The Harmonization Principle in the TBT AgreementESTIMATED TIME: 5 hours

OBJECTIVES OF MODULE 6

Present another core principle of the TBT Agreement: The principle of Harmonization;

introduce some selected International Standardizing Bodies and their work;

explore how the principle of Harmonization applies to the preparation, adoption and application of Technical Regulations, Standards and Conformity Assessment Procedures;

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MODULE

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expound how the harmonization principle has been interpreted in WTO Dispute Settlement cases (especially in the EC - Sardines case); and

explain the principle of equivalence in the TBT Agreement.

I. INTRODUCTION

As studied in the previous Module, the principles of Non-Discrimination and Avoidance of Unnecessary Obstacles to Trade are important foundations of the TBT Agreement.

The principle of non-discrimination in the TBT   Agreement is applicable to the three types of measures covered by the Agreement, as follows:

Technical Regulations (Article 2.1): Products imported from the territory of any WTO Member shall be accorded treatment no less favourable than that accorded to like products of national origin and to like products originating in any other country.

Standards (Annex 3.D of the Code of Good Practice): Standardizing bodies shall accord treatment to products originating in the territory of any other WTO Member of the WTO no less favourable than that accorded to like products of national origin and to like products originating in any other country.

Conformity Assessment Procedures (Article 5.1.1): These are prepared, adopted and applied so as to grant access for suppliers of like products originating in the territories of other WTO Members under conditions no less favourable than those accorded to suppliers of like products of national origin or originating in any other country, in a comparable situation. Access is a supplier's right to an assessment of conformity.

Avoidance of unnecessary obstacles to international trade in the TBT Agreement:

For Technical Regulations (Article 2.2), it means that a measure shall not be more trade-restrictive than necessary to fulfil a legitimate objective, taking into account the risks non-fulfilment would create.

Necessity has been interpreted in WTO disputes as provided in the GATT Agreement. A necessary measure involves a process of weighing and balancing a series of factors, including the: contribution made by the measure to the enforcement of the regulation at issue; and the importance of the common interests or values protected by the regulation.

Legitimate objectives are listed in Article 2.2 of the TBT Agreement and include, but are not limited to, national security requirements; protection of human health or safety; protection of animal or plant life or health; protection of the environment; prevention of deceptive practices.

For Standards (paragraph E of the Code of Good Practice): a standardizing body shall ensure that standards are not prepared, adopted or applied with a view to, or with the effect of, creating unnecessary obstacles to international trade.

For Conformity Assessment Procedures (Article 5.1.2): these shall not be more strict than necessary to give the importing WTO Member adequate confidence that products conform with the applicable technical regulations or standards, taking account of the risks non-conformity would create.

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As we could see in the previous Module, the various approaches to facilitate the acceptance of conformity assessment results are important tools to facilitate international trade and the flow of goods from countries with different domestic technical regulations and standards. Five non exclusive approaches were recognized by WTO Members as particularly useful (G/TBT/9):

Accreditation;

the unilateral recognition of results of foreign conformity assessment as equivalent,;

Mutual Recognition Agreements (MRAs) for conformity assessment between governments;

co-operative (voluntary) arrangements between domestic and foreign conformity assessment bodies; and

the use of Supplier's Declaration of Conformity (SDoC).

Accreditation is the formal evaluation and recognition of competence of a body by another (the authoritative one) and may be applied to testing laboratories, inspection bodies and certification bodies. Accreditation bodies are authoritative and independent entities that do not themselves deal with verification of product specifications but whose task is to assess the organizations carrying out such functions.

Unilateral Recognition of Results: According to Article 6.1 of the TBT Agreement, WTO Members have an obligation to ensure whenever possible that results of conformity assessment procedures in other WTO Members, which are equivalent – not necessarily equal - to their own procedures are accepted. This obligation relates to central government bodies.

Mutual Recognition Agreements (MRAs): Two or more WTO Members may enter into agreements which involve the reciprocal acceptance of the results of conformity assessment procedures taking place in the territory of WTO Members concerned (government-to-government agreements).

WTO Members have the obligation, under Article 10.7 of the TBT Agreement, to notify these agreements to the TBT Committee.

The word "agreement" is used to designate government-to-government deals; while the word "arrangement" refers to voluntary accords between conformity assessment bodies themselves.

Voluntary Mutual Recognition Arrangements between Domestic and Foreign Bodies: This approach refers to arrangements among accreditation bodies directly (and not through WTO Members and central government bodies) as well as arrangements among individual laboratories, certification bodies and inspection bodies.

Supplier's Declaration of Conformity: SDoC is a conformity assessment procedure by which a supplier provides a written declaration assuring that a product conforms to specified requirements. SDoC is also referred to as a "manufacturer's declaration of conformity" or a "self-declaration of conformity". A "supplier" is understood here in its broad meaning as the party that supplies the product and may be a manufacturer, distributor, importer, assembler, etc.

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Remember we said that, when elaborating a technical regulation, standard or conformity assessment procedure, a government has to take into consideration the various obligations contained in the TBT Agreement, for that measure to be in conformity with it.

Now, in a step-by-step process, we add another obligation which has to be fully considered by WTO Members: the consideration of international standards (when they exist or are being prepared) in the formulation of national technical regulations, standards and conformity assessment procedures.

So, it is time to start Module 6! Let's learn about Harmonization!

Please take a look at our digital library and the additional resources we have prepared for you. Oh, and remember to note down the chat session dates. We are looking forward to seeing you there and our guests are waiting to answer to your questions! Be prepared!

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II. THE WORK OF INTERNATIONAL STANDARDIZING BODIES

II.A. THE HARMONIZATION EFFORT

IN BRIEF

One may think of harmonization in general as the establishment, recognition and application of common measures by different countries, where previously each might have had its own set of requirements.

The TBT Agreement does not define harmonization, but the importance of international standards is enshrined in the Agreement and recognized in its Preamble.

In the context of TBT measures, the harmonization effort takes place when WTO Members base their regulations, standards or conformity assessment procedures on the relevant international standards, guides or recommendations, or when WTO Members recognize each other's measures as equivalent, as shall be further explained below.

IN DETAIL

The relevant parts of the TBT   Agreement 's Preamble read:

Recognizing the important contribution that international standards and conformity assessment systems can make in this regard by improving efficiency of production and facilitating the conduct of international trade;

Desiring therefore to encourage the development of such international standards and conformity assessment systems;

Recognizing the contribution which international standardization can make to the transfer of technology from developed to developing countries;

Harmonization may bring several benefits by:

facilitating international trade, as the products conforming to the same standards may be accepted more widely and producers do not need to know in advance the final markets for their products, resulting in fewer unjustified restrictions on trade;

diffusing technology embodied in products and processes;

promoting efficiencies and allowing economies of scale, as producers do not have to create different processes or design and manufacture a product in many variations to meet varying, different standards;

resulting in lower costs for consumers, who may compare and chose from a larger number of suppliers; and

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aiding governments in developing sound TBT measures without the need to undertake scientific/policy assessments on their own. They may use the conclusions of an international standardizing body or another WTO Member to that end.

Ultimately, harmonization can ease production and trading conditions for producers, importers and exporters, especially from developing countries (which face more financial constraints to adapt to the requirements of the export market), thus minimizing obstacles to international trade.

In this Module, we are going to examine how the principle of harmonization in the TBT  Agreement applies to Technical Regulations, Standards and Conformity Assessment Procedures.

First, we will start by explaining the principles that should guide international standardizing bodies in their creation of international standards and by illustrating the work of some of these bodies, which are observers in the TBT Committee.

Second, we will examine the obligations in the TBT Agreement regarding harmonization, as applicable to technical regulations, conformity assessment procedures and standards.

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Note that "international standardizing organizations" (or bodies) are also referred to as "international standard-setting organizations" (or bodies).

II.B. INTERNATIONAL STANDARDIZING BODIES IN THE TBT AGREEMENT

Various provisions in the TBT Agreement, i.e. Articles   2.4 and 2.6 for technical regulations, Articles   5.4 and 5.5 for conformity assessment procedures and paragraphs   F and G of the Code of Good Practice for standards, require that WTO Members and standardizing bodies use international standards, guides and recommendations, or parts of them, as a basis for their measures. In short, when a WTO Member decides to create a new TBT measure - or revise one which is already in place - it should start its task by verifying if an international standard exists for the product and/or measure in question. If it exists, the WTO Member has the obligation to base its measure on it, unless the relevant international standard is an ineffective/inappropriate means to fulfil a legitimate objective.

