Balance in Trade

8/2/2019 Balance in Trade

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balance in

TRADE

Understanding how the Sanitary and Phytosanitary (SPS) Agreement helps protect New Zealands

people, economy and environment while improving trade opportunities


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conTEnTs

Frewrd 1

Itrduti why the sPs Agreemet matter 2

1 What i the sPs Agreemet 4

2The sPs Agreemet ad new Zealad 13

3challege fr the future 16

ctat 17

Glary 18

Further pieTis report can be downloaded romhttp://www.maf.govt.nz.

You can request hard copies rom:

SPS Enquiry Point

PO Box 2526

Wellington 6140

el: 64 4 894 0431

Email: [email protected]

2009 Crown copyright Ministry o Agriculture and Forestry, Ministry o Foreign Afairs and rade, New Zealand

Food Saety Authority

ISBN 978-0-478-33880-5 (Print)

ISBN 978-0-478-33881-2 (Online)

DilaimerTe inormation in this publication by the Ministry o Agriculture and Forestry, Ministry o Foreign

Afairs and rade and the New Zealand Food Saety Authority is based on the best inormation available

at the time it was written and all due care was exercised in its preparation. As it is not possible to oresee

all uses o this inormation or to predict all uture developments and trends, any subsequent action that

relies on the accuracy o the inormation in this publication is the sole commercial decision o the user

and is taken at their own risk. Accordingly, the Ministry o Agriculture and Forestry, Ministry o

Foreign Afairs and rade and the New Zealand Food Saety Authority disclaims any liability whatsoever

or any losses or damages arising out o the use o this inormation, or in respect o any actions taken.


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Foreword

New Zealand depends on trade or its prosperity. Fair

and consistent rules or international trade benet

New Zealand as well as our trading partners. Tesecountries require an assurance that our exports are sae.

Similarly, the New Zealand government has to manage

the risks that imported goods can pose to the saety o

our ood, our productive base and to our native plants

and animals.

Te World rade Organization (WO) Agreement on

the Application o Sanitary and Phytosanitary Measures

(SPS Agreement) sets in place rules that protect each

countrys sovereign right to take the measures necessary

to protect the lie or health o its people, animals,

and plants while at the same time acilitating trade. It

embodies and promotes the use o science-based risk

assessments in managing the risks associated with the

international movement o goods.

New Zealand, as a member o the WO, has the

sovereign right to decide its own level o health

protection. We also expect our exports to be allowed

to compete airly in oreign markets, while meeting the

level o protection required by the importing country.

We thereore have a strong interest in the setting o

international standards so that they protect lie and

health but do not unnecessarily restrict trade.

We commend this publication to New Zealanders as a

clear summary o the international rules or ood saety,

and protecting human, animal and plant lie or health

when trading.

Hon David Carter

Minister o Agriculture

Minister or Biosecurity

Minister o Forestry

Hon im Groser

Minister o rade

Hon Kate Wilkinson

Minister or Food Saety

Foreword


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balance in trade

introduction why the SPS Agreement mAtterS

At the heart o the world trading system is theWorld rade Organization (WO). By 2008 the

WO had 153 members, representing most o the

worlds trading nations.

aris and quotas have or many years been the

biggest barriers to trade. Tese are continually

being reduced through negotiations in the WO.

Measures to protect against the spread o diseases

and pests by traded goods may also be barriers to

trade. Te SPS Agreement is about how to applysanitary (human and animal health) measures and

phytosanitary (plant health) measures in a way that

does not unnecessarily restrict trade.

An increasing volume o international trade and

travel means that all countries, New Zealand

included, need to be more vigilant than ever

against pests and diseases that threaten the health

o their people, animals and plants. Likewise,

countries rightly expect the ood they import tomeet their own standards o saety.

So reedom to trade, and the benets that result,

must be balanced against the need to protect

people, animals and plants rom unacceptable risks

to health and saety.

WO member countries negotiated the SPS

Agreement to help achieve this balance. It

establishes principles that countries are committed

to uphold when trading in animals, plants andtheir products. Te SPS Agreement does not

stop countries rom protecting health and saety.

Rather, it allows them to determine their own level

o protection but requires that any restrictions

on trade needed to achieve that protection be

non-discriminatory, transparent and scientically

justied.

P looks at the SPS Agreement in detail.

P looks at how the SPS Agreement affects

New Zealand.

P 3describes some of the future challenges in

implementing the SPS Agreement.

Finally there is a shortGssof terms and guide

to further sources of information.

Freedom to trade, and thebenefts that result, must be

balanced against the need to

protect people, animals and plants

rom unacceptable risks to health

and saety.


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introduction3

, f

s ps

xpsbecause they generate

almost two-thirds o

New Zealands exports

o goods, and employ

hundreds o thousands oNew Zealanders, directly

and indirectly.

sbecause it makes clear the

actors that should be taken

into account when sanitary

and phytosanitary measures

are applied to protect our

unique natural resources,

and plants and animals, rom

damaging pests and diseases.

t SPS ag s p :

pp s zsbecause it allows us to protect human and

environmental health rom damaging pests

and diseases.

pp s ssbecause it allows us to ensure that ood

imports are sae to eat.

pswho benet rom

certainty over import

requirements. In

turn, processors and

commercial users o

imported ood, animal

and plant products also

benet.

vpg sthat can use the international

ramework or SPS arrangements

among countries, irrespective o their

economic and technical capability.


