Deliberate Release Directive: Precautionary Interactions. Ingmar von Homeyer Ecologic Institute for International and European Environmental Policy

Transcription

1 Deliberate Release Directive: Precautionary Interactions Project Deliverable No. D 25, Final Draft (December 2002) Ingmar von Homeyer Ecologic Institute for International and European Environmental Policy 1. Introduction The EU Directive on the Deliberate Release of Genetically Modified Organisms (DRD) is one of the most controversial pieces of EU environmental legislation. It has been - and still is - heavily criticised by the U.S. and other producer countries of GM agricultural products, parts of industry and some scientists working in the field. The DRD interacts with several environmental and non-environmental institutions, in particular in the agricultural and food sectors and concerning trade. The politically most significant interactions are with EU product sector legislation, such as rules governing the authorisation for Community wide sale of foods, feed, seeds and plant protection products, and various international institutions, such as the WTO SPS and TBT Agreements and the Biosafety Protocol. These interactions focus on three main issues: a precautionary regulatory approach, labelling provisions, and traceability of GM agricultural products. Following a short discussion of these interactions, this paper analyses the interactions with EU product sector legislation - in particular the Directive on Plant Protection Products (Pesticides Directive (PD)) - and with the WTO SPS Agreement in more detail. In both cases, the discussion focuses on the application of the precautionary principle in risk assessment. The interaction with the PD provides an instructive example of the challenges involved in coordinating precautionary, biotechnology-specific or horizontal legislation aimed specifically at regulating GMOs with more conventional, non-precautionary rules for product approval ( product sector or vertical legislation 1 ). It illustrates the capacity of the EU to effectively respond to an interaction with highly disruptive effects. The second case goes to the heart of international conflicts over the DRD which focus primarily on trade aspects. Due to the more fragmented nature of international institutions as reflected in conflicting institutional objectives and variations in membership, the interaction between the DRD and the WTO SPS Agreement appears to be more difficult to resolve than interactions between EU legislative instruments. In addition, the case provides an example for the spill-over of an interaction to related third institutions, in this case the Codex Alimentarius Commission (CAC). Finally, looking at both cases together, it is interesting to observe that the EU response to the interaction between the horizontal, European level interaction between the DRD and the PD is likely to increase the disruptive effects of the vertical interaction between the revised DRD and the SPS Agreement. 1 In the following the terms vertical and horizontal legislation will not be used in this context to avoid confusion with vertical and horizontal interactions which refer to different levels of analysis.

2 2 Institutional Interaction The discussion starts in the following part with a short overview of the most relevant aspects and the legislative evolution of the DRD. The next part summarises the main interactions with the other EU and international institutions mentioned above. Parts four and five focus on the detailed case studies. The last part summarises the findings. 2. The Deliberate Release Directive At present the development and use of GM agricultural products is still at a relatively early stage. Despite smaller alleged or real incidents, deliberate releases have so far not had any known major health or environmental impacts. However, GM agricultural products have a considerable potential for causing environmental and health problems if their use is not adequately regulated. Potential effects include toxicity, allergeinity, negative impacts on biodiversity, undesirable effects on agricultural practices, such as an increase of pesticides use etc. To address these effects the EU Council of Ministers (Environment) adopted Directive 90/220 on the Deliberate Release of GMOs into the Environment in April The Directive is based on Art.100a of the EC Treaty on harmonisation measures to establish the Internal Market. It aims at harmonising legislation in the EU Member States and at protecting human health and the environment (Art.1). Although the DRD is not explicitly based on the precautionary principle, it is generally recognised as an important early piece of precautionary Community legislation (Douma 2001: ; Schomberg 1998; Haigh 1994: 237; Cameron/ Abouchar 1991: 13-14). Its precautionary character derives from the fact that the Directive subjects all releases of GMOs to a specific environmental risk assessment and authorisation procedure to address any potential environmental risks. However, stating in Art.4 that Member States shall ensure that all appropriate measures are taken to avoid adverse effects on human health and the environment, the Directive fails to specify concrete, substantive criteria for risk assessment. The DRD covers the deliberate releases for research purposes (Part B) and marketing of GM products (Part C). Releases for research purposes are authorised at the national level in accordance with the rules laid down in the Directive; Community institutions - in particular the European Commission and the so-called Art.21 Committee established to oversee implementation of the Directive - merely serve as decision-making and discussion fora for adaptation to technical progress and for the exchange of information between the national Competent Authorities. Products which have been approved for placing on the market in accordance with the Directive may be sold throughout the Community. Therefore the involvement of Community institutions is significantly stronger in product approval than in releases for research purposes. As is the case for research, an application for a marketing authorisation must first be submitted to a national Competent Authority. However, while the national Competent Authority can reject the application, final approval also depends on the absence of objections by other Competent Authorities. If there are objections, the Art.21 Regulatory Committee mentioned above must approve the product. The Commission and all national Competent Authorities are represented in the Committee. The Art.21 Committee decides on the basis of a Commission proposal which can only be rejected by a qualified majority of Member State representatives in the Council (Art.21, DRD). However, Art.16, DRD, provides a safety clause which allows the Member States to temporarily suspend the use or sale of GM products if there are justifiable reasons to do so.

