WRITTEN QUESTION P-3248/97 by Honor Funk (PPE) to the Commission (9 October 1997)

Subject: WTO ruling on the import ban on meat treated with hormones

1. What arguments did the EU use to appeal against the WTO ruling?

2. What is the task of the WTO Appellate Body (7 members)? Can only legal aspects of the Panel's report be the subject of appeals?

3. Can negotiations still take place in the WTO? If so, on what subject?

4. When will the final ruling be given by the WTO?

5. If the current WTO ruling were not changed and the EU continued to insist on the import ban on meat from cattle treated with hormones, what would be the consequences?

6. Are penalty duties the only solution?

7. Who sets the level of the penalty duties or the compensation payments? Which countries will be granted such compensation payments and on what basis?

Joint answer to Written Questions P-3248/97 and E-3429/97 given by Mr Santer on behalf of the Commission (25 November 1997)

1. The Community has appealed from all the conclusions of the hormones panel report and most findings on which they are based. In particular, it argued that the panel has made serious errors in interpreting:

- Article 5:1-5:2 of the agreement on sanitary and phytosanitary measures of the World trade organisation (WTO) (SPS agreement), regarding the concepts of risk, risk assessment and the related question of appropriate level of sanitary protection;

- Article 3:3 of the SPS agreement as regards the right of a WTO member when there is scientific justification to adopt a higher level of sanitary protection than that which can be achieved by basing the measures on the recommendations of the Codex Alimentarius commission;

- Article 5:5 of the SPS agreement as imposing an obligation of consistency in the choice of levels of sanitary protection with substances which are not toxins or contaminants, and with regard to substances which are not the same and pose the same type of health risk to humans or animals as the growth hormones under dispute;

- a number of important provisions of the SPS agreement without taking into proper account of the precautionary principle and against the panel's decision placing exclusively on the Community rather than on the complainants the burden of proving that these hormones pose no risk;

- the WTO dispute settlement understanding (DSU) as allowing panels to substitute their judgement on the scientific basis of the measures and scientific uncertainty for that of the regulatory authorities of WTO members.

2. Article 17:6 of the DSU and the appellate body's working procedures for appellate review provide indeed that an appeal is limited to issues of law covered in the panel report and legal interpretations developed by the panel. The Community has also argued that existing case law appears to accept appeals also on the ground that the first instance panel report committed manifest errors in the interpretation of the facts or manifestly distorted the facts and evidence before it or committed serious violations of the procedural rules applicable in the conduct of the proceedings.

The appellate body section hearing appeals is always composed of three members, as Article 17:1 of the DSU provides.

3. Negotiations on the issues subject to these appeal proceedings normally do not take place whilst awaiting the final outcome. Depending on the final judgement, each party will have to consider how to resolve this trade dispute, which may include negotiations.

4. The report of the appellate body should take a minimum of 60 days and a maximum of 90 days to be issued, starting from 25 September 1997 (Article 17:5 DSU).

5. - 7. It is premature to speculate on these points without knowing the final outcome of the Panel appeal.