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balance in trade

whAt iS

the SPS aGreement? a g pspTe WO and its agreements, including the SPS

Agreement, were created and put into orce in

1995. Te SPS Agreement represented a signicant

change in philosophy in that trade can now

not be prohibited without good reason, such as

protecting human, animal and plant lie or health.

Beore the SPS Agreement, countries could and

did impose barriers to imports on sometimes-

dubious health grounds with the burden being onpotential exporters to prove that such barriers were

not justied. Te SPS Agreement now requires that

any import restrictions that are imposed must be

supported by scientic evidence, and be based on a

risk assessment or international standard.

Te SPS Agreement maintains the sovereign right

o any government to determine the level o health

protection it deems appropriate, but it also aims

to stop abuse o this right and the prolieration ounnecessary barriers to international trade. Tis is

consistent with the overall trade-enhancing thrust

o the WO system.

w SPS ag vs

Te SPS Agreement covers all SPS measures that

aect or have the potential to aect trade

between WO members. It establishes principles

that members must ollow when they set measures

or protecting the lie or health o their people,

animals or plants when importing animals, plants

and their products. SPS measures apply to

products moved between countries.

Te SPS Agreement does not cover:

measures or the welare o animals;

measures or protecting the physical

environment (or example, water and air

quality);

measures or protecting the health o animals

being transported between countries but not

being traded (e.g. companion cats and dogs);

and

non-health/non-saety-related consumerinterests (or example, labeling or consumer

choice and packaging o ood).

Tese are addressed by other WO agreements, or

example the Agreement on echnical Barriers to

rade (B see box).

SPS measures are requirements that are applied:

to protect human or animal lie or health rom

risks arising rom additives, contaminants,

toxins or disease-causing organisms in oods orbeverages;

to protect human lie or health rom risks arising

rom diseases carried by animals, plants or their

products, or rom the entry, establishment or

spread o pests;

to protect animal or plant lie or health rom

the entry, establishment and spread o pests,

diseases or organisms that carry or cause

disease; and

to prevent or limit other damage to a country

rom the entry, establishment or spread o pests.

Key featuresThe SPS Agreement covers all sanitary and phytosanitary

(SPS) measures standards, guidelines and

recommendations to protect human, animal and plant lie

or health that aect international trade between WTO

members.

The SPS Agreement preserves national sovereignty:

countries have the right to protect the lie or health o their

people, animals and plants.

SPS measures must be necessary and based on scientifc

principles. They must not be maintained without scientifc

justifcation.

SPS measures must not discriminate unairly between

countries or between imported and domestically produced

goods.

SPS measures are to be based on international standardswherever possible, but WTO members can adopt a

measure that is more stringent than an international

standard, provided the measure is scientifcally justifed.

The SPS Agreement provides guidance on using precaution

when making decisions on SPS measures.


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The TBT Agreement a WTO agreement

The TBT Agreement covers all technical standards or regulations except where they are SPS measures as

defned by the SPS Agreement. While the two Agreements are undamentally dierent, they have some important

principles in common. These include:

basic obligations to not discriminate between oreign and local products o the same type;

requirements or notiying proposed measures in advance o implementing them (transparency); and

creating ofcial points or conveying and receiving inormation.

The SPS Agreement relates specifcally to regulations or protecting human, animal and plant lie or health.

Under the SPS Agreement, SPS measures must not be arbitrary or cause unjustifable dierences in the level o

protection considered appropriate in dierent situations. The SPS Agreement requires that regulations must be

scientifcally justifed.

In contrast, the TBT Agreement simply states that general technical regulations and standards including

packaging, marking and labeling requirements must not create unnecessary barriers to trade and must not

restrict trade more than necessary to ulfll a legitimate objective. Legitimate objectives include national security,

preventing deceptive practices, and protecting the environment.

Te term animal or plant lie includes marine andreshwater sh, bees, orests, and both native and

valued introduced auna and ora.

t ppp v p

k p

It is impossible or any country, even a

geographically remote island nation like

New Zealand, to isolate itsel rom all risks o

imported pests or diseases. Achieving zero risk

is impossible: tourism would have to be banned

completely, as would all imports o goods.

Even then, zero risk could not be assured. For

instance, pests and diseases could enter through

smuggling or by natural means such as wind-borne

movement, migratory birds, or via ocean currents

in the case o marine organisms.

rade increases some o these risks. For

New Zealand, which depends on both imports and

exports, the risks must be appropriately managed.

Recognising that zero risk is unattainable, the SPS

Agreement instead enshrines the right o each

country to determine the level o protection that itconsiders appropriate. While this appropriate level

o protection (ALOP) will be a judgement, the SPS

Agreement stipulates that the measures applied

to achieve it must be rmly based on scientic

evaluation.