The TBT Agreement speaks of international standards, guides or recommendations. But what are these? Who develops these? What is the role of the WTO in the development of international standards?

International standards (guides and recommendations) are those prepared by international standardizing bodies (ISB). The TBT Agreement, however, does not offer a precise definition of an ISB. Annex 1, paragraph 4 offers the definition of an "International body or system":

Body or system whose membership is open to the relevant bodies of at least all Members.

Similarly, the ISO/IEC Guide 2: 1996 defines an "International standardizing organization" as "Standardizing organization whose membership is open to the relevant national body from every country."

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Remember that in the TBT Agreement there is no specific reference to any particular international standardizing body. Therefore, the term is open and should be interpreted on a case by case basis.

Important note

Unlike the TBT Agreement, the SPS Agreement contains a direct reference to three "relevant international organizations" (Article 3.4 SPS Agreement): the Codex Alimentarius Commission, the International Office of Epizootics (now called World Organization for Animal Health), and international and regional organizations operating within the framework of the International Plant Protection Convention.

Important note

As we mentioned before, there are many international standard-setting bodies and the WTO is not one of them. The WTO neither sets international standards nor is responsible for the actual process of harmonizing various national technical regulations and standards of its Members. The WTO strongly encourages its Members to use relevant international standards as a basis for their technical regulations, conformity assessment procedures and standards. Furthermore, the WTO encourages its Members to recognize each other's regulations as equivalent and to enter into mutual recognition arrangements and agreements, which shall be further explored in our course.

Finally, WTO Members and standardizing bodies are also required, within the limits of their resources, to play a full part in the preparation of international standards by international standardizing bodies. Widespread participation in international standardizing bodies can ensure that international standards reflect country-specific production and trade interests.

EXERCISES:

1. How would you describe harmonization?

2. What are some of the benefits harmonization may bring to international trade relations?

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II.C. DEVELOPMENT OF INTERNATIONAL STANDARDS

Although a list of international standardizing bodies for the purposes of the TBT Agreement does not exist, guidance on the work of these bodies may be found in a decision adopted by the TBT Committee in 2000, at the Second Triennial Review of the TBT Agreement: "Principles for the development of international standards, guides and recommendations with relation to Articles 2, 5 and Annex 3 of the Agreement" (Document G/TBT/9, page 24).

The Committee, during the Second Review of the Agreement, noted that in order for international standards to make a maximum contribution to the achievement of the objective to facilitate trade embodied in the TBT Agreement, it was important that all WTO Members had the opportunity to participate in the elaboration and adoption of international standards.

Bodies operating with open, impartial and transparent procedures, that afforded an opportunity for consensus among all interested parties in the territories of at least all WTO Members, were seen as more likely to develop standards which were effective and relevant on a global basis and would thereby contribute to the goal of the Agreement to prevent unnecessary obstacles to trade.

Therefore, the Committee decided on a set of principles and procedures that should be observed when international standards, guides and recommendations are elaborated. Their dissemination would encourage the various international bodies to clarify and strengthen their rules and procedures on standards development, thus further contributing to the advancement of the objectives of the TBT Agreement. The principles and procedures developed by the TBT Committee fall into six categories:

1. Transparency

2. Openness

3. Impartiality and Consensus

4. Effectiveness and Relevance

5. Coherence

6. Development Dimension

II.C.1.TRANSPARENCY

All essential information regarding current work programmes, on proposals for standards, guides and recommendations under consideration and on the final results should be made easily accessible.

Procedures should be established so that adequate time and opportunities are provided for written comments, for example by: (i) early publication of a notice for the development of a standard; (ii) early notification with a brief description of the draft standard's scope; (iii) prompt provision of the text of the draft standard's upon request; (iv) an adequate period of time for interested parties to make comments in writing; (v) prompt publication of a standard upon adoption; and (vi) periodical publication of a work programme containing information on the standards currently being prepared and adopted.

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II.C.2.OPENNESS

Membership of an international standardizing body (ISB) should be open on a non-discriminatory basis to relevant bodies of at least all WTO Members.

Openness regards participation both at the policy development level and at every stage of standards development, including: (i) proposal and acceptance of new work items; (ii) technical discussion on proposals; (iii) submission of comments on drafts; (iv) review of existing standards; (v) voting and adoption of standards; and (vi) dissemination of the adopted standards. Meaningful opportunities to participate at all stages should be provided to any interested member of the ISB.

II.C.3.IMPARTIALITY AND CONSENSUS

Consensus procedures should be established to take into account the views of all parties concerned and to reconcile any conflicting arguments, so that the standard development process will not favour the interests of, a particular supplier/s, country/ies or region/s.

Impartiality should be accorded throughout the development of a standard with respect to (i) access to participation in work; (ii) consideration of views expressed and comments made; (iii) obtaining of information and documents; (iv) the right to transpose the international standard into a regional or national standard; and (v) revision of the international standard, among other things.

II.C.4.EFFECTIVENESS AND RELEVANCE

In order to facilitate international trade among WTO Members, international standards need to be relevant and to respond effectively to regulatory and market needs, as well as to scientific and technological developments in various countries.

Accordingly, it is important that international standardizing bodies take into account the relevant regulatory or market needs, and scientific and technological developments in the elaboration of standards. ISB should also review standards as they become obsolete, inappropriate or ineffective for various reasons, and put in place procedures aimed at improving communication with the WTO.

II.C.5.COHERENCE

In order to prevent the development of conflicting international standards, it is important that international standardizing bodies avoid duplication of, or overlap with, the work of other international standardizing bodies.

In this respect, cooperation and coordination with other relevant international bodies is essential.

II.C.6.DEVELOPMENT DIMENSION

Constraints on developing countries, in particular to participate effectively in standards' development, should be taken into consideration in the standards development process. The impartiality and openness of any

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international standardization process requires that developing countries are not excluded de facto from the process.

Tangible ways of facilitating developing countries' participation in international standards development should be sought. Provision of capacity building and technical assistance within these bodies are important, in line with Article   11 of the TBT Agreement. This will be further explored in Module 8.

We would like to present you with a brief summary of the work of five international bodies that have an important role in setting international standards: the Codex Alimentarius (a joint FAO/WHO standard-setting organization), the ISO (International Organization for Standardization), the International Electrotechnical Commission (IEC), and the International Telecommunication Union (ITU). We are also going to present the work of a regional organization, the UNECE (United Nations Economic Commission for Europe), because of its work in the field of agricultural standards and the fact that many European countries, potential importers of agricultural products, adopt them.

Please note that the fact that we present these particular bodies does not mean they are more important than others, nor that they are the only bodies engaged in international standard-setting activities. They are being explained mainly to raise awareness of the harmonization effort that has been put in place for many years by both developed and developing countries.

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There are MANY national and regional standardisation bodies, which usually set national standards and/or common standards for a group of countries. If your country or your country's businesses are interested in a particular market, you should find out what are the technical regulations or the standards in place for products in that market. At our Digital Library you will find a list of WTO Members' Enquiry Points (a list is also available on line at http://www.wto.org/english/tratop_e/tbt_e/tbt_enquiry_points_e.htm). These are the national institutions that can provide answers to your questions about national technical regulations, standards and conformity assessment procedure for a particular product in other WTO Members.

EXERCISES:

3. Which are the principles that WTO Members came up with, regarding the development of international standards, guides and recommendations, during the Second Triennial Review (2000)? What are the objectives of formulating such principles? Please, briefly explain each of them.

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II.D. 5 EXAMPLES OF INTERNATIONAL STANDARDIZING BODIES

II.D.1.THE CODEX ALIMENTARIUS COMMISSION

In the early 1960s, the Food and Agriculture Organization (FAO) of the United Nations and the World Health Organization (WHO) recognized the importance of developing international food standards for the purposes of protecting public health and minimizing disruption of international food trade. The Joint FAO/WHO Food Standards Program was established, and the Codex Alimentarius Commission was designated to administer the program.

MEMBERSHIP & MISSION

Membership of the Commission is open to all member Nations and Associate members of FAO and WHO and currently comprises 175 countries. The Commission develops standards through consultative mechanisms with member governments, which takes place in meetings and by correspondence. Codex meetings are open to participation by accredited NGOs, and observers from the public.

Its mission is, among others, to promote coordination of all food standards work undertaken by international governmental and non-governmental organizations; to set priorities and to initiate, guide, develop, finalize and amend standards and publish them in a Codex Alimentarius.

