U.S. farmers are widely adopting biotechnology, growing genetically engineered (GE) crops-- mainly corn, soybean, and cotton varieties -- to lower production costs and reduce laborrequirements. (1) In 2002, 66% of an estimated 145million acres planted to GE crops worldwide werein the United States, according to the International Service for the Acquisition of Agri-biotechApplications (ISAAA). (2) U.S. crops where GE varieties are common are highly dependent upon export markets. According to USDA, approximately 40% of all U.S. soybeans, 20% of all corn, and 45% of allupland cotton production is exported. These crops and their major products accounted for more thana fourth ($13.3 billion) of the total annual average annual value of $52.6 billion for all U.S.agricultural exports during calendar years (CY) 2000 to 2002. Not all of these soy, corn, and cottonexports were GE varieties, but the U.S. marketing and regulatory systems do not distinguish between(approved) GE and non-GE varieties. Commingling bulk commodity shipments provides animportant cost competitive advantage for U.S. handlers in domestic and world markets, accordingto industry analysts. These analysts observe that U.S. adoption of agricultural biotechnology has been facilitated bythe current U.S. regulatory system. The basic federal guidance for regulating biotechnology productsis the Coordinated Framework for Regulation of Biotechnology (51 Fed. Reg. 23302) published in1986 by the White House Office of Science and Technology Policy (OSTP). One of its keyprinciples is that genetically engineered products should continue to be regulated according to theircharacteristics and unique features -- not according to their method of production. Thus, if a foodproduct produced through biotechnology is determined to be substantially equivalent to oneproduced by more conventional means, that food is subject to no additional (or no different)regulatory processes. Once approved, food products do not have to be labeled as to whether or notthey contain any genetically modified organisms (GMOs), except to the extent a GE food issubstantially different (e.g., contains an allergen or has a changed nutritional content). However,marketers are free to make such claims, one way or the other, so long as the labeling is truthful. Theframework maintains that new biotechnology products are regulated under existing federal statutoryauthorities, all of which were conceived and enacted before the advent of commercial agriculturalbiotechnology. (3) The problem for U.S. agriculture is that many countries remain wary of agricultural biotechnology, including those in the European Union (EU), where consumer and environmentalorganizations have been vocal in expressing concerns about the safety of GE crops and animals. TheEU and other important U.S. trading partners have adopted widely divergent approaches toregulating biotechnology. As a result, U.S. exporters are encountering barriers to their products inthese markets. For example, since 1998, the EU, the fourth largest foreign market for U.S. agricultural products, has maintained a de facto moratorium on approvals of new GE crop varieties. In May2003, the United States, Canada, and Argentina began a formal challenge of the EU policy in theWorld Trade Organization (WTO), contending that it violates international trade agreements and alsohas fueled unwarranted concerns about the safety of agricultural biotechnology throughout the world(see page 9 ). The EU counters that it must protect its consumers by exercising the so-calledprecautionary approach, which says that if scientific evidence is insufficient or inconclusiveregarding a practice's or product's potential dangers to human or environmental health, it should bemore vigorously regulated or even prohibited if there are reasonable grounds for concern, thusproviding a safeguard against future unforeseen problems. Under this approach -- which is alsobeing emulated somewhat in other important U.S. markets such as Japan and South Korea, forexample -- the products of biotechnology are deemed to be inherently different than theirconventional counterparts. Even some countries that grow GE crops are imposing their own approval and labeling regulations for GMOs. For example, China is planting its own GE cotton and other crops, but hasimposed a temporary GMO import regime while it develops permanent new rules for approval andlabeling of GMO farm products. This has created uncertainty about continuing access to thisimportant U.S. export market. Some U.S. producers, who otherwise generally have supported biotechnology, have expressed trepidation about expansion to more GE varieties due to such foreign market uncertainties. Theirconcerns have been evident as biotechnology companies work toward government approvals of GEwheat. Although some growers are eager to plant the new varieties when they become available,others do not want commercialization approvals until there is wider global acceptance. (4) Wheatgrowers, too, depend heavily on exports; USDA reports that 56% of production is exported. Theaverage annual value of U.S. wheat exports was $3.6 billion (7% of all agricultural exports) inCY2000-2002. Around the world, countries have taken widely divergent approaches to regulating the products of agricultural biotechnology. Critics have noted that many, particularly in the developing world,have adopted no coherent policy at all. (6) Amongthose that do, each has its own system. Althoughmultilateral attempts to harmonize GMO regulation have been under way for several years,internationally recognized standards still are evolving. The disparity of national regulatory responses has been characterized as a "renationalization" of agri-food safety regulation, and "a sharp break from the international food safety system thatevolved over the past 100 years, where importers tended to accept the food and environmental safetyjudgments of regulators from those