Beore the SPS Agreement, governments could

respond to pressure rom domestic producers,

or example, by setting a high level o protection

against the entry o a commodity that would

compete with domestic products. At the same time,

they could set a lower level o protection against

similar risks posed by other imported commodities

that they considered economically benecial,

such as commodities not produced locally, or

new or superior varieties o plants or bloodlines

o livestock. But the SPS Agreement means that

governments may no longer apply discriminatory

measures. Tere must be consistency between

the levels o protection considered appropriatein like situations. Tis allows trade to ow more

predictably.

what iS the SPS

aGreement?


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?

riSK aSSeSSment

? ?

balance in trade

Although the term appropriate level o protectionis relatively new (i.e. since the inception o the

SPS Agreement in 1995), the concept is not.

Governments and regulatory authorities in

New Zealand had, or many years, made decisions

on which risks to accept, and on the extent and

targeting o actions aimed at mitigating risk. Tese

decisions have, in eect, been about New Zealands

ALOP. Tese decisions are made aer

consulting interested parties such as consumers,

environmental organisations and industry, and

take into account, through the political process, the

views o all stakeholders.

Te ALOP reects judgements o the community

as well as science-based evidence. Tis means it can

change over time. It takes into account the benets

o trade, including peoples access to imported

goods, as well as the consequences o incursions

o pests or diseases on industries, biodiversity and

society.

rsk ssss sf ss

SPS ss

WO members are obliged to ensure that their

SPS measures are based on scientic evidence.

I they are not using international standards

this entails risk assessment. Risk assessment is a

scientic discipline (and one component o the

wider discipline o risk analysis which includesrisk management and risk communication). It

helps regulators assemble and analyse data in anobjective, transparent and consistent way, so that

decisions about managing risks can be made on a

sound technical basis.

Any WO member aected by a decision is usually

entitled to see the rationale or the decisions made

by another WO member in developing an SPS

measure.

Countries may conduct their own risk assessments

to evaluate risks and their possible consequences.When carrying out a risk assessment or SPS

measures, a country must take into account a range

o actors such as:

available scientic evidence;

relevant processes and production methods (or

example, or animal or plant products);

relevant inspection, sampling and testing

methods (in both the importing and exporting

countries);

prevalence o specic diseases or pests (in both

the importing and exporting countries);

existence o pest- or disease-ree areas (in both

the importing and exporting countries);

relevant ecological and environmental

conditions (in both the importing and exporting

countries); and

quarantine or other treatment (in both the

importing and exporting countries).

Te list is not exhaustive; other relevant actors

may be considered.

What could

go wrong?

How likely is it

to go wrong?

What would be the

consequences?

a sk ssss p ss qss:


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Risk analysis in New Zealand

Consumers in overseas markets supplied by New Zealand are increasingly concerned about protecting their

own health, and that o their animals and plants, and the saety o their ood. At the same time, consumers are

demanding access to new products rom new sources. This increases the volume and diversity o trade in primary

products. Because the sae movement o animals, plants and their products in and out o New Zealand is so

important to our economic well-being, the discipline o risk analysis plays a crucial role in trade.

These are some o the issues that play a part in decisions by New Zealand regulators:

Pg rom zoonotic and insect-borne diseases, and rom venomous species.

mg s: Assuring the saety o ood produced domestically or imported rom other countries is

essential or maintaining the health and confdence o consumers in New Zealand and overseas.

Pg n Zs p ss: New Zealands reedom rom many o the worlds most

harmul pests and diseases is an invaluable asset that must be protected.

mk ss: In order to preserve and enhance our access to overseas markets, New Zealand must be able

to assure other governments that our agricultural products are sae. The mutual acceptance or methods o

assessing risk by governments acilitates this assurance.

Qv qv sk

ssssIn some cases the risk o an adverse event is

expressed numerically. Tis is qv risk

assessment. In other cases the nature and severity

o the risk are assessed, but without quantication

and the risk estimate is not reported in quantitative

terms. Tis is qv risk assessment.

Risk assessment also evaluates the consequences

o an adverse event. Tis might be measured in

terms o the costs o controlling or eradicating

a new disease and the economic impact o lost

production or sales.

Once the level o risk has been identied, options

or managing the risk are evaluated. From those,

one or more options are chosen to mitigate risk to

the level considered acceptable.

what iS the

SPS aGreement?


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balance in trade

h SPS ag s pp

csg SPS s

Where there is a choice o SPS measures to reduce

risk to an acceptable level, WO members must

choose the one that restricts trade the least. Similar

risks associated with trade must be managed

consistently, even i the commodity comes

rom dierent countries. Countries must avoid

unjustiable distinctions between levels o SPS

protection applied to like situations. Tis means

that they must be able to justiy any dierences in

the way they treat imports rom dierent countries

with similar health status.

tspWO members are required to notiy each other

o proposed new regulations or ood saety and

protecting animal and plant lie or health. Tese

are open or comment and enquiry by other

WO members. Tis system is one o the key

innovations o the SPS Agreement and ensures a

no surprises approach to trade between WO

members.

