International Trade and Private Standards: Discussions in the WTO and initiatives outside the WTO

Author Name NAIKI Yoshiko  (Osaka University)
Creation Date/NO. July 2015 15-J-046
Research Project A Study on Trade/FDI and the Environment/Energy
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Private standards have emerged and proliferated in various fields, such as food, forestry, minerals, and services. The proliferation of private standards has been positively perceived as a new governance mode by private actors, addressing social, environmental, and ethical issues with which state governments have not fully dealt. However, the increase and fragmentation of private standards raise several problems. For instance, consumers may be confused with multiple private standard systems and do not understand their differences. Producers may not understand which standard is more suitable for their own production and business. What is worse, producers may choose to be certified by a weaker standard system because of loose monitoring procedures. This paper explores varied responses to mitigate such negative consequences from the fragmentation of private standards. This paper first looks at how private standards have been addressed in the Sanitary and Phytosanitary (SPS) Committee of the World Trade Organization (WTO). Then, it examines three other initiatives and approaches outside the WTO, dealing with the increase of private standards: (1) the ISEAL Alliance's Codes for defining credible standards; (2) attempts to examine market impacts and effectiveness of private standards; and (3) the International Trade Centre's "Standards Map" database. This paper concludes by pointing out important topics to be addressed in future research.