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Beef Hormone Dispute: Domestic Environmental Agenda and Global Trade

Beef Hormone Dispute: Domestic Environmental Agenda and Global Trade Essay Example

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Other
Document type:
Research Paper
Level:
Undergraduate
Page:
10
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7085

Abstract

The World Trade Organization or the WTO which was created after the Uruguay Round of multilateral trade negotiations in 1995 has had an important role to play in freeing up global trade and writing the rules for international trade amongst nations. This organization which grew out of the earlier General Agreement on Tariffs and Trade or GATT has enjoyed the support of the developed nations of the world and has an enhanced ability to compel nations to alter their domestic regulations in order to comply with the WTO and GATT accords. However, disputes amongst nations and political groups do occur, resulting in an occasional rethinking about the limits of free trade, the working of the WTO and the ability of nations to impose their societal values on other nations. The beef hormone dispute between the United States and the European Union or EU is one of such trade disputes in which the EU refused to agree to the import of beef which had been produced from cattle whose growth had been assisted by the application of natural or artificial hormones. The EU cited the precautionary principle, linking such beef with a possible danger to public health in applying the ban, while the United States remained adamant that beef produced through the use of such methods was safe. A WTO ruling and the subsequent appeal resolved the matter in favour of the United States, but the EU refused to lift the ban, insisting that it had higher standards associated with the protection of public health then what were considered to be adequate by the WTO, resulting in retaliatory duties being imposed by the United States against the EU. This essay takes a look at the beef hormone dispute involving a conflict of the societal values in the United States and the EU.

Contents

1.1 Introduction 3

2.1 Beef Hormones and Evidence of their adverse

Impact on Human Health 6

2.2 The Use of Beef Hormones in Meat Production 7

2.3 Biological, Sociological and Health Issues 8

3.1 WTO and the Beef Hormone Dispute 9

4.1 Response of the European Union to the WTO Position 10

5.1 Retaliatory Sanctions by the United States government 11

6.1 Conclusion 11

Appendix A – Assignment Question 12

Works Consulted 14

Works Cited 18

Quotations and Drafts etc 21

1.1 Introduction

The so called “Beef Hormone Dispute” between the European Union, or EU and the United States as well as Canada commenced in 1985 when the EU released a directive which prohibited the importation of all meat from animals which had been treated with growth stimulating hormones to rapidly increase their weight prior to being slaughtered for human consumption (The United States Mission to the European Union). The initial directive of 1985 was again readopted in 1988 and this made it impossible for meat produced by United States and Canadian producers to be sold in the European Union. The ban by the EU was made under the precautionary principle when probability based risk assessment related to possible impact of practices on human health reaches its limit (National Consumer Council, UK). Beef hormones are routinely and widely used in the United States of America and Canada to rapidly fatten up livestock prior to its slaughter and the sale of its meat (Friends of the Earth, International). The Europeans prefer the natural method of rearing livestock without the use of any growth stimulating hormones. Consumer groups, animal rights groups and possibly even environmental groups in the EU welcomed and supported the decision and it is quite possible that the EU had been under public pressure to implement such a directive from the farming community in the EU (Friends of the Earth, International). Many individuals around the world will also find it ethically repugnant to use growth hormones to rapidly fatten up animals and to change their natural biology when their ultimate destiny was to be slaughtered for the benefit of humans. The precautionary principle used by the EU to place this ban in order to protect public, environmental and animal health is recognised in Article 5.7 of the Sanitary and Phytosanitary Code of the General Agreement on Tariffs and Trade, or GATT and the definition is considered to be a workable one, although it has been said that this definition can be improved. However, article 20 of GATT also stipulates that (National Consumer Council, UK):

“Nothing in the Agreement shall prevent the adoption or enforcement by any member country of measures necessary to protect human, animal or plant life or health, provided they are not used as a means of arbitrary or unjustifiable discrimination between countries or as a disguised restriction on international trade”.

As a result of this EU decision, the United States government had come under intense pressure from Monsanto, the multinational chemical manufacturing giant which has been producing many hormones for use in agriculture and livestock production and other farming interest groups, which had indulged in intense lobbying on Capitol Hill to try and protect American economic interests (Friends of the Earth, International). A complaint was lodged with the World Trade Organization or the WTO in May, 1996 and Mickey Kantor, the then US Trade Representative who later became a board member of Monsanto was responsible for initiating the WTO action. Canada also lodged a complaint against the EU on its so called protectionist trade policies and the same WTO panel was formed to hear and adjudicate on both the complaints.