countries developing and exporting the products." (7) Others arguethat scientific knowledge about biotechnology's effects on food and environmental safety is stillincomplete. In the meantime, they argue, countries have a right and obligation to take the"precautionary approach" to regulation. Various countries' national biotechnology regulation isoccurring within two broad categories: Approval to commercialize new products of agricultural biotechnology. The United States,Canada, Japan, Mexico, Argentina, and South Africa are among the countries where developersseeking approvals of new GE products have found a relatively flexible regulatory environment. Tothis list might be added India and China, where considerable research has been conducted onagricultural biotechnology and domestic approvals appear to be increasing, but where, nonetheless,imports of GE crops may face obstacles. (8) InAustralia, the EU, and New Zealand, approvals haveslowed. A total of nearly 30 countries reportedly have developed relatively coherent (although inthe case of some countries, either somewhat ambivalent or not necessarily fully transparent) policieswith regard to GE approvals. Systems for labeling and traceability. In Argentina, Canada, Hong Kong, and the UnitedStates, labeling products as to whether or not they are from GE-derived crops generally is voluntary. However, the EU and more than 20 countries have either adopted, or announced plans for,mandatory labeling of GMO products. A number of them, for example, Australia, Brazil, China,Indonesia, Japan, New Zealand, Saudi Arabia, South Korea, and the United Kingdom (an EUmember), have formally implemented their mandatory labeling regimes. Many others, however,have not fully outlined their proposals or indicated when they might take effect; some also apparentlylack implementing structures. (9) Generally, mandatorylabeling also necessitates accompanyingtraceability requirements, meaning that the marketing system must have documentable ability totrace the presence or absence of GMOs through each step from farm to point of sale (see also page 10 ). The wide range of national approaches to GMO regulation is in part due to the fact that an international consensus on how to regulate agricultural biotechnology is still evolving. Agriculturalbiotechnology and trade policy analysts throughout the world generally agree that an internationalconsensus on how best to regulate agricultural biotechnology is not only desirable but necessary. Attempts have been under way for some years in a variety of multinational institutions to developmore harmonized standards for ensuring the safety of GE crops and foods, and to establish groundrules for testing, enforcement, and dispute resolution. It is not yet clear which of these internationalbodies will have the greatest influence in resolving these questions, although it appears likely thatmost, if not all, will have some role. The IFPRI/Phillips paper (see footnote ?) observed that "Despite the substantial effort being undertaken, there is no common view on the goal of international regulation. While most agree thatsafety is the bottom line, few can agree on what that means, whose opinions should hold the mostweight (scientists' or citizens'), or how to handle nonsafety issues such as social, economic, orethical concerns." A wide array of multinational bodies has, or claims, a role in some facet of biotechnology regulation and standard-setting (see Table 1 ). Several are longstanding and largely science-basedorganizations, including the U.N. World Health Organization (WHO), the U.N. Food andAgriculture Organization (FAO), the food standards-focused Codex Alimentarius Commission, theInternational Plant Protection Convention (IPPC), and the International Epizootics Organization(OIE). The WTO and the Organization for Economic Cooperation and Development (OECD) areprimarily (although not necessarily exclusively) concerned about free trade. Codex, for example, was created in 1963 by FAO and WHO to develop internationally recognized, science-based food standards and guidelines and related materials. Its main objectivesare to protect consumer health, ensure fair trade, and promote coordination of food standards workundertaken by governmental and non-governmental organizations. Codex standards are used toevaluate national food regulations and to settle sanitary and phytosanitary (SPS) related tradedisputes in the WTO. In 1999, the Codex established the ad hoc Intergovernmental Task Force on Foods Derived from Biotechnology. The task force was charged with considering health and nutritionalimplications, and with developing standards, guidelines or recommendations, as appropriate, for suchfoods. The task force held its fourth and final meeting in March 2003, when it completed work onthe last of three framework documents, Draft Principles for the Risk Analysis of Foods Derived fromRecombinant-DNA Microorganisms . The task force's documents were to be presented for approvalby the full Commission at its July 2003 meeting. U.S. officials expressed satisfaction with the outcome of the final session, althoughdeliberations over the guidelines often were contentious. At the last meeting, for example, an opendiscussion was held on rules for traceability of GE products. The EU led by France was advocatingthat they encompass rules for full traceability of GE products. The United States was arguing thattraceability is acceptable only for food safety/public health purposes, not merely to preserve theidentity of specific products, including those resulting from biotechnology. The U.S. view is thatthese types of questions should be considered in other Codex committees because they are notunique to biotechnology. (10) The 2000 Cartagena Biosafety Protocol is a newer, environmentally-focused effort devoted to the safe transfer, handling and use of bio-engineered products crossing international borders. TheUnited States is not a