To facilitate continuous contact with member countries, the Commission, in collaboration with national governments, has established country Codex Contact Points and many member countries have National Codex Committees to coordinate activities nationally.

STANDARD SETTING PROCESS

Over the years, the Commission has developed over 200 standards covering processed, semi-processed or raw foods intended for sale for the consumer or for intermediate processing; over 40 hygienic and technological codes of practice; evaluated over 1000 food additives and 54 veterinary drugs; set more than 3000 maximum levels for pesticide residues; and specified over 30 guidelines for contaminants.

The core scientific work is done independently by several WHO and FAO joint expert bodies, which make recommendations to serve as the basis for proposed draft Codex standards.

The procedures for preparing standards are open and transparent and involve:

The submission of a proposal for a standard to be developed by a national government or a subsidiary committee of the Commission.

A decision by the Commission or the Executive Committee that a standard be developed as proposed. Formal Criteria for the Establishment of Work Priorities and for the Establishment of Subsidiary Bodies exist to assist the Commission or Executive Committee in their decision-making and in selecting or creating the subsidiary body to be responsible for steering the standard through its development.

The preparation of a proposed draft standard is arranged by the Commission Secretariat and circulated to Member Governments for comments.

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A draft standard is sent to governments a number of times before becoming a Codex standard. Once adopted by the Commission, a Codex standard is added to the Codex Alimentarius. Most standards take several years to develop.

MAJOR WORK AND PUBLICATIONS

One of the principal purposes of the Commission is the preparation of food standards and their publication in the Codex Alimentarius. The legal basis for the Commission's operations and procedures is published in the Codex Alimentarius - Procedural Manual.

In addition to commodity standards, the Codex Alimentarius includes general standards, which have across-the-board application to all foods and are not product-specific. They include standards on: food labelling; food additives; contaminants; methods of analysis and sampling; food hygiene; nutrition and foods for special dietary uses; food import and export inspection and certification systems; residues of veterinary drugs in foods; pesticide residues in foods.

The Codex Alimentarius Commission is an observer body in the TBT Committee.

Note

The Codex is one of the "three sisters" under the SPS Agreement, i.e. one of the three recognized standardizing organizations mentioned in the SPS Agreement. The other two are the World Organization for Animal Health and the International Plant Protection Convention.

IF YOU WANT TO KNOW MORE ...

THE CODEX ALIMENTARIUS COMMISSION (CODEX)

Check their website at http://www.codexalimentarius.net and the document Understanding the Codex Alimentarius Commission

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II.D.2.INTERNATIONAL ORGANIZATION FOR STANDARDIZATION

The International Organization for Standardization (ISO) officially began operations on 23 February 1947.

MEMBERSHIP & MISSION

ISO is a network of the national standards institutes of 157 countries, on the basis of one member per country, with a Central Secretariat in Geneva, Switzerland, that coordinates the system. The ISO is a non governmental organization.

ISO standards are voluntary and ISO has no legal authority to enforce their implementation. A certain percentage of ISO standards - mainly those concerned with health, safety or the environment - has been adopted in some countries as part of their regulatory framework, or is referred to in legislation for which it serves as the technical basis.

STANDARD SETTING PROCESS

In all, there are some 3'000 ISO technical groups (technical committees, subcommittees, working groups, etc.) in which some 50'000 experts participate annually to develop ISO standards.

ISO standards are developed by technical committees comprising experts from the industrial, technical and business sectors that have asked for the standards, and which subsequently put them to use.

The national delegations of experts of a technical committee meet to discuss, debate and argue until they reach a consensus on a draft agreement. This is then circulated as a Draft International Standard (DIS) to ISO's membership as a whole for comment and balloting. Many members have public review procedures for making draft standards known and available to interested parties and to the general public.

The ISO members then take into account any feedback they receive in formulating their position on the draft standard. If the voting is in favour, the document, with eventual modifications, is circulated to the ISO members as a Final Draft International Standard (FDIS). If that vote is positive, the document is then published as an International Standard.

MAJOR WORK AND PUBLICATIONS

ISO's entire portfolio of standards is listed in the ISO Catalogue which can be accessed online. The site also provides access to the World Standards Services Network (WSSN) which is a network of publicly accessible Web servers of standards organizations around the world. WSSN provides information on international, regional and national standardization and related activities and services. On behalf of the WTO, ISO periodically publishes a Directory of standardizing bodies that have accepted the WTO TBT Standards Code.

As you remember, the Code of Good Practice contained in Annex 3 of the TBT Agreement requires standardizing bodies that have accepted its terms to notify this fact to the ISO/IEC Information Centre located at the ISO Central Secretariat. Standardizing bodies having accepted the TBT Code must publish their work programmes and also notify the existence of their work programmes to the ISO/IEC Information Centre. This will be further discussed in Module 7.

The ISO is an observer body in the TBT Committee.

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IF YOU WANT TO KNOW MORE ...

INTERNATIONAL ORGANIZATION FOR STANDARDIZATION (ISO)

Between 1947 and the present day, ISO published more than 16'000 International Standards. ISO's work programme ranges from standards for traditional activities, such as agriculture and construction, through mechanical engineering, to medical devices, to the newest information technology developments, such as the digital coding of audiovisual signals for multimedia applications. For more examples of the many areas of life and work where ISO standards provide technical, economic and social benefits, see The ISO Café. Also check their website at www.iso.org.

II.D.3.INTERNATIONAL ELECTROTECHNICAL COMMISSION IEC

The IEC was officially founded in June 1906 in London, England, where its Central Office was set up. There it stayed until 1948, when it moved to Switzerland.

MEMBERSHIP & MISSION

The International Electrotechnical Commission (IEC) prepares and publishes international standards for all electrical, electronic and related technologies. These serve as a basis for national standardization and as references when drafting international tenders and contracts.

Through its members, the IEC promotes international cooperation on all questions of electrotechnical standardization and related matters, such as the assessment of conformity to standards, in the abovementioned fields.

The IEC charter embraces all electrotechnologies including electronics, magnetics and electromagnetics, electroacoustics, multimedia, telecommunication, and energy production and distribution, as well as associated general disciplines such as terminology and symbols, electromagnetic compatibility, measurement and performance, dependability, design and development, safety and the environment.

STANDARD SETTING PROCESS

Each National Committee of the IEC handles the participation of experts from its country. If you would like to participate in the work of an IEC technical committee, contact your National Committee. If you are in a country where the IEC does not have a National Committee, contact the IEC Central Office.

Some 179 technical committees (TCs) and subcommittees (SCs), and about 700 project teams / maintenance teams carry out the standards work of the IEC. These working groups are composed of people from all around the world who are expert in electrotechnology. The great majority of them come from industry, while others from commerce, government, test laboratories, research laboratories, academia and consumer groups also contribute to the work.

The technical committees prepare technical documents on specific subjects within their respective scopes, which are then submitted to the full member National Committees (IEC's members) for voting with a view to their approval as international standards. The preparation of a new IEC standard takes place in the following principal stages (for further details, see the ISO/IEC Directives, Part 1):

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Preliminary stage: includes a better definition of a project for new work, data collection or round-robin tests necessary to develop standards, which is not part of the standardization process. At this stage, a Publicly Available Specification (IEC-PAS) can be prepared and submitted to approval.

Proposal stage: a proposal for new work originates via a National Committee, generally from the industry. A simple majority vote of members on the interest of studying the proposal takes place within three months. If the result is positive it is included in the work programme together with a project plan including target dates.

Preparatory stage: a Working Draft (WD) is prepared, generally by a project leader within a project team. The document is then submitted to the National Committees as a committee draft (CD) for comment.

The Draft for Vote (CDV) is submitted to all National Committees for a five-month voting period. It is the last stage at which technical comments can be taken into consideration. Then each National Committee votes on the final standard explicitly: positive, negative or abstention. This publication of the standard is entirely the responsibility of the Central Office.

The IEC is an observer body in the TBT Committee.

IF YOU WANT TO KNOW MORE ...

INTERNATIONAL ELECTROTECHNICAL COMMISSION (IEC)

Check their website at www.iec.ch

II.D.4.INTERNATIONAL TELECOMMUNICATIONS UNION

The Union was established last century as an impartial, international organization within which governments and the private sector could work together to coordinate the operation of telecommunication networks and services, and advance the development of communications technology. ITU has worked over more than one hundred years towards helping to create a global communications network which now integrates a huge range of technologies, and encompasses standardization activities in the fields of mobile communications, Internet, information infrastructure, and advanced multimedia systems which deftly handle a mix of voice, data, audio and video signals.