3 The Deliberate Release Directive 3 In 1998 the Commission submitted a proposal for the revision of the DRD (European Commission 1998). Originally, this legislative initiative had been aimed at accommodating complaints by industry and scientists about exaggerated regulation hindering the deliberate release of GMOs and discriminating against GM products (cf. Homeyer 2002). The Commission therefore proposed to introduce simplified procedures. However, the final version of the legislative proposal also contained provisions which tightened regulatory oversight. These provisions addressed some of the shortcomings of the DRD, certain new scientific findings, for example concerning the possibility of gene transfer, and growing popular and governmental opposition to the commercialisation of GM agricultural products in the Member States. Such opposition had increased markedly in the wake of the 1997 BSE crisis which undermined trust in agro-industrial production methods and EU and national food safety regimes. In addition, the first European imports of GM soya and maize from the US had been greeted by opposition from environmental NGOs and consumer associations, in particular because the imports had not been labelled as GM (cf. Vogel 2001). As a result of the rising political opposition, the Art.21 Committee has not approved any new GM agricultural products since March In June 1999 the Environment Council officially declared the so-called de-facto moratorium on product approval under the DRD. Based on the Commission s 1998 legislative proposal, the Council and the European Parliament adopted the revised DRD in March Directive 2001/18/EC is significantly tighter than the Commission s original proposal. It explicitly incorporates the precautionary principle as a rationale for the adoption of Community legislation (Recital 8 and Art.1) and as a princ iple of risk assessment (Art.4 and Annex II). As the Directive requires the risk assessment to cover indirect and long-term effects, it also clarifies some questions regarding the substantive criteria for risk assessment. However, in other respects the term adverse effects remains undefined. The Directive also contains general provisions to ensure traceability of GM products. According to the Commission proposal for a Regulation to implement the traceability and labelling provisions of the revised DRD, traceability requires, among other things, that the kind and characteristics of GMOs are clearly identifiable by means of a code number referring to a register of authorised GMOs at all stages of the placing on the market (European Commission 2001). In addition, the revised DRD prescribes clear labelling of all GM products. 2 This was not the case with its predecessor which was initially interpreted to require labelling of GM products only if such a measure was justified in terms of specific risks (FoE 1997: 3). In 1997 the original DRD was amended by Directive 97/35. According to the amendment, GMOs or products containing GMOs had to be labelled. But clear, unequivocal labelling was undermined by the option to label a product may contain GMOs if the presence of GMOs could not be excluded. 3. Overview of the Institutional Interactions of the DRD The main institutional interactions of the DRD are related to the provisions on precautionary risk assessment, traceability and labelling of GM products. These provisions are biotechno logy-specific because their application is triggered by the fact that a product is a GMO, contains GMOs, or has been produced in a process involving genetic engineering. In contrast, marketing authorisations for conventional products are usually governed by sectoral 2 See Arts.12 and 26, revised DRD.

4 4 Institutional Interaction regulations. In this case specific regulatory requirements are triggered not by technology, but by the kind of product as defined by its intended use. As a result of the parallel existence of techno logy specific and sectoral legislation, many GM products are regulated twice; once under conventional product sector legislation and again under the DRD. This situation has led to several horizontal interactions between the provisions on precautionary risk assessment, traceability and labelling of the DRD and EU product sector legislation. It has also contributed significantly to vertical interactions with international institutions. The following paragraphs provide an overview of the main interactions of the DRD. In cases in which the interaction was closely linked to the revision of the DRD, an explicit distinction between the original DRD and the revised DRD was made and the two were treated as separate cases of interaction. Because of the wide range of existing and potential applications of genetic engineering, there is a large potential for institutional interactions involving the DRD. To name just a few examples: It is argued by some that GMOs may improve food security. This is an issue of central importance for the World Food and Agricultural Organisation (FAO); GMOs may also be used for environmental purposes, for example to dissolve toxic chemicals or to mitigate climate change by increasing the capacity of plants to absorb CO 2. Consequently, there may be interactions with the climate change regime and regimes to protect oceans and rivers. More worrying is the potential application of GMOs in biological warfare a possibility that could lead to interactions with regimes in the field of security and defence. Not least because only relatively few non-medicinal GM products have so far been developed, all of these potential interactions remain more or less hypothetical. The Table (below) therefore only illustrates particularly intensive or politically important interactions.

