STC Number - 159
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Proposal on animal by-products

Maintained by: European Union
Raised by: China; United States of America
Supported by: Australia; Brazil; Canada
First date raised: April 2003 G/SPS/R/29 paras. 40-45
Dates subsequently raised: June 2003 (G/SPS/R/30 paras. 47-49)
October 2003 (G/SPS/R/31 paras. 27-30)
March 2004 (G/SPS/R/33 paras. 53-55)
June 2004 (G/SPS/R/34 paras. 39-41)
Number of times subsequently raised: 4
Relevant documents: G/SPS/N/EEC/103
Products covered: 0511 Animal products not elsewhere specified or included; dead animals of Chapter 1 or 3, unfit for human consumption.
Primary subject keyword: Animal Health
Keywords: Animal health; Equivalence; Food safety; Human health; Risk assessment; Transmissible Spongiform Encephalopathy (TSE)
Status: Not reported
Solution:
Date reported as resolved:

Extracts from SPS Committee meeting summary reports

In April 2003, the representative of the United States stated that EC regulation 1774/2002 would severely restrict or prohibit a range of animal by-products intended for use in feed, industrial or other non-food purposes. He was concerned with the lack of transparency of this regulation given its excessively broad scope, the lack of sufficient time and information given for exporters to comply and the EC failure to adequately address the concerns of third countries like the United States. The European Communities had not provided for a reasonable time interval between the publication of the regulation and its entry into force. While the regulation was published in October 2001, the United States had still not received the full information necessary to comply even through the implementation date was 1 May 2003. The United States had requested a delay in the implementation of the regulation, but had not received a clear response. In February 2001, the United States submitted significant comments in response to the EC notification of its initial proposals. However, the final EC regulation had not addressed its concerns and had also raised other concerns by significantly expanding the scope and opaqueness of the regulation. The United States was also concerned about reports of derogations for certain EC member States without the same derogations being made for third countries, the lack of scientific justification for the regulation and the lack of a risk assessment for the proposed inter-species feed ban. Certain provisions of the regulation exceeded the OIE's recommendation, did not seem to be based on a risk assessment and went beyond a reasonable level of protection, such as the pressure treatment requirement for all mammalian material regardless of species or a country's BSE status.

The representative of Brazil shared the concerns raised by the United States. He noted that some of the by-products affected came from sanitary facilities not inspected by EC authorities as part of Brazil's bilateral agreement on meat exports.

The representative of China indicated that the EC market was one of the largest for China's animal by-products – worth some US$440 million in 2002. EC regulation 1771/2002 had been notified to the WTO while China was still in the process of accession and as such it had not had a chance to comment on the notification. In March 2003, China had finished translation of the regulation, but interested exporters and AQSIQ were still not familiar with the regulation. Therefore, China requested the European Communities to delay the regulation's implementation for two years, to allow China to provide comments by 31 May 2003, and not to reject or destroy any shipment of Chinese animal by-products which did not comply with the regulation's requirements before 1 May 2005.

The representative of Australia noted that a useful technical meeting had taken place with the European Communities on 14 March. Article 30 of the regulation allowed for the recognition of equivalence of certain health measures, and Australia might seek recognition of equivalence based on its favorable animal health situation, in particular regard to animal TSEs and the derogation given Australia with respect to the removal of specified risk materials. Without clarifications and equivalence determinations, Australia would have difficulty in complying with this regulation by 1 May and might seek a delay in the full implementation of this regulation.

The representative of Canada stated that it did not see how practical implementation of this regulation would be possible by 1 May 2003. In addition to the many requests for clarification from third countries still being received by the European Communities, many EC member States were seeking temporary derogations. A patchwork of exemptions and derogations for specific countries seemed to be emerging. A single set of clear rules for all was needed. An additional requirement for third countries was the need for certification from competent authorities for implicated products, which required a complete understanding of the regulation. Canada was of the view that a delay in the implementation of the regulation was warranted and required.

The representative of the European Communities recalled that a number of food crises had occurred in the European Union in the past ten years and as such protection measures needed to be strengthened to avoid new crises. In this context, the draft regulations aimed to ban the recycling of dead animals, to offer alternatives to denaturation, to take account of environmental requirements, to control traceability of sub-products and to simplify the patchwork of existing legislation. In response to comments received, the European Communities had organized information meetings on 13 November 2002 and 28 March 2003, and had produced an explanatory document. Third countries had had sufficient time to comment on the 24 November 2002 notification. The measures were based on solid science, even though no formal risk assessment had been conducted for each chapter of the text, and the European Communities was willing to make all relevant information available to trading partners. The economic impact of the measure was up to each country to judge. Certain EC member States and third countries had expressed concern over the date of entry into force of the regulation. As a result, the EC Commission was studying transitional arrangements which would enable temporary flexibility on certain provisions. Any temporary flexibility or new measures on certification of third country products would be decided on and notified to WTO Members with a new deadline for comment.