Beore the SPS Agreement, one o the greatest

difculties or exporters was nding out all the

requirements o importing countries. An SPS

notication takes inormation sharing to an

international level and allows potential problems

to be identied early. Te results o a risk analysis

can also be open to scrutiny. Te risk analysis

process assembles available data in an orderly

and transparent ashion, providing a basis or

inormed and objective decision making. By

allowing other members to comment, WO

members ensure that their SPS measures will

withstand international scrutiny, while protecting

Communicating SPS information betweenNew Zealand and its WTO partners

The National Enquiry Point or SPS matters in New Zealand

plays an important role in acilitating compliance with

New Zealands obligations or transparency under the SPS

Agreement or example, passing on inormation about

New Zealand SPS measures and its systems to other WTO

members.

The National Notifcation Authority conveys inormation on

notifcations o New Zealands new SPS measures to WTO

trading partners through the WTO secretariat in Geneva, or

example, deciding whether a notifcation is necessary, when

to notiy, and processing and sending the notifcation. The

National Notifcation Authority also receives notifcations rom

other WTO members on their new SPS measures rom the

WTO secretariat and passes these on to interested parties in

New Zealand.

Both the National Enquiry Point and the National Notifcation

Authority are located in the Ministry o Agriculture and

Forestry in New Zealand.

the lie or health o their people, animals and plants.

ransparency is important to both importing and

exporting countries. Whenever a government

is proposing a new SPS regulation or modiying

an existing one that diers rom an international

standard and may aect trade, it must notiy

the WO Secretariat, which then circulates the

notication to all other WO member governments.

Tis process also allows other WO members to

submit comments on these SPS proposals. Te

systematic communication o inormation and

exchange o experiences among the WO members

provides a more transparent basis or national

standards, and in many cases makes harmonisation

o SPS measures easier. It also means that many

potential conicts are resolved inormally betweencountries, rather than through ormal processes

under the SPS Agreement.


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balance in trade0

in situations where the health status o modern,commercial poultry industries has been protected

through stringent biosecurity programmes rom

diseases, such as avian inuenza, which may

be present in back yard poultry and wild bird

populations in the same geographic region.

eqv: s s

pss

Under the SPS Agreements provisions on

equivalence, WO members must accept the SPS

measures o other WO members as equivalent,

where this can be objectively demonstrated, even

when measures dier rom their own. When

trading in the same product, so long as they

achieve the same level o protection, there is

exibility in how that outcome can be achieved.

Equivalence allows exporters to adopt dierent

ways o reaching the required level o protection.

expg vg SPS ss:

ss g

What happens i a WO member country is not

satised that an SPS measure imposed on its

exports by another WO member is warranted?

WO members may introduce SPS measures that

are more stringent than international standards

i there is scientic justication to do so, and i

they determine a higher level o protection is

appropriate in accordance with the SPS Agreement.

WO members can challenge a proposed

SPS measure i they have reason to believe

that the measure could unjustiably constrain

their exports, and the measure is not based on

relevant international standards, guidelines or

recommendations. Te rst step is to ask why the

measure has been imposed. Te explanation should

show how the SPS measure is justied using the

provisions o the SPS Agreement.

In particular, it should show that it is:

applied only to the extent necessary to protect

against identied risks;

based on scientic principles and evidence;

not used to discriminate against imported goods

in avour o domestically produced ones;

consistent with the members appropriate level

o protection;

as least trade restrictive as possible; and

generally applied consistently with the SPSAgreement.

I a measure does not meet these criteria, the

country applying it may be required to review

it and adjust it to make it conorm to the SPS

Agreement.

dsp s

I a dispute remains unresolved aer attempts to

resolve it bilaterally, it can be raised ormally in the

SPS Committee o the WO. Te good ofces

provisions enable the chair o the SPS Committee

to mediate through ad hoc consultations.

Equivalence in action

New Zealands meat and seaood industries have traditionally

borne heavy costs in meeting the inspection requirements

o overseas countries. The technical justifcation or these

has sometimes been doubtul, and the eects have been

to increase regulatory and other costs associated with

maintaining market access.

Scientifc research and risk analysis has enabled a marked

reduction in the human resources needed or routineinspection o meat and seaood. This has increased processing

options, reduced wastage, and improved the integration o

public and animal health activities. The net result has been

savings to the ood industry, and ultimately consumers, o

millions o dollars a year, while maintaining and enhancing

standards o ood saety.

Equivalence has the potential to save exporters

millions o dollars per year, by allowing them to

determine the most cost-eective and efcient

way to ulll the agreed health requirements o the

importing country.


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I there is still no mutually agreeable solution,the aggrieved WO member can start ormal

WO dispute settlement procedures. First,

consultations (ormal discussions) take

place. I these do not lead to a mutually

acceptable solution then, at the request o the

aggrieved country, a panel o qualied people

is established. I the panel nds that the SPS

measure under dispute is inconsistent with

the SPS Agreement, it can recommend that

the WO member bring the measure into

conormity with the SPS Agreement.

Panel decisions can be appealed on points o law.

Te appeals are heard by a standing Appellate

Body established by the WO. Te decision o

the Appellate Body is binding.

