AMONG ARTICLES 2.2,5.1 AND 5.7
Panel in EC-Biotech Products, after finding that Article 5.7 of the SPS Agreement constitutes a qualified exemption to Article 2.2 and Article 5.1 thereof, reaches the conclusion that where the SPS measure at issue does not satisfy any of the
111 Id. para. 7.3007.
Art. 5.1
inconsistent
Conclusion: consistency with Article 5.1
Conclusion: inconsistency with Art. 5.1.
Art. 5.7 consistent inconsistent
Conclusion: consistency with Article 5.1.
consistent
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four criteria set forth in Article 5.7, Article 2.2 and Article 5.1 shall apply and the consistency of the measure at issue with Article 2.2 and 5.1 cannot not be found after the review of the same under Article 5.7. It is legally reasonable to say that the principle (Article 2.2) cannot be found to have been violated if an exemption (Article 5.7) is established. That is also the reason why the Panel in Japan–Agriculture II opined that a measure satisfying the requirements in Article 5.7 of the SPS Agreement cannot be found as inconsistent with Article 2.2 thereof. By the same token, if the exemption is not established, the principle shall apply unless otherwise agreed by the parties. The implication of the Panel’s approach is that the four elements under Article 5.7 are equally valued and lacking in any of them will result in the inapplicability of Article 5.7 and introduction of Article 2.2 and Article 5.1, inconsistency of which will, in most cases, result in the revocation of the measure at issue. Given that the four elements are indispensable for the exemption of the application of Article 2.2 and Article 5.7, especially noted that existence of insufficiency of scientific evidence is only one of the four elements, the existence of the insufficiency of scientific evidence does not per se precludes the application of Article 2.2 and Article 5.1.
Panel’s said approach is criticized by Lang who proposed an alternative interpretation of Article 5.1 and Article 5.7 of the SPS Agreement by distinguishing
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the first sentence of Article 5.7 from the second sentence thereof,112 which from the author’s view, also applies to the relationship between Article 2.2 and Article 5.7 because throughout Lang’s analysis, he focused on the distinction between the first and second sentence of Article 5.7 of the SPS Agreement and when he referred to Article 5.1, he referred to the governments’ obligations to conduct a risk assessment, which is also provided under Article 2.2. According to Lang, the first sentence contains a right to provisionally adopt SPS measure on the basis of available pertinent information and such right exists in all cases where relevant scientific evidence is
“insufficient.”113 The second sentence is an independent obligation, which is triggered by a Member’s exercise of its right under the first sentence of Article 5.7, to seek additional information and to review the measure within a reasonable period of time (abbreviated as “research and review obligations” by Lang in his article).114 Lang pointed out that “the difference between the two (i.e. the approach adopted by Lang and the approach adopted by the Panel in EC-Biotech Products) lies in the characterization of the nature of the research and review obligations: instead of seeing
112 Andrew T.F. Lang, Provisional Measures under Article 5.7 of the WTO’s Agreement on Sanitary
and Phytosanitary Measures: Some Criticisms of the Jurisprudence So Far, 42 (6)J.WORLD TRADE
1085, 1091 (2008).
113 Id., at 1091.
114 Id.
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these obligations which are triggered by the exercise of that right (so that failure to comply makes the right disappear), they are here seen as supplementary obligations which are triggered by the exercise of that right (so that failure to comply has no effect on the existence of the underlying right).”115
Lang based his analysis on four reasons from the perspectives of both the texts and object and purposes of Article 5.7. First, he found that the structure of Article 5.7, including the absence of the “if-then logic” in the second sentence compared to its existence in the first sentence, the use of separating phrase “in such circumstances”
between the first and the second sentence thereof, the contrast between the permissive
“may” in the first sentence and the obligatory “shall” in the second sentence suggested that the second sentence sets out independent obligations, not additional conditions.116 Secondly, he recalled the object and purpose of Article 5.7 which is a compromise between the two objectives: on the one hand to ensure that Members maintain their right to take protective SPS measures on a temporary basis where there is objective cause for concern but where there is as yet inadequate science to make a proper risk assessment; and on the other hand to discipline the use of such provisional measures to ensure that their use does not in practice undermine other obligations