5 The Deliberate Release Directive 5 Table 1: Interactions between the DRD and other EU legislative instruments and international institutions Institution/Instrument Product sector legislation 1 (precaution) Product sector legislation 2 (precaution/labelling) Interaction The precautionary environmental risk assessment prescribed by the DRD introduced an additional regulatory hurdle for GM products authorised under product sector legislation The revised DRD requires the revision of product sector legislation to include a precautionary environmental risk assessment and clear labelling provisions Pesticides Directive 1 Responsibility for the assessment of secondary effects of GM herbicide resistant crops is assigned to the PD rather than the DRD Pesticides Directive 2 Different interpretations among the national Competent Authorities of the scope of risk assessment under the DRD and the PD undermine product approval Novel Food Regulation The initial labelling provisions of the DRD tended to undermine labelling under the Novel Food Regulation Product sector legislation 3 (labelling) Directive 97/35 amending the labelling provisions of the DRD was not consistent with the emerging approach to labelling under product sector legislation WTO SPS Agreement 1 The WTO SPS Agreement endangers the provisions on precautionary risk assessment and traceability of the DRD WTO SPS Agreement 2 The provisions on precautionary risk assessment of the DRD challenge the version of precaution supported by the SPS Agreement WTO TBT Agreement The WTO TBT Agreement may endanger the labelling and traceability provisions of the DRD United Nations Environmental Programme Guidelines The basic regulatory approach of the Guidelines was partly modelled on the DRD It is important to note that the Table only lists the pairs of institutions which gave rise to interactions. However, the range of institutions involved in interactions with the DRD is wider. This is particularly relevant for the interactions with the WTO. While the DRD and the WTO were the constituting institutions, other institutions were drawn into these interactions at subsequent stages. The case study of the interaction between the DRD and the SPS Agreement shows that this spill-over has already occurred in the case of the Codex Alimentarius Commission. It may also happen to the International Plant Protection Convention and the Office International des Epizootes which are also recognised as international standards setting bodies by the WTO SPS Agreement. To a lesser extent this also applies to other international institutions, in particular the Cartagena Biosafety Protocol. The main interactions of the DRD mostly concern non-environmental institutions, in particular EU product sector legislation and the WTO. However, some institutions, for example the PD, are somewhat similar to environmental institutions in that they also aim at establishing adequate standards of protection. Given that the biotechnology-specific approach of the DRD cuts across different product sectors, it is hardly surprising that the DRD interacts with this kind of related product sector legislation. Frequently, the DRD is also the source of the interaction. Regarding horizontal interactions, this may to some extent be explained by the fact that the DRD has been adopted more recently than most product sector legislation. It therefore affected the operation of the pre-existing legislation. In addition, the more recent

6 6 Institutional Interaction process of revising the DRD was hardly affected by product sector legislation. As to vertical interactions, the DRD was one of the world s first biotechnology-specific pieces of legislation. It therefore influenced later efforts to specifically address the potential environmental and health risks of the deliberate release of GMOs. This happened to some extent in the cases of the UNEP Guidelines. There are similarities and differences between the main causes of interactions at European and international levels. In both cases differences between the institutional objectives to some extent contributed to interactions. This may often be attributed to the fact that many interactions involve non-environmental institutions which pursue goals that differ from those of the DRD. However, beyond this commonality differing objectives appear to be more relevant for vertical than for horizontal interactions. More specifically, only some of the objectives of the DRD and other EU legislative instruments differ. For example, product sector legislation may focus more on health and safety than on environmental aspects and the overall level of protection may be lower than that provided for by the DRD, but both legislative instruments share the common goal of establishing the Internal Market. Therefore the DRD is not a purely environmental institution but also aims at promoting regional economic integration. The resulting overlap of objectives limits the impact which differing objectives can have on horizontal interactions. In contrast, objectives seem to be particularly important for explaining vertical interactions. The objectives of the DRD and of the WTO SPS and TBT Agreements differ significantly because the latter two agreements promote trade liberalisation rather than environmental objectives or regional economic integration. Differences between the causes of interactions between the European and the international level are particularly obvious in the case of membership. The fact that the most important producer country of GM agricultural products - the US - does not belong to the EU is the main reason why differences in membership contribute significantly to the interactions between the DRD and international institutions such as the WTO. With the exception of interactions in which the DRD had a model function, their initial effects were mostly disruptive because differences in objectives and membership between the DRD on the one hand, and product sector legislation and non-environmental international institutions on the other hand, led to diverging interpretations, inconsistencies, conflicts of interest, and impediments to trade. Yet, in some cases of horizontal interactions more synergetic effects resulted from the revision of the DRD. In contrast, vertical interactions with the WTO seem to have become even more disruptive as a result of the revision of the DRD. Although the majority of the interactions was not intentional, some qualifications are necessary: First, this does not apply to most horizontal interactions, specifically those dealing with precautionary risk assessment or involving the revised DRD. In both cases the DRD contains provisions which expressly aim at influencing practices under product sector legislation. Second, although many interactions may not have been intended in the strict sense, they were nevertheless anticipated and to some degree accepted. This is particularly true for the interactions of the revised DRD. Concerning effects, some provisions of the original DRD - for example on the possible incorporation of an environmental risk assessment into product sector legislation (Art.10(2), DRD) - aimed at creating synergies with other legislative instruments, but often failed to do so. Consequently, disruptive effects prevailed. However, as mentioned above, some synergies occurred at the international level in cases of interaction with environmental institutions, and to a lesser extent in horizontal interactions involving the revised DRD.

