South Africa just filed its first-ever WTO case — but it’s not obvious it wants to win
South Africa just filed its very first complaint at the World Trade Organization (WTO). It’s about import measures the European Union (EU) slapped on citrus fruit in July. What makes the case intriguing is that it’s not obvious that South Africa’s government wants to win.
First, the back story. In its request for consultations, filed last week, South Africa says the EU is stoking fear about false codling moth to practice protectionism, allegedly on behalf of Spain. False codling moth, which thrive in tropical, dry or temperate climates, pose a real risk to fruits, vegetables and other plants. To mitigate this risk, Brussels has started requiring that all imports of citrus fruit undergo cold treatment and precooling procedures. South Africa argues that these “abrupt and radical changes” to the EU’s import regime are unscientific, overly costly to comply with and have doomed those shipments already at sea.
Just another trade dispute over health and safety standards? Not at all. Ask yourself: Why this case, and why now?
South Africa has never been a plaintiff at the WTO, and has no experience arguing about health and safety standards as a defendant, or even as a third party. The request for consultations puts forward no fewer than 14 legal claims, 11 of which concern health and safety standards. This count is somewhat inflated by the interconnections among the claims, reflecting the structure of the WTO’s Sanitary and Phytosanitary (SPS) Agreement.
Still, this is a big, complex, science-based case, not exactly the kind South Africa or any country would want to cut its teeth on as a plaintiff, least of all against the EU, which jealously defends its health and safety measures.
The timing of the case is as interesting as its content. True, the EU’s import measures took effect only in mid-July. But South Africa has been complaining about Europe’s measures on citrus black fruit for many years. These longstanding complaints about citrus black fruit invoke the same legal arguments that are now being made about false codling moth, yet only now has South Africa decided to sue Europe.
Then there’s the fact that this is the first dispute to be filed in Geneva since the conclusion of the WTO’s 12th Ministerial Conference (MC12) in June. Heading into that meeting, South Africa, along with India, fired several shots across the institution’s bow, including proposing a waiver on intellectual property, condemning smaller trade deals known as “plurilaterals” and calling for an end to a moratorium on digital taxes. These submissions talk a lot about developed versus developing country interests. I worry that South Africa’s case over false codling moth is fodder for this narrative.
MC12 kicked several cans down the road, one of which concerns dispute settlement. With a wink and a nod, MC12 made a plea to the members to resuscitate “a fully and well-functioning dispute settlement system” by 2024. I fear South Africa’s case is more about setting the stage for this fight than about exports of oranges to Europe.
This is not to say that South Africa has a weak case. On the contrary, it could win. But win what? For example, South Africa says Brussels failed to give sufficient notice of its new measures. Perhaps, but that horse has left the barn. South Africa also insists that Europe’s import regime is overly trade restrictive. Maybe, but Brussels says the status quo isn’t working, and any alternative regime will impose costs on South Africa’s exports and do nothing for shipments already at sea.
South Africa’s strongest claim may be that the EU’s import regime isn’t “based on” region-specific science, or applies differently across fruits or vegetables, for example, that pose the same risk. But again, this would be a Pyrrhic victory, given that Brussels could drag its feet, not least by putting the case into legal limbo by appealing.
The Citrus Growers’ Association of South Africa has high hopes for this case, perhaps with good reason. My concern is that, win or lose, the government will spin this case as proof that the WTO’s dispute settlement system doesn’t serve the interests of developing countries. This would be wrong, and South Africa knows it.
To see why, let’s go back to South Africa’s longstanding complaints about the EU’s import measures on citrus black fruit. Brazil has sided with South Africa in these complaints, but sees the negotiation of a global standard, on an expedited basis, as being the solution. This would be done under the auspices of the International Plant Protection Convention (IPPC), one of the three institutions from which the SPS Agreement draws. It’s not as flashy an outcome as winning a ruling, but it’s the way to reach a lasting peace in SPS disputes.
Interestingly, the IPPC has its own dispute settlement system, and there’s been talk about using it to solve the case over false codling moth. Brussels should back an expedited negotiation, looking to settle the case in the next 60 or fewer days. This would be in the best interest of South Africa’s exporters, EU consumers, and cast doubt on a narrative that will only hurt the prospects of reforming WTO dispute settlement by 2024.
Marc L. Busch is the Karl F. Landegger Professor of International Business Diplomacy at the Walsh School of Foreign Service at Georgetown University. Follow him on Twitter @marclbusch.