115 Id.
116 Id.
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contained therein.117 Thirdly, Lang opined that his approaches, under which the research and review obligations were freestanding and only triggered once provisional measures are adopted under the first sentence of Article 5.7 of the SPS Agreement, and a finding on compliance with the first sentence is a logically prior step, provides Members a clearer guidance to bring their measures at dispute into the conformity with the SPS Agreements than the result under the Panel’s approach, where the Panel would reach its decision on the dispute once any of the four elements under Article 5.7 of the SPS Agreement is found not met, which left the responding Member inadequate information to ensure the conformity of its measure. Last but most important, Lang argued that the Panel’s approach involved a serious logical flow because it required a member to conduct a risk assessment where there is no sufficient scientific evidence. In a hypothetical case where a Member adopted a provisional SPS measure in accordance with the first sentence of Article 5.7 of the SPS Agreement while it failed to meet its obligations under the second sentence thereof, which would result in the inapplicability of Article 5.7 and applicability of Article 5.1, the government is therefore required to conduct a risk assessment, which is in fact impossible because there is no sufficient evidence for it to do so.118
Before starting our analysis on this issue, we would like to make remarks about
117 Id. at 1092.
118 Id. at 1093.
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the implementation of recommendation under the dispute settlement mechanism of the WTO. We believe that a clarification of the nature of Article 5.7 of the SPS Agreement helps to address what is the appropriate way to implement the recommendation of the disputed SPS measure found inconsistent with Article 5.7 thereof.
We recall Article 19.1 of the Understanding on Rules and Procedures governing the Settlement of dispute which provides that “[w]here a panel or the Appellate Body concludes that a measure is inconsistent with a covered agreement, it shall recommend that the Member concerned bring the measure into conformity with that agreement. In addition to its recommendations, the panel or Appellate Body may suggest ways in which the Member concerned could implement the recommendations.” According to the Panel in United States – Final Dumping Determination on Softwood Lumber from Canada, the Panel considered that “[b]y virtue of Article 19.1, panels have discretion ("may") to suggest ways in which a Member could implement the relevant recommendation. However, a panel is not required to make a suggestion should it not deem it appropriate to do so.”119 In the absence of more detailed provision under the SPS Agreement regarding how to bring a measure inconsistent with Article 5.7 of the SPS Agreement, it is the Panel or the
119 Panel Report, United States – Final Dumping Determination on Softwood Lumber from Canada, WT/DS 264, para. 8.5, April 13, 2004 (hereinafter “US-Soft Lumber V”).
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responding Member (where the Panel exercise its discretion not to make suggestion) will in the first place decides the way of implementation of recommendation. The next question is whether the Panel or the responding Member has the discretion on how to implement the recommendation of bringing a disputed measure which is found inconsistent with maintenance obligation of Article 5.7 into conformity with the SPS Agreement by fulfilling its maintenance obligations under Article 5.7 or by revocation the disputed measure to be in conformity of the Article 5.1, or even if recognizing the Panel’s discretion on the suggestion of the ways to implement its recommendation, what is the more appropriate suggestion the Panel is to make.
The author finds Lang’s analysis, though seems to be supported by the texts and object and purposes of the SPS Agreement, no more persuasive than the same proposed by the Panel. For example, the structural difference between the first and second sentences of Article 5.7 does not necessarily lead to the conclusion proposed by Lang as it is equally persuasive to the author that the criteria set forth under Article 5.7, accumulatively applied, procure the legality of the provisional measure thereunder as proposed by the Panel based on the language of Article 5.2. For example, if it were the Members’ intention to differentiate the obligations under the first and the second sentences of Article 5.7 as proposed by Lang, language used in Article 2.2 should be “except where relevant scientific evidence is insufficient”
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instead of “except as provided for in paragraph 7 of Article 5.” The author is of the view that Article 5.7 is a compromise taking care of needs of both sides by setting forth the criteria of a provisional SPS measure, which in essence reflect Members’ agreement
on the balance of interest in the adoption of SPS measures. Considering the texts
and the object and purpose of SPS Agreement is not especially in favor of the Panel’s approach nor Lang’s approach and Article 5.7 is in essence a balance of interest, the author finds it might be helpful to analyze the issue from the perspective of risk allocation. The author will first analyze what the exact difference of the outcome under the Panel’s approach and the Lang’s approach is. If there is any difference, then proceed to see whether the current SPS Agreement has determined that it is the complaining Member or the responding Member in the dispute that should bear the disadvantage of the risk under the SPS Agreement, interpreted in light of its object and purpose as required by Article 31 of the Vienna Convention.
Firstly, the result will not be different if it is one of the first two elements of the Article 5.7 is violated, which will result in the violation of Article 2.2 and the recommendation of the dispute settlement body will be bringing the measure at dispute into conformity with Article 5.1 and 2.2 and, in such circumstances, is most likely to cease the measure. However, if it is the research and review obligations under Article 5.7 that are not met, under the approach of the Panel in EC-Biotech
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Products, the Panel will then find that the Articles 2.2 and 5.1 of the SPS Agreement
applies, and the way to implement the recommendation in such circumstances will require the cease of the application of the measure at dispute rather than to seek additional information and review the measure under Article 5.7 as proposed by Lang.
