Sanitary and Phytosanitary Measures

Substantive Scope of Application

Article 1.1 of the SPS Agreement defines the scope of application of the Agreement.This Agreement applies to all sanitary and phyto sanitary measures which may, directly or indirectly, affect international trade. Such measures shall be developed and applied in accordance with the provisions of this Agreement.

Thus, as stated by the Panel in EC - Hormones, there are two requirements for the SPS Agreement to apply, namely that the measure in dispute is an SPS measure and that the measure, directly or indirectly, affects international trade

Definition of an SPS Measure

Not all measures aimed at public health protection are SPS measures for purposes of the SPS Agreement. Article 1.2 points to Annex A of the SPS

Any measure applied:

(a) to protect animal or plant life or health within the territory of the Member from risks arising from the entry, establishment or spread of pests, diseases, disease-carrying organisms or disease-causing organisms;

(b) to protect human or animal life or health within the territory of the Member from risks arising from additives, contaminants, toxins or disease causing organisms in foods, beverages or feedstuffs;

(c) to protect human life or health within the territory of the Member from risks arising from diseases carried by animals, plants or products thereof, or from the entry, establishment or spread of pests; or

(d) to prevent or limit other damage within the territory of the Member from the entry, establishment or spread of pests. Sanitary or phytosanitary measures include all relevant laws, decrees, regulations, requirements and procedures including, inter alia, end product criteria; processes and production methods; testing, inspection, certification and approval procedures; quarantine treatments including relevant requirements associated with the transport of animals or plants, or with the materials necessary for their survival during transport; provisions on relevant statistical methods, sampling procedures and methods of risk assessment; and packaging and labeling requirements directly related to food safety.

It is clear from the above definition that the question whether a measure falls there under depends on its purpose or goal. Broadly speaking, the definition covers measures aimed at protecting humans and animals from food-borne health risks and protecting humans, animals and plants from risks from pests or diseases. Measures addressing other health risks relevant for international trade (such as a ban on asbestos-containing products) and measures not directly aimed at health protection, but rather at consumer information (such as a labeling requirement for biologically grown vegetables), do not fall under this definition. Such measures would thus not be subject to the disciplines of the SPS Agreement but be dealt with under other WTO rules. While this has not yet been subject to dispute settlement, it would appear that the purpose or goal of a measure would be determined objectively (for example by examining the formulation of the measure, its structure or design, and its effect), rather than by trying to determine the subjective aim of the Member imposing it. The latter would have the clearly unintended result of enabling a Member to evade the disciplines of the SPS Agreement by denying that the purpose of its measure is one of those falling within the Annex A.1 definition. If the measure at issue is aimed at one of the goals mentioned in points (a) to (d) of the Annex A.1 definition, it is an SPS measure for the purposes of the SPS Agreement, regardless of the specific form it takes. This appears from the second part of the definition, which contains a broad, illustrative, non exhaustive list of various types of government measures which could be classified as SPS measures, ranging from end-product criteria and quarantine requirements to certification and sampling procedures. It is important to note that the Annex A.1 definition expressly refers to the protection of human, plant or animal life or health within the territory of the Member. Thus, measures aiming at the extra-territorial application of domestic health standards are excluded from the application of the SPS Agreement

Discriminatory and Non-discriminatory Measures

The scope of application of the SPS Agreement is not limited to discriminatory SPS measures. When negotiating the SPS Agreement, Members realized that a test based on discrimination is not sufficient to separate legitimate SPS measures from those used for protectionist purposes. It is possible for a measure that neither on its face nor in practice discriminates between domestic and imported products to have a negative impact on international trade and thus serve to protect the domestic producers from foreign competition. For this reason, the disciplines of the SPS Agreement catch both discriminatory and non-discriminatory SPS measures that affect international trade. It is therefore possible for a measure that is non-discriminatory and thus in conformity with the GATT 1994, to violate the SPS Agreement.

Effect on International Trade

The second requirement laid down in Article 1.1 for the application of the SPS Agreement is that the measure at issue must directly or indirectly affectinternational trade. Empirical proof of a reduction in trade flows is not required,but it suffices to show that the measure is applied to imports and therefore canbe presumed to have an impact on international trade. The requirement of aneffect on international trade should thus be easy to fulfill and has in fact notbeen in dispute in any SPS case thus far.

Temporal Scope of Application

The SPS Agreement came into force on 1 January 1995. The question thus arises whether SPS measures in existence before this date are subject to its provisions. In EC - Hormones the EC argued that as its ban on hormone treated beef predated the entry into force of the SPS Agreement, this ban was not subject to the disciplines of the SPS Agreement. Upholding the Panel’s finding rejecting this argument, the Appellate Body held:

If the negotiators had wanted to exempt the very large group of SPS measures in existence on 1 January 1995 from the disciplines of provisions as important as Articles 5.1 and 5.5, it appears reasonable to us to expect that they would have said so explicitly. Articles 5.1 and 5.5 do not distinguish between SPS measures adopted before 1 January 1995 and measures adopted since; the relevant implication is that they are intended to be applicable to both.

Furthermore the Appellate Body pointed to Article XVI:4 of the WTO Agreement which obliges Members to ensure the conformity of their laws,regulations and procedures with their obligations under the annexedAgreements.3 It is thus a