Assessment of Egypt’s Compliance with the WTO Agreement on Technical Barriers to Trade (TBT) April 18th, 2004 by Sahar Tohamy, ATR World Bank Institute Trade Capacity Building Workshop Ein Sokhna-Egypt

Assessment Team Foreign Trade Policies Sector (FTPS) The Egyptian Organization for Standardization and Quality Control (EOS) Assistance for Trade Reform, ATR

Assessment Objectives Gives the government’s assessment of the system of standards and technical regulations Updates and improves on previous work in this area Provides an action plan addressing remaining weaknesses in the system Serves as a DSP deliverable

Purpose of Presenting the Assessment Results in this Workshop Public awareness of the main features of Egypt’s standards system emphasizing TBT compliance issues Overview of recent trade facilitation efforts and remaining weaknesses Coordinating efforts to simplify and streamline trade facilitation efforts among government agencies and donors assisting in this area Comparing Egypt’s import inspection system to systems implemented in other countries

The presentation covers A summary of Egypt’s obligations under the TBT Agreement An overview of the Egyptian system of standards and technical regulations 3. Evaluates the Egyptian system against TBT obligations 4. Provides policy recommendations and an action plan for further reform

The Technical Barriers to Trade Agreement (TBT) in the WTO A summary of Egypt’s obligations under the TBT Agreement 1. The Technical Barriers to Trade Agreement (TBT) in the WTO defines technical regulations as any mandatory requirement related to product characteristic, process, administrative provision, etc. prohibits the use of technical regulations to restrain trade.

The Code of Good Practice: (Annexed to the Agreement) A summary of Egypt’s obligations under the TBT Agreement 1. The Code of Good Practice: (Annexed to the Agreement) Requires similar obligations for (voluntary) standards. Egypt is signatory to the Code of Good Practice Egypt is bound by obligations under the TBT Agreement and the Code of Good Practice

1. 1 A summary of Egypt’s obligations under the TBT Agreement The main obligations under the TBT Agreement are National treatment Harmonization of technical regulations and standards with international standards Notification to the WTO Transparency

1. 1 A summary of Egypt’s obligations under the TBT Agreement National treatment National treatment requires that technical regulations not be used to discriminate against imports.

1. 1 A summary of Egypt’s obligations under the TBT Agreement Harmonization with international standards Countries are encouraged to use standards developed by international organizations Deviation from the international standard is allowed in cases of concerns about national security, protection of human health, safety, environment and protection from deceptive practices.

1. 1 A summary of Egypt’s obligations under the TBT Agreement Notification to the WTO WTO members are required to give other members an opportunity to comment on proposed or changed technical regulations and standards. They must also notify to the WTO: - standards and technical regulations adopted - standards and technical regulations framework - any changes in either

1. 1 A summary of Egypt’s obligations under the TBT Agreement Transparency in the process of technical regulation and standard development enquiry point to answer questions and clarifications general transparency of the system to reduce barriers to trade

1. A summary of Egypt’s obligations under the TBT Agreement Complementarity and Similarity between TBT and Sanitary and Phyto-Sanitary Measures, SPS The SPS Agreement concerns measures that countries undertake to: protect human, animal or plant health from pests and diseases that are carried by infected agricultural or animal products; protect human, animal and plant health from entry of food products that contain toxic additives or contaminants; protect the environment from entry of pests and diseases Prohibits using SPS measures to restrict foreign trade flows

1. A summary of Egypt’s obligations under the TBT Agreement Complementarity and Similarity between TBT and Sanitary and Phyto-Sanitary Measures, SPS National treatment Harmonization of technical regulations and standards with international standards Notification to the WTO Transparency In addition: SPS Agreement requires that countries rely on scientific risk assessment techniques in case SPS measures are stricter than international standards

1. A summary of Egypt’s obligations under the TBT Agreement Complementarity and Similarity between TBT and Sanitary and Phyto-Sanitary Measures, SPS Regulations on Pesticides: - SPS: If measure relates to residues in food or animal feed and is to protect human or animal health - TBT: If measure relates to the quality or efficacy of the product, or to health risk to handlers Establishment of labeling requirements for food - SPS: If the measure is related to food safety - TBT: If the regulation concerns size of typeface used in labels, presentation of information and content Regulation on containers for the shipment of grains: - SPS: If the regulation is on fumigation or disinfection measures of containers - TBT: If the regulation relates to size or structure of containers

Standard and technical regulation formulation process (EOS), annually: Egypt’s system of standards and technical regulations 2. 1 Standard and technical regulation formulation process (EOS), annually: EOS formulates a work plan for adding or updating existing standards With 100+ technical committees, EOS drafts new or updates an existing standard EOS publishes the new standard in the Official Gazette

2. 1 Egypt’s system of standards and technical regulations Technical Regulations: MOI mandatory list MOI Decree 179/1996 280 groups of goods - mainly agriculture and food products (70%) - and engineering and chemicals and textiles and clothing For items on the MOI mandatory list, the Egyptian Standard must be used for conformity assessment

2. 1 Egypt’s system of standards and technical regulations Technical Regulations: Ministerial Decrees from the MOA, MOH, and others particular specification, food colors, residues, additives, etc. MOFT regulations were issued after removal of bans in the textiles and clothing sector. If submitted to EOS, these regulations are incorporated into the mandatory list.

