The Agreement on the Application of Sanitary and Phytosanitary Measures - also known as the SPS Agreement is an international treaty of the World Trade Organization. It was negotiated during the Uruguay Round of the General Agreement on Tariffs and Trade, and entered into force with the establishment of the WTO at the beginning of 1995.[1]
Under the SPS agreement, the WTO sets constraints on member-states' policies relating to food safety (bacterial contaminants, pesticides, inspection and labelling) as well as animal and plant health (phytosanitation) with respect to imported pests and diseases.
The SPS agreement is closely linked to the Agreement on Technical Barriers to Trade, which was signed in the same year and has similar goals.
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In 2003, the USA challenged a number of EU laws restricting the importation of Genetically Modified Organisms (GMOs), arguing they are “unjustifiable” and illegal under SPS agreement. In May 2006, the WTO's dispute resolution panel issued a complex ruling which took issue with some aspects of the EU's regulation of GMOs, but dismissed many of the claims made by the USA. A summary of the decision can be found here
Another prominent SPS case is the hormone-treated beef case. In 1996, the USA and Canada challenged before the WTO Dispute Settlement Body (DSB) a number of EU directives prohibiting the importation and sale of meat and meat products treated with certain growth hormones. The complainants alleged that the EU directives violated, among other things, several provisions of the SPS Agreement. The EU contended that the presence of the banned hormones in food may present a risk to consumers' health and that, as a consequence, the directives were justified under several WTO provisions authorizing the adoption of trade-restrictive measures that are necessary to protect human health. In 1997 and 1998, the WTO adjudicating bodies admitted USA and Canada claims and invited the EU to bring the directives into conformity with WTO law before end of May 1999. EU did not comply and the DSB authorized the USA and Canada to take countermeasures against the EU. The countermeasures took the form of increased custom duties applied by the USA and Canada on certain EU products, including the notorious Roquefort cheese. In 2004, while the ban on hormone-treated meat was still in place, the EU initiated before the DSB new proceedings seeking the lifting of the countermeasures applied by the USA and Canada. EU alleged that it had collected new scientific data evidencing that the banned hormones may cause harm to consumers. According to the EU, the new scientific data provides sufficient ground for the ban on hormones, which may no more be sanctioned by the countermeasures imposed by the USA and Canada. As of January 2007, the proceedings initiated by the EU were still pending.
Quarantine policies play an important role in ensuring the protection of human, animal and plant health. Yet under the SPS agreement, quarantine barriers can be a 'technical trade barrier' used to keep out foreign competitors.
The SPS agreement gives the WTO the power to override a country's use of the precautionary principle – a principle which allows them to act on the side of caution if there is no scientific certainty about potential threats to human health and the environment. Under SPS rules, the burden of proof is on countries to demonstrate scientifically that something is dangerous before it can be regulated, even though scientists agree that it is impossible to predict all forms of damage posed by insects or pest plants.