Te dispute settlement understanding

emphasises that prompt compliance with

(dispute settlement) recommendations

or rulings... is essential to ensure eective

resolution o disputes to the benet o all

members. Tere are procedures or retaliation

o trade measures or compensation i the WO

member losing its case does not comply with

a dispute settlement ruling, but these are a last

resort.

Many complaints involving SPS-related matters

are ormally raised in the SPS Committee.

Examples are: procedures or inspecting resh

ruits, regulations or the shel-lie o processed

meat products, a ban on the use o growth-

enhancing hormones in meat production,

and restrictions on methods or processing

poultry. Panels established by the WO Dispute

Settlement Body, however, have heard only ve

issues that have been argued primarily on SPS

grounds. Tese involved the entry o salmon to

Australia, bee rom hormone-treated cattle into

the EU, certain varieties o plants into Japan,

apples into Japan, and marketing o products o

biotechnology in the European Union. In 2007,

a case involving entry o New Zealand apples toAustralia was initiated.

hs s sg s

Harmonisation means that countries should

base their SPS measures on relevant standards,

guidelines or recommendations developed by the

appropriate international organisations identied

in the SPS Agreement. Tese are the standard-

setting bodies or ood saety, animal health

and zoonoses (diseases transerred to humansrom animals), and plant protection. Tese three

organisations are known colloquially as the three

sisters, and New Zealand belongs to all o them:

Te FAO/WHO Codex Alimentarius

Commission (Codex), responsible or protecting

The WTOs SPS Committee

The Committee on Sanitary and Phytosanitary Measures(the SPS Committee) is made up o representatives o all

WTO members; there are also some observer countries and

organisations. It has a mandate to provide a regular orum

or consultations, and to do anything necessary to implement

the provisions o this Agreement and the urtherance o its

objectives.

The SPS Committee:

encourages ad hoc consultations or negotiations among

members on specifc SPS implementation issues;acilitates training on specifc issues, especially or

developing countries and new members (or example,

transparency, and risk analysis); and

maintains close contact with the relevant international

organisations (or example, the FAO/WHO Codex

Alimentarius Commission (Codex), the World Organisation

or Animal Health (OIE), and the relevant international and

regional organisations operating in the ramework o the

International Plant Protection Convention (IPPC).

The SPS Committee does not set international standards:

these are handled by Codex, OIE and IPPC (see

Harmonisation and the three sisters).

what iS the

SPS aGreement?


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balance in trade12

consumer health and acilitating air practices inood trade. Codex had 178 members in 2008.

Te World Organisation or Animal Health

(OIE), covering animal health and zoonoses.

Te OIE had 172 members in 2008.

Te ramework o the FAO International

Plant Protection Convention (IPPC), covering

international and regional organisations,

responsible or plant health. Te IPPC had 170

members in 2008.

Harmonisation helps ensure a consistent approach

to addressing risks and can reduce costs when

members ollow standards that have been agreed

internationally rather then having to undertake

specic risk assessments.

Harmonisation does not restrict a countrys ability

to select and implement any SPS measures it sees

as necessary to protect its human, animal or plant

health.

A country is ree to deviate rom an international

standard, guideline or recommendation and

introduce an SPS measure that will give a higher

level o protection, provided that there is scientic

justication, or a risk assessment is undertaken

that shows a higher standard is necessary to meet

the members appropriate level o protection.

WO members are encouraged to play a ull part

in the standard-setting organisations. In doing

so, countries have the opportunity to inuence

the way standards are set, and help ensure that

international standards take account o their

circumstances.

Biosafety Protocol

a United Nations agreement

The Cartagena Protocol on Biosaety, concluded in January 2000

under the United Nations Convention on Biological Diversity, aims

to protect biological diversity rom the potential risks posed by

transboundary movement o living modifed organisms (LMOs)

resulting rom modern biotechnology.

The Biosaety Protocol sets out procedures or advance inormed

agreement or the intentional transboundary movement o LMOs

that are likely to have adverse eects on the conservation andsustainable use o biological diversity. The Biosaety Protocol

came into orce on II September 2003. New Zealand ratifed the

Biosaety Protocol in 2005.

W kgsTe SPS Agreement ocuses on managing the trade

o goods. Tere are however, other international

organisations and agreements that New Zealand

is active in that are relevant to the movement o a

variety o organisms (including pests) particularly

where they afect the environment. For example,

the United Nations Convention on Biological

Diversity has a work programme that considers

the impact o invasive alien species on biodiversity.Similarly, the International Maritime Organization

has work programmes to manage the transer

o aquatic invasive species on ships. Another

international agreement, the Biosaety Protocol

to the United Nations Convention on Biological

Diversity, governs the international movement

o living (genetically) modied organisms. In

each o these cases, there are potential overlaps

with the operation o the SPS Agreement. Care is

taken to ensure that the work undertaken in these

other organisations and agreements supports the

operation o the SPS Agreement and that there is

consistency between all o these agreements.