2. 1 Egypt’s system of standards and technical regulations Voluntary Standards Egyptian Standards issued by EOS: Over 4000 Egyptian standards updated through the 1980s Other recognized standards are: ISO/IEC, European (EN), BS-DIN-NF, US (ANS), Japanese (JIS), CODEX for food MOI Decree 180/1996 requires that any good (local or imported) comply with the Egyptian standard or one of 6 international standards

2. 1 Egypt’s system of standards and technical regulations Conformity assessment for locally produced goods governed by MOI Decree 42/2003 responsibility divided between EOS and the Industrial Regulation Authority (هيئة الرقابة الصناعية)

2. 1 Egypt’s system of standards and technical regulations Conformity assessment for imports governed by Import Export Law 118/1975 and Implementing Regulations (MOFT Decree 275/1991) . Article 73 and 74 of Ministerial Decree specify GOEIC as the agency responsible for inspection of imports Annex 8 lists imports that are required to be inspected, Annex 9 is for exports GOEIC uses EOS standards and technical regulations for inspection (if on MOI mandatory list) and one of 6 international standards for remaining items Several decrees simplifying procedures.

2. 1 Egypt’s system of standards and technical regulations Conformity assessment for imports Presidential Decree 106/2000: consolidated responsibility of sampling and testing under GOEIC MOFT Decree 346/2000: executive regulations for implementing Decree 106. Decree 524/2000 maximum number and size of samples used in inspection

2. 1 Egypt’s system of standards and technical regulations Conformity assessment for imports Decree 501/1999: The White List Decree Exempts non-agricultural imports from inspection by GOEIC if 10 or more shipments were imported in span of 2 years, none rejected. 250+ importers and exporters are currently listed on the White List Importers added to the White List by successive Ministerial Decrees

2. 1 Egypt’s system of standards and technical regulations Conformity assessment for imports Acceptance of inspection certificates of other agencies: - MOFT Decree 552/2000: criteria for agencies to qualify for certificate recognition - Decrees 801/2001 and 76/2002 registering SGS Holding Company and its agent in Egypt and Bureau Veritas SA and Bivac International SA

2. 1 Egypt’s system of standards and technical regulations Conformity assessment for imports Prime Ministerial Decree 1186/2003: - GOEIC sole agency for inspecting - Customs shall not take other agencies inspection results - Types of tests to be conducted are specified by Decree for each product - Location for conducting different tests specified in the Decree - Dispute settlement mechanisms and time limits on providing test results

2. 1 Egypt’s system of standards and technical regulations Conformity assessment for imports Ministerial Decree 515/2003: - Executive Decree for implementation of Prime Minister’s Decree 1186/2003. - Article 18 of Decree 515/2003 allows recognition of International Marks, subject to regulations to be drafted by MOFT.

Compliance of the Egyptian system with obligations of the TBT Agreement 3. 1 National treatment Technical regulations Standards Conformity assessment procedures The White List framework for imports Result: Egypt meets the national treatment obligation.

Harmonization with international standards Compliance of the Egyptian system with obligations of the TBT Agreement 3. 1 Harmonization with international standards MOI Mandatory List Other technical regulations MOI Decree 180/1996 Result: Egypt is compliant with respect to standards and will be with respect to MOI list. Mandatory Ministerial Decrees will have to conform, however.

Notification to the WTO Compliance of the Egyptian system with obligations of the TBT Agreement 3. 1 Notification to the WTO Decree 179/1996 and MOI mandatory list Annex 8 for imports the process of standard and technical regulation development and adoption MOI Decree 180/1996 Result: Egypt will need to ensure its notification obligations to the WTO are met.

Compliance of the Egyptian system with obligations of the TBT Agreement 3. 1 Transparency enquiry point process of standard and technical regulation development Better access to information transparency in conformity assessment Result: Continued work is needed in this area, more than just meeting TBT transparency requirements.

4. 1 Policy recommendations and an action plan TBT compliance obligations in section 3 continuous attention to reducing transaction costs and enhancing transparency of the system action plan (in the report) public awareness and interaction with local producers and importers From rules and regulations to implementation

4. Developments since the assessment was completed Establishment of the National Sub-Committee on TBT and SPS issues in Nov 2003 Executive regulations for Prime Ministerial Decree 1186/2003 (MOFT Decree 515/2003) Harmonization of food and agriculture technical regulations with CODEX? EOS website? Implementation issues: ATR started a time-of-release survey with GOEIC to monitor time needed for inspection and customs procedures