by Anastasia Laitila

Summary in English of
NIGD Discussion Paper 5/2004

For some time Member Countries of the European Union and their peoples have been suspicious of genetically modified foodstuff. In 1996, the EU put into effect a strict system of approval which has slowed down market access for GM products and crops. After that, eighteen genitically modifed foods have been approved into the EU market under the novelfood directive (EC 258/97) as well as some vaccines and flowers. During 1996 to 2003, eight GMOs were approved as feed.

Since 18 April 2004, genetically modified food and feed have been regulated with the same directive (EC 1829/2003), under which two varieties of maize have been approved, one of them also as feedstuff.

The United States, the world's greatest soy producer, was upset with EU policy as they lost a big market area. In addition, EU regulation set an example to other countries: Eastern European and Latin American countries (excluding soy producing Argentina, Uruguay and Chile) were against food aid containing GM food and tried to put up regulations for GM food imports. African countries suffering from famine refused to accept US genetically modified food aid during the 2000-2002 crisis, and some of them still won't accept it (Sudan & Angola). US President George W. Bush thought this was a result EU's example and even accused the European Union of starving Africa. In his speech at a biotechnology conference in Washington, D.C. on 23 June, 2003, he declared, "For the sake of a continent threatened by famine, I urge the European governments to end their opposition to biotechnology."

In other words, behind all this politics of GM food lies the expanding biotech industry. New products and varieties have to be introduced, and if people are unwilling to buy, there are other ways to introduce GMOs, such as exporting GM food as food aid. As resistance to that as well has grown too uncomfortable, the US filed in April 2003 a complaint in the World Trade Organization against EU GM regulation.

Two thirds of world trade is governed by multinational corporations: one third is trade between MNCs and two thirds is trade within them (fusions etc). This means trade disputes are often about the interests of corporations. As an industry or a corporation cannot file a case in the WTO it has to lobby it's country of origin to do that for the corporation. For example the American Soybean Association (ASA) promotes market access for US soybean exports all over the world. It does this by lobbying the US government to pressure other countries not to set up import restrictions acknowledged in the United Nations Biosafety Protocol and force poor farmers to use patented US GM seeds and pay royalties for them. US soyproducers' interests are presented to conflict with the Biosafety Protocol's precautinary principle and the World Trade Organization is used as a tool by the biotech industry to realise these interests. WTO moulds international law just by the threat of the dispute settlement mechanism.

The WTO, set up to create common rules and promote international trade, is actually a patron for the biggest monopolies. The organization has been described to be "more democratic than the UN" because each country has one vote. So far there hasn't been a single voting in the WTO and it's actual power derives from the dispute settlement mechanism. Dispute settling is an effective deterrent which moulds national legislation to become "WTO consistent" instead of countries keeping their other international commitments such as Multilateral Environmental Agreements.

US actions are threatening to force GM food to European markets with WTO sanctions against European consumers' wishes. According to the Eurobarometer of 2001, 70 per cent of the Europeans are against GM food and 94 per cent wants to be able to choose whether to eat GM products or not.

The WTO provides a useful vehicle for the biotech industry since its sanctions make it more powerful than the UN Biodiversity Convention and Cartagena Biosafety Protocol (supplementary agreement to the Convention) which make it possible to impose GM restrictions in the first place. Cartagena Biosafety Protocol came into effect in September 2003, and is the first agreement that officially seeks to protect biological diversity from the potential risks posed by living modified organisms resulting from modern biotechnology. US - not a party to the Protocol - doesn't want to acknowledge it's validity.

Therefore it can be questioned whether the trade on GM food will benefit the hungry or even the US farmer - or is it reallly about whether the UN will be a legislative body in the future? GM food is a central part of global governance and the debate on international institutions.

The UN has two agreements that could stop the US dispute on EU GM regulation: the Biosafety Protocol and the International Treaty on Plant Genetic Resources for Food and Agriculture. Both agreements are the result of multilateral negotiations and supported by over 100 countries - not just the European Union. WTO disputes are settled by a panel of three people, who mould international legislation with trade expertise. It's not only a question of food safety but the whole global decision-making system and whose interests it promotes, as well as a state's right to put up national regulatory frameworks to protect public health and the environment.

This discussion paper is about the EU and US dispute on the import restrictions on genetically modified foodstuff but the actual purpose is to point out through case studies how MNCs and industries use the WTO as a tool to promote and strengthen their own interests. On the other hand this case is also a good example of how some countries promote trade liberalisation without always wanting it themselves. For example the EU has been driving for more liberalisation through the WTO but is still trying to restrict market access for foodstuff (such as hormone treated beef and genetically modified organisms).