In June 2003, the representative of China stated that China had submitted comments on a new EC regulation on animal by-products, but had not received any reply from the European Communities. He observed that China had not had the possibility to comment on the EC regulation when it was first notified, since China had not been a Member of the WTO in 2002. He also noted that most Chinese exporters were small and medium enterprises, and that they would need a transitional period of two years to adjust to the new EC regulation.

The representative of the United States said that the concerns he had raised at the last SPSCommittee meeting regarding the EC regulation were still valid.

The representative of the European Communities reported that this issue had been discussed by the EC Trade Commissioner in China. He confirmed that the comments made by China would be carefully examined and that China would receive a response. The European Communities would take a flexible view on transitional measures for third countries.

In October 2003, the representative of the United States stated that despite bilateral technical discussions on the EC animal by-products regulation, disruption of US exports of pet food was likely. He urged the European Communities not to implement certain measures contained in the regulation until scientific risk assessments had been performed.

The representative of Canada welcomed the decision to postpone implementation of the animal by-products regulation for third parties beyond 1 May 2003. The regulation necessitated major adjustments in processing procedures for countries who exported to the European Communities. EC member States benefited from 16 transitional measures to allow them to adjust to the new regulations, and Canada asked to also benefit from such transitional measures.

The representative of China requested a transitional review of the regulation and continued bilateral discussions.

The representative of the European Communities explained that transitional measures had been adopted for EC members States and additional time for compliance for all third parties allowed until 31 December 2003 (EC 1812/2003). Certification of imports had been reviewed and notified. The European Communities had decided to offer targeted transitional measures to third countries on a case-by-case basis. A technical agreement, based on comments received from Australia, Canada, China and the United States, would be notified shortly. The European Communities was awaiting the conclusions of a scientific review to produce the risk assessment, that would be available in February 2004.

In March 2004, the representative of the United States stated that his country remained concerned about the significant trade disruptions that could result from the implementation of EC regulation 1774/2002 on 1 May 2004. This regulation was notified as G/SPS/N/EEC/103 but questions on its implementation remained even though the European Communities had granted a one-year delay in its enforcement. The regulations would enter into force in less than six weeks time but the European Communities had not published the final text of the regulation and the US request for a risk analysis had gone unanswered. He urged the European Communities to clarify the remaining implementation questions and to delay enforcement of the regulation.

The representative of Canada stated that although the European Communities had extended the implementation of the regulation for third countries to 1 May 2004, it shared the concerns of the United States. Canada requested that the European Communities provide clear information on its plans to formally adopt the derogations and provide details of any other transitional measures that had been or would be granted to third countries.

The representative of the European Communities recalled that he had announced the implementation of transitional measures in the June 2003 Committee meeting. This proposal introduced new provisions that required EC member States to provisionally accept imports from third countries. With regards to the risk analysis, the European Communities was awaiting results from its Scientific Committee on Food Safety and a report would be available at the end of March. The second postponement of EC regulation 268/2002 and delayed implementation of EC regulation 1674 should enable trading partners to adapt to new conditions for certification of imports into the European Communities. The European Communities was also studying the possibility of adopting measures regulating the use of gelatine, collagen and other products destined exclusively for technical and industrial applications and banning their use in food, cosmetic, pharmaceutical and medical products. A draft bill had been submitted to the permanent committee this week and the European Communities would keep the United States and Canada updated on this issue.

In June 2004, the representative of the United States drew attention to EC Regulation No. 1774 which imposed new requirements on gelatine, tallow, pet food, yellow grease and other animal by-products not intended for human consumption. This regulation had been implemented on 15 June 2004, although product could arrive in the European Communities as late as 15 August 2004. He reported that while consultations had lead to derogations on hide, skins and tallow, the United States continued to be concerned about other provisions of the regulation, particularly those related to pet food and yellow grease.

The representative of Canada expressed satisfaction that the European Communities had adopted two transitional measures requested by Canada. He commented that since these complicated regulations had been put in place, the European authorities had indicated that a flexible enforcement strategy would be implemented until 15 August 2004. Although no problems had yet been reported by Canadian exporters, problems could arise with the end of "soft" enforcement in August.

The representative of the European Communities commented that based upon on-going consultations with the United States and Canada, the European Communities had modified the regulations to include justified exemptions. The EC regulation allowed cooking oils (yellow grease) to be used for animal feed only when they came from the food industry and only when a reliable system of traceability had been established. Imported used cooking oils intended for technical purposes remained authorized without restriction. The use of animal carcasses judged unfit for human consumption in pet food had been prohibited based upon scientific information which indicated that the BSE epidemic had spread through recycling of infected bovine material in bovine feed. A waiver had been implemented for the use of wild fish protein for feed for fish in fish farms. The European Communities indicated a willingness to discuss implementation of this regulation with Members concerned about potential trade restrictions.