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MEMBERSHIP & MISSION

The International Telecommunication Union was founded on the principle of cooperation between governments and the private sector. Under the Constitution of the International Telecommunication Union, the purposes of ITU are to:

maintain and extend international cooperation between all its Member States in the field of telecommunications;

promote and enhance participation of entities and organizations in the activities of the Union, and cooperation and partnership between them and Member States;

promote and offer technical assistance to developing countries in the field, and improve access to telecommunications services in such countries;

promote the development of technical facilities with a view to improving the efficiency of telecommunication services;

harmonize the actions of Member States; and

promote, at the international level, the adoption of a broader approach to the issues of telecommunications in the global information economy and society, by cooperating with other world and regional intergovernmental organizations and those non-governmental organizations concerned with telecommunications.

STANDARD SETTING PROCESS

The three Sectors of the Union — Radiocommunication (ITU-R), Telecommunication Standardization (ITU-T), and Telecommunication Development (ITU-D) — work through conferences and meetings, where members negotiate the agreements which serve as the basis for the operation of global telecommunication services. Study groups made up of experts drawn from leading telecommunication organizations worldwide carry out the technical work of the Union, preparing the detailed studies that lead to authoritative ITU Recommendations.

ITU-R draws up the technical characteristics of terrestrial and space-based wireless services and systems, and develops operational procedures. In ITU-T, experts prepare the technical specifications for telecommunication systems, networks and services, including their operation, performance and maintenance. Their work also covers the tariff principles and accounting methods used to provide international service. ITU-D experts focus their work on the preparation of recommendations, opinions, guidelines, handbooks, manuals and reports, which provide decision-makers in developing countries with 'best business practices' relating to a host of issues, ranging from development strategies and policies, to network management.

There are currently 22 study groups spanning the Union's three Sectors (7 in ITU-R, 13 in ITU-T, 2 in ITU-D), which together produce around 550 new or revised Recommendations every year. All ITU Recommendations are non-binding, voluntary agreements. Each Sector also has its own Bureau which ensures the implementation of the Sector's work plan and coordinates activities on a day-to-day basis.

IF YOU WANT TO KNOW MORE ...

INTERNATIONAL TELECOMMUNICATIONS UNION (ITU)

Check their website at www.itu.int

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II.D.5.UNECE (UNITED NATIONS ECONOMIC COMMISSION FOR EUROPE)

The United Nations Economic Commission for Europe (UNECE) was set up in 1947 by the Economic and Social Council of the United Nations. It is one of five regional commissions of the United Nations, the others being the Commission for Asia and the Pacific; Latin America and the Caribbean; Africa; Western Asia. Its major aim is to promote pan-European economic integration by providing analysis, policy advice and assistance to governments in cooperation with other global players and key stakeholders, notably the business community.

MEMBERSHIP & MISSION

It has 56 member States located in the European Union, in non-EU Western, Eastern and South-East Europe, in the Commonwealth of Independent States (CIS) and North America. Additionally, over 70 international professional organizations and other non-governmental organizations take part in UNECE activities. All interested UN member States may participate in its work.

UNECE's trade development programme focuses on the following key areas:

Developing and maintaining effective international trade-related instruments, norms, standards and recommendations, in response to the needs of the global economy.

Reducing barriers to trade in goods and services in all countries, and UNECE member States in particular, through greater implementation of international and UNECE norms, standards, instruments and recommendations, especially in trade facilitation.

Facilitating trade policy development through the provision of an international platform for the exchange of views, particularly for the benefit of countries with economies in transition. Examples include trade security, European integration and sustainable development.

STANDARD SETTING PROCESS

UNECE has had an active role in the development of regional quality standards for agricultural products (Working Party 7 or W-7), which have been widely adopted by EU Member countries. Through the work of W-7 and its Specialised Sections (SS), UNECE has developed quality standards for fresh fruit and vegetables; dry and dried fruit; seed, early and ware potatoes; meat and egg products; and cut flowers.

Although UNECE sets regional standards, it is important to be aware of its activities and standardization efforts if your country is an exporter to the European markets. As said earlier, many EU (and other) countries rely on UNECE agricultural quality standards and on standards related to vehicles.

A UNECE standard is set by consensus through international meetings that count with the presence of experts from UN countries and observer organizations. The process of its elaboration involves the decision to create a standard, taken by a SS or the W-7; the preparation of the text by a Rapporteur; the detailed discussion of the text by a SS; its general discussion by the W-7. Then, the standard is either adopted by UNECE by consensus or is recommended for a trial period of up to three years and further discussed by the SS concerned.

Finally, UNECE also has a working party (Working Party 6) on Regulatory Cooperation and Standardization Policies, an intergovernmental group of experts engaged in providing a forum for debate on issues of concern to Governments, elaborating recommendations and good practices on a variety of policy matters relating to technical regulations, standardization; conformity assessment (testing, certification, inspection, etc.); accreditation; market surveillance; quality/environmental management systems and metrology.

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IF YOU WANT TO KNOW MORE ...

UN ECONOMIC COMMISSION FOR EUROPE (UNECE)

You can learn more about the work developed by UNECE in the field of agriculture and other trade areas standardization by visiting their website at www.unece.org.

EXERCISES:

4. Why is it important that WTO Members participate in the creation of international standards?

5. What do the international standardizing bodies mentioned above have in common?

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III. HARMONIZATION PROVISIONS IN THE TBT AGREEMENT

We are now going to discuss how the principle of Harmonization is directly applied to the three types of measures falling within the scope of the TBT Agreement. Since the disciplines regarding the three types of measures are very much alike, we will not analyse them individually. We will actually verify the common requisites that are imposed on WTO Members and standardizing bodies, regarding each type of measure.

IN BRIEF

Harmonization is a central discipline of the TBT Agreement and is articulated into obligations and rights for WTO Members (and standardizing bodies, as the case may be).

The three main requirements:

WTO Members and standardizing bodies shall use international standards – or relevant parts of them - as a basis for their technical regulations and standards; and international guides and recommendations as a basis for their conformity assessment procedures (Articles 2.4, 5.4, and Annex 3 paragraph F).

WTO Members and standardizing bodies shall participate, within the limits of their resources, in the preparation of international standards, guides and recommendations by international standardizing bodies (Articles 2.6 5.5, Annex 3 paragraph H).

Standardizing bodies shall make every effort to avoid duplication of, or overlap with, the work of other standardizing bodies, including international or regional standardizing bodies (Annex 3 paragraph H).

The two main rights are that:

WTO Members' technical regulations which are prepared, adopted or applied for one of the legitimate objectives stated on the TBT Agreement and which are in accordance with relevant international standards will be rebuttably presumed not to be creating an unnecessary obstacle to trade (Article 2.5).

WTO Members and standardizing bodies may adopt technical regulations and standards which are not based on relevant international standards, when these are seen as ineffective or inappropriate to fulfil a legitimate objective. WTO Members have the same right regarding conformity assessment procedures, if the relevant international guides or recommendations are considered inappropriate for the WTO Member concerned. Articles 2.4, 5.4, Annex 3 paragraph F).

Before starting our analysis, we have to acknowledge the fact that in some areas or for some products, there are no international standards in place.

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Let's analyse each of these requirements, in the order below.

Summary of WTO Member's rights and obligations concerning Harmonization:

A. Base measures on international standards, guides, recommendations and right to adopt measures not based on these if they are inappropriate/ineffective

B. Presumption of Necessity when a technical regulation is in accordance with an international standard

C. Participation in international standard-setting bodies' activities

D. Avoid duplication of work, among standardizing bodies

III.A. USE OF INTERNATIONAL STANDARDS (IS) AS A BASIS AND RIGHT TO ADOPT MEASURES NOT BASED ON INAPPROPRIATE/INEFFECTIVE IS

III.A.1. TECHNICAL REGULATIONS

Article   2.4 reads:

Where technical regulations are required and relevant international standards exist or their completion is imminent, Members shall use them, or the relevant parts of them, as a basis for their technical regulations except when such international standards or relevant parts would be an ineffective or inappropriate means for the fulfilment of the legitimate objectives pursued, for instance because of fundamental climatic or geographical factors or fundamental technological problems.