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the SPS Agreement

and new Zealand Ever since the invention o rerigerated shippinglate in the 19th century, trade in animal and

plant products has underpinned New Zealands

economy. But it is an inescapable act that trading

in animals, plants and their products poses a risk

o introducing any pests, diseases or hazards they

may sometimes carry. Protecting the lie and health

o New Zealanders, and our native and introduced

animals and plants is a key goal o the New Zealand

government. New Zealands biosecurity and ood

saety activities also directly support our export

industries, whose continued access to overseas

markets depends on their products continuing to

meet the standards o importing countries.

t s s: pg

n Zs , v

pp

Biosecurity or biological security reers

to measures to keep out, remove, or eectivelymanage the harm that pests or diseases can do to

New Zealands economy, environment or people.

New Zealand has a world-leading biosecurity

system that does this by:

preventing harmul organisms rom crossing

New Zealands borders and establishing here

while, at the same time, ensuring trade and

tourism are maintained;

reducing the harm caused by organisms already

established in New Zealand; and

supporting New Zealanders being inormed and

involved participants in the biosecurity system.

In the last een years, the biosecurity system

has evolved rom a strong ocus on protecting

primary production to a broader ocus that

includes protecting native and valued introduced

ora and auna (including marine and reshwater

biodiversity), and human health. Tis began when

parliament passed the Biosecurity Act 1993, that

takes account o the nature and eect o introduced

organisms on people, plants and animals, and the

New Zealand economy.

Te strategic direction and strategies or

biosecurity aim to improve leadership, consistency

and perormance across the whole biosecurity

programme toward a uture state whereby:

New Zealanders, our uniquenatural resources, our plants

and animals are all kept sae and

secure rom damaging pests and

diseases1Border controls will remain a critical part o

maintaining biosecurity as more tourists arrive and

more goods are imported, increasing the risk that

harmul organisms enter New Zealand and establishthemselves here. Climate change may also extend

the host range o pests and diseases that need to

be managed. Te SPS Agreement will continue to

guide how New Zealand sets standards and makes

decisions related to biosecurity. In particular, it

will be important to maintain the standards o

transparency and scientic rigour required by the

SPS Agreement, and to make decisions as quickly

as possible. Tis will encourage other countries to

comply with the rules o the SPS Agreement, and

also demonstrate that New Zealands strict controls

are justied to countries that challenge them.

1 Tiakina Aotearoa Protect New Zealand The Biosecurity Strategy for New Zealand(2003).

the SPS aGreement

and new Zealand

3


16/22

balance in trade

t s s: sWorld ood production and consumption practices

are rapidly changing. New Zealand needs a ood

regulatory programme that is risk-based and that

protects consumers o ood and related products

produced in New Zealand, as well as imports and

exports o ood products. Te challenges include:

emerging causes o ood-borne disease;

changing technologies or production and

processing;increasing complexities within the ood chain;

the ever-increasing volume o international ood

trade; and

changing consumer habits and choices.

New Zealand has responded to these challenges

with a change in approach to regulating

primary production. Te traditional command

and control regime, based on prescriptive

requirements, is being replaced by a risk-basedapproach aimed at ensuring that products are

t or purpose. Tis means that industries are

taking more responsibility or meeting outcomes

described in ood saety standards through the

use o risk-based management plans that are

independently audited.

t s: gxps

As a small country trading in global markets,

New Zealand gains much rom the WO trading

system because it is transparent and based on

objective rules. In the WO, even the smallest

member states have the same rights as the

heavyweights o international aairs and trade.

Except or sheepmeat and dairy products,

New Zealand is a small player in world trade terms.

But in many o our markets, armer and grower

lobbies and politicians are opposed to imports

rom New Zealand, despite good consumer

demand. Restrictions that are not genuinely

required or biosecurity or ood saety reasons can

be very eective devices to protect local industries

rom export competition. Tey are difcult to

challenge because o their complexity and lack

o transparency about how a decision has beenreached. Te SPS Agreement enables New Zealand

to challenge attempts by other countries to

erect unjustied trade barriers. Prior to the SPS

Agreement, SPS measures aecting trade could

be imposed with little accountability. But the SPS

Agreement means that members are now required

to justiy scientically the SPS measures they

impose.

Te SPS Agreement helps New Zealand exportersto achieve:

b k ss

Te SPS Agreement is making it easier or

New Zealanders to sell their primary produce

on world markets, because the signatories have

undertaken to scientically justiy the SPS

measures they impose. Te measures imposed

must stand up to international scrutiny.

l p ss

New Zealand has an excellent reputation or

meeting the requirements o importing countries,


17/22

but this has oen come at a high cost. Stringentinspection requirements or meat products

imposed in the past by overseas markets are prime

examples. Complying with unnecessarily rigid SPS

requirements can marginalise an otherwise viable

export operation. As unjustied requirements

are stripped away, these costs will be reduced.

Standards will be increasingly brought into line

with international ones, making costly special

production runs or individual markets less

necessary. Te concept o equivalence enables

exporters to meet the saety outcomes required by

importing countries in cost-eective ways.

n ks

Te SPS Agreement opens up markets previously

closed to New Zealand exporters, as governments

bring their trade practices into line with the rules

o the SPS Agreement.

cTe SPS Agreement provides export industries with

the condence to plan ahead. New measures are

signalled in advance, and their reasons explained.