party to the Protocol but is participating to ensure that its provisions do notundermine such trade in GM-derived products (see page 11 ). Table 1. Multinational Institutions Involved inBiotechnology Sources: IFPRI; USDA. Agricultural biotechnology was not a major element of international trade during the last comprehensive round of multilateral trade negotiations and therefore is notdirectly addressed in the 1994 Uruguay Round (UR) agreements. However, the U.S.position has long been that the UR Agreement on Agriculture, the Agreement on theApplication of Sanitary and Phytosanitary (SPS) Measures, and the TechnicalBarriers to Trade (TBT) Agreement provide adequate guidance for dealing with tradein GMOs. Taken together, these agreements seek to reduce or eliminate allunnecessary or arbitrary barriers to trade, and ensure that SPS or technical measures(e.g., GMO labeling) are transparent, scientifically defensible, and based on acceptedinternational standards. (11) The U.S. proposal inthe current Doha round ofnegotiations in the WTO is silent on biotechnology itself but presumes a continuationof this position. U.S. officials say they are actively engaged multilaterally and bilaterally toensure that any national or international standards are consistent, transparent, basedon scientific principles, and compliant with international trade rules (e.g., thoseadministered through the WTO). However, they face difficulties in reconciling thecurrent U.S. approach with the opposing perspectives of other influential countrieslike those in the EU and elsewhere. Following are discussions of selected issues inthe international arena which have challenged U.S. supporters of agriculturalbiotechnology. On May 13, 2003, the U.S. Trade Representative (USTR) and the U.S. Secretary of Agriculture announced that the United States, Canada, Argentina, and Egypt werefiling a case before the World Trade Organization against the EU's de facto 5-yearmoratorium on approving new agricultural biotechnology products. (Egyptsubsequently decided against filing with the United States.) The Administration wasunder increasing pressure from key Members of Congress and farm groups to launchsuch a case. U.S. agricultural interests contend that not only have these policiesblocked their exports to the EU, but also fueled unwarranted concerns about thesafety of agricultural biotechnology throughout the world. EU officials say they have been moving as quickly as possible to reinstate biotechnology approvals while trying to reassure their consumers regarding safetyissues. There is concern among some policymakers that the filing of a WTO casewill only escalate trade tensions between the United States and the EU, where thevalue of two-way agricultural trade amounts to more than $14 billion annually. Background. With minor exceptions, the EU has approved no agricultural biotechnology products since 1998, even thoughit has an elaborate approval process in place, and, in October 2002, implementedrevisions to that process aimed at reassuring its member states and the public aboutthe safety of its regulatory system. Approximately 13 products in early 2003 wereawaiting approval, some for as long as 6 years. A majority of EU states haseffectively blocked the release of any new GE crops into the environment. Thesestates -- France, Belgium, Luxembourg, the Netherlands, Germany, Austria, Italy,Ireland, Greece, Spain, Portugal, and Finland -- say they will not implement theEU-wide legislation for approvals until new, stricter, regulations for labeling andtracing GM-containing products also are adopted. Although the EuropeanCommission first approved these separate proposals in July 2001, the lengthy EUdecision-making and implementation process make it unlikely that these proposalswill come into force any earlier than some time in 2004. In the 3 years before the de facto ban, U.S. corn exports to the EU averaged approximately $300 million annually (Spain and Portugal were the largest EUimporters). Since then, they have declined to less than one-tenth of that valueannually -- the result, according to analysts, of the EU's moratorium on the approvalof new corn varieties already approved in the United States. Although one varietyof biotech corn was approved by the EU prior to the moratorium, other approvedvarieties are being grown in the United States, making exports of any U.S. corn(which is not separated as to GM or non-GM varieties) to the EU impractical. U.S.soybean exports to the EU have declined, too, from an average value ofapproximately $2.2 billion in the 3 years before the ban to about $1.2 billion annually (2000-2002), according to USDA data. Unlike biotech corn, only onevariety of biotech soybeans has been widely grown in the United States; the EU hadapproved this GE crop under its regulatory process prior to the moratorium. (The EUalso had approved a number of other GMOs prior to the 1998 moratorium.) The WTO Case. The U.S.-led case began with a request for 60 days of formal consultations with the EU. In addition tothe three main filers, Australia, Chile, Colombia, El Salvador, Honduras, Mexico,New Zealand, Peru, and Uruguay expressed their support for the case. On June 19,2003, a USTR spokesman issued a statement announcing that the consultations werenot successful, and that the WTO will now be asked to establish a dispute settlementpanel, the next step. At any rate, resolution of the dispute could take up to 18months. The United States and its allies argue in part that the EU moratorium violates the WTO Agreement on the Application of Sanitary and Phytosanitary (SPS)Measures. The SPS agreement permits countries to regulate crops and food productsto protect health and the environment, but their rules must be scientifically justifiedand approval procedures must be operated without undue delay. U.S. interestscontend that there is no scientific evidence that GM-derived food and feed crops aresubstantially different