On August 18, 1997 the WTO panel which was formed to adjudicate on the dispute found that there was no evidence to suggest that meat produced using hormones to stimulate growth in livestock had any adverse impact on human health and ruled against the EU’s use of the precautionary principle (The United States Mission to the European Union). Although the initial burden of proof rested with the United States to demonstrate that the use of hormones was safe and the application of the precautionary principle illegal, this burden of proof later shifted to the EU, which had to demonstrate that there was a probability that the use of hormones in meat production was unsafe. However, one of the hormones used on livestock which is known as MGA had no international standard or publicly available study which could substantiate its safety and the United States refused to provide evidence related to this hormone, stating that information related to MSG was confidential and proprietary in nature (Eggers). The EU appealed against the decision of the panel and although the appellate body issued a report on January 16, 1998 that modified the ruling of the WTO panel which was first constituted to adjudicate on the complaint, the appellate body also ruled against the EU. In May, 1998 the WTO granted EU until May 13, 1999 to comply with the rulings of the world trade body (The United States Mission to the European Union). The EU refused to comply with the decisions of the WTO, stating that a change was required in the international agreement on trade and on July 26, 1999, the WTO authorized United States to impose retaliatory sanctions against the EU amounting to US$ 116.8 million per annum, an amount which was calculated by the WTO arbiters as being the level of damage suffered by American producers (Friends of the Earth). Since then, the EU has refused to comply with the ruling of the WTO and has been trying to make the ban compatible with the World Trade Agreement, while the United States of America has been trying to force the EU to lift its ban on hormone treated meat. The EU has been suffering US sanctions and has also imposed its own sanctions, while both the parties to the beef hormone dispute have been trying to have their version of the GATT imposed on the world. In 1995 the Codex Alimentarius Commission or Codex — the international food standards body – had controversially adopted standards accepting residue levels of these hormones in meat after the United States chaired the relevant committee and forced a secret ballot. This was something which went against the earlier decision of Codex. The EU has claimed that it has higher standards associated with the protection of public health then Codex.

This essay takes a look at the beef hormone dispute, presenting perspectives associated with the use of hormones for beef production, the WTO system and the GATT agreement. A conclusion is then presented about the ability of a government to restrict the entry of products which it finds to be unsuitable for its citizens in an era of free trade. Opponents of the WTO see the organization as being too powerful and infringing excessively on the sovereignty of member states.

The next section takes a look at the hormones that are used in meat production in North America.

2.1 Beef Hormones and Evidence of their adverse Impact on Human Health

Meat is widely consumed around the world and it is considered to be an important ingredient in a balanced diet for humans. Hence, meat is widely traded internationally between countries and its methods of production differ. In the United States and Canada, growth stimulating hormones which are said to produce leaner meat in cattle which is made to rapidly gain weight through their use enables more economical production to be made possible. However, in the EU, the use of such hormones is prohibited. In 1999, the EC Scientific Committee of Veterinary Measures relating to Public Health presented an opinion which recommended a ban on the use of meat which had been produced from cattle whose growth had been assisted by hormones including naturally occurring testosterone (T), E2-17β and progesterone (Pr) and the xenobiotic compounds (not produced naturally in animals) trenbolone acetate (TBA), zeranol (Z) and melengestrol acetate or MGA (Galbraith). The EU committee considered the toxicology, environmental impact, residues and the abuse of the previously mentioned hormonal compounds in formulating this opinion which has been widely challenged in the United States, Canada and even the United Kingdom. More recently in 2000 and 2002, the European Committee of Veterinary Measures relating to Public Health again reconsidered the issue and refused to revise its original opinion of 1999 despite the criticism. There has been a growing incidence of oestrogen-related cancers in the human population which has been observed and the reason for the opinion presented by the EU committee was a possible link with the use of hormones for beef production. Small residues of hormones were found in the meat from hormone treated cattle which had been slaughtered for human consumption. Laboratory tests indicate that high doses of certain hormones did indeed result in cancerous tumors of the mammary glands and the reproductive tract in laboratory animals (Galbraith). Hence, although no conclusive evidence has been found to establish definitely that there is indeed a link between stimulating the growth of livestock with hormones and the incidence of cancer in humans, it was considered appropriate by the EU to place the ban as a precautionary measure in the absence of any conclusive evidence. Monsanto, the chemical company came out lobbying strongly against the issue because such a ban threatened the huge revenues that this company could have otherwise made from sales of hormones all over the globe. The American habit of pumping chemicals into live animals for 10 – 15 % gain in revenues has since then gone beyond beef production to include milk production and milk producing cows are now injected with recombinant bovine somatrotropin or rbST which is also manufactured by Monsanto. Such milk has also been banned in the EU and it is very likely that further bans may occur as genetically modified organisms are developed (Friends of the Earth, International). However, it is certainly repugnant that for enhanced profits of only 10 -15 % and the potential sale of millions of dollars worth of agrichemicals by Monsanto, American farmers have disregard considerations related to human health and the ethics of not mal-treating animals by changing their biology and biochemistry. It is even worse that the WTO, which is an American invention is planned to be used to impose American morality and societal values on the rest of the world.

