights to make their own decisions about whether to allow GM crops. The EU Member States have already voted against a proposal from the European Commission that such bans be declared unlawful.
What will happen if the ruling goes against the USA, Canada and Argentina?
Like the European Union, the USA and its complaining allies could also appeal the decision. If the WTO decides that GM crops are different from non-GM crops, this will mean that many more countries will feel free to follow their citizens' wishes and label GM food, feed and seed to distinguish it from conventional food and seed.