Background:
Biotech-related agricultural trade problems are currently in the spotlight in Washington. U.S. agencies are devoting significant time and attention to bilateral trade problems with the European Union (EU), China and Korea, and to multilateral discussions in the Codex and the World Trade Organization (WTO). The House Biotechnology Caucus recently invited United States Trade Representative (USTR) Ambassador Robert Zoellick to meet with them to discuss trade problems with the EU. USTR has raised the possibility of initiating WTO dispute settlement proceedings against the EU regarding new product approvals.

For a long time, BIO has been calling attention to the need for a comprehensive, long-term strategy for dealing with biotech trade issues. The Administration has now recognized the need for such a strategy; a USTR strategy paper was recently distributed to interested agencies for consideration.

The USTR approach is reportedly consistent with BIO's recommendations in most respects. The paper lays out an aggressive strategy that should bring coherence to U.S. policy and allow the U.S. to make much better use of available tools for addressing issues. One potential problem: food company representatives are concerned by reports that USTR may be recommending compromises with the EU on labeling.

Essential elements of an effective trade strategy are as follows:

• Lifting the EU moratorium on new product approvals. The EU has maintained for nearly four years a WTO-illegal moratorium on the approval of biotech products. The Commission is now promising to restart the approval process when new EU legislation will hopefully go into effect in October. If that does not happen, the U.S. should consider initiating WTO dispute settlement proceedings.
• Resisting the adoption of EU traceability and labeling proposals. The U.S. should expand efforts to inform Member States and the European Parliament of U.S. objections to the Commission proposals on traceability and labeling and novel foods and feeds. USTR should prepare a WTO legal analysis of the proposals and make clear that the U.S. intends to exercise its WTO rights if the proposals are implemented as drafted. Moreover, the U.S. should make clear that it would be unacceptable for the EU to link lifting the moratorium on approvals to implementation of the new labeling and traceability rules.
• International coalition building. The U.S. should work to build international support for the U.S. position on biotech trade issues. Meetings of the WTO, the Codex Alimentarius and various other international bodies provide ample opportunities for this effort.
• Domestic regulatory reform: The U.S. government should adopt a rational, science-based policy on adventitious presence that could be used as an international model. Without such a policy the U.S. will find it increasingly difficult to persuade other countries to adopt similar measures and could be vulnerable to arbitrary restrictions on U.S. exports.

For more information, contact Matthew Lyons at 202-962-9200.