WTO Rules Help to Combat
Illegal Food Trade, DDG Paugam
·
WTO
rules allow members to exercise control over their borders and enforce their
trade laws, leaving less room for illegal trade.
·
Virtual
agriculture symposium titled “Illicit Trade in Food and Food Fraud”
·
Illegal
or illicit food trade typically refers to food fraud — selling sub-standard
food products and ingredients — and food smuggling — undertaken to avoid high
import and export tariffs in certain economies.
Speaking
at a virtual agriculture symposium titled “Illicit Trade in Food and Food
Fraud” on 11 December, Deputy Director-General Jean-Marie Paugam
emphasized that the WTO rulebook brings a legal framework to international food
trade, helping to combat illicit trade. He said: “By definition, our DNA is
legal trade. Strengthening the WTO is the first way to combat illicit trade.”
Highlighting
the WTO's unique role in promoting open and legal trade, DDG Paugam said WTO rules allow members to exercise control
over their borders and enforce their trade laws, leaving less room for illegal
trade. “Like in physics where you have matter and antimatter, we (the WTO) are
the matter of legal trade, and illicit trade is the antimatter,” he said.
Illegal
or illicit food trade typically refers to food fraud — selling sub-standard
food products and ingredients — and food smuggling — undertaken to avoid high
import and export tariffs in certain economies. According to the Transnational
Alliance to Combat Illicit Trade, the annual economic loss resulting from food
fraud is USD 30-50 billion.
DDG
Paugam said an important aspect of WTO activities is
encouraging members to lower trade barriers as lower prices for legal goods can
be one of the good ways of reducing the incentive for illegal trade, although
“one size doesn’t fit all”.
The
WTO's Agreement on Sanitary and Phytosanitary Measures (SPS), the Agreement on
Technical Barriers to Trade (TBT) and the Agreement on Trade-Related Aspects of
Intellectual Property Rights (TRIPS) lie “at the heart” of the WTO engine in
the fight against food fraud, said DDG Paugam.
The
SPS Agreement allows governments to regulate food imports based on science and
risk assessment techniques. It also enables them to ensure imports conform with
national rules and regulations. Illegal practices, such as dilution or
substitution of ingredients and concealment of product contents, and
enhancements to good practice can be addressed through this regulatory
framework, he explained.
The
TBT Agreement also allows governments to address illegal practices, such as
false and misleading food labels, he added.
The
TRIPS Agreement protects the intellectual property content of traded goods and
serves as a vital tool in fighting the counterfeiting of food, beverages and
agrochemicals.
DDG
Paugam highlighted other WTO agreements that also
help to tackle illegal food trade. Three WTO agreements directly regulate a
wide range of border operations, with the aim of facilitating trade and weeding
out fraud, namely the Customs Valuation Agreement, the Pre-Shipment Inspection
Agreement and the Trade Facilitation Agreement, he said.
DDG
Paugam underscored the need to update the WTO
rulebook and to strengthen open trade as a means of fighting against illegal
food trade.
He
underlined the importance of ongoing agriculture negotiations, which aim to
reduce excessively high tariffs and trade-distorting subsidies, and to address
import and export restrictions. Trade opening can reduce the incentives for
smuggling and illegal trade, he said.
Looking
forward, DDG Paugam said the upcoming 13th
Ministerial Conference in February 2024 is expected to provide “the future
direction of negotiations in terms of market opening and other areas which
would help minimise the cost of legal trade and optimise its benefits.”