7 The Deliberate Release Directive 7 At the European level unilateral influence of one institution on the other initially tended to be rare. The DRD and product sector legislation mostly were able to influence each other, in particular with respect to the provisions on precautionary risk assessment. More recently, the revision of the DRD seems to have shifted influence towards the DRD. With the exception of international environmental institutions - a case in which the DRD mostly exerted unilateral influence - the situation at the international level is less clear because relevant processes are still very much ongoing. Efforts by the EU to diffuse the regulatory approach of the DRD internationally could lead to the modification of international rules and practices. However, if diffusion should fail, there might be a need to revise the DRD in response to the requirements of the WTO. At the European level collective responses to the interactions have been the rule rather than the exception, although the issues raised by the interactions sometimes only constituted one among several reasons for the responses. For example, the revision of the DRD addressed several interactions at once. However, the adequacy in particular of the early responses has been limited. The incorporation of an environmental risk assessment into several pieces of product sector legislation in accordance with Art.10(2), DRD, often failed to resolve the problems resulting from the regulatory overlap between the DRD and product sector legislation. In contrast, the respective provisions of the revised DRD offer the prospect of addressing this issue more effectively. Due to the fact that most interactions at the international level are relatively recent, major political responses have, with the partial exception of some decisions by the CAC, so far been rare. 4. Interactions with the Pesticides Directive: Precaution Prevails The first generation of GM agricultural products has been commercially available since the mid GM maize and soya are by far the most common products, GM oilseed rape ranks third. The most frequent GM characteristics of these products are herbicide and insect resistance (Sauter/Mayer 2000: ). Several potential environmental risks are associated with herbicide resistant GM crops. First, some risks are related to primary effects. For example, genetically engineered resistance to a herbicide may be transferred to related wild species as a result of cross-breeding or gene transfer. GM crops may also have undesirable effects on non-target organisms, such as beneficial insects. Second, there are secondary effects which are not directly caused by the GM crops themselves, but are associated with the use of the complementary herbicide. For example, due to the increased use of the herbicide on the resistant crops, over time processes of adaptation and mutation may lead to the development of resistance to the herbicide in target weeds. The application of the herbicide may also have a negative impact on biodiversity (Sauter/Mayer 2000: 64-75). The precautionary environmental risk assessment of the DRD addresses the primary effects of the use of herbicide resistant GM crops. When the first marketing applications were discussed at the EU level in the mid-1990s some national Competent Authorities held the view that secondary effects were also covered by the precautionary environmental risk assessment. However, a majority opposed this interpretation. These conflicting interpretations resulted in two largely simultaneous interactions: First, the Environment Council and the Commission initially decided that the assessment of secondary effects was not covered the DRD but would fall into the remit of product sector legislation, in particular the Pesticides Directive which did not provide for a precautionary environmental risk assessment (cf. Commission Decision

8 8 Institutional Interaction 94/385/EC). Consequently, the PD prevailed over the DRD in this conflict over competencies. Second, an increasing number of national authorities which did not agree to this interpretation refused to grant approval to the placing on the market of herbicide resistant GM crops because they assessed secondary effects on the basis of the precautionary environmental risk assessment of the DRD. The resulting objections, national bans and moratoria seriously delayed or prevented the approval of herbicide resistant GM crops, thereby undermining the PD. Eventually, the revision of the DRD resolved both interactions by establishing explicitly that secondary effects were to be assessed under the DRD. The following paragraphs present the two interactions and the political response in more detail. 4.1 Mutual Disruptions The interactions between the DRD and the PD illustrate the difficulties arising from the overlap of competencies between biotechnology-specific legislation, e.g. the DRD, and product sector legislation, such as the PD (Sauter/Meyer 2000: 119). However, the interactions differ from other interactions resulting from this overlap, for example with the Novel Foods Regulation (cf. Levidow/Carr/Wield 2000: 196). More specifically, Art.10(2), DRD, created the possibility of reducing this overlap by integrating an environmental risk assessment similar to the one prescribed by the DRD into product sector legislation. However, in contrast to several other pieces of product sector legislation, Art.10(2) has not been applied to the PD. 3 Consequently, the primary effects of herbicide resistant GM crops had to be assessed under the DRD. But neither the DRD nor the PD explicitly addressed secondary environmental effects. When the issue of assessing secondary effects arose in the approval process, it was therefore not clear whether the assessment was to be based on the precautionary assessment criteria of the DRD or the less restrictive environmental standards of the PD. The PD lays down conditions for the authorisation of pesticides in the EU Member States. It relies on the method of mutual recognition according to which a product which has been authorised in one Member State in accordance with the Directive must also be authorised in the remaining Member States. Although the Preamble of the PD states that it provides for a high level of protection which should take priority over the objective of improving plant protection, the Directive is not based on precaution. Rather, its operative clauses focus on narrowly circumscribed effects: Pesticides may not have any harmful effect on plants or plant products, directly or indirectly (e.g. through drinking water, food or feed), or on groundwater and they may not have any unacceptable influence on the environment, having particular regard to the following considerations: its fate and distribution in the environment, particularly contamination of water including drinking water and groundwater; its impact on non-target species (Art.4(b iv, v)). Because these criteria for environmental risk assessment are less demanding than the precautionary approach of the DRD (cf. Sauter/Meyer 2000: 119), an evaluation of secondary effects was generally believed to be less comprehensive under the PD than under the DRD. The interactions between the DRD and the PD therefore centred on conflicts over which of the two Directives should cover secondary effects. As 3 In Art.1(3) the PD states that the Commission shall submit a proposal for an amendment of the Directive insufficient time for the latter [the Council] to be able to act no later than two years after the notification of this Directive [the PD]. The amendment is to contain a specific environmental risk assessment procedure which allows for the application of Art.10(2), DRD. Such a legislative measure has, however, not been adopted.