Figure 1: TBT Article 2.4

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Except when they would be an ineffective or inappropriate means for the fulfilment of a legitimate objective, WTO Members shall use relevant international standards as a basis for their technical regulations.

Article 2.4 contains an important obligation assumed by WTO Members under the TBT Agreement. It also carries a right, as WTO Members are authorized to deviate from international standards (or from parts of it) if these are ineffective or inappropriate for the achievement of the legitimate objective pursued.

Three key concepts can be highlighted in Article 2.4: (i) relevant international standards; (ii) use as a basis; (iii) ineffective or inappropriate means to achieve a legitimate objective.

(i) "Relevant international standards" has been interpreted by the Appellate Body in the EC - Sardines (WT/DS231) case (further explored below). As suggested by the Appellate Body, to be relevant the standard needs "to bear upon, relate, or be pertinent to a technical regulation".

(ii) The concept of "use as a basis" was interpreted in the same case as the principal constituent or fundamental principle of the purpose of enacting the technical regulation. That is, a very strong and non-contradictory relationship should exist between the international standard and the national technical regulation.

(iii) As to "inappropriate or ineffective means", in the same case it was interpreted that a means is inappropriate if it is not adequate, and ineffective if it does not produce the desired results, that is, the fulfilment of the legitimate objective. Keep in mind that the TBT Agreement, in Article 2.4, states that an international standard may be inappropriate or inadequate, for instance, because of fundamental climatic or geographical factors or fundamental technological problems, not excluding other reasons.

III.A.2. CONFORMITY ASSESSMENT PROCEDURESSimilarly to the case of technical regulations and standards, the TBT Agreement provides that relevant guides or recommendations issued by international standardizing bodies shall be used by WTO Members as a basis for the elaboration of conformity assessment procedures, and provides for exceptions based on inappropriateness.

IN DETAIL

Article   5.4 of the TBT Agreement reads:

In cases where a positive assurance is required that products conform with technical regulations or standards, and relevant guides or recommendations issued by international standardizing bodies exist or their completion is imminent, Members shall ensure that central government bodies use them, or the relevant parts of them, as a basis for their conformity assessment procedures, except where, as duly explained upon request, such guides or recommendations or relevant parts are inappropriate for the Members concerned, for, inter alia, such reasons as: national security requirements; the prevention of deceptive practices; protection of human health or safety, animal or plant life or health, or the environment; fundamental climatic or other geographical factors; fundamental technological or infrastructural problems.

International guides or recommendations are to be used as a basis for a conformity assessment procedure under the following circumstances:

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Figure 2: The use of international guides or recommendations as a basis for CAPs

Although not yet interpreted in the context of the TBT Agreement's Article 5.4 on conformity assessment procedures, to "use as a basis" was interpreted in the EC - Sardines case, regarding technical regulations, as seen above.

To determine what should be understood by the term "inappropriate", the cited Article 5.4 provides a non-exhaustive list of reasons for an international guide or recommendation to be considered inadequate for serving as a basis of conformity assessment procedures of a WTO Member.

TIP

In document G/TBT/W/72/Rev.4 you can find "A List of Relevant International Guides and Recommendations Related to Conformity Assessment Procedures". Another interesting document is the G/TBT/W/43 "Practical Experience of Individual Governments and International Organizations in Using International Guides on Conformity Assessment".

III.A.3. STANDARDS

IN DETAIL

Regarding standards and the work of standardizing bodies, paragraph F of the Code of Good Practice reads:

Where international standards exist or their completion is imminent, the standardizing body shall use them, or the relevant parts of them, as a basis for the standards it develops, except where such international standards or relevant parts would be ineffective or inappropriate, for instance, because of an insufficient level of protection or fundamental climatic or geographical factors or fundamental technological problems.

A relevant international standard is to be used as a basis for the standards developed by local, national, regional and non-governmental bodies, if it exists or its completion is imminent.

Similarly to Article   2.4 of the TBT Agreement on technical regulations, WTO Members are not obliged to use international standards as basis for their standards if those standards are ineffective or inappropriate. Paragraph F of the Code of Good Practice provides a non-exhaustive list of reasons for their ineffectiveness or inappropriateness, such as insufficient level of protection; fundamental climatic factors; geographical factors; or fundamental technological problems.

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III.A.4. CASE STUDY: EC – SARDINES (WT/DS 231)

Now it is time to analyse how the provisions explained above have been interpreted by the WTO's Appellate Body, regarding technical regulations. Have you heard about the EC - Sardines case?

EUROPEAN COMMUNITIES – TRADE DESCRIPTION OF SARDINES (WT/DS231)

Complainant: Peru

Respondent: the European Union (EU)

Third Parties: Canada, Chile, Colombia, Ecuador, Venezuela, the United States

On 20 March 2001, Peru requested consultations with the EU concerning Regulation (EEC) 2136/89 aimed at consumer information, applicable since June 1990. The regulation allowed only a certain type of sardine (European "Sardina pilchardus") to be labelled as "sardines", and excluded the Peruvian fish type "Sardinops sagax sagax" thus preventing Peruvian exporters to continue to use the trade description "sardines" for their products.

The dispute concerned the name under which certain species of fish could be marketed in the European Union.

WHAT WERE THEIR ARGUMENTS?

Peru claimed that, according to the relevant Codex Alimentarius standards (STAN 94), the species "sardinops sagax sagax" were listed among those species which could be traded as "sardines". Peru claimed such standard was effective and appropriate, therefore considering that the EU Regulation was an unjustifiable barrier to trade in violation of Articles 2 (paragraphs 1, 2 and 4) and 12 of the TBT Agreement and Article XI:1 of GATT 1994. In addition, Peru argued that the Regulation was inconsistent with the principle of non-discrimination, inconsistent with Articles I and III (paragraph 4) of GATT 1994.

The EU requested the Panel to reject Peru's claims. It argued, inter alia, that the document was not a technical regulation, that the TBT Agreement did not apply to measures adopted before 1 January 1995, that the EU Regulation was enacted prior to the adoption of the Codex Alimentarius standard for sardines and, in general, that there was not violation of WTO Agreements.

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WHAT DID THE PANEL AND THE APPELLATE BODY SAY?

The Appellate Body upheld the Panel's finding that the EU Regulation was inconsistent with the TBT Agreement, Article 2.4.

FINDINGS OF THE PANEL AND OF THE APPELLATE BODY

Four fundamental questions:

1. Is the EU Regulation a Technical Regulation?

2. Is Codex Stan 94 a relevant international standard?

3. Was Codex Stan 94 used as a basis for the EU regulation?

4. Would Codex Stan 94 be ineffective or inappropriate to achieve the legitimate objective pursued?

1. IS THE EU REGULATION A TECHNICAL REGULATION WITHIN THE SCOPE OF THE TBT AGREEMENT?

After having considered that the EU Regulation was a technical regulation, as it defined the product characteristics (name) and was mandatory, the Appellate Body went on to examine if the Codex Stan 94 was a relevant international standard in casu.

Regarding the temporal scope of application of the TBT Agreement, as already explained in Module 3 of our course, the Appellate Body clarified that the Agreement applies to technical regulations in force, regardless of the time of their enactment (in this case 1990). Furthermore, Article 2.3 of the TBT Agreement requires WTO Members to review their regulations according to the circumstances.

2. IS THE CODEX STAN 94 A RELEVANT INTERNATIONAL STANDARD?

Figure 3: Codex Stan 94

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Based on the definition of standard given by the TBT Agreement Annex I, the Panel and the Appellate Body decided that Codex Stan 94 was not only a standard, but a relevant international standard for the case under analysis. Codex Stan 94 provided, for common and repeated use, rules, guidelines, and characteristics for products; it was approved by a recognized body (Codex); and, compliance with it was not mandatory.

The EU had alleged that Codex Stan 94 was not a relevant standard because:

Only standards that have been adopted by consensus are relevant

Codex Stan 94 coverage is different from that of the EU Regulation

The Panel and the Appellate Body in the EC – Sardines case addressed the issue of whether only standards adopted by consensus were international standards, for the purposes of the TBT Agreement. The Panel found that the first sentence of the Explanatory Note to Annex 1 paragraph 2, reiterated the norm of the international standardization community that standards were prepared on the basis of consensus, while the second sentence acknowledged that consensus might not always be achieved. The Explanatory Note therefore confirmed that even if not adopted by consensus, a standard, international or otherwise, could constitute a standard within the meaning of the TBT Agreement.