from, or any less safe than, conventional varieties, a conclusionthey say even European scientific authorities have reached. The moratorium has notonly impacted U.S. exports to the EU, but also caused other countries -- particularlyin the developing world -- to shun biotechnology, which, the United States hasargued, holds great promise for vastly improving agricultural productivity andfeeding growing populations (see also page 12 ). EU officials counter that they have shown good faith in moving as quickly as possible to restart the approval process. In early April 2003, the EC threatened totake legal action at the European Court of Justice against the 12 member states if theyfail to implement the GE approval legislation once the new labeling and tracing rulesare approved. Nonetheless, EU officials have told the United States that theircautious approach to regulating agricultural biotechnology is necessary to restoreconfidence among European consumers, who may be more wary of changes in howtheir food is produced due to a series of recent food safety crises. (13) It is unclear how a WTO dispute panel might rule on the U.S.-EU case, in part because agricultural GMOs are not explicitly recognized in the Uruguay Round tradeagreements, which were concluded before the advent of widespread agriculturalbiotechnology. If the United States wins, it would validate the basic principles of theSPS agreement and could discourage other countries from emulating the EUregulations. The United States has pointed out that many EU farmers themselveswould like to be planting and selling GE crops. However, a win might not open EUmarkets to more GE imports; the United States might simply have to settle for someform of alternate compensation. Some have suggested that a win could create abacklash among the European public and governments who view the United Statesas forcing biotechnology on unwilling consumers. As noted, a number of foreign markets for U.S. farm products have been developing systems that will require most or all GE-derived products to be labeledas to their GE content. In the U.S.-EU biotechnology dispute, the U.S.-led WTOchallenge to the EU moratorium on GM approvals does not involve the emerging EUlabeling regulations. These regulations, if approved as proposed, would require allfood, feed and processed products from GMOs to be labeled, even if they no longercontain detectable traces. A tolerance level for non-GMO foods, feeds, andprocessed products of 0.9% is set for allowable "adventitious presence" (AP) -- thatis, unintended, low-level presence -- of an EU-approved GE substance. All productswith more than 0.9% must be labeled as GM. The allowable level for unapprovedGE varieties that received a positive EU risk assessment during the moratorium is0.5% for 3 years, after which it drops to 0%. (The current EU regime requireslabeling if ingredients contain more than 1% GMO protein or DNA.) U.S. officials so far have challenged formally only the EU moratorium, but asimilar effort against the labeling and traceability rules is possible in the future. U.S.agricultural interests argue that, even if the GMO approval moratorium is lifted, thenew labeling and traceability rules are themselves unworkable and unnecessary, andwill continue to discriminate against U.S. exports. Compliance with the EU labelingrule would require segregation of GE crops and foods derived from them from thetime they are planted all the way through the processing and marketing chain. Thiswould entail prevention of pollen drift from GE to non-GE fields; and difficult andcostly handling procedures such as using separate equipment, storage, and shippingcontainers, or at least painstakingly cleaning them. U.S. interests argue that foodcompanies forced to label accurately all GE products could face huge risks andliabilities. All of these problems would discriminate against U.S. shipments, theyadd. Material from Virginia Cooperative Extension asserts: Segregating crops at every step during growth, storage, transportation, processing, and exporting would be very difficult andcostly to implement. Dr. Susan Harlander, a former vice president of PillsburyCompany, illustrated the situation with the following example: a medium-sized foodcompany can have more than 6,000 products that contain 8,000 ingredients from1,000 suppliers that move through 30 processing plants on their way to beingexported to as many as 100 countries. Implementing a system to track all of theseingredients from their source (as far back as the farm) to the final destination is adaunting task that would cost billions of dollars and even then it may not beinfallible. (14) According to Virginia Extension, among the issues to be resolved on labeling and detection of GE material in crops and foods are: the scientific methods used toscreen the product; the sensitivity of the detection system; what would actually bedetected (DNA or protein); what agency would manage and regulate the testing; andwho would be held accountable if a product were mislabeled. The Cartagena Biosafety Protocol, an outgrowth of the 1992 Convention on Biological Diversity (CBD), was adopted in January 2000 and will take effect thisyear, now that the required 50 nations have ratified it. The United States is not aparty to the 1992 CBD, and therefore cannot be a party to the Protocol. However, ithas actively participated in the negotiations over the Protocol text and in countries'preparations for implementation. The Protocol addresses a major area of concern not resolved by the parent CBD in 1992 -- the safe handling, transfer and transboundary movement of bio-engineeredorganisms and products. It enables countries to obtain information about biotechorganisms (i.e., "living modified organisms" or LMOs) before they are imported intothose countries. It recognizes each country's right to regulate such organisms so longas they are consistent with existing international agreements, and