Finding that the difference the aforementioned two approaches will only exists in where the research and review obligations are not fulfilled, below the analysis narrows down to such circumstances.
Under the Panel’s approach, the implementation of the recommendation will require the cease of the measure at dispute without waiting for the responding to conduct the required research and review and regardless whether the responding Member can find additional information to support the insufficiency of scientific evidence. However, if the responding Member, after its seeking to obtain the additional information necessary for a more objective assessment of risk and review, finds the grounds to continue (or to be more precisely, re-adopt) the provisional measure, there is no provision under the SPS Agreement preventing a Member from doing so. On the contrary, if the responding Member, cannot find the grounds to maintain the measure at issue after its research and review thereof, such measure should not be readopted after its immediate cease after the recommendation is made by the dispute settlement body. On the other hand, under the approach suggesting
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separate application of Articles 2.2 and Article 5.7 proposed by Lang, the recommendation will require the responding Member bring the measure into conformity with Article 5.7 and the responding Member shall conduct the required research and review. The provisional SPS measure will continue during the research and review and will be ceased or maintained thereafter depending on the result of the research and review. Compared to where the required research and review is conducted within the a reasonable period of time under Article 5.7, under the Panel’s approach, during the period of research and review, there will be no provisional SPS measure which would be otherwise permitted and under Lang’s approach, during the
period of research and review, the provisional SPS measure, which would be otherwise ceased, remains effective. The above can be summarized by the following
matrix.
Chart III : Result of measures at dispute under Panel’s approach and
Lang’s approach (compared to where the review and research were conducted in
accordance with Article 5.7)
Approaches
Result of research & review
Panel’s Approach Lang’s Approach
Supports the provisional measure Provisional SPS measure will be “readopted.”
Provisional SPS measure will be maintained.
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Not supports the provisional measure No provisional SPS measure will be readopted
The next question is who should bear the disadvantage of such difference.
As summarized above, the difference between the Panel’s approach’s and Lang’s approach’s comparison with where the research and review are conducted in a reasonable period of time is the existence of the provisional SPS measure during the research and review period, Panel’s approach prohibits what would be otherwise
permitted, and Lang’s approach, on the contrary, permits what would be otherwise prohibited. Panel’s approach protects the legitimate interest of the complaining Member, which is basically the economic interest derived from the trade without affecting by the SPS measure at issue, at the cost of the a regulatory gap where a
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required and otherwise permitted provisional SPS measure will not be allowed to maintain during the review and research period. On the contrary, Lang’s approach ensures the continuance of SPS measures without the aforementioned regulatory gap at the cost of the economic interest of the complaining Member at dispute. Who should bear the disadvantage in such circumstances?
The author advocates the view of the Panel for the following two reasons. First, as aforementioned, the criteria set forth in Article 5.7 are in essence Members’
agreement on the distribution of risk and balance of interest between Members in SPS measures provisionally adopted and the four elements set forth in Article 5.7 constitute the legality of the provisional SPS measure. Lack in any of them would deprive the legality of the provisional measure taken. It is especially true when the research and review is closely related to the fundamental ground for the taking of the provisional SPS measure, i.e. the sufficiency of scientific evidence. Secondly, given that it is the responding Member that fails to fulfill its research and review obligations, it should be such Member to take the disadvantage results from such failure, especially considering the uncertainly but possibly long time period it will require for the conduct of review and research. Although the author is also aware of the different natures of the competing interests at issue, i.e. the economic interest of the complaining Member versus the legitimate purpose the SPS measure at issue pursue,
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including the life and health of human, animals or plants, which are irrevocable, or other interest, which according to the Panel in EC-Biotech Products as aforementioned, including economic ones, that will be protected against damage from the entry, establishment or spread of pests, as applicable. A sophisticated deliberation of the risk allocation might take such difference of natures of the competing interests at issue into consideration, especially considering their irrevocability, but the author is not in a position to do so before finding more grounds from the interpretation of the SPS Agreement supporting the inclusion of such comparison of interests into consideration.
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VI. THE CONSISTENCY OF THE SAFEGUARD MEASURE WITH
ARTICLES 5.1, 5.7, AND 2.2 OF THE SPS AGREEMENT
After analyzing the relationship among Articles 5.1, 5.7 and 2.2 of the SPS Agreement, the Panel started to apply the aforementioned legal interpretation to the instant case at dispute.