The next two sections discuss the use of the previously mentioned hormones and the biological, sociological as well as health issues associated with their use.

2.2 The Use of Beef Hormones in Meat Production

In the United States and Canada, the hormone MSG is administered orally to animals, while other hormones are administered through commercial implants made of silistic rubber or compressed pallets which are placed under an animal’s skin at a convenient location such as the upper surface of the ear. The dose level contained in such implants is typically 8–20 mg E2-17β or oestradiol benzoate; 100–200 mg Tor T-propionate; 200 mg Pr; 40–300 mg TBA; 36 mg Z, with MGA administered in the diet at 0·25–0·5 mg / d. Effects of combined implants (E2-17β+Pr; E2-17β+T; E2-17β+TBA; Z+TBA) can be more effective then single hormone implants and castration of the livestock is often used in combination with hormone treatment to gain the maximum possible weight gain prior to slaughtering the animal for human consumption (Galbraith). The implants are supposed to be discarded at the time of slaughtering the animals. The American government has stated that the hormones have been thoroughly investigated by the United States Food and Drug Administration, or the FDA and a regulatory program exists within the United States to monitor their safe use. Because higher doses of the hormones other then the optimal recommended dosage is ineffective in producing further weight gain, therefore there is no economic incentive for farmers to try and increase the safe hormone dose. Animals taken for slaughter are monitored for safe hormone levels and the United States Department of Agriculture, or the USDA provides training in the safe use of hormone implants to veterinarians (The United States Mission to the European Union) and (Kansas State University).

2.3 Biological, Sociological and Health Issues

Whereas the United States Food and Drug Administration has conducted extensive testing on the use of hormones in meat production, nevertheless, it is unclear if a sufficiently detailed study linking these hormones to cancer in humans has been carried out, or indeed can be carried out. The United States government itself admitted that there is no conclusive data available for the impact of the use of MGA hormone (Galbraith) and (Friends of the Earth, International). The use of hormones certainly has an impact on the animal on which they are being applied and in larger doses such use can be adverse for the health of the animal. In the EU, consumers themselves are not in favour of meat produced with the assistance of hormones and farming interests are definitely against the imports because of the competition that local meat production will have to face from the imports. Environmental groups in Europe are also unhappy with hormone assisted meat production. Any government will have required that the consumers should be able to make an informed choice about the kind of meat that they want to consume and a relevant question which should be asked is whether the existing laws related to the labelling of meat in the EU will have been adequate to provide consumers with a choice (World Health Organization)?After all, just how much information can be presented on food labels for consumers to be in a position to make informed choices? Another relevant question which can be asked relates to whether a free trade regime means that a country has a right to impose its values on the rest of the world by, for example, attempting to export pig meat to Islamic countries or cows to the Hindus and claiming that such meat is fully wholesome, nutritious, with no ill effects on humans.? Surely, a democratic government as a representative of the people and has a right to make a decisions for their welfare. Public pressure existed on both the US and the EU. However, the precautionary principle is applicable if any suspicion of links with a higher incidence of cancer is suspected, even to a minimal level of probability because a government has a right to minimise any potential health problems. A 10 – 15 % increase in yield is surely negligible if some suspicion exists about the health hazards of beef produced with hormones. One wonders if the USA and Canada has attempted to export beef that has been produced without the use of hormones to the EU.

