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What Are Some Of The Weaknesses Of The WTO? (Case Study Sample)

Instructions:

1) What are some of the weaknesses of the WTO?
2) What did the United States do in response to the EU ban before and after the WTO distributed its final report?
3) Do you think the WTO was effective in handling this dispute?
4) Do you believe the EU should lift the ban? Why or Why not?
THE U.S. - EU HORMONE DISPUTE
For the past 15 years, the United States and the European Union (EU) have been disputing the safety of growth promotants used in cattle. The disagreement over the use of hormones in cattle peaked in 1989 when the EU banned the import of beef from cattle treated with growth promotants, effectively cutting off U.S. exports of beef. The United States has always maintained that U.S. beef from cattle treated with certain approved growth hormones poses no public health risk, and therefore, the EU's hormone ban is unjustified. Numerous scientific studies and evaluations, including those conducted by the EU and CODEX, the international food safety standard setting body, have supported the U.S. position.
Background
On January 1, 1989, the European Union implemented a ban on imports of red meat from animals treated with six growth promotants, both natural and synthetic, cutting off U.S. beef exports to the EU. The products used in the U.S., three natural hormones and three synthetic products, have been thoroughly tested and have been shown to have no adverse effects on human or animal health. The EU, however, continued to publicly rule out an end to the hormone ban, stating that economic, environment and consumer concerns must be considered in addition to the scientific evidence. Therefore, the United States and Canada launched separate WTO dispute settlement panel cases against the EU regime in 1996.
On August 18, 1997, the WTO distributed its final report. In a major victory for the hard-fought Sanitary and Phytosanitary (SPS) Agreement, the panel strongly upheld all the principles argued by the United States, and ruled that the EU ban was inconsistent with the principles of the SPS Agreement. The EU appealed this finding.
On January 16, 1998, the Appellate Body (AB) released its report and firmly upheld the Panel findings. Although EU officials claimed victory because the AB weakened a couple of the Panel findings on specific SPS articles, the AB's bottom line is that the ban is inconsistent and must be brought into conformity with WTO rules. On February 13, 1998, the Panel and Appellate Body reports on the EU hormone ban were adopted by the WTO Dispute Settlement Body (DSB). At the DSB meeting on March 13, the EU announced only that it would implement the Appellate Body finding in "as short a time as possible."
Because the parties were not able to agree on a "reasonable period of time" for implementation, the EU requested binding arbitration. The EU argued for 4 years in which to come into compliance: 2 years to conduct a risk assessment, and 2 years to complete legislative procedures, depending on the outcome of the risk assessment. The arbitrator decided, however, that the EU only needed 15 months, and that is was not necessary to conduct another risk assessment. The 15 months started in February 1998, with the adoption of the Appellate Body report. The deadline expired on May 13, 1999.
For more information on the WTO dispute settlement panel final ruling, see the WTO homepage.
Suspension of Concessions
On July 12, 1999, WTO arbitrators determined that the EU beef ban results in a significant loss to U.S. beef exporters, and that the United States is entitled to suspend tariff concessions covering EU trade in the amount of $116.8 million per year. On July 19, 1999, the United States announced the final list of products from the EU on which the United States has imposed 100 percent ad valorem duties, effective July 29, 1999. The United-States, however, remains willing to discuss the issue of compensation, as an interim step until the EU lifts its import ban.
In May 2000, the European Commission, following an EU scientific committee opinion, proposed to ban definitively the use of estradiol in farm animals both for growth promotion and therapeutic purposes and to maintain the prohibition on the five other hormones on a provisional basis while it seeks more complete scientific information. The Commission stated that this provisional ban would be in compliance with the ruling of the Appellate Body. The Commission's effort to replace its eleven-year old ban with a new "provisional" ban was an attempt to bring it into compliance with the WTO decision. This action was unacceptable to the United States who contended it did not comply with WTO rules.
In November 2004, the EU requested WTO consultations with the U.S. (WTO doc. WT/DS320/1). The U.S. maintains its WTO-authorized sanctions on EU products and does not agree that the EU is in compliance with the WTO ruling as the EU's position remains unsupported by any scientific rationale. The U.S. and the EU continue to explore possible approaches to resolve this long-standing dispute.
THE LATEST UPDATE
EU mulls appeal over WTO growth hormone decision
By Neil Merrett
4/1/2008- The European Commission will consider appealing against this week's ruling by the World Trade Organisation (WTO) that condemns its ban on imports of meat containing growth hormones.
A spokesperson for the commission told FoodProductionDaily.com that the bloc would be reviewing its options regarding the WTO's decision, which has led to markets like the US and Canada imposing additional taxes on some of its foods in retaliation.
EU processors have had to carefully choose the source of their meat supplies as a result of the ban, with pressure now likely to mount at the WTO level for the bloc to drop its objections to the use of the growth hormones.
Trade dispute
The WTO's ruling comes as part of an ongoing trade dispute between the bloc and both the US and Canada over the EU's decision to outlaw meat from both countries that contains growth hormones, because of health concerns.
The organisation initially claimed that as the health concerns were not conclusively backed by scientific studies, the US and Canadian governments could therefore impose custom tariffs on EU food exports like cheeses.
Despite claims made by the EU that there was now a strong scientific basis for the ban, the WTO yesterday ruled that these health concerns have remained unproven and therefore said the ban was not justified under its rules.
With the ban still in place, Canada and the US were therefore not judged to have violated their own WTO commitments as a result and would not be force to drop the custom tariffs.
The Commission spokesperson said that as a result of the verdict, it had failed in lifting the Canadian and US custom charges, though still hoped to resolve the issue at a later date.
The WTO also said Canada and the United States should have re-submitted their complaints in the wake of the 2003 update but that since the EU was still not in compliance, Ottawa and Washington were not deemed to have violated their own WTO commitments.
Growth hormones
Growth promoting hormones are used to increase the weight gain of cattle. Such drugs are not permitted in Europe because of concerns about possible health risks from residues in the meat and other edible parts, though there has been no conclusive testing on the issue.
Previous scientific studies have linked the eating of red meat with specific hormone-dependent cancers in humans.
The European Food Safety Authority (EFSA) was asked by the European Commission to assess any new scientific evidence that emerged since the EU risk assessment in 2002 on natural and synthetic growth promoting hormones (GPH) in cattle. ` red meat and certain hormone-dependent cancers."
The EFSA panel also said that new data published since 2002 confirmed and extended the understanding of the effects of GPHs.
"However, these new data available to EFSA do not provide any quantitative information that would change the understanding of the possible risks to human health associated with residues of GPH substances in meat and meat products," the panel stated. "Consequently the panel concluded that there are no grounds to call for revision of the previous risk assessments.
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Content:


US-EU Hormone Dispute
Name
Institution
Date
What are some of the weaknesses of the WTO?
Some of the weaknesses of the WTO mixed ruling, according to the WTO the US is to continue its sanctions, an on the other hand the WTO permits the EU to maintain the ban on the US beef products (Johnson & Hanrahan, 2010). The WTO acknowledged the fact that the health concerns raised by the EU were not conclusively supported by scientific research (Johnson & Hanrahan, 2010). WTO believes that the health concerns have not been proven, to them the ban was not justified; however, the WTO failed to defend the US from EU claims as the EU continues to ban the import of hormone treated meat without adequate scientific evidence (Johnson & Hanrahan, 2010).
2) What did the United States do in response to the EU ban before and after the WTO distributed its final report?

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