Furthermore, the Appellate Body confirmed that, to be relevant, the standard needs to bear upon, relate or be pertinent to the technical regulation. As the regulation and the standard both dealt with preserved sardines, Codex Stan 94 was considered a relevant international standard.

About the second claim, the Appellate Body in paragraph 231 of its report stated that "… although the EU Regulation expressly mentions only Sardina pilchardus, it has legal consequences for other fish species that could be sold as preserved sardines, including preserved Sardinops sagax".

3. WAS CODEX STAN 94 USED AS A BASIS FOR THE EU REGULATION?

In the EC - Sardines Case, the Appellate Body stated that "a thing is commonly said to be 'based on' another thing when:

the former 'stands' or is 'founded' or 'built' upon or 'is supported by' the latter;

the latter is the main constituent … a thing on which the former is constructed and by which its constitution or operation is determined.

Using definitions from dictionaries, the Panel and the Appellate Body concluded that an international standard was used "as a basis for" a technical regulation "when it is used as the principal constituent or fundamental principle for the purpose of enacting the technical regulation".

The Appellate Body further indicated that that "there must be a very strong and very close relationship between two things in order to be able to say that one is 'the basis for' the other", and that "at a minimum … something cannot be considered a 'basis' for something else if the two are contradictory."

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Article 6 of Codex Stan 94 sets forth specific labelling provisions for these products, as follows:

The name of the products shall be:

6.1.1. (i) "Sardines" (to be reserved exclusively for Sardina pilchardus (Walbaum));

(ii) "X Sardines" of a country, a geographic area, the species, or the common name of the species in accordance with the law and custom of the country in which the product is sold, and in a manner not to mislead the consumer.

The Panel and Appellate Body concluded that the international standard had not been used as a basis for the EU technical regulation, since Codex Stan 94 permitted the use of the term "sardines" with any one of four qualifiers for the identification and marketing of preserved fish products prepared from 20 species of fish other than "Sardina pilchardus", while the EU Regulation prohibited it for all, except the latter. Thus, the international standard and the EU Regulation were manifestly contradictory.

TIP

If the technical regulation and the international standard contradict each other, it cannot be concluded that the international standard has been used "as a basis for" the technical regulation.

4. WOULD CODEX STAN 94 BE AN INEFFECTIVE OR INAPPROPRIATE MEANS TO ACHIEVE THE LEGITIMATE OBJECTIVE PURSUED?

The Appellate Body noted that the burden of proof to demonstrate that Codex Stan 94 was an effective and appropriate means to achieve consumer protection (the objective of the EU Regulation) rested on Peru.

With regard to the meaning of the term "ineffective or inappropriate" (Article 2.4 of the TBT Agreement), the Appellate Body noted that it referred to two issues, effectiveness and appropriateness. These two elements, although closely related, were considered different in nature. The Panel, as upheld by the Appellate Body, pointed out that:

the term "ineffective" referred to something which was not "having the function of accomplishing", "having a result", or "brought to bear", whereas

the term "inappropriate" referred to something which was not "specially suitable", "proper", or "fitting".

The Panel and the Appellate Body decided that the international standard was effective and appropriate to achieve the legitimate objective pursued.

On the basis of these findings, the Panel, as upheld by the Appellate Body, concluded that the EU Regulation was inconsistent with Article 2.4 of the TBT Agreement. Peru and the EU adopted a mutually agreed solution. EU Regulation No 1181/2003 of 2 July 2003 amending Council Regulation No. 2136/89 states that preserved sardine-type products may be marketed in the EU under a trade description consisting of the word 'sardines' joined together with the scientific name of the species. This is valid for Peruvian sardines and 19 other types of fish. On the other hand, "preserved sardines" only means products prepared from fish of the species Sardina pilchardus (the European sardine).

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SUMMING UP:

1. Was the EU Regulation a Technical Regulation? YES

2. Was Codex Stan 94 a relevant international standard? YES

3. Was Codex Stan 94 used as a basis for the EU TR? NO

4. Would Codex Stan 94 have been ineffective or inappropriate to NOachieve the legitimate objective pursued by the EU?

---> The EU Regulation was inconsistent with Art. 2.4 of the TBT Agreement

III.B. PRESUMPTION OF NECESSITY APPLICABLE TO TECHNICAL REGULATIONS

The TBT Agreement provides for a rebuttable presumption that a technical regulation does not create an unnecessary obstacle to international trade if it is in accordance with relevant international standards.

TBT Agreement Article   2.5 , second part, reads:

Whenever a technical regulation is prepared, adopted or applied for one of the legitimate objectives explicitly mentioned in paragraph 2, and is in accordance with relevant international standards, it shall be rebuttably presumed not to create an unnecessary obstacle to international trade.

The rebuttable presumption of necessity is under two conditions:

The technical regulation is prepared, adopted or applied for one of the legitimate objectives explicitly mentioned in Article 2.2 of the TBT Agreement, i.e. national security requirements, the prevention of deceptive practices, protection of human health or safety, animal or plant life or health, or the environment; and

the technical regulation is in accordance with relevant international standards. A difference in wording exists: While Article 2.4 of the TBT Agreement states that WTO Members shall use international standards as a basis for their technical regulations, Article 2.5 of the TBT Agreement covers cases where a technical regulation is in accordance with relevant international standards. The presumption is only for the latter.

Article 2.5 of the TBT Agreement thus provides that a technical regulation which is in accordance with a relevant international standard will be deemed necessary to fulfil a legitimate objective. Such a measure enjoys the benefit of a presumption (albeit a rebuttable one) that it is consistent with Article 2.2 of the TBT Agreement.

The expression to be "in accordance with" has not yet been interpreted by any Panel or the Appellate Body in WTO disputes.

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International standards are sometimes described as providing a "safe harbour" for governments. Clearly, however, WTO Members have the right to challenge any technical regulations, particularly if they believe, for example, that the claim that the measure is in accordance with the international standard is ill founded.

Finally, WTO Members have an obligation to explain, upon request, the rationale of their regulation. If their regulation is not based on an international standard, another WTO Member may request and explanation as to why the relevant international standard was not used for the formulation of the technical regulation. As we will see in Module 7, WTO Members have to give an explanation of the rational and objective of a regulation, also in the notification that they have to submit to the TBT Committee.

The first part of Article 2.5 of the TBT Agreement, reads:

A Member preparing, adopting or applying a technical regulation which may have a significant effect on trade of other Members shall, upon the request of another Member, explain the justification for that technical regulation in terms of the provisions of paragraphs 2 to 4.

ILLUSTRATIONNow it's time to illustrate what we have discussed so far in this Module. Suppose your country seeks your advice for the preparation of a technical regulation in the field of energy generation and water power. So far, you know that: (i) first, your technical regulation should not be discriminatory, so that foreign hydraulic turbines do not receive a less favourable treatment than the domestic producer nor the turbines that come from another WTO Member; (ii) second, it has to be designed in a way that does not create unnecessary obstacles to trade.

Obviously, when formulating a technical regulation, as a mandatory requirement for a hydraulic turbine used in power generation, you have several objectives in mind. One could guess that one of the most important preoccupations you have in mind is the protection of the environment; another is probably related to the safety of the people who live in the surrounding areas and of those who work in the facility, and to the prevention of noise.

Suppose that, to elaborate the appropriate requirements, which should be effective to achieve your legitimate objective, you sit down with your fellow experts. What should you do that you have not yet done?

You should look for international standards in this field and see what has been already discussed, proposed and adopted by the relevant international organization in the field. Having found a relevant international standard, you should base your technical regulation on it. This is a great tool to promote cooperation and transparency, and by doing this you will not only be applying the TBT Agreement and fulfilling the obligations contained in its Article 2.4, but also saving a lot of time and work, because these organizations, while creating and updating standards, receive the input of experts from various countries, so as to propose a "one size fits all" solution.

Moreover, if your technical regulation is in accordance with the relevant international standard, let's say the International Electrotechnical Commission Technical Committee 4 standard, it will be rebuttably presumed not to create an unnecessary obstacle to trade.

You should also keep in mind that, if the international standard is neither appropriate nor effective, you could depart from it. Remember that, according to the TBT Agreement's Article 2.5, another WTO Member might request you explain the justification for not using an international standard.

