Case Study Example: Canada and Australia Salmon Importation

The dispute between the two countries emerged in the year 1975 when fresh salmon import ban was imposed by Australia under quarantine regulations so as to avoid attack by diseases into Australian fish market. Most of the Australian Salmon imports came from Canada which its value in 1995 was about 52 million dollars. The Australian Salmons had a great in Japanese markets and others all over the word for providing premium products due to its environmental regulations. However, the dispute arose between the two countries in the 1990s due to the Australian ban where Canada argued that the prohibition was not justifiable and Australian stated that the ban was based on the health issues (Thorn and Carlson, 1999).

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The case officially began in October 1995 with Canada requesting for consultation. It alleged that Australian ban on the importation of Canadian salmon was not as per SPS Agreement and General Agreement on Tariffs and Trade in the year 1994. Following this request, a DSB formed a panel in April 1997 while the European Communities, United States, Norway and India retained their third party rights. Within one years time, the board had started circulating its report which showed that Australia ban was inconsistent with some articles like 2.2 and 5.1 of the SPS Agreement together with nullifying some benefits accruing to Canada as per the agreement. The dispute was not easily solved since Australia filed a report to the WTO appellate body to appeal the findings of the panel. The appeal body reversed the jury findings of the article 5.2 and 2.1 of the SPS agreement, however; they found that Australia had acted differently regarding some articles in the accord like 5.5 and 2.3. Finally, Australia was told to lift the ban on the Canadian import Salmons and quarantine requirements for other species of fish (Thorn and Carlson, 1999).

In 1999 Australia published an article which was known as Import Risk Analysis which highlighted some health risks associated with the importation of fresh, chilled and frozen salmon. They also modified their import legislation quarantine where they only allowed non-heated Salmons to be imported and also to leave Australia quarantine facilities just in case the salmon were in consumer-ready form. In this regulations, Australia was acting according to the SPS agreement in Article 5.6 which allowed them to take the necessary protection measures and also bearing in account the economic and technical feasibility. The Australian Quarantine Inspection Service (AQIS) was not a proper risk assessment body according to claims made by Canada in that there was some baseless consistency in the what Australia addressed the disease risks on imported salmons compared to other imported fish like the ornamental fish which led Canada to view the ban as trade restrictive rather than achieving the Australian levels of health protection(Thorn and Carlson,1999).

In 2000 the two countries came to an agreement, and they also made some changes in the measures that were inconsistent to the WTO. This, however, did not mean that Australia was going to be less aggressive on the regulations which would bring about health risks to the consumers of the imported salmons. According to the WTO, each participant country sets their rules or quarantine on the imported consumed goods to address the issues of health risks. Nevertheless, they are not allowed to hinder trade with their set rules in because the freedom to make their quarantine measures is meant to protect their consumers. This also meant that the regulation risks imposed on one imported product could differ from the other imported goods this is because different consumer goods pose different health risks(Winickoff et al. 2005). Hence Australia placed higher regulation measures on the salmons since most of them came where they were ready to be consumed posting more health risks compared to other fresh imported fish this was under Article 5.5 of the SPS Agreement. Canadian quarantine contention was rejected by the implementation panel since it wanted all the measures posted on the imported fish to be similar and to add quarantine measures on the exotic disease as well as those diseases endemic in some areas in Australia (Winickoff et al. 2005).

The dispute excited a lot of internal stakeholders which was reflected on the high level of public interests as well as the media. Victorian trout farmers, Recreational Fishermen, and Tasmanian Salmon Growers among other stakeholders were highly interested in the dispute proceedings since they were directly affected by the rulings of the dispute. Regardless of the dispute, the implementation panel upheld the Australian right to impose its level of protection to minimize the health risks also they were allowed to set measures above the international standards. Australia maintained that the sanitary measures should always be high in that it helps to minimize the health risks to lower levels that are easily manageable and not establishing zero risks. The Commonwealth government was also urged by the WTO not to adopt the zero risk approach since it will be almost impossible to achieve it and it will erupt more dispute not to mention it will hinder trade in most countries. Also, the sustainability of the zero risk approachs hard to carry out since a lot of restricting measure will be put in place (WHO, 2006)