WO members can no longer justiy imposing

arbitrary and unexpected import restrictions with

the potential to cripple an export industry.

o

Te SPS Agreement means that New Zealandis now less at risk rom the danger o other

countries unilaterally imposing barriers against our

exports disguised as SPS rules. In the absence o

a multilateral agreement like the SPS Agreement,

New Zealand would need to devote more resources

to negotiating a large number o bilateral trade

agreements with individual countries. Tis would

place an enormous strain on resources and impose

signicant costs on exporters and the Government.

Te SPS Agreement has already brought benets

to New Zealand. Te existence o a ormal rules-

based agreement together with an emphasis on

using science to establish and challenge tradeconditions has meant that there is now much more

transparency about the intent o SPS measures.

At the same time, being party to the SPS

Agreement has not aected our ability to protect

our native and introduced auna and ora. By

signing up to the SPS Agreement (and the B

Agreement) New Zealand is able to welcome the

liberalising o world trade without compromising

our hard-won status as being ree rom the

worlds most serious pests and diseases. Te SPS

Agreement supports our export trade in primary

products and our pursuit o the highest levels o

ood saety.

F sss

pss

I you are an exporter you might encounter

unair trade restrictions in the international

marketplace. Te problem may not just be customs

duties, but barriers at or behind the border, such

as discriminatory product standards, labeling

requirements, unjustied quarantine restrictions

and other government regulations or red tape.

Te SPS Agreement includes mechanisms through

which governments may resolve dierences

over barriers to trade. MFA, MAF and NZFSA

negotiate with oreign government trade ofcials,

questioning and challenging such barriers. Temain aim is to keep doors open beore resorting

to ormal dispute settlement procedures. Any

New Zealand exporter encountering sanitary or

phytosanitary restrictions that appear unjustied

should discuss them with MFA, MAF or NZFSA

so that they can work to remove any unjustied

measures.

the SPS aGreement

and new Zealand


18/22

balance in trade

challenGeS For the Future 3While there have been successes and benets romthe SPS Agreement, there are also challenges or

the uture. Tese challenges will ocus attention on

the SPS Agreement, its role and coverage, and its

eectiveness or WO members.

dvpg s s-

vp s

One provision o the SPS Agreement commits

Members to acilitate providing technical

assistance to other Members, especially developing

country Members, either bilaterally or through the

appropriate international organisations. Te FAO,

OIE and WHO have considerable programmes

to assist developing countries with respect to

ood saety, and capacity building with respect

to the maintenance o animal and plant health.

Various countries also have extensive bilateral

programmes with other WO Members in these

areas. By December 2007, the WO Secretariathad undertaken 158 SPS technical assistance

and training activities with the main objective

being to increase the awareness o participants

about Members rights and obligations under the

SPS Agreement and the implications o the SPS

Agreement or national policy making.

Tere is a growing interest rom developing

countries in strengthening national ood control

systems, reormulating national ood regulationsto align them with international standards, and

establishing import/export ood inspection and

certication programmes to ensure compliance

with SPS and B requirements.

Te Standards and rade Development Facility was

established as a joint initiative between the WO,

WHO, World Bank, OIE and FAO in 2002. Te

Facility is a global programme in building capacity

and technical cooperation. One o its strategic

aims is to assist developing countries enhance their

expertise and capacity to analyse and to implement

international SPS standards, which in turn would

improve their human, animal and plant healthsituation, and their ability to gain and maintain

access to markets or their products.

t p g

Te SPS Agreement was part o a package o

agricultural measures included in the Uruguay

Round o multilateral negotiations (see Glossary

or more detail). Other reorms rom that Round

o trade talks included the gradual stripping

away o export subsidies and domestic price

support policies by WO members something

New Zealand had already largely done by the late

1980s. Even while the ink was still drying on the

Uruguay Round negotiations, it was expected that

the ull benet o the trade reorms would take up

to a decade to ow through to the New Zealand

arm gate.

For New Zealand armers and growers, opening

up international market access cannot come soonenough. Te slow pace o change is rustrating,

but not unexpected. In some countries overnight

exposure to the ull blast o international

competition could have negative social and

economic consequences or domestic producers.

Within the WO, the more developed nations

are helping developing nations comply with the

requirements o multilateral agreements such as

the SPS Agreement.

Despite the apparent slowness, regulatory agencies

around the world are increasingly conorming

with the SPS Agreement. International agreements

giving trading partners improved market access

while maintaining acceptable levels o protection

in ood saety and biosecurity, are becoming

increasingly common (.fa.ov.z/tad-

ad-ecooc-rlaos/tad-As/dx.pp

provides more inormation on how New Zealand

implements this in bilateral, regional, and

multilateral trade agreements).


19/22

ms ag FsTe mission o the New Zealand Ministry

o Agriculture and Forestry is to enhance

New Zealands natural advantage. It does this

by: encouraging high-perorming sectors;

developing sae and reer trade; ensuring healthy

New Zealanders; and by protecting New Zealands

natural resources or the benet o uture

generations.