9 The Deliberate Release Directive 9 illustrated below, the diverging objectives of the DRD and the PD which imply differing criteria for environmental risk assessment are the main cause of the interactions. The first interaction between the DRD and the PD resulted from conflicting interpretations of the scope of risk assessment under the DRD which surfaced among the national Competent Authorities soon after the first applications for marketing of herbicide resistant GM crops had been submitted to the Commission. Ciba-Geigy s (today: Novartis) herbicide and insect resistant Bt-176 maize provides an early example. In 1995 Austria, Denmark, Sweden and the UK rejected the marketing application in the Art.21 Regulatory Committee supervising the implementation of the DRD. Except for the UK, these Member States objected inter alia that no overall environmental assessment of potential secondary effects had been made. They argued that the DRD required an assessment of such effects (cf. Mayer/Sauter 2000: ; Toft 1999: 14). DGs Environment and Agriculture attempted to clarify the situation by stating that issues of plant protection arising in the approval procedure for GM crops were covered by the PD rather than the DRD (Levidow/Carr/Wield 1999: 51). However, the Council failed to muster the qualified majority of votes which was required to override the dissenting Member States. To prepare a final decision, the Commission therefore referred the issue to its scientific advisory committees. In 1996 the Scientific Committee on Pesticides (SCP) supported the Commission s position. It argued that secondary effects - in this case the development of Bt-resistance in destructive insects as a result of any increased herbicide use - were not an environmental but an agronomic problem. As with conventional pesticides, such problems could be managed with the help of alternative pesticides. Additional long-term secondary environmental effects which might be caused by alternative pesticides, the decreasing effectiveness of Bt as an environmentally friendly pesticide, and the possibility of an overall increase in pesticide use were not addressed (cf. Mayer/Sauter 2000: , 233). Immediately following the Commission s subsequent approval of the Bt-176 maize, Austria, Luxe mbourg and Italy resorted to the safeguard clause of Art.16, DRD, and banned the use and sale of the Bt-176 maize on their territories (FoEE 1997: 6). However, the Commission decided that the appeal to Art.16 was not justified, thereby confirming that secondary effects were to be assessed under the PD rather than the DRD. Although most Member States had initially accepted the Commission s position on the allocation of competencies for the assessment of secondary effects (cf. Torgersen/Seifert 2000: ), support waned quickly in the second half of the 1990s. In particular France and the UK reassessed their positions. The history of the marketing application for a Plant Genetics Systems (PGS) herbicide resistant GM oilseed rape (MS1xRF1) exemplifies this development. Having initially only received approval for growing and seed production in the UK, PGS had obtained a broader authorisation in France. Despite objections by several Member States which referred to a missing or inadequate assessment of secondary effects (cf. Levidow/Carr/Wield 1999: 29; Schomberg 1998: 17), the Commission supported the French approval in This decision essentially reiterated the views of the British and French Competent Authorities which had treated secondary effects as agronomic problems that could be addressed in a manner similar to the effects of conventional pesticides (cf. Levidow/Carr 2000: 263; Levidow/Carr/Wield 1999: 28; Levidow/Carr/Wield 1999a: 14, 18; Roy/Joly 1999: 19). However, in the meantime the French government had reversed its position and imposed a moratorium on the commercialisation of herbicide resistant oilseed rape. The French U-turn amounted to a recognition that secondary effects were relevant for the approval procedure (cf. Roy/Joly 1999: 19-20). Subsequently, the government supported demands to