To justify that the Australian ban was based on the discrimination of some countries to trade the Appellate Body brought to the table five arguments which never proved much either. These arguments included: the Australian government did not assess the risk before imposing the ban, different levels of health protection that they were seeking for salmon and herring. There was the substantial difference in the pursued levels of health protection, the report that they drafted to tolerate Salmons import was revised in 1996 and lastly was that Australia did not have internal controls on Salmons compared to what it was imposing on the other countries(Guzman, 2004). These arguments were baseless and did not bring any impact on the Australian ban neither did they prove that it discriminated trade against Canada rather than protecting the consumers against imported diseases. After the two countries came to an agreement on what was to be introduced to Australia the dispute ceased, and they all worked harmoniously to satisfy each others demands. Canada economically benefited by importing their Salmons to Australia, and this also it created job opportunities for their people. This has increased and expanded the Australian salmon fish markets since they easily satisfy the market and have enough for local consumption. Australia is globally known for its premium foods due to the health regulations they impose on their imported foods making them be trusted by most of the fish consumers worldwide. Despite the two countries being business partners, Australia does not allow importation of preheated Salmons in the country they only allow the fresh salmons to be imported, and also they processed under quarantine measures to maintain the health standards (Goh, 2002).

Through this dispute between these two nations, it enabled the Commonwealth government to do away with their zero risk approach and placed unit as minimal risk approach. This has created more trade opportunities between these countries. This is because with the minimal risk approach it is easy to sustain it and also they can easily monitor the entry of any foreign disease and take quarantine measures as soon as possible. Also, it has enabled most countries to set their health protection measures that a state wants to minimize the entry of imported diseases sometimes these regulations can be higher than the international standards. In such cases, the country must have some reasonable justification for the reason for such measures to be put in place. In cases where there is an outbreak of a killer disease, a country is entitled to take such protective action to safeguard their territories. However, in such cases, the country is supposed to follow the necessary process so as not to prohibit trade among the countries. The WTO also allows the states to make their health regulations, but before imposing a ban, they should take into consideration the effects of their economy as well as the countries they are trading with. Also, the health regulatory measures to be imposed does not have to be symmetrical among all the imported products this is because different products like the case of fish pose different health risks(Goh,2002). For example, the processed salmons that are ready to be consumed can constitute a significant threat to the health of the people compared to the freshly imported Salmons which will be treated under maximum supervision and quarantine. Hence with the processed salmons Australian will not have much control over it once it has been imported this led to the country only allowing the fresh Salmons only to be imported. Since with the fresh Salmons, its easy to detect any diseases on it and to take the necessary quarantine measures to avoid the spread of the disease. The chilled and the frozen Salmons are only imported under severe measures where they undergo multiple tests to ensure they are safe for human consumption and this occurs in rare cases. This can be attributed to the reason why Australian foods are majorly preferred especially by the Japanese due to the high levels of standards imposed on them. This has made Australia be the largest exporter of fresh fish or processed fish globally (Guzman, 2004).

In conclusion, the Australian salmon ban has and will always remain a major point of reference in the countries that carry out the trade on the consumer goods. This is because it has taught a major lesson that health comes before business for one to remain at the highest levels in the food industries. It also enabled other countries to set their regulations to minimize the risk of imported diseases instead of having a zero risk approach.

References

Goh, G., 2002. Australia's Participation in the WTO Dispute Settlement System. Fed. L. Rev., 30, p.203.

World Health Organization, 2006. Building foundations for eHealth: progress of member states. World Health Organization.

Winickoff, D., Jasanoff, S., Busch, L. and Grove-White, R., 2005. Adjudicating the GM food wars: science, risk, and democracy in world trade law. Yale J. Int'l L., 30, p.81.

Thorn, C. and Carlson, M., 1999. The agreement on the application of sanitary and phytosanitary measures and the agreement on technical barriers to trade. Law & Pol'y Int'l Bus., 31, p.841.

Guzman, A.T., 2004. Food fears: Health and safety at the WTO. Va. J. Int'l L., 45, p.1.