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Figure 4: Three fundamental questions for the regulators

III.C. PARTICIPATION IN THE WORK OF INTERNATIONAL STANDARDIZING BODIES

III.C.1. TECHNICAL REGULATIONSArticle 2.6 of the TBT Agreement establishes that WTO Members shall play a full part in the preparation of international standards, guides and recommendations by appropriate international standardizing bodies, with a view to harmonizing technical regulations. The only limit foreseen to this participation is a WTO Member's resources. The obligation of participation extends to those products which are regulated by the WTO Member under technical regulations (adopted or expected to be adopted). We have illustrated the work of some international standardizing bodies in the previous section.

At the 2001 Doha Ministerial Conference, WTO Members urged the WTO Director-General to continue his cooperative efforts with international standard setting organizations and other institutions, which prioritized the effective participation of least-developed country Members of the WTO and the facilitation of the provision of technical and financial assistance for this purpose (WT/MIN(01)/17, paragraph 5.3). A report summarizing these actions can be found in document G/TBT/W/172.

Active participation in the work of international standardizing bodies can be particularly challenging for developing countries. A number of developing country Members of the WTO had noted that they were not able to effectively participate in the work of the standardizing bodies, and, in particular, in the development of international standards. For instance, in a survey conducted by the TBT Committee on the identification of technical assistance needs and priorities in the TBT field, 30 per cent of the replies indicated a need to facilitate the participation of developing country Members of the WTO in the work of international standards-setting bodies (see G/TBT/W/193). These WTO Members were concerned that the standards did not necessarily reflect their needs and interests.

In this context, a number of observer international standard-setting organizations have taken actions to enhance the participation of developing country Members of the WTO in their work, and the TBT Committee invited them to provide further information on steps taken to ensure their effective participation. These will be further explored in Module 8.

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III.C.2. CONFORMITY ASSESSMENT PROCEDURESA similar provision exists for conformity assessment procedures. Article 5.5 of the TBT Agreement requires WTO Members to play a full part, within the limits of their resources, in the preparation by appropriate international standardizing bodies of guides and recommendations for conformity assessment procedures.

III.C.3. STANDARDSThe principle that standardizing bodies shall participate in the preparation of international standards by international standardizing bodies is found in paragraph G of the Code of Good Practice, first part, which reads:

With a view to harmonizing standards on as wide a basis as possible, the standardizing body shall, in an appropriate way, play a full part, within the limits of its resources, in the preparation by relevant international standardizing bodies of international standards regarding subject matter for which it either has adopted, or expects to adopt, standards.

This sentence of paragraph G applies to all three types of standardizing bodies covered by the Code of Good Practice (See paragraph B of the Code), i.e.:

Standardizing bodies within the territory of a WTO Member (central governmental, local governmental or non-governmental bodies);

governmental regional standardizing body, one or more members of which are Members of the WTO; and

non-governmental regional standardizing body, one or more members of which are situated within the territory of a Member of the WTO.

Paragraph G, second sentence, contains an additional obligation that only applies to standardizing bodies within the territory of a WTO Member, adding an element of coordination between the different levels of domestic standardizing bodies (central, local and non-governmental): in a particular international standardization activity, whenever possible, only one delegation shall represent all standardizing bodies in the territory, from those involved with the subject matter being standardized.

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III.D. AVOID DUPLICATION OF WORK

Standardizing bodies have the obligation to make every effort to avoid duplication of, or overlap with, the work of other standardizing bodies. Relevant parts of paragraph H of the Code of Good Practice read:

The standardizing body within the territory of a Member shall make every effort to avoid duplication of, or overlap with, the work of other standardizing bodies in the national territory or with the work of relevant international or regional standardizing bodies. .../... Likewise the regional standardizing body shall make every effort to avoid duplication of, or overlap with, the work of relevant international standardizing bodies.

Finally, standardizing bodies shall also make every effort to achieve a national consensus on the standards they develop.

EXERCISES:

6. What are the main rights and obligations of WTO Members (and standardizing bodies, as the case may be), with respect to harmonization under the TBT Agreement?

7. Please explain the WTO Members' obligation to "use international standards as a basis for their technical regulations". What have we learned from WTO dispute settlement cases?

8. What are the exceptions provided to WTO Members and standardizing bodies regarding the obligation to use international standards as a basis for their measures?

9. Article 2.5 of the TBT Agreement provides that technical regulations which are in accordance with relevant international standards will be presumed not to create an unnecessary barrier to trade. Could you explain what this means exactly?

10. What is the obligation WTO Members and standardizing bodies have regarding participation in the work carried out by the international standardizing organizations?

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IV. EQUIVALENCE PROVISIONS IN THE TBT AGREEMENT

Equivalence is the situation whereby a WTO Member accepts a technical regulation from another WTO Member as equivalent, even if it differs from its own, provided that it adequately fulfils the objective of its own regulation. It does not require measures to be identical.

As explained in Module 5, the use of equivalence may be seen as a good regulatory practice. Equivalence is widely used for the acceptance of conformity assessment procedures results, as a way to facilitate international trade. In this regard, we examined it in Module 5 under "Unilateral Recognition of Results".

We learned before that the TBT Agreement recognizes that more than one measure may be equally effective in fulfilling a country's legitimate interest. A proof of this is that it requires WTO Members to specify technical regulations in terms of performance rather than design or descriptive characteristics wherever possible (Article 2.8 of the TBT Agreement). That is the reason why the use of equivalence by WTO Members is an important tool to foster trade and to avoid unnecessary barriers to trade.

IN DETAIL

Articles 2.7 and 6.1 of the TBT Agreement provide that:

Article 2.7: Members shall give positive consideration to accepting as equivalent technical regulations of other Members, even if these regulations differ from their own, provided they are satisfied that these regulations adequately fulfil the objectives of their own regulations.

Article 6.1: Without prejudice to the provisions of paragraphs 3 and 4, Members shall ensure, whenever possible, that results of conformity assessment procedures in other Members are accepted, even when those procedures differ from their own, provided they are satisfied that those procedures offer an assurance of conformity with applicable technical regulations or standards equivalent to their own procedures.

The burden to demonstrate equivalence usually falls upon the exporting country, given that the importing country may accept another measure or procedure as equivalent provided it is satisfied that the regulationor procedure adequately fulfils its own legitimate objectives, even if the regulations or procedures differ from its own.

In the particular case of equivalence of conformity assessment procedures, it is important to mention that Article 6.1 of the TBT Agreement deals exclusively with the recognition of conformity assessment by central government bodies and that it contains recognition that prior consultations may be necessary in order to implement the principle of equivalence, namely to:

ensure adequate and enduring technical competence of the conformity assessment body in the exporting WTO Member, so as to foster confidence in their conformity assessment results;

verify compliance, e.g. through accreditation, with relevant guides or recommendations issued by international standardizing bodies, as an indication of adequate technical competence.

Consultations may also serve to limit the acceptance of conformity assessment results to those produced by designated bodies in the exporting WTO Member. Under this approach, governments may designate specific

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conformity assessment bodies, including bodies located outside their territories, to undertake conformity assessment activities.

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V. SUMMARY

Harmonization may be commonly described as the establishment, recognition, and application of common measures by different countries, where previously each might have had its own set of requirements.

International standards are those adopted by international standardizing bodies. An international body is a body or system whose membership is open to the relevant bodies of at least all WTO Members. The TBT Agreement does not offer specific reference to any particular international standardizing body. Therefore, the term is open and should be interpreted on a case-by-case basis.

The TBT Committee has adopted some principles which should provide guidance for the elaboration, adoption and application of international standards by standardizing bodies: Transparency, Openness, Impartiality and Consensus, Effectiveness and Relevance, Coherence, and Awareness of the Development Dimension.

Harmonization is a central discipline of the TBT Agreement and is articulated into obligations and rights of WTO Members (and standardizing bodies, as the case may be). The three main requirements are:

WTO Members and standardizing bodies shall use international standards – or relevant parts of them - as a basis for their technical regulations and standards; and international guides and recommendations as a basis for their conformity assessment procedures (TBT Agreement's Articles 2.4, 5.4, and Annex 3 paragraph F).

WTO Members and standardizing bodies shall participate, within the limits of their resources, in the preparation of international standards, guides and recommendations by international standardizing bodies (TBT Agreement's Articles 2.6, 5.5, and Annex 3 paragraph H).

Standardizing bodies shall make every effort to avoid duplication of, or overlap with, the work of other standardizing bodies, including international or regional standardizing bodies (TBT Agreement's Annex 3 paragraph H).