For urther inormation or assistance contact:

MAF Biosecurity New Zealand

PO Box 2526

Wellington 6140

New Zealand

el: +64 4 894 0431

Fax: +64 4 894 0733


Internet: .boscu.ov.z/sa-ad-

cosulao/sa/aoal-as/saa-

ad-posaa-sps-a

n Z F S a

Te mandate o the New Zealand Food Saety

Authority is to protect consumers by providing an

eective ood regulatory programme covering ood

produced and consumed in New Zealand as well as

imports and exports o ood products.

For urther inormation or assistance contact:New Zealand Food Saety Authority

PO Box 2835

Wellington 6011

New Zealand

el: +64 4 894 2500

Fax: +64 4 894 2501


Internet: .zfsa.ov.z

ms Fg as t

Te Ministry o Foreign Aairs and rade

(MFA) is the Governments principal adviser

and negotiator on oreign and trade policyissues. Te Ministry conducts the New Zealand

Governments business with oreign governments

and international organisations, including the

World rade Organization.

For urther inormation or assistance contact:

Ministry o Foreign Aairs and rade

Private Bag 18-901

Wellington 6011

New Zealand

el: +64 4 439 8000

Fax: +64 4 472 9596


Internet: .fa.ov.z

wss

World rade Organization: www.wto.org

SPS-related issues in the WO:

.o.o/ls/aop_/sps_/sps_.

Full text o the SPS Agreement: .o.o/ls/

docs_/lal_/15sps_01_.

MAF gateway site to inormation on exports and

imports o live animals and germplasm, plants and

plant products, and orest products:

.boscu.ov.z

World Organisation or Animal Health (OIE):

.o.

International Plant Protection Convention (IPPC):

.ppc.

Codex Alimentarius Commission:

.codxalaus.

New Zealand Codex Strategy:

.zfsa.ov.z/polc-la/codx/publcaos/z-

objcvs-ad-sa/dx.

iakina Aotearoa Protect New Zealand Te

Biosecurity Strategy:

.boscu.ov.z/bosc/ss/sa/bosa/

bosaz

contactS

contactS


20/22

balance in trade

appp v p (aloP) Te level o protection deemed appropriate by the WO memberestablishing a sanitary or phytosanitary measure to protect human,

animal or plant lie or health within its territory.

bs Protection rom the risks posed by organisms to the economy,

environment and peoples health through exclusion, eradication and

control.

cx as css (cx) Codex is the internationally recognised standards setting body or

ood saety. Its ull name is the Joint FAO/WHO Codex Alimentarius

Commission. Codex Alimentarius is Latin or ood code. Codex

standards, recommendations and guidelines are recognised asinternational standards or the purposes o trade.

eqv Te establishment, recognition and application o common sanitary

and phytosanitary measures by dierent Members. Equivalence relates

to the situation where SPS measures which are not identical but are

recognised as having the same health outcome and are accepted as

equivalent by another WO member.

hs WO members should base their SPS measures on relevant

international standards guidelines or recommendations where these

exist. For instance harmonisation with international ood saety

standards means basing national requirements on standards developed

by Codex.

i P P cv Te IPPC is an international treaty to secure action to prevent the

(iPPc) spread and introduction o pests o plants and plant products, and to

promote appropriate measures or their control.

mss Measures include all relevant laws, decrees, regulations, requirements

and procedures and are usually based, where possible, on international

standards under the SPS Agreement. Tey are also commonly reerred

to as standards.

Ps sss Health issues involving the pest and disease status o plants and plant

products.

S sss Health issues involving the pest and disease status o animals and

animal products, and human health.

t sss A colloquial term or the three international standard-setting bodies

or ood saety, animal health and zoonoses and plant protection, whose

guidance is recognised under the SPS Agreement. Te Joint FAO/WHO

Codex Alimentarius Commission is responsible or ood saety. Animalhealth and zoonoses are covered by the OIE and the international

and regional organisations operating under the ramework o the

International Plant Protection Convention have responsibility or plant

health and protection.

GloSSary


21/22

tsp Te extent to which agreements and government regulations

aecting trade are open, clear and measurable. ransparency under

the SPS Agreement has three main components notications,ofcial enquiries and the publication o regulations.

ug r Te eighth round o GA multilateral trade negotiations, which

began in Punta del Este, Uruguay, in 1986, and was concluded in

April 1994 at Marrakesh, Morocco.

w ogs a h (oie) Te OIE, until 2004 known as the Ofce International des

Epizooties, deals with animal health and zoonoses (human

diseases that are caught rom animals), and sets sanitary standards

or the international trade o animals or animal products.

w t ogz (wto) Te international organisation established by the Uruguay Round

to oversee and provide a single administrative and legal umbrella

or all o the Rounds Agreements.

Zss Diseases that can be transmitted rom animals to humans.

GloSSary


22/22

Crown copyright Ministry of Agriculture and Forestry, Ministry of Foreign Affairs and Trade, New Zealand Food Safety Authority 2009

ISBN 978-0-478-33880-5 (Print)

ISBN 978-0-478-33881-2 (Online)

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Balance in Trade

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