10 10 Institutional Interaction extend risk assessment under the DRD to secondary effects (Roy/Joly 2000: 253). In late 1998 British authorities also reversed its position and included secondary effects in the risk assessment (Levidow/Carr/Wield 1999a: 14). These developments show that the initial decision to allocate responsibilities for the evaluation of secondary effects to the PD faced growing opposition among the Member States. While the first interaction affected the formal distribution of competencies between the DRD and the PD by restricting the reach of the provisions on precautionary environmental risk assessment of the DRD, the second interaction undermined the implementation of the PD. As illustrated above, a growing number of Member States defied the Commission s decisions and assessed secondary effects under the DRD. The resulting risk assessments served as justifications for national bans and moratoria which frequently prevented or severely restricted the marketing of herbicide resistant GM crops. For example, Austria upheld its ban of the Bt-176 maize although the Commission had decided that Austria could not invoke the Art.16 safety clause (Winkler 1999: 10). Similarly, France banned the sale and use of the PGS oilseed rape - and GM oilseed rape more generally - despite the previous approval by French authorities and subsequent EU approval (cf. ibid.: 11-12; Marris 2000: 8-9; Roy/Joly 2000: 250). Even the UK, which had for a long time been the most outspoken and influential opponent among the Member States of an evaluation of secondary effects under the DRD, eventually followed suit and imposed additional monitoring and testing requirements. In Britain, this new strategy of managed development of GM crops was coupled with a three year moratorium on commercial cultivation (cf. Levidow/Carr 2000: 264). Similar measures were agreed in additional Member States, such as Germany (cf. Sauter/Meyer 2000: 98). From 1998 on these national initiatives were also complemented by Member State action at the EU level. More specifically, the conflicts over the assessment of secondary effects contributed significantly to the de-facto moratorium on the approval of GM products under the DRD. The moratorium was officially announced by the Environment Council in June 1999, but had effectively been in force since March/April It brought the approval process to a complete halt (cf. Sauter/Meyer 2000: 91-93). Although the moratorium was originally planned to last until the revised DRD and implementing rules for labelling and traceability of GM products were in place, some Member States have subsequently raised new conditions for ending the moratorium, such as the adoption of liability rules for damage caused by GMOs. In sum, the situation in the second half of the 1990s was characterised by two more or less simultaneous interactions between the DRD and the PD which, however, occurred at different levels. As far as rule-making was concerned, the assessment of secondary effects was allocated to the PD, although an increasing number of Member States rejected this distribution of competencies. At the level of substantive outcomes, bans and moratoria undermined the effectiveness of the PD because they prevented the large-scale marketing and use of herbicide resistant GM crops in the EU. 4.2 The Revision of the DRD The blocked approval of GM agricultural products, to which the conflict over the assessment of secondary effects contributed significantly, demonstrated the need to resolve the respective interactions between the DRD and the PD. As a growing number of Member States reinforced their calls for an assessment of secondary effects under the DRD with objections to marketing applications in the Art.21 Committee, bans, and moratoria, the Commission used the already

11 The Deliberate Release Directive 11 ongoing process of revising the DRD to accommodate these demands in its legislative proposal. In particular, Annex II of the revised DRD outlines the Principles for Environmental Risk Assessment. They include an assessment of indirect effects which refer, among other things, to changes in use or management. This means that the revised DRD explicitly covers secondary effects, such as increased herbicide application. The risk assessment also explicitly aims at identifying and evaluating potential adverse effects of the GMO, either direct and indirect, immediate or delayed, on human health and the environment. Similarly, the conclusions of the environmental risk assessment must address changes in management, including, where applicable, in agricultural practices. These new provisions are reinforced by the introduction of market stage precautionary measures, in particular monitoring plans to identify previously unknown or delayed adverse effects (Art.20) and time limited marketing authorisations (Art.17). The developments which led to the inclusion of an assessment of secondary effects in the revised DRD suggest that the political responses to the interaction between the DRD and the PD fall into three categories: First, a growing number of Member States reacted to the lack of assessment of secondary effects with the imposition of bans and moratoria. Second, the Member States adopted measures, such as further research into the significance and implications of secondary effects, step-by-step commercialisation, and market stage monitoring. Finally, the EU adopted the revised DRD which explicitly incorporates the evaluation of secondary effects. With respect to any potential negative environmental implications of secondary effects, these responses mostly appear to have been helpful: Bans and moratoria resulted in delays of large scale commercialisation. Thereby they provided the time necessary for initiating further research into the potential implications of secondary effects and for discussing and implementing additional political responses (cf. Levidow/Carr/Wield 2000: 198). The bans and moratoria, in particular the European level de facto moratorium, also increased the political pressure to incorporate the evaluation of secondary effects in the environmental risk assessment of the revised DRD and to adopt supporting measures, such as market stage precaution and monitoring. Market stage precautions, for example monitoring of farm-scale cultivation of GM crops and accompanying research, are unlikely to be sufficient to create consensus among the national Competent Authorities on the environmental implications of secondary effects. Consensus building requires market stage precautions to be based on common objectives, concepts and methodologies (cf. Sauter/Meyer 2000: ). The market stage precautions which have already been introduced unilaterally by some Member States may help to generate the necessary experience and knowledge. By integrating the evaluation of secondary effects in the precautionary environmental risk assessment, the revised DRD seems to have ended the tensions with the PD. From the point of view of the environment, this is a clear improvement over the previous situation, in which secondary effects were only assessed on the basis of the more limited environmental requirements of the PD. This assessment suggests that the political responses to the interaction between the DRD and the PD may be interpreted as elements of a learning process (cf. Levidow/Carr/Wield 2000: ) which led to the recognition of the significance of potential secondary effects and, subsequently, to their incorporation in the risk assessment procedure. However, this learning process has also come at a price in terms of the other, non-environmental objective of the