provides for aninternational clearinghouse for the exchange of LMO information. The Protocol establishes the use of "Advance Informed Agreements" (AIA) between the importing and exporting parties that cover the first transboundarymovement of any GMO. The purpose of AIAs is to ensure that recipient countrieshave the opportunity to assess environmental risks associated with the importationof biotechnology products. The Biosafety Protocol creates the procedure by requiringexporters to seek consent from importers before the first shipment of a GMO isintroduced into the environment (applies to seeds for planting, fish for field release,and microorganisms for environmental bioremediation). In addition, article 11 alsorequires that bulk shipments of GMO commodities for food, feed, or processing beaccompanied by declarations stating that such shipments "may contain" GMOs andare "not intended for intentional introduction into the environment." One section of the Protocol states that "Lack of scientific certainty due to insufficient relevant scientific information and knowledge regarding the extent of thepotential adverse effects of a living modified organism on the conservation andsustainable use of biological diversity in the Party of import, taking also into accountrisks to human health, shall not prevent that Party from taking a decision, asappropriate, with regard to the import of that LMO ... in order to avoid or minimizesuch potential adverse effects." Defenders of the application of this approach(essentially the "precautionary principle") maintain that it is only "a temporarymechanism" that gives time for scientific inquiry. Policymakers in Europe recognize,as do those in the United States, the need for an assessment of risks based onaccepted scientific facts. However, critics worry that adopting the precautionaryprinciple in formal agreements like the Protocol may create false public expectationsof absolute safety and the demand for zero environmental risks. Further, some criticsmaintain, the precautionary approach can be used as disguised protectionism -- asthey say already has occurred on the part of the EU in blocking U.S. beef importscontaining growth hormones and in delaying approvals of new GMOs. Implementation of the AIAs, and of provisions on documentation that countries can require for GMOs and GM-containing shipments, also are of major concern tothe United States and other GMO exporters. Government and industry officials fromthe exporting countries have been meeting with each other, and with the ratifyingcountries, to ensure that bulk grain shipments, processed foods, and other trade inproducts that may contain GMOs are not disrupted due to confusing, repetitive, orinconsistent new requirements, shipping delays, burdensome paperwork, and the like. Six countries in southern Africa -- Lesotho, Malawi, Mozambique, Swaziland, Zambia, and Zimbabwe -- are experiencing continuing severe food shortages. In2002, the United Nations World Food Program (WFP) announced an appeal for foodaid to meet the needs of some 14 million people in the six countries. However,provision of food aid to meet the needs of food-short people in the region has beenmade more difficult and costly by a debate over the presence of genetically modifiedcorn in U.S. food aid shipments. Some of the countries expressed reluctance toaccept GE corn on account of perceived environmental and commercial risksassociated with potential introduction of GE seeds into southern Africa agriculture. One, Zambia, refused all shipments of food aid with GE corn out of health concernsas well. A concern of the southern Africa countries is that corn contained in U.S. food aid shipments could be planted either accidentally or intentionally by African farmersand damage future trade with the European Union. Introduction of geneticallymodified corn into their food systems could mean that crops grown for export or usedin livestock feed would contain genetically modified components. As noted, the EUhas approved and permits imports of genetically modified soybeans, but has not yetapproved imports of most varieties of genetically modified corn. The EU is expectedsoon to put in place a system of tracing and labeling of food products as to their GEcontent. While livestock products will be exempted from such labeling, some of theAfrican countries express fears that EU consumers already antipathetic to GE foodswill reject meat products that might have been produced from animals fed GE grain. The governments of Zimbabwe and Mozambique have accepted U.S. food aidshipments of corn only if it is milled prior to distribution. Malawi has requested thatcorn be milled, but according to the U.S. Agency for International Development(USAID), is allowing distribution of whole grain corn due to limited millingcapacity. Swaziland and Lesotho have expressed reservations about food aidshipments of GE corn, but are accepting them. Only Zambia has rejected any foodaid containing bio-engineered grain. The United States has blamed EU policies for southern Africa countries' views on food aid containing GE products. President Bush, for example, has stated that EUgovernments, because of their policies on GE products, are hindering the cause ofending hunger in Africa. (16) The United Statesmaintains that genetically modifiedcrops are safe to eat; and that there is little likelihood of GE corn entering the foodsupply of African countries for several reasons, including the fact that bio-engineeredvarieties of corn are not well adapted to African growing conditions. (17) Relatedly, there is considerable debate over the potential contribution of biotechnology to food security and agricultural development in developing countries. Critics of biotechnology argue that the benefits of biotechnology in developingcountries have not been established and that the technology poses unacceptable risksor problems for developing country agriculture. (18) They argue