Source: BRIDGES Weekly Trade News Digest

Following hours of negotiations, parties to the Cartagena Protocol on Biosafety managed to reach an agreement on trade-related documentation requirements for commodity shipments of living modified organisms (LMOs) -- albeit one that was deliberately vague about some contentious issues. These requirements are central to the treaty's goal to protect biological diversity and human health from potential biotech-related risks through regulating the transfer, handling, and use of LMOs. The third Meeting of the Parties (MOP-3) rather quickly resolved the other items on its agenda during its 13-17 March session in Curitiba, Brazil.

Parties widely welcomed the accord on documentation requirements for LMOs for use in food, feed, and for processing (LMO-FFP) -- a thorny issue that sunk the previous MOP in Montreal in May-June 2005, and bogged down negotiations of the Protocol itself (see http://www.trade-environment.org/page/infoxch/CPB_MOP2.htm). While many civil society groups also cautiously welcomed the agreement, they attacked the biotech industry and the trade interests of some countries for preventing more stringent requirements. The 'constructive ambiguities' in the adopted text allowed it to secure the support of countries with differing positions in the negotiations.

The key question for the future implementation and effectiveness of the Protocol is now whether the labelling decision is sufficiently broad to persuade biotech exporting non-Parties to join the Protocol.

"may contain" versus "contain" -- leaving the options open

Article 18.2(a) of the Protocol, which stipulated that LMO-FFPs must have labels stating that they "may contain" LMOs and are not intended for release into the environment, also mandated Parties to reach a more detailed agreement on documentation requirements.

Mirroring discussions at previous meetings, much of the debate at MOP-3 again focused on the use of "contain" versus "may contain" in trade-related documentation. Biotech importers, in particular African countries, advocated the former, while biotech exporters pushed for the latter. In the end, the decision provides two options, as Brazil had proposed early in the negotiations. Thus, in cases where the identity of the LMO is known "through means such as identity preservation systems" (a series of documentation and storage-related requirements aimed at guaranteeing that a product retains particular characteristics), the shipment should be labelled as containing LMO-FFPs. In cases where the identity is unknown, the "may contain" label would apply. In both cases, exporters would be required to provide the common scientific or commercial names of the LMOs, as well as information about the specific nature of the genetic modification.

The decision's provisions apply to LMO-FFPs that are "in commercial production and authorised in accordance with domestic regulatory frameworks," but do not specify whether these frameworks refer to the exporting or importing countries. It also does not clarify how countries without a regulatory framework would be covered. In addition, given that the trigger for the "contain" label was not further clarified, the choice of which labelling option to apply will most likely rest largely with the exporter.

A Brazilian proposal to require "contain" labelling of all shipments by 2010 was diluted to a decision to review countries' experiences with the documentation requirements at MOP-5, "with a view to considering a decision" at MOP-6 to require the "contain" label.

Indirect references to accidental presence of LMOs

The documentation provisions are further qualified by an acknowledgement that the expression "may contain" does not require listing of LMOs of species "other than those that constitute the shipment." This article marked a compromise on the question of the extent to which the rules should also cover the 'adventitious' (i.e. accidental, non-intentional) presence of LMOs in shipments.

The African countries in particular had advocated strongly for the broader scale, which would effectively shift the burden of testing for accidental presence to exporting countries. The EU would have preferred at least a reference to nationally-determined thresholds for adventitious presence, which would have provided multilateral backing for its existing domestic legislation. These proposals were met with opposition by New Zealand and Brazil, both strong supporters of further farm trade liberalisation.

The final wording of the decision seemed subject to interpretation -- some felt it did not cover adventitious presence, while others perceived it to apply to the accidental presence of all LMOs. Most non-governmental observers adopted the view that adventitious presence would be covered for LMOs of the same species (such as different types of genetically modified soy), but not for other species (such as GM corn in shipments of GM soy).

Mexico concerned over trade with NAFTA parties

Last-minute changes sought by Mexico, which, along with Paraguay, had been pushing for less stringent documentation requirements and for shifting much of the information sharing to the Biosafety Clearing House (an information exchange mechanism set up by the Protocol), threatened to derail the discussions. Many observers suggested that Mexico was motivated by concerns over the impact of new rules on its trade with the US, as well its trilateral agreement on biotech-related documentation requirements with the US and Canada -- its partners in the North American Free Trade Agreement (NAFTA) -- reached in November 2003, prior to the first Cartagena Protocol MOP. Though both countries are signatories, neither the US nor Canada has ratified the Protocol.

In an effort to accommodate Mexico's concerns, a new paragraph was inserted in the decision to address trade with non-Parties. The text notes that "transboundary movement of LMOs between Parties and non-Parties shall be consistent with the objective of the Protocol," but adds that the specific documentation requirements will not apply to such trade. The new provision also calls on Parties to "encourage non-Parties to adhere to the Protocol." While the immediate implication of this provision is somewhat ambiguous, many delegates felt that the paragraph simply reiterates what is already known, namely that the Protocol's provisions are not obligatory for non-Parties.

Emphasis on capacity building

At the insistence of some countries, particularly from Latin America, the final decision strongly emphasises the need for capacity building to help developing countries implement and benefit from documentation requirements. This reflects the interests of biotech exporting developing countries, such as Brazil and Paraguay, which have alluded to their limited capacities to implement the labelling rules. Some countries fear that the cost of complying with the Protocol could place them at a competitive disadvantage vis-à-vis non-Parties, notably the US, Canada, and Argentina.

Changing of the guard?

Several countries appeared to depart from their traditional negotiating positions at the Curitiba meeting. While at MOP-2, the charge against stringent documentation requirements was led by Brazil and New Zealand, this role now fell to Paraguay, Peru, and Mexico. Brazil, which had produced the initial draft text that formed the basis for the final decision, was widely lauded for its spirit of compromise, while New Zealand appeared to take an increasingly constructive role in the talks.

Some speculated that Brazil's changed stance was a result of the lengthy internal consultation process that had preceded the talks, a stronger role for its environment ministry, and its political stake in concluding the negotiations at home in Curitiba. More cynical voices suggested that Brazil might be relying on gaining a commercial advantage, in particular with respect to other Latin American countries, by having the capacity to install a system that will allow Brazilian exporters to segregate biotech from conventional products.

Parties furthermore agreed to make the heretofore annual MOPs take place every other year. MOP-4 will be held in conjunction with the ninth Conference of the Parties (COP) to the Convention on Biological Diversity, the date and venue of which will be determined at the eighth COP, taking place from 20-31 March, also in Curitiba.

Documents of MOP-3 are available at http://www.biodiv.org/doc/meeting.aspx?mtg=MOP-03.

BRIDGES Weekly Trade News Digest © is published by the International Centre for Trade and Sustainable Development (ICTSD)