Fratini Vergano

EU’s Product Environmental Footprint (PEF) initiative: Fratini Vergano report

The EU’s Product Environmental Footprint initiative and the potential impacts on international trade
Trade Perspectives by Fratini Vergano, European lawyers,  Issue No. 20 of 6 November 2015 (via email); In relevant part, the Commission’s initiative intends to remedy to the following problems: (i) the lack of a common definition of ‘green product’; (ii) the unnecessary costs for businesses caused by the proliferation of footprint methods, as well as the impact on the free movement of products that such proliferation stands to have; and (iii) the lack of consumers’ trust in ‘green claims’ which, according to the Commission and the OECD’s “Environmental Claims – Findings and Conclusions of the OECD Committee on Consumer Policy” are “becoming more superficial and vague in their use of terminology”. The PEF has thus been conceived as a method to measure life cycle environmental impacts, based, according to the EU Commission, on existing LCA approaches and international standards. The PEF methodology requires that Product Environmental Footprint Category Rules (hereinafter, PEFCRs) be developed to allow comparison of environmental performances between similar products (i.e., products within the same ‘product category’, which is defined as group of products, including services, that can fulfil equivalent functions), and to ensure that environmental performance is quantified in the same way for similar products. The three-year pilot phase has been conceived....Pilots have been established in sectors such as information technology equipment, leather, photovoltaic electric generation and a range of food and drink products, such as pasta, olive oil, coffee, dairy, meat, fish and wine, inter alia. The PEFCRs resulting from the pilot phase will become the product rules valid under the PEF, to be used by all stakeholders in the sector in the EU or internationally who decide to measure the performance of their products based on PEF......
The TBT Agreement allows WTO Members to adopt measures that result in technical barriers to trade directed (inter alia) at the protection of the environment. However, it also requires that such technical regulations be non-discriminatory, be based on science and be not more trade-restrictive than necessary to achieve the legitimate objective sought..... The EU has already applied or proposed comparable classification and grading systems in sectors such as biofuels, with the establishment of default values for purposes of the calculation of greenhouse gas emissions savings under the Fuel Quality Directive and the Renewable Energy Directive and the  Indirect Land Use Change remains to be seen which factors will be considered for the determination of the PEFCRs, what will be the recommended or required use of the PEF and the PEFCRs (e.g., labelling, incentives, premiums), and whether any such future framework would result in better conditions of competition for certain products of domestic or foreign origin.

Trade policy on palm oil: Fratini Vergano- WTO Environmental Goods Agreement does not include "green by definition, such as commodities...'; WHO Interim Report on Ending Childhood Obesity calls for taxes and marketing restrictions to tackle child obesity

Subject: Trade Perspectives by FratiniVergano - European Lawyers Date: 3 Apr 2015 02:54
Issue No. 7 of 2 April 2015
*             The Environmental Goods Agreement negotiations continue to progress despite the lack of participation by key countries
*             Trade facilitation developments to take place at the multilateral and regional levels by the end of 2015
*             WHO Interim Report on Ending Childhood Obesity calls for taxes and marketing restrictions to tackle child obesity
*             Recently Adopted EU Legislation

The Environmental Goods Agreement negotiations continue to progress despite the lack of participation by key countries; During the week of 16 March 2015, representatives from the 17 WTO Members that are currently taking part in the negotiations for an Environmental Goods Agreement (hereinafter, EGA), gathered in Geneva to participate in the fifth round of negotiations. These negotiations are directed to the conclusion of a new plurilateral agreement aimed at promoting green growth and sustainable development by liberalising trade in environmental goods..... EGA negotiations intend to build on the efforts made in the context of the Asia-Pacific Economic Cooperation (hereinafter, APEC), where, already back in 2012, its 21 Member Economies agreed on a list of 54 environmental goods for which they would reduce import tariffs to 5 percent ad valorem or less by 2015. The APEC list focusses on machinery and electronic products used for environmental protection (such as parts and components of various ‘green’ manufacturing items, products related to waste processing or disposal, and instruments for testing and analysing samples) and is based on 6-digit level HS codes (see Trade Perspectives Issue No. 14 of 11 July 2014). Apart from its limited coverage, the APEC list appears to be of limited accuracy, to the extent that it includes machinery and high-tech goods that, although designed for environment-friendly uses, may not necessarily be the result of an environment-friendly production process. In order to ensure that the list of covered products under the EGA does not suffer from the same shortcomings as the APEC list, it appears necessary that additional criteria (possibly relating to the very products’ sustainability) be established.........The EGA will apply on a most-favoured nation (i.e., MFN) basis, meaning that all WTO Members (including those which did not participate to the negotiating process) will benefit from the agreed tariff reductions once a ‘critical mass’ of WTO Members has agreed to participate. Negotiations were triggered in July 2014 by 14 WTO Members (i.e., Australia, Canada, China, Chinese Taipei, Costa Rica, the EU, Hong Kong China, Japan, New Zealand, Norway, Republic of Korea, Singapore, Switzerland and the US). As of March 2015, 3 more WTO Members (i.e., Iceland, Israel and Turkey) have joined the negotiations, and are, therefore, in a position to drive the process.
The fifth negotiating round reportedly concluded with a compilation of the proposals put forward by most EGA participants on the products that should benefit from duty-relief. In total, countries have proposed that the EGA cover around 600 tariff lines
, divided into a number of categories (relating to, inter alia, air pollution control, waste management, environmental remediation and clean-up, noise and vibration abatement, cleaner renewable energy, energy efficiency and environment monitoring assessment). In practice, these categories include goods as diverse as bicycles, windmills, solar panels, LED monitors, hydro-electric generating equipment, isolation material, water treatment chemicals, and advanced products for waste management and air pollution mitigation. Against this background, it is, at the very least, surprising that the proposed goods do not include goods that are ‘green’ by definition, such as commodities (e.g., palm oil, soybeans, sugarcane and rapeseed) that are available in nature and which can be used, inter alia, for renewable energy production (such as biofuels, which provide for substantial emission reductions when compared to fossil fuels)...........

WHO Interim Report on Ending Childhood Obesity calls for taxes and marketing restrictions to tackle child obesity; In March 2015, the World Health Organisation (hereinafter, WHO) released an Interim Report through its Commission on Ending Childhood Obesity, which calls for taxation and restricted marketing of ‘unhealthy’ foods and drinks to children, in order to help cut childhood obesity. The purview of ‘unhealthy’ foods includes foods that are high in saturated fats, trans fats and salt, as well as sugar-sweetened non-alcoholic beverages and energy-dense, nutrient-poor foods. The WHO Report outlines potential policy options that governments could consider through fiscal policies (such as taxes to reduce the intake of ‘unhealthy’ foods and sugar-sweetened non-alcoholic beverages), the increased intake of healthy foods, and the promotion of physical activity in children and adolescents. The WHO Report further indicates that governments could also take action to implement restrictions on the marketing of ‘unhealthy’ foods to children and adolescents.
According to the WHO Report, addressing childhood obesity requires attention to both developmental (i.e., life-course) and environmental considerations. With respect to the latter, important factors include exposure to inappropriate infant and young child feeding, and the influence of the marketing of ‘unhealthy’ foods directly to children.
The WHO considers that no single intervention can halt the rise of the growing obesity epidemic. Therefore, actions that address both the so-called ‘obesogenic’ environment and developmental factors are required.........