that bio-engineeredcrops could adversely affect the health of consumers and that genetically engineeredcrops pose unacceptable environmental risks for agriculture in developing countries. Critics suggest that intellectual property rights (IPR) protection impedes developmentand dissemination of GE crops in developing countries and also gives multinationalcompanies control over developing country farmers. Proponents, however, say thatthe development of GE technology appears to hold great promise, with the potentialto complement other, more traditional research methods, as the new driving force forsustained agricultural productivity in the 21st century. They maintain that GE foodsare safe to consume, that environmental risks are both negligible and manageable,and that IPR difficulties have been exaggerated. (19) Members of the House and Senate Agriculture, House Ways and Means, HouseScience, and Senate Finance Committees are among those in the 108th Congress whoare closely monitoring biotechnology developments in the international arena, as wellas the Administration's response. If this Congress follows the lead of itspredecessors, it is more likely to be supportive of agricultural biotechnology ininternational trade than to seek constraints on GE commodities traded internationallyand domestically. For example, the Senate on May 23, 2003, passed, by unanimousconsent, a resolution ( S.Res. 154 ) supporting the U.S. action against theEU; a similar House measure ( H.Res. 252 ) was passed June 10, 2003,by a suspension vote of 339-80. Separately, H.R. 2447 , introduced June12, 2003, would establish a federal interagency task force, composed of seniorAdministration officials, to promote the benefits, safety, and uses of agriculturalbiotechnology The House Agriculture Committee held a hearing on March 26, 2003, where the theme was the EU's moratorium on GMO approvals and its possible influence ondecisions by developing African countries to reject or delay U.S. food aid. (20) TheHouse Science Subcommittee on Research held a hearing on June 12, 2003, toexamine plant biotechnology research and development challenges and opportunitiesin Africa. Earlier, the 107th Congress included biotechnology provisions in the 2002 farm bill ( P.L. 107-171 ) including: a biotechnology and agricultural trade program, aimedat barriers to the export of U.S. products produced through biotechnology (Section3204); competitive grants for biotechnology risk assessment research (Section 7210);agricultural biotechnology research and development for developing countries(Section 7505); and a program of public education on the use of biotechnology inproducing food for human consumption (Section 10802). In addition, legislation thatgives the President Trade Promotion or "fast track" authority ( P.L. 107-210 ) containslanguage providing that U.S. trade negotiators should seek to negotiate rules anddispute settlement procedures that will eliminate unjustified restrictions andrequirements, including labeling, of biotechnology products. Bills also were introduced in the 107th Congress that took other approaches to regulating agricultural biotechnology, and some could reappear in the 108th. Theyincluded H.R. 4814 , which called for mandatory labeling of GE foods;and other bills in the 107th ( H.R. 4812 , H.R. 4813 , and H.R. 4816 ) which dealt respectively with legal issues raised bycross-pollination with GE plants, a study of the safety of GE foods, and liability forinjury caused by GE organisms. No comparable bills had been introduced as of earlyJune 2003. Responsibility for biotechnology trade issues and activities is shared by numerous federal agencies and departments. Officials who deal with them on aday-to-day basis say they communicate often, either individually or in workinggroups, to share information, resolve jurisdictional questions, and coordinate efforts. As more difficult or controversial trade-related issues arise, officials from relevant agencies may meet at successively higher levels to discuss how to formulateand implement a policy response. According to U.S. officials, years of experience-- along with established statutory authorities and the 1986 Coordinated Framework-- have provided them with a strong, if somewhat tacit, understanding on how theywill handle any given problem, including which agency should take the lead role. Such experience has fostered an increasingly coordinated, if not yetwidely-enunciated, formal approach to biotechnology trade policy, several U.S.officials argued. Nonetheless, some agencies are more prominent than others. The Office of the U.S. Trade Representative (USTR) is generally regarded as the lead agency onbiotechnology trade issues as part of its overall mandate to coordinate U.S. tradepolicy, including negotiating trade agreements and dealing with major disputes. USTR leads the U.S. delegation of agency representatives at quarterly SPS and TBTmeetings convened by the WTO, where biotechnology matters generally are covered.Back home, biotechnology questions pass through the USTR staff-level offices thathandle agricultural, SPS, and TBT matters. USTR convenes and coordinates aninteragency SPS Trade Policy Staff Committee consisting of representatives fromagencies throughout government. This committee meets frequently, but on an"as-needed" basis, on biotechnology trade issues, some of which may arise fromongoing bilateral or multilateral negotiations, and others from disputes with tradingpartners. USTR also convenes a higher-level SPS Trade Policy Review Group,composed of more senior agency officials, to discuss and resolve more controversialSPS questions, including those on biotechnology. (22) However, other agencies take the lead on specific biotechnology issues. The State Department, for example, is at the forefront in dealing with countriesimplementing the Cartagena Biosafety Protocol. FDA, supported by USDA's FoodSafety and Inspection Service (FSIS), leads