US questions use of sPS-iC pHL in agricultural imports

WASHINGTON expressed concern over Manila’s use of Sanitary and Phytosanitary Import Clearances (SPS-IC) to restrict the importation of certain agricultural products for reasons “unrelated to the protection of life or protection. human, animal or plant health ”.

The United States raised several questions regarding the Philippines’ non-issuance of SPS-ICs to “restrict” agricultural imports as a means of protecting domestic industries at a recent meeting of the Import Licensing Committee of the United States. World Trade Organization (WTO) last week.

Agriculture Secretary William Dar has suspended comments for now until he sees the US document, while Commerce Secretary Ramon Lopez saw nothing wrong with the use of the SPS- IC by Manila as long as it is properly implemented.

SPS-IC is a document issued by the Philippines for inbound imports certified to be free from pests or diseases that could harm the country’s agricultural sector and even human health.

“The United States is concerned that the Philippines is using SPS-IC to restrict imports for reasons
which appear unrelated to the protection of human, animal or plant life or health, ”the United States in its submission to the committee meeting, a copy of which was obtained by BusinessMirror.

The United States noted that the Philippines had made numerous notifications of legislation and regulations regarding import licensing last year.

Citing notifications from the Philippines, the United States said Manila had explained that it used SPS-IC to “ensure that imported products meet standards designed to protect human and animal life or health, to ensure that products are safe for consumers and prevent the spread. pests or diseases of animals ”and are not intended“ to restrict the quantity or value of imports ”.

Domestic supply problem

However, Washington, citing the Philippine Trade Policy Review in 2018, noted that in “certain cases” relevant Philippine government agencies take the current domestic supply into account when issuing SPS-ICs.

Washington has also expressed concerns about “repeated public statements” made by the Department of Agriculture (DA) to use SPS-IC to “periodically block” imports of certain agricultural products during their respective national harvest seasons.

“We are particularly concerned about repeated public statements from the Philippine Department of Agriculture. [DA] that it uses the SPS-IC system to periodically block imports of rice, corn and feed wheat during its national harvest seasons, ”he said.

Washington revealed that it had received “reports of ongoing SPS-IC refusals for no reason since September 2020” for the importation of whole American chickens.

Industry sources confirmed to BusinessMirror that the Bureau of Animal Industry (BAI) has stopped issuing SPS-ICs for whole chickens since the end of last year without any reason being given to them. parties involved.

“We know that DA will not issue SPS-IC for whole chickens for any reason,” Jesus C. Cham, president of the Association of Meat Importers and Traders (MITA), told BusinessMirror . “We interviewed them and they just told us that there was a memorandum that should not be published.”

BAI data obtained by BusinessMirror showed that the last time the agency issued the SPS-IC for importing whole chickens was in June of last year.

Some lawmakers and agriculture officials had argued over the issuance of SPS-ICs for rice imports last year, as commodity purchases abroad have driven domestic prices down in recent years. .

For example, Senator Cynthia A. Villar has repeatedly asked the DA not to issue SPS-IC during the harvest season to manage or even limit the import of rice and thus avoid having an oversupply.

Bureau of Plant Industry (BPI) data obtained by BusinessMirror showed that there were certain months in the past year – such as October and November – that it had issued no SPS-IC for imports of rice.

The BPI earlier told BusinessMirror that it had not suspended the issuance of the SPS-IC for rice imports and that it was “managing” the arrival schedule “to prioritize the distribution of palay / local rice ”.

Dar, Lopez

Seeking to comment on concerns raised by the United States, Agriculture Secretary William D. Dar told BusinessMirror he wanted to “see the document before commenting.”

For the Department of Trade and Industry (DTI), obtaining Sanitary and Phytosanitary Import Clearance (SPS-IC) permits for agricultural imports is “not necessarily” a barrier to trade if properly done. Implementation.

DTI Secretary Lopez told BusinessMirror that requiring SPS-IC permits for agricultural imports is a necessary measure, although the United States calls it a trade barrier.

Lopez said the permits “are non-tariff measures necessary to ensure food security and protect local industry from the entry of plant and animal diseases.”

“He [SPS-IC permit] should be applied to the extent necessary to protect human, animal and plant life and should not be used arbitrarily, ”he said, noting that standards should be subject to science.

“He [SPS-IC permit] is not necessarily a trade barrier unless the measures are used improperly, ”he added.

In the 2021 National Trade Estimate of Foreign Trade Barriers (USTR) report, it was noted that the United States had expressed concerns about the SPS-IC permit requirement. before the WTO at the last meeting of the Committee on Import Licensing and the last meeting of the Committee on Agriculture. year.

The United States, in a WTO document dated April 7, also asked the Philippines to explain the rationale for the SPS-IC system and to detail the laws, regulations and guidelines underlying it. support for this requirement.

“This [SPS-IC permit] the requirement adds costs, complicates the timing of exports and prevents the diversion to the Philippines of products destined for other markets but not sold there for commercial reasons, ”the USTR said. “It also prevents an exporter from reselling an imported product if the importer refuses to accept delivery or abandons the shipment.”

The USTR said the Philippines also did not issue an SPS-IC permit for imported rice and horticultural products, such as American table grapes, chopped potatoes, feed wheat, whole birds. and corn in 2019 and 2020.

Stakeholders, the USTR noted, asserted that the oft-cited reason for not issuing SPS-IC permits appeared to be protecting “domestic producers from import competition”, rather than ensuring that products were suitable for consumption.

Asked what the government did in response, Lopez turned himself over to the DA.

In a previous interview with BusinessMirror, the trade chief supported the removal of non-tariff barriers on imports and their replacement with an appropriate tariff. (Related story: https://businessmirror.com.ph/2021/04/22/lift-non-tariff-barriers-put-proper-tariff-dti/)

Lopez made the statement after the Economic Development Cluster (EDC) ordered both DTI and DA to conduct a study whether the Minimum Access Volume (MAV) system was abolished while setting an appropriate tariff. .

At an EDC meeting last month, Finance Secretary Carlos G. Dominguez III said in an April 20 letter to Senate President Vicente Sotto III that rising prices for major products of basis was due to “government tariffs, low MAV quotas and non-tariff barriers.” trading. “

MAV refers to the certain volume of agricultural imports that are imposed with lower tariffs. In the Philippines, it covers rice, corn, pork, poultry, coffee, and sugar.

Not the first time

This was not the first time that the United States had raised concerns about the Philippines’ SPS-IC system at the WTO.

At the November meeting of the WTO Agriculture Committee last year, the United States raised the issue after the SPS-IC for feed wheat and whole chicken imports from states -Unis was rejected by the Philippines; while the publication of the SPS-IC for US fresh fruits and vegetables has been delayed.

“Pursuant to Article 4.2 of the Agreement on Agriculture, Members shall not maintain, resort to or revert to any measure such as the conversion into ordinary customs duties”, including quantitative restrictions import and discretionary import licensing, ”the US said.

The Philippines responded to questions raised by the United States at the November WTO meeting on COA. “Due to the review of importers’ registrations in light of reports of unfair trade practices and food safety requirements, the issuance of SPS-IC has been halted for rice and other products,” he said. -he declares.

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