Contributing Lawyers

Canada

Cyndee Todgham Cherniak

United States

Susan Kohn Ross

Australia

Andrew Hudson



Canada Requests WTO Consultations on South Korea Importation Ban of Canadian Beef

On April 9, 2009, the Minister of International Trade, Stockwell day, announced that Canada is filing a Request for Consultations with South Korea under the WTO Dispute Settlement Understanding. The dispute related to the continued South Korean importation ban on Canadian beef. In May 2003, South Korea banned imports of Canadian beef after bovine spongiform encephalopathy (BSE) was discovered in a single mad Canadian cow. In May 2007, the World Organization for Animal Health (OIE) officially categorized Canada as a "Controlled BSE Risk" country, meaning that Canada has effective processes and procedures to detect BSE and mitigate risks.

However, South Korea has not lifted the importation ban and is not recognizing Canada's approved status at a recognized international organization. The issues include most-favoured nation treatment as Canadian beef is treated differently (and less favourably) than beef from other countries. Importation bans are prohibited under Article XI of the WTO Agreement. In addition, there are issues under the WTO Agreement on Sanitary and Phyto-Sanitary Measures (known as the "SPS Agreement").

One of the reasons for the importation ban is that South Korea has significant beef farming operations and the importation ban gives the competitive advantage to Korean farmers. In other words, the importation ban is a protectionist measure.

On the other hand, South Korean consumers are concerned about food / health risk and large protests were held in June-July 2008 against the United States - Korea free trade agreement negotiations and an agreement on imports of beef from the United States. South Korea will attempt to justify the importation ban under Article XX of the WTO Agreement as a measure to protect animal life and health. South Korea will also argue that the importation ban is justified under the SPS Agreement.

As a result, the question is whether the South Korean importation ban involves bad protectionism or good protectionism. This case is one that is important to watch as it will establish jurisprudence for international food law - an important topic of increasing importance.

Canadian businesses should monitor the proceedings closely and, to the extent possible, work with Canadian trade lawyers to provide guidance to the Government of Canada in their representation of the interests of the stakeholders.

It is unclear whether this WTO dispute will cause a delay in the Canada-Korea FTA negotiations. The automobile manufacturers will be wishing for bad feelings among the South Korean negotiators. Or - maybe - Canada has realized that the FTA negotiations involve too many concessions and it may be Canada's opportunity to throw cold water on the negotiations.

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