on Codex matters (see Table 1 ). On occasion, particularly thorny issues and/or jurisdictional disputes must be resolved at the White House level, which ultimately decides overall U.S.biotechnology policy with input from its Office of Science and Technology Policy(OSTP). The President's Special Assistant for Agricultural Trade and Food Aid, anda biotechnology working group composed of high-level officials under the aegis ofthe White House National Economic Council (NEC), periodically may be calledupon to discuss or referee such issues. The National Security Council also has beeninvolved in discussions, e.g., those concerning whether to challenge formally the EUover its de facto moratorium on new GMO approvals. Some critics assert that the U.S. response to biotechnology remains largely reactive, ad hoc, and not well coordinated. Thus, on any issue, jurisdictionaldiscussions may precede substantive action, they contend, arguing that a morecomprehensive long-term strategy is needed. The Biotechnology IndustryOrganization (BIO) has reported on its website that USTR has circulated amonginterested agencies a draft paper spelling out such a strategy. However, as of earlyJune 2003, the paper had not emerged publicly. (23) Biotechnology issues and activities, including international ones, are addressed both at the departmental level (across agencies) and within the various agenciesthemselves. USDA's Biotechnology Coordinating Committee is a staff-levelinteragency group that has met periodically to share information and work onbiotechnology issues of mutual concern (both domestic regulatory as well astrade-related matters). A higher-level Biotechnology Policy Group is convened atleast several times monthly by the Secretary of Agriculture's special counsel on tradeto discuss policy, receive updates, and map plans for upcoming interdepartmental andinternational meetings. Secretary of Agriculture Ann Veneman, on April 8, 2003,named 18 people to a new Advisory Committee on Biotechnology and 21st CenturyAgriculture (authority for a previous advisory committee expired in 2001). Elevenof the members represent agribusiness companies or agricultural producer groups;the rest are from academia or consumer advocacy organizations. Section 3204 of the 2002 farm bill ( P.L. 107-171 ) created a new Biotechnology and Trade Program to provide grants for public and private sector projects that willaddress nontariff barriers to U.S. agricultural exports involving biotechnology, foodsafety, disease, or other SPS concerns; or that will develop, through bilateralnegotiations, protocols on animal health, grain quality, and GMOs. The measureauthorizes appropriations of up to $6 million annually through FY2007. USDA's FY2004 budget proposal recommends new funding of $6.6 million and 20 new staff positions "to support a number of important cross-cutting, trade-relatedand biotechnology activities of the Department and to ensure that adequate funds areavailable to address them effectively." Of this amount, $2.1 million would bespecifically for work on GMO trade issues, presumably approximately a third of theauthorized funding under Section 3204. Of this amount, $600,000 would be for theForeign Agricultural Service's new biotechnology unit (see below), and the other$1.5 million for U.S. activities in other countries, according to a Departmentofficial. (24) (Congress had not yet acted on theFY2004 USDA appropriation bymid-June 2003.) The budget documents note that USDA "faces a growing array ofchallenges related to biotechnology, including a rapidly expanding number ofregulatory, market access, and trade barrier issues." The funds would be appropriateddirectly to the Secretary to provide her with flexibility in allocating them amongvarious agencies. At the agency level, the Foreign Agricultural Service (FAS) facilitates and promotes agricultural trade, including trade in the products of biotechnology. FASactivities include education, training, technical assistance, and issue resolution. Inrecent years, FAS attention has been shifting increasingly from biotechnologycapacity building (e.g., technical assistance on the science and application ofbiotechnology in agriculture), to monitoring and dealing with foreign regulatorypolicies and restrictions on trade in GMO products. FAS programs include: (25) An Overseas Biotech Training/Education Program involving seminars, symposia, and educational materials on various biotechnology issues aimedat foreign educators, public officials, and others; Cochran Fellowship Program Biotechnology Training, offeringshort-term U.S. training for foreign scientists, regulators, journalists, andpolicymakers, to provide information about the technology's benefits and about U.S.regulation; Biotechnology Short Courses, a new series of quarterly,two-week programs in the United States for foreign participants intended primarilyto impart "biotechnology's relationship to market access and trade in agriculturalproducts, and the factors influencing that relationship"; Capacity Building for the Seed Trade Industry to expand seedtrade with Eastern Europe, Africa, and Asia; Biotechnology Research Capacity Building, supporting thedevelopment of science-based research and regulatory programs and promotingglobal food security, particularly in developing and newly emergenteconomies; Biotechnology Activities With International Organizations,utilizing a variety of approaches like briefings staged at multinational meetings (e.g.,at Codex and at the Rome World Food Summit in 2002) and at regionalworkshops. FAS generally convenes a USDA interagency team weekly to review SPS and TBT problems in agricultural trade, including those in GE products; is involved indeveloping policy on matters requiring higher-level decisions; and leads oraccompanies other agency officials on overseas missions to discuss and resolveissues. FAS staff have long been engaged in biotechnology trade issues, but generally not