12 12 Institutional Interaction DRD, e.g. the creation of the Internal Market. The various national bans, moratoria and market-stage precautionary measures undermined this objective primarily by preventing the large scale commercialisation of GM crops (cf. Winkler 1999). Although the inclusion of secondary effects in the risk assessment procedure of the DRD will probably end the conflicts with the PD, controversies among national Competent Authorities over the evaluation of secondary effects are unlikely to disappear. The assessment of secondary effects poses questions which are often similar to the issues raised in the context of the interaction with the PD. In particular, the definition of adverse effects (Art.4(1), revised DRD) remains controversial. For example, the reduction of pesticide use is an important agricultural policy objective in some Member States, such as Austria (Torgersen/Seifert 2000: ), but less so in others. As a result of these differences, national Competent Authorities continue to differ in their evaluation of the environmental implications of the large scale cultivation of GM herbicide resistant crops. A resolution of these conflicts would require agreement on a substantive definition of good agricultural practice (cf. Sauter/Meyer 2000: ). Ongoing discussions concerning the reform of the Common Agricultural Policy (CAP), the integration of environmental concerns into the CAP, and sustainable development may offer opportunities to address relevant issues. Common objectives and methodologies also need to be agreed if the introduction of market stage precautions to monitor secondary and unexpected effects is not to result in new conflicts. Furthermore, it will be necessary to develop criteria which can be used to determine which factors, including certain secondary effects, need to be assessed in the framework of the precautionary environmental risk assessment before a marketing permission is given, and which other factors may be assessed later, in the framework of market stage precautions (Sauter/Meyer 2000: ). 5. Interactions with the WTO SPS Agreement: Trade vs. Precaution? In 1947 the Member States of the UN established the General Agreement on Tariffs and Trade (GATT). Subsequently, the Uruguay Round of GATT negotiations was concluded in 1994 and resulted inter alia in the creation of the WTO and the adoption of a binding agreement on trade in agricultural products. The SPS Agreement is intended to prevent that different national sanitary and phytosanitary standards become non-tariff barriers to trade. It therefore introduces restrictions on national standards to protect human, plant and animal life and health. In particular, the measures in question should not be more trade-restrictive than necessary and their application should not result in arbitrarily different treatment. Measures should not be applied in such a way as to create disguised barriers to trade and, with limited exceptions for interim measures, must be based on scientific principles (cf. Arts.2, 5 SPS Agreement; Cosbey 2001). The implementation of the SPS Agreement is overseen by the SPS Committee of member country delegations. The Committee reviews notifications of national measures, develops guidelines and discusses trade issues. If member countries disagree on the conformity of trade restrictions with the SPS Agreement, they may take recourse to the WTO dispute settlement mechanism which can authorise the damaged party to use trade sanctions against an infringing country. This possibility means that WTO rules assume a quasi compulsory character. In establishing whether trade restrictions are justified, the SPS Agreement refers to three international standard setting