3.1 WTO and the Beef Hormone Dispute

A dispute that is brought before the WTO has to pass through a length process of being heard. After the filing of a complaint, a period of consultation commences in which the parties have 60 days to try and resolve the dispute on their own or with the assistance of the Director General, WTO (Cuppett). However, if a solution is not reached, then a panel is appointed to adjudicate on the dispute within 45 days of a request being received. The members of such a panel serve in their individual capacities and cannot receive instructions from any government. The decisions of the panel can be rejected and both parties to the dispute have a right to appeal against any decisions. The EU had used delaying tactics when US raised the issue in the WTO. The US position was that the directives of the EU in regard to the banning of meat produced with the assistance of hormones lacked any scientific evidence and was a violation of the Agreement on Technical Barriers to Trade or TBT. A technical expert group was formed in accordance with Article 14.5 of TBT agreement which ruled in favour of US on the basis of the existing Codex standards. The US then introduced retaliatory measures in the form of 100 % ad valorum duties. The WTO Panel ruled on January 30, 1997 that the EU action was a violation of the Agreement on the Application of Sanitary and Phytosanitary (SPS) Measures, Articles 5.1, 5.5, 3.3, and 3.1. An appeal was launched by both the EU and US in October, 1997. The Appellate Body modified the verdict of the original panel and required that EU should reverse its directives to bring them in line with the GATT agreement, while repealing the right of the EU to continue with its measures if its claims could be supported in a new risk assessment study (Cuppett), (Holmes), (Charnovitz) and (Warren).

4.1 Response of the European Union to the WTO Position

Despite the ruling of the WTO panel and the decision of the WTO Appellate Body, the EU refused to lift its ban on the import of meat from hormone treated cattle. The fifteen month compliance period that was given to the EU by the WTO expired in July of 1999. The EU has been hoping that the WTO will reassess its position in regard to the use of the precautionary principle that it had applied to ban the beef imports from the United States (Cuppett). The members of the WTO panel which had been appointed consisted of members from Australia, New Zealand, Canada and Norway. While members from Australia, New Zealand and Canada supported the US position, the member from Norway sided with the EU position, indicating that regional as well as trading interests could also have influenced the decisions. The EU claimed victory after the ruling of the Appellate Body of the WTO, claiming that it had upheld the right of the EU to retain its ban provided that it could produce sound scientific evidence to back up its decision. It can be concluded that globalization does not induce nations to relax their regulatory standards in order to remain economically competitive (Vogel). The EU has been accepting retaliatory duties on its exports to the United States, without reversing its decision about a ban on meat imports which have been produced through the use of growth hormones. However, such an action does not go well with the obligations of member states to try and trade within the WTO system, even though some improvements in the WTO rules may be necessary (Howse).

5.1 Retaliatory Sanctions by the United States government

The United States government was authorised by the WTOto impose retaliatory sanctions against selected imports from the EU amounting to $116.8 million per annum, a sum which was considered to be equal to the damage suffered by the United States producers as a result of EU action. These duties were imposed in July, 1999 and the United States has continued to try to have the EU ban lifted (Friends of the Earth International) and (Cupett).

6.1 Conclusion

Although developed countries such as the United States and the members of the EU have an obligation to try and support the free trade regime that has come into existence as a result of the creation of the WTO, it is also possible that some rules of the WTO may be required to be better thought out. A democratically elected government can ultimately only reflect the wishes of its people and these citizens do have a right to decide what is good for them and what they can consume as their diet. Even in the present WTO regime, a country can ban imports that it may consider to be contrary to its societal values, provided that it is willing to pay the price. However, a better WTO mechanism needs to be thought out as economically powerful countries should not try to impose their societal values on others in the name of free trade.

Appendix – Text of the Assignment

Summary:

Pages: 16

University, Bachelor’s

Style: MLA

Language: US

Total: $96.00

12 days 11 hours

Assignment extract:

1 page 200-300 word free write or rough draft in either sentences or phrases 2. Create a one sentence thesis statement. 3. Produce a sentence outline: with 5 Roman Numeric points and subdividing to a third level. 4. Create a working title in phrase form of 5 to 10 words. 5. Produce a quotation from final paper in MLA format for «in-text citation» of 1 to 3 sentences Produce a paraphrase from final paper in MLA format for «in-text citation» of 1 to 3 sentences. Do a follow-up of quotation or paraphrase with relevant discussion, include the quotation or paraphrase-use MLA format for «in-text citation». 6. Create a draft of introduction and conclusion of 5 to 8 sentences. 7. Create works consulted page of all sources used-Use MLA format (this is not a works cited page) 8. Create an abstract of the research paper (1 page 120 words) should have a running head and page number. 9. Produce a 10 page final research paper in MLA format 10. Produce complete works cited page. Beef Hormones Research Paper Format Requirements. WORKS CITED PAGE: Double space entries—1st line of each entry should be flush left—indent all other lines 5 spaces Minimum of 10 sources to include at least 3 hardcopy sources. Include Works CITED PAGE in pagination. RESEARCH PAPER: 10 double spaced pages in MLA FORMAT Include TITLE PAGE Font: 12 pt Times New roman Margins: 1″ L,R,T,B—Use Left Justification—Indent 1st line of ea. paragraph 5 spaces Use proper order, wording and punctuation within parenthetical in-text citations. Include page# on each page—FOLLOWING TITLE PAGE For Page header: Place Last Name (DeSilva) + page # on one line in upper right-hand corner.