on a full-time basis. Seeking to improve its focus and work, the agency in 2002established a new Biotechnology Office reporting to the Administrator and AssociateAdministrator. The office hopes to have 10 full-time staffers on board by August2003 organized around four teams devoted exclusively to biotechnology work:bilateral relations in Asia and the Americas; bilateral relations in Europe, the MiddleEast, and Africa; international organization work (e.g., with WTO, FAO, etc.); andone devoted to technical assistance, capacity building, and outreach. USDA's Animal & Plant Health Inspection Service (APHIS) regulates the movement, testing, and commercialization of new GE crop varieties (and GEveterinary biologics) in the United States. In addition, as the lead federal agencyregulating commodity imports and exports, APHIS works to minimize tradedisruptions caused by animal and plant health issues, including those related tobiotechnology. APHIS staff participate, and sometimes take the lead, in U.S.negotiations with trading partners and in multinational forums to resolve SPS-relateddisputes and to harmonize international standards, to ensure that such issues are notused as unfair barriers to trade. An increasing share of APHIS harmonization work revolves around trade in GE products. The agency has sought both to ensure that international biotechnologypolicies are science-based, and to promote the global credibility of the U.S. GEregulatory process. It is involved in Codex, IPPC, OIE, the Cartagena Protocol, andthe OECD, among other organizations, and is in ongoing negotiations with Canadaon harmonization, which led recently to a draft bilateral agreement on environmentalassessment criteria for transgenic plants. In FY2002, APHIS consolidated itsbiotechnology personnel under a single new office, Biotechnology RegulatoryServices, covering both domestic regulatory activities; and international trade, policy,and capacity building. The office was assigned 46 staff slots in FY2002. (26) The Federal Grain Inspection Service of USDA's Grain Inspection, Packers & Stockyards Administration (GIPSA) spells out official grain quality standards,establishes standard testing methodologies, and, for a fee, tests grain (a requirementfor most exports) to ensure they meet such standards. GIPSA has articulated abiotechnology program in response to the "emergence of value-enhanced grains andoilseeds, development of niche markets for non-biotech commodities, andestablishment of new regulatory requirements by U.S. trading partners [which] hascreated a need for greater product differentiation in the marketplace." (27) GIPSA has been evaluating the performance of tests to detect the presence of GMOs in grains and oilseeds and offering a proficiency program for organizationstesting for biotechnology-derived grains and oilseeds to improve reliability. Theagency also has developed sampling guidelines for the industry, among otherservices. GIPSA itself has not been testing for GMOs in shipments, except for thepresence of StarLink TM corn, as a voluntary fee-based service. (28)

Summary: U.S. farmers have been rapidly adopting genetically engineered (GE) crops -- mainly corn, soybean, and cotton varieties -- to lower production costs and improve management. However, theU.S. agricultural economy is highly dependent upon exports, at a time when many foreign consumersare wary of the products of agricultural biotechnology. As a result, U.S. exporters often haveencountered barriers to trade in these markets. Among the most controversial barriers is in the European Union (EU). The EU, the fourth-largest foreign market for U.S. agricultural products, since 1998 has maintained a de factomoratorium on approvals of new GE crop varieties. In May 2003, the United States launched aformal challenge of the EU policy, contending that it both violates international trade agreementsand causes unwarranted concerns about the safety of agricultural biotechnology throughout theworld. The EU and other important U.S. trading partners around the world have adopted widely divergent approaches to regulating biotechnology. The wide range of approaches to GE productregulation is in part due to the fact that an international consensus on how to regulate agriculturalbiotechnology is still evolving. U.S. officials say they are active globally to ensure that national andinternational standards for genetically modified organisms (GMOs) are consistent, transparent, basedon scientific principles, and compliant with international trade rules (e.g., those administered throughthe World Trade Organization). For example, they have been working to ensure that the so-calledCartagena Biosafety Protocol, a multilateral agreement on the safe handling, transfer, andtransboundary movement of living modified organisms, does not present new obstacles to U.S.exports of such products. Another issue involves recent difficulties in moving U.S. food aid to certain African countries due to what U.S. officials said were unwarranted, EU-provoked concerns that such aid's possible GEcontent could pose safety problems for recipients. Debate also revolves around the potential benefitsand problems of introducing GE crops to developing countries. Congress continues to follow these issues closely. For example, a number of leading lawmakers pressed hard for the Administration to aggressively challenge the EU moratorium. Following theAdministration's decision to do so, the Senate and House passed resolutions ( S.Res. 154 ; H.Res. 252 ) in support of the action. Several House hearings have been held toreview barriers to the adoption of, and trade in, GE agricultural products; and to review challengesand opportunities for plant biotechnology development in Africa. Additional hearings are possible. Whether the 108th Congress will consider other legislation affecting agricultural biotechnology wasuncertain in June 2003. This report will be updated if events warrant.