G/SPS/GEN/1654  
 
12 October  2018 
(18-6336) Page: 1/2 
Committee on Sanitary and Phytosanitary Measures  Original: English  
 
UPDATE ON OECD ACTIV ITIES OF INTEREST TO  THE SPS COMMITTEE  
COMMUNICATION FROM T HE OECD  
The followi ng communication, received on 11 October  2018, is being circulated at the request of the 
OECD . 
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OECD WORK ON TRADE -RELATED INTERN ATIONAL REGULATORY C O-OPERATION  
1  RECENT WORK ON INTER NATIONAL REGULATORY CO-OPERATION BY THE OECD TRADE 
COMMITTEE AND THE OECD  COMMITTEE FOR AGRICULTURE  
1.1  Estimating Ad Valorem Equivalents of Non -Tariff Measures  
1.1.  The OECD Trade Policy Paper No. 215 uses a novel econometric method to estimate trade 
effects of non -tariff measures for roughly 5000 traded goods and 80 countries. It explicitly 
distinguishes several t ypes of measures and ascertains their distinct effects on trade volumes and 
prices. The latter feature allows disentangling trade -cost effects associated with non -tariff measures 
from possible demand -enhancing effects that come from reducing information as ymmetries and 
strengthening consumer confidence in imported products. The volume -based estimates yield 
information on how NTMs ultimately affect trade: the trade cost associated with NTMs, as captured 
by the ad valorem estimates, often reduces trade volume s, as expected, but not always. In a number 
of cases, in particular in the sanitary and phytosanitary (SPS) area, trade is found to expand, even 
though trade costs rise. This is likely explained by closer regulatory environments between the 
countries exami ned, but the trade -enhancing features of such measures merit further study.  
 Cadot, O., J. Gourdon and F. van Tongeren (2018), "Estimating Ad Valorem Equivalents of 
Non-Tariff Measures: Combining Price -Based and Quantity -Based Approaches", OECD Trade 
Policy  Papers, No. 215, OECD Publishing, Paris. http://dx.doi.org/10.1787/f3cd5bdc -en 
1.2  Estimating the trade -enhancing effects of IRC mechanisms within preferential trade 
agreements  
1.2.  Current and ongoing work loo ks at the implications of different IRC mechanisms within 
preferential trade agreements (PTAs). This econometric assessment explicitly disentangles the 
effects of PTAs as such from those to be had from IRC mechanisms related to SPS and TBT measures, 
and al so looks at the implications of their enforceability. Preliminary results suggest that TBT and 
notably SPS related IRC mechanisms generate the bulk of the positive trade effects to be gained 
from PTAs. Importantly, however, the positive trade effects of SP S- and TBT -related IRC 
mechanisms remain small unless agreed mechanisms are backed by the relevant enforcement 
mechanisms.  
1.3.  The work is expected to become publicly available as an OECD Trade Policy Paper in early 2019.  G/SPS/GEN/1654  
 
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  2  RECENT WORK ON INTER NATIONAL REGULATORY CO -OPERAT ION BY THE OECD 
REGULATORY POLICY CO MMITTEE  
2.1.  On 10 October 2018, the OECD launched the 2018 Regulatory Policy Outlook. Second in a 
series started in 2015, the Outlook monitors good regulatory practices against the principles set out 
in the 2012 Recommendation on Regulatory Policy and Governance. It is based on the results of the 
extensive 2017 OECD Regulatory Indicators Survey (iREG). Beyond the monitoring of changes in 
country practices over time in the areas of regulatory impact assessm ent, stakeholder engagement 
and ex post evaluation of laws and regulations, this second edition of the Outlook covers a number 
of new topics that have come to the forefront of policy makers’ attention, including international 
regulatory co -operation. In th is area, the report takes stock of country practices to embed 
international considerations in domestic rule -making.  
 OECD (2018), OECD Regulatory Policy Outlook 2018, OECD Publishing, Paris. 
https://d oi.org/10.1787/9789264303072 -en 
 OECD (2012), Recommendation of the Council on Regulatory Policy and Governance, OECD 
Publishing, Paris. http://www.oecd.org/gov/regulatory -policy/2012 -recommendation.htm   
Contacts:  
Martin von Lampe (E -mail: martin.vonlampe@oecd.org ) 
Céline Kauffmann (E -mail: celine.kauffmann@oecd.org ) 
 
 
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