13 The Deliberate Release Directive 13 bodies; the Codex Alimentarius Commission (CAC; food safety), the International Plant Protection Convention (IPPC; plant health), and the Office International des Epizootes (OIE; animal health). Except for certain interim measures, member states may not introduce requirements that are more trade restrictive than internationally agreed standards without scientific justification (cf. Art.3, SPS Agreement). Because the CAC is one of the institutions providing reference standards for the WTO SPS Agreement, it plays an important role in interactions between the SPS Agreement and the DRD. Interactions between the DRD and the WTO SPS Agreement primarily revolve around the different meanings given by the two institutions to the concept of precaution. For the DRD precaution is a fundamental concept that influences not only the Directive s substantive provisions - for example on risk assessment - but also constitutes a kind of raison d être. In particular, the biotechnology rather than product specific character of the DRD reflects the view that safety legislation must accommodate the possibility that science may fail to produce widely accepted evidence showing that deliberate releases of GMOs generally do not pose any specific risks. In contrast, the SPS Agreement only supports a more limited version of precaution. It states in Art.5.7 that [i]n cases where relevant scientific evidence is insufficient, a Member may provisionally adopt sanitary or phytosanitary measures on the basis of available pertinent information [...]. In such circumstances, Members shall seek to obtain the additional information necessary for a more objective assessment of risk and review the sanitary or phytosanitary measure accordingly within a reasonable period of time [emphases added]. Whereas the DRD is based on the assumption that the safety of deliberate releases can, if anything, only be established in a long and unpredictable process, the SPS Agreement merely allows for strictly time limited precautionary measures. The underlying assumption seems to be that it will be relatively easy to provide sufficiently comprehensive, broadly accepted scientific evidence in any given case. The differing versions of precaution give rise to two interactions between the DRD and the WTO SPS Agreement: First, at the level of substantive outcomes, the more stringent interpretation of precaution embodied in the DRD has had a significant negative impact on US exports of certain GM agricultural products to the EU. It has therefore undermined the goals of the SPS Agreement. Second, at the level of rule-making, the EU is trying to export the precautionary approach of the DRD to the SPS Agreement. 5.1 Trade Implications The precautionary approval procedure for the marketing of GM agricultural products in the EU is more rigorous and slower than the more product oriented US approach. Consequently, US producers have been unable to sell various GM agricultural products in the EU, although these products had already received US approval several years ago. More specifically, European maize imports from the US dropped from 86% of EU maize imports in 1995 to 12% in 1999 largely because most GM maize varieties which are cultivated in the US have so far not gained approval under the DRD. The estimated losses in US export opportunities amount to approximately $200 annually. In the case of US soybean exports, the trade damage may be even larger (Vogel 2001: 14). The low approval rate of GM agricultural products in the EU seems to a considerable extent to reflect the precautionary approach of the DRD. Its negative effects on US exports of GM agricultural products appear to have undermined the objective of the SPS Agreement of reducing non-tariff trade barriers.

14 14 Institutional Interaction Differing objectives between the DRD and the SPS Agreement are an important reason why the DRD leads to trade restrictions which may contravene the SPS Agreement. The DRD pursues the dual goal of ensuring a high level of protection and completing the Internal Market. In contrast, the SPS Agreement primarily aims at the removal of trade barriers. Supported by the threat of trade sanctions, it actively promotes this aim, while delegating standard setting to other international institutions, such as the CAC. Due to the focus on environmental protection and regional economic integration of the DRD on the one side, and the emphasis of the SPS Agreement on global trade liberalisation on the other side, there is hardly an overlap of objectives between the two institutions. A second, perhaps even more important cause of the interaction is linked to the fact that the US, which is by far the most important producer country of GM agricultural products, is a member of the WTO, but does not belong to the EU. Global production of the four major, commercially available GM crops - maize, soybeans, canola, and cotton - is heavily concentrated in the US, Argentina, and Canada. In 2000, of the million acres planted with GM crops world-wide, 98 percent were planted in these three major agricultural exporting countries. The respective share of the US alone was 68 percent. In addition, the US has a considerable comparative advantage in agricultural biotechnology research (Sheldon 2001: 2). Given the exceptionally large US commercial interests in agricultural biotechnology, it seems unlikely that the DRD would have been based on a strongly precautionary approach, had the US been a member of the EU. Therefore, US membership in the EU would have prevented the interaction with the SPS Agreement. The crucial role of the US is further illustrated by some of the political responses to the interaction. More specifically, the US has repeatedly threatened to challenge the approval process for GM products under the DRD in the WTO (cf. US Mission to the EU 1999; Yerkey 1999; US Pressures WTO Members on GMOs ). However, there appear to be several reasons why the US has so far hesitated to implement these threats. First, against the background of the adoption of the Cartagena Biosafety Protocol the US and other countries attempted to strengthen the role of the WTO in the field of biotechnology. US negotiators therefore feared that their respective diplomatic initiatives would be weakened by a simultaneous WTO challenge to the DRD (cf. US Mission to the EU 1999a; USDA 1998: 35). Second, the US seems to be afraid that too much pressure on the EU to relax its precautionary approval procedures would further increase consumer and grass-roots political resistance against GM agricultural products in Europe (cf. Aaron et al. 2002; Alden/Mann 2002). But the possibility of a WTO challenge and US political pressure have also led to limited EU efforts to reduce the negative trade implications of the revised DRD. For example, the Commission s recent proposal for a regulation implementing the traceability and labelling requirements of the revised DRD introduces thresholds for accidental GM contamination of non-gm products and even allows for contamination by GMOs which have only been authorised in states that do not belong to the EU. The regulation also rhetorically emphasises the relevance of trade concerns and international developments which are frequently mentioned in the text (#). Yet, the overall significance of these responses remains quite limited. First, the proposed regulation only affects certain aspects of the EU approval process. Second, it seems likely that the Commission s proposals will be tightened during the legislative process. The European Parliament has already called for a lower threshold for GM contamination and rejected the approval of products containing GMOs which have not been approved in the EU (ENDS 2002).