15-01-2010 | SPS ‘Good Offices’

in association with:

15-01-2010 | SPS ‘Good Offices’ – A Good Idea?

‘Good Offices’ is a less formal, quicker and cheaper way to solve a trade dispute than would be the case under formal dispute settlement proceedings. It is however more formal than a bilateral consultation between the parties. The SPS Agreement actually encourages ad hoc consultations or negotiations among Members on specific SPS issues under Article 12.2 of the SPS Agreement.

Before going to ‘good offices’ a Member can take a bilateral approach. For instance a Member can ask a trading partner to explain the reasons for a particular measure under Article 5.8 of the SPS Agreement. In addition, documents can be exchanged, possibly including questionnaires and replies. If this does not lead to an agreement, one or more bilateral meetings can be convened, for example in the margins of the meetings of the SPS Committee. If these meetings do not lead to a resolution, the complainant may raise the matter at an SPS Committee meeting under the agenda item on specific trade concerns, possibly providing additional information in a Committee document. If the problem persists, the Member concerned may seek the ‘good offices’ of the Chairperson or of the Secretariat, informing the Committee of any progress.

What then are ‘good offices’? Essentially ‘good offices’ means that the Chair of the SPS Committee is prepared to get together with countries in disagreement and help them to find an amicable solution to a disagreement, without having an official dispute. This has been done 3 times in the past to our knowledge, and in one instance included South Africa. That instance involved Argentina, Brazil, Chile, South Africa and Uruguay with respect to measures relating to citrus canker taken by the European Communities in 1998. The other 2 matters were firstly by the United States with respect to restrictions on wheat and oilseeds maintained by Poland, also in 1998; and the third by Canada with respect to import restrictions on bovine semen maintained by India in 2001. Perhaps one of the reasons that ‘good offices’ has been so infrequently used is that there is no structured way of conducting them. In this regard Members have previously proposed formalising them by establishing procedures for resolving these trade conflicts and a structured procedure is currently being crafted in the SPS Committee.

The SPS Committee has been discussing a formalised procedure now for several months. Essentially what it describes is a procedure intended to encourage and facilitate ad hoc consultations or negotiations among Members on specific sanitary or phytosanitary issues, with a view to assist Members to reach mutually satisfactory solutions, as is possible using Article 12.2 of the SPS Agreement.

In terms of what is being discussed, a written request for good offices must be accepted or declined within 30 days, and a date for discussions then set within 45 days thereafter. No time limit is set on concluding the matter, reference is simply made to a ‘reasonable period’. In practice getting the matter moving in a reasonable time this is likely to be part of the Chair’s value.
The role of the Chair is to facilitate communication between the consulting Members. The Chair will work out the parameters and a working procedure for the consultations. This can cover for example whether it is recommended that technical experts should be present at the consultations, whether production of written responses and supplementary questions are desirable; and if an acceptable schedule for such submissions and for ongoing meetings can be determined.

The procedure does not add to nor detract from the existing rights and obligations of Members, nor does it provide any legal interpretation or modification to the Agreement itself and it is without prejudice to the right of a Member to determine its appropriate level of sanitary or phytosanitary protection against risks to human, animal or plant life or health. Under the draft procedure the Chair is not allowed to express an opinion on a technical issue or on the consistency with any WTO Agreement.
It makes sense that the Chair of the SPS Committee could not opine on the WTO consistency as this might taint their impartiality for wider duty in the chair. One might however speculate that perhaps a mediator who was not the Chair may have more freedom to point out and ask some very probing questions that are about consistency with the SPS agreement. After all any opining is only relevant to the parties and the result may never be revealed. It is also notable that the Members who are in consultation, as well as the Chairperson of the Committee and the Secretariat (if involved), have to treat the information submitted and positions taken during consultations as confidential, unless disclosure is consented to by all the consulting Members.
There is certainly merit in adopting this procedure, as is or with minor amendments, because it will serve to ease irritations before they grow to full blown disputes. Given the highly technical nature of these disputes and their length, complexity and cost, governments should be encouraged to try the ad hoc procedures to try and solve the SPS concern. It is notable in this regard that in formal dispute settlement proceedings on SPS issues most consultation requests have not progressed beyond the consultations phase to full panel proceedings and most of these consultations end in a solution or in the complaining government not pursuing the case. This said one does wonder why the current SPS Committee ‘complaint’ list has over 270 open issues, some of which have not been active for several years, and whether there are perhaps a handful of dispute panels ripe for the commencement among these.

In short the adoption of the procedural assistance methodology for ‘good offices’ is a good thing. None the less some Members have had a concern that the discussions in the SPS Committee may be out of sync with similar talks (so-called ‘horizontal discussions’) under the Doha negotiations, so it is specifically understood that the draft procedure is not intended to prejudice in any way the process or outcome of the work related to the Doha Development Agenda. In some way this is strange as it is evident that strong forward progress is being made on the good offices for SPS disputes while the Doha negotiations are void of any progress – presenting some irony in the ‘fear of prejudice’ to our mind. We look forward to the passage of this issue in the SPS Committee in 2010.