Works Consulted

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Charnovitz, Steve. “The WTO’s Problematic “Last Resort” Against Noncompliance”. Wilmer, Cutler & Pickering, Washington, DC. 2002. December 1, 2005. http://www.gets.org/Aussenwirtschaft.pdf

Cuppett, Brian Scott. “Case Study on World Trade Organization Dispute Settlement:

European Communities Measures Affecting Meat and Meat Products (Hormones) – Complaint by the United States”. Virginia Polytechnic Institute and State University. 2000. December 1, 2005. http://scholar.lib.vt.edu/theses/available/etd-02052001-155532/unrestricted/CuppettThesis.pdf

Eggers, Barbara. “The Precautionary Principle in WTO Law” Hamburg University. 2001.

December 3, 2005. http://deposit.ddb.de/cgi-bin/dokserv?idn=962930709&dok_var=d1&dok_ext=pdf&filename=962930709.pdf

Friends of the Earth International. “Trade Case Study: Beef-Hormone Dispute”. Friends

of the Earth International. 2001. December 2, 2005. http://www.foei.org/trade/activistguide/hormone.htm

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Holmes, Peter and Young, Alasdair. “Emerging Regulatory Challenges to EU’s External

Economic Relations”. Sussex European Institute. 2001. December 1, 2005. http://www.sussex.ac.uk/sei/documents/wp42.pdf

Howse, Robert and Kalypso, Nicolaidis. “Enhancing WTO Legitimacy:

Constitutionalization or Global Subsidiarity?” Roger Porter, Pierre Sauve, Arvind Subramanian and Americo Zampetti, Eds, Equity, Efficiency and Legitimacy: The Multilateral System at the Millennium, Washington D.C.: Brookings Institution Press. 2001. December 1, 2005. http://faculty.law.umich.edu/rhowse/Drafts_and_Publications/Howse%20&%20Nicolaidis%20Background%20Paper%20_WTO%20Legtimacy_.pdf

Kansas State University. “Agricultural Industry Competitiveness: Enhance the Value of

Kansas Agricultural Goods”. Kansas State University. December, 1999. December 1, 2005. http://www.oznet.ksu.edu/library/agec2/mf2432.pdf

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Consumer View on Implementing the Precautionary Principle”. National Consumer Council, UK. 2000. December 1, 2005. http://www.ncc.org.uk/risk/precautionary.PDF

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and the Globalization of Corporate Power”. North Atlantic Books. 1993. December 3, 2005. http://print.google.co.uk/print?id=psOi7qhjEQAC&pg=PA62&lpg=PA62&dq=Books:+Beef+Hormone+Dispute&prev=http://books.google.co.uk/books%3Fq%3DBooks:%2BBeef%2BHormone%2BDispute%26lr%3D&sig=baQMHBqNGdEmgrQR6VeF2jEAjK0&auth=DQAAAHEAAABMEq8TYBaCo6Vv7uPkhaYV649iDMgr5bWxu4InkBkM6LhOHiKSj8Qeh5Cz4ajfdE9eF2q0gn-Z6eE96boxaXYX5imvQoUWa0F_rCy6Idm8J2Cwf-Qpk2UMk1EMhiSOx_8AvCwLKs7Y3AN5eCaysjwIzhkq_y6IqO_IKUcvAvefIw

The United States Mission to the European Union. “US – EU Dispute on EU Hormone

Ban”. The United States Mission to the European Union. 2000. December 1, 2005.
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Vogel, David and Kagan, Robert A. “National Regulations in a Global Economy”. The

University of California. 2002. December 1, 2005. http://repositories.cdlib.org/cgi/viewcontent.cgi?article=1001&context=uciaspubs/editedvolumes

Warren F. Schwartz and Alan O. Sykes. “The Economic Structure of Renegotiation and

Dispute Resolution in the WTO / GATT System”. The University of Chicago. 2002. December 1, 2005. http://www.law.uchicago.edu/Lawecon/WkngPprs_126-150/143.AOS.wto.pdf

World Health Organization. “Globalization, Diets and Non – Communicable Diseases”.

World Health Organization. 2002. December 1, 2005. http://www.who.int/hpr/NPH/docs/globalization.diet.and.ncds.pdf

Works Cited