The two main rights are that:

WTO Members' technical regulations which are prepared, adopted or applied for one of the legitimate objectives included in the TBT Agreement, and which are in accordance with relevant international standards, will be rebuttably presumed not to create an unnecessary obstacle to trade (Article 2.5 of the TBT Agreement).

WTO Members and standardizing bodies may adopt technical regulations and standards which are not based on relevant international standards, when these are seen as ineffective or inappropriate to fulfil a legitimate objective. WTO Members have the same right regarding conformity assessment procedures, if the relevant international guides or recommendations are considered inappropriate for the WTO Member concerned. (Articles 2.4, 5.4, and Annex 3 paragraph F of the TBT Agreement).

When a WTO Member or a standardizing body decides to create a new TBT measure - or revise one which is already in place - it should start its task by verifying if a relevant international standard exists for the product and/or measure in question. If it exists, the WTO Member or the standardizing body shall use the relevant international standard as a basis for its measure, unless the international standard is ineffective (not in the case of conformity assessment procedures) and/or inappropriate to fulfil a WTO Member's legitimate interest.

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EQUIVALENCE

Equivalence is the state wherein a WTO Member accepts a technical regulation or conformity assessment procedure from another WTO Member as equivalent, even if it differs from its own, provided that it adequately fulfils the objective of its own regulation. It does not require duplication or sameness of measures, and can be applied between all WTO Members, irrespective of their level of development.

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ANSWERS PROPOSED:

1. Harmonization may be described as the establishment, recognition and application of common measures by different countries, where previously each might have had its own set of requirements.

2. Harmonization may bring several benefits by:

facilitating international trade, as the products conforming to the same standards may be accepted more widely and producers do not need to know in advance the final markets for their products, resulting in fewer unjustified restrictions on trade;

diffusing technology embodied in products and processes;

promoting efficiencies and allowing economies of scale, as producers do not have to create different processes or design and manufacture a product in many variations to meet varying, different standards;

resulting in lower costs to consumers who may compare and chose from a larger number of suppliers; and

aiding governments in developing sound TBT measures without the need to undertake scientific/policy assessments on their own. They may use the conclusions of an international standardizing body or another WTO Member to that end.

Ultimately, harmonization can ease production and trading conditions for producers, importers and exporters, especially from developing countries (which face more financial constraints to adapt to the requirements of the export market), thus minimizing obstacles to international trade.

3. The dissemination of such principles by WTO Members and standardizing bodies in their territories would encourage the various international bodies to clarify and strengthen their rules and procedures on standards development, thus further contributing to the advancement of the objectives of the Agreement.

The principles and procedures developed by the TBT Committee fall into six categories:

(i) Transparency: Essential information on current work programmes, proposals and final results should be easily accessible to at least all interested parties, and procedures to provide for adequate time for written comments should be established.

(ii) Openness: Membership of an international standardizing body should be open on a non-discriminatory basis, to relevant bodies of at least all WTO Members. Openness regards both policy and standard development in every stage. Meaningful opportunities to participate should be provided, especially to developing countries.

(iii) Impartiality and consensus: All relevant bodies of WTO Members should be able to contribute to the elaboration of an international standard, regardless of particular interests of countries, regions, etc. Consensus procedures should be established so that the views of all parties concerned are taken into account and conflicting arguments may be reconciled.

(iv) Effectiveness and relevance: International standards need to be effective for regulatory and market needs and allow scientific and technological development. They must not distort the global market, adversely affect fair competition, nor give preference to requirements of specific countries or regions to the detriment of others. They should be based on performance wherever possible.

(v) Coherence: It is important to avoid duplication of, or overlap with, the work of other international standardizing bodies, therefore preventing conflicting international standards. This is achieved through coordination and cooperation.

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(vi) Development dimension: Due to the constraints developing countries suffer in their participating in international standards development, ways of facilitating their participation should be enhanced, so as not to be excluded de facto from the process. Capacity building and technical assistance is a vital part in this effort.

4. It is important that all WTO Members have the opportunity to participate in the elaboration and adoption of international standards to guarantee that international standards make a maximum contribution to the achievement of the trade facilitating objectives of the TBT Agreement.

Bodies operating with open, impartial and transparent procedures, that afford an opportunity for consensus among all interested parties in the territories of at least all WTO Members, were seen as more likely to develop standards which were effective and relevant on a global basis and would thereby contribute to the goal of the Agreement to prevent unnecessary obstacles to trade.

5. The abovementioned international standardizing bodies have in common: their broad participation, which may include experts and other interested members of community (industry, consumer associations, and often NGOs); their standards are usually adopted through an elaborated procedure, which involves at least three phases: the drafting or planning, the discussions and the adoption; many of them adopt their decisions by consensus; and membership is usually opened to any member of the international community (except UNECE, whose membership is limited but whose activities are open for the participation of any UN Member).

6. Harmonization is a central discipline of the TBT Agreement and is articulated into obligations and rights for WTO Members (and standardizing bodies, as the case may be). The three main requirements are that:

WTO Members and standardizing bodies shall use international standards – or relevant parts of them - as a basis for their technical regulations and standards; and international guides and recommendations as a basis for their conformity assessment procedures (TBT Agreement's Articles 2.4, 5.4, and Annex 3 paragraph F).

WTO Members and standardizing bodies shall participate, within the limits of their resources, in the preparation of international standards, guides and recommendations by international standardizing bodies (TBT Agreement's Articles 2.6, 5.5, Annex 3 paragraph H).

Standardizing bodies shall make every effort to avoid duplication of, or overlap with, the work of other standardizing bodies, including international or regional standardizing bodies (TBT Agreement's Annex 3 paragraph H).

The two main rights are that:

WTO Members' technical regulations which are prepared, adopted or applied for one of the legitimate objectives stated in the TBT Agreement, and which are in accordance with relevant international standards, will be rebuttably presumed not to create an unnecessary obstacle to trade (TBT Agreement's Article 2.5).

WTO Members and standardizing bodies may adopt technical regulations and standards which are not based on relevant international standards, when these are seen as ineffective or inappropriate to fulfil a legitimate objective. WTO Members have the same right regarding conformity assessment procedures, if the relevant international guides or recommendations are considered inappropriate for the WTO Member concerned (TBT Agreement's Articles 2.4, 5.4, Annex 3 paragraph F).

7. Three key concepts can be highlighted in Article 2.4 of the TBT Agreement: (i) relevant international standards; (ii) use as a basis; (iii) ineffective or inappropriate means to achieve a legitimate objective.

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(i) "Relevant international standards" has been interpreted by the Appellate Body in the EC - Sardines (WT/DS 231) case. As suggested by the Appellate Body, to be relevant, the standard needs "to bear upon, relate, or be pertinent to a technical regulation".

(ii) The concept of "use as a basis" was interpreted in the same case as the principal constituent or fundamental principle of the purpose of enacting the technical regulation. That is, a very strong and non-contradictory relationship should exist between the international standard and the national technical regulation.

(iii) As to inappropriate or ineffective means, in the same case it was decided that a means is inappropriate if it is not adequate, and ineffective if it does not produce the desired results, that is, the fulfilment of the legitimate objective. Keep in mind that the TBT Agreement, in Article 2.4, states that an international standard may be inappropriate or inadequate, for instance, because of fundamental climatic or geographical factors or fundamental technological problems, not excluding other reasons.

8. WTO Members and standardizing bodies shall use international standards, or relevant parts of them, as a basis for their TBT measures. However, WTO Members are authorized to deviate from international standards if these are inefficient/inappropriate to fulfil a WTO Member's legitimate objective.

9. Article 2.5 provides that a technical regulation which is in accordance with a relevant international standard will be deemed necessary to fulfil a legitimate objective. Such a measure enjoys the benefit of a presumption (albeit a rebuttable one) that it is consistent with Article 2.2 of the TBT Agreement.

International standards are sometimes described as providing a "safe harbour" for governments. Clearly, however, WTO Members have the right to challenge any technical regulations, particularly if they believe, for example, that the claim that the measure is in accordance with the international standard is ill founded.

10. WTO Members and standardizing bodies shall participate in the preparation of international standards, guides and recommendations by international standardizing bodies (TBT Agreement's Articles 2.6, 5.5 and Annex 3 paragraph H). The limit foreseen to this participation is a WTO Member's and a standardizing body's resources.

The obligation of participation extends to those products which are regulated by the WTO Member under technical regulations (adopted or expected to be adopted) and those subject matter for which the standardizing body has adopted, or expects to adopt, standards.

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