1. Regulating goods and the WTO Erik Wijkström Counsellor, Trade and Environment Division World Trade Organization (WTO) Geneva, Switzerland erik.wijkstrom@wto.org +41 22 7395729

2. The “how” is important, much can be learnt from both Agreement and a dynamic committee work The right to regulate remains, even under freer trade Why is regulation becoming more important?

3. WTO - World Trade Report 2014, p118

4. 9% Average applied tariff, WTO Members in 2013

5. Tariffs have declined significantly.

6. But also trade patters have changed …

7. Country / company: A, B, … …..to market More specialization! WTO Trade Facilitation Agreement (agreed in Bali 2013). Report just out. -Multilateral cooperation -Standard-setting / harmonization -Trade costs high in d-ing countries …

8. = production is more fragmented

9. Another way to say it: deeper integration 

10. Compatibility , inter-operability 

11.  More focus on “behind the border” measures

12. In sum: tariffs are declining, production is more fragmented and deeper integration is on the rise, this puts increasing focus on regulations (and regulation is not declining).

13. The right to regulate remains, even under freer trade

14. Non-tariff measures (NTMs, NTBs) (including standards) neutral term! (NTMs are not necessarily bad!)

15. NTMs are allowed! (and there may me many reasons …)

16. Information to consumer: fresh or frozen? (TBT) Food safety (SPS)

17. Protecting environment (dolphins), informing the consumer (TBT)

18. Nutritional labelling (not safety) = TBT

19. In the last three years, 27 per cent of trade issues discussed in the TBT Committee are related to NCDs.

20. Legitimate objective 1

22. TBT SPS

23. Food safety, animal plant life or health = SPS The rest (including environment, safety and health) = TBT

24. All products are covered!

25. TBT SPS Does it make a difference? Open “Relevant” ISBs Factors other than science also Closed: food safety, animal plant life or health Codex, OIE and IPPC Science!

26. In sum: You have the right to regulate – WTO rules are not about removing barriers to trade, they are about disciplining how you regulate so as to avoid unnecessary trade trade friction.

27. The “how” is important, much can be learnt from both Agreement and a dynamic committee work

28. right obligation

29. First: you don’t necessarily need to regulate (even if you have the right) – there are voluntary and mandatory measures

30. Standards Technical Regulations VoluntaryMandatoryMarket Conformity Assessment Procedures Measures

31. So to repeat: an important first question is if there is a need to regulate. That is a decision that you, regulators (government), must take – not WTO.

32. Once that decision has been taken, the rules apply

33. Non-discrimination 2

34. Most-favoured nation (MFN) treatment and national treatment (NT)

35. Can you label “fresh” if defrosted?

36. Treating “characterizing flavours” differently

37. MFN and NT: “Like products” – same treatment (this is a simplification)

38. Avoidance of unnecessary obstacles to international trade 3

39. avoiding unnecessary barriers to international trade allowing Members to fulfill legitimate objectives at levels they consider appropriate

42. 1) Degree of contribution 2) Trade restrictiveness 3) nature of the risks / gravity of the consequences 4) alternatives (assessment) Holistic weighing and balancing

43. Unnecessary Necessary

44. Unnecessary Necessary

45. Unnecessary Necessary

46. use of international standards allowing for regulatory autonomy to protect legitimate interests avoiding unnecessary obstacles to international trade

47. The use of international standards “harmonization” = ≈ 4

48. Which ones?

49. SPS = ≈

50. EC – Sardines Sardina Pilchardus Sardinops Sagax = ≈

51. WTOSlide 51 Sardina pilchardus EC: Sardinops sagax Peru: … only Sardina pilchardus may be marketed as preserved sardines in EC (Article 2) = ≈

52. Transparency 5

53. 53 Timeline

54. 1 2 3 4 5 = ≈

55. The rules are about fairness, necessity, transparency, use of international standards: taking these into account will make regulation more effective and less likely to cause friction. WTO rules to not remove the right to regulate! Regulation is becoming more important (tariffs down, trade patters changing, deeper integration). Here is where trade policy is going to focus.

56. Thank you! erik.wijkstrom@wto.org