Technical barriers to trade

The average international trade transaction is subject to numerous procedural and documentation requirements which add to the costs of doing business as an importer or exporter and also use up scarce government resources. While these requirements can be necessary to fulfil policy objectives questions are often raised about why and how they are implemented. The Trade Facilitation Agreement (TFA) adopted by WTO Members in 2014 seeks to expedite the movement release and clearance of goods across borders and reduce these trade transaction costs - by an average of 14.3 per cent as estimated by the 2015 World Trade Report. At the same time many WTO Agreements already contain provisions aimed at facilitating trade procedures and avoiding unnecessary costs. The Agreement on Technical Barriers to Trade (the TBT Agreement) is one of these: its provisions on transparency and conformity assessment procedures some of which are applied at the border are of particular relevance in this context. The TFA and TBT Agreements are in fact complementary with the TFA introducing some new requirements/recommendations which are likely to apply to certain TBT measures. This paper maps out the linkages between these two Agreements. It does so with a view to informing TBT officials of the requirements and best practices emerging in the trade facilitation area as well as raising awareness amongst trade/customs officials of existing rules and evolving practices in the TBT area. The 2015 World Trade Report refers to “border agency cooperation” as the main TFA implementation challenge identified by developing countries and also points to the importance of cooperation and coordination between ministries as one of the main success factors. Considering that a significant share of import/export procedures and controls arise from the implementation of TBT measures a better understanding of the linkages between the TFA and the TBT Agreement (as well as other relevant WTO Agreements such as the SPS Agreement) will be crucial for effective implementation. It will also contribute to more streamlined technical assistance activities and raise awareness among TBT officials of the opportunities generated by trade facilitation projects. The procedures and practices of the WTO TBT Committee especially with regards to transparency and specific trade concerns could also be of interest to the future TFA Committee as it embarks on its task of furthering the implementation of the TFA. All these in turn will help reap the expected benefits of the new Trade Facilitation Agreement.

This paper investigates whether TBT provisions included in RTAs differ from those under the WTO TBT Agreement and if they do whether they entail broader commitments. Our analysis covers 238 RTAs of which 171 include at least one provision and focuses on the provisions on technical regulations conformity assessment procedures transparency dispute settlement marking and labelling and sector-specific commitments. We find that all RTAs signed since 2010 systematically include TBT provisions and that the most frequent provisions are those referring to the TBT Agreement and transparency. Moreover even if there are RTAs that include new or broader commitments than the TBT Agreement our study shows that their number remains very limited. For instance relatively few RTAs have included provisions to better implement WTO provisions in the area of transparency or provisions requiring the equivalence or harmonization of technical regulations among the parties or even the recognition of conformity assessment results. RTAs with a dispute settlement provision that applies exclusively to TBT issues are also very few. These RTAs give in general exclusive jurisdiction to the WTO DSM over TBT related disputes. Finally also only a minority of RTAs include provisions on new issues such as marking and labelling or sector-specific provisions typically for electric and electronic products pharmaceuticals or vehicles.

The WTO TBT Agreement obliges governments to use international standards as a basis for regulation yet leaves a degree of flexibility with respect to the choice of standard and the manner of its use. This interplay between obligation and flexibility has given rise to tension in various fora of the WTO. This paper brings together these three distinct strands of WTO work to illustrate core aspects of the international standards debate at the WTO. In our analysis we first briefly outline the nature of the discipline in the TBT Agreement itself; next we describe where and how the discussion arises in the WTO; and finally explore some implications of governance of international standard setting. We propose that greater regulatory alignment could be achieved through a renewed focus on the procedures of setting international standards (the how) and greater emphasis on robust technical/scientific underpinnings of such standards (the what).