The China Banking Regulatory Commission’s (CBRC) guidelines for IT security equipment used in banks (e.g. for cash machines and smartcard chips) was raised as a new trade concern by the United States and supported by the European Union and Canada. The guidelines were issued in December 2014. The members concerned said that some of the requirements were technical regulations or conformity assessment procedures that appeared to go beyond the usual practice for the regulation of information and communication technology (ICT) equipment in the commercial banking sector. One such requirement relates to encryption and the disclosure of source code. China was asked, among other things, to provide the objective and rationale for the extension of the certification and testing requirements to ICT products. It was also important to provide for meaningful opportunity for comment from interested stakeholders, including through a notification to the TBT Committee.

China explained that the rapid development of global information technology and financial innovation had brought new challenges to the banking sector. It was necessary for all governments to strengthen security to protect public interests. China’s guidelines, it said, were consistent with international practice and contributed to the stability of the global financial system. Moreover, in February 2015, the CBRC had published a notice online to answer the main concerns by interested parties.

 

Specific trade concerns

WTO members use the meetings of the TBT Committee to flag concerns over other members’ measures which they believe are causing disruption in the flow of goods across borders. These "specific trade concerns" (referred to as "STCs") can be about new standards, regulations or labelling requirements imposed by the importing country on traders, which can have an impact on both the companies moving these goods across the borders and consumers who utilise them. The total number of concerns raised at this meeting was 55, eight of which were new while the rest were carried over from previous committee meetings.

In addition to IT security issues, members again brought up for discussion plain packaging regulations for tobacco products, labelling of nutritional information on food, and regulations for cosmetics and alcoholic drinks. After hearing from others about the implication of these measures for the daily work of their exporters, members introducing these measures provided further information and explained how they are linked to their health, safety, consumer protection, and environmental objectives, among other things.  A full list of the STCs raised is provided below.

 

Members’ review of the TBT Agreement

Members undertook an annual review of the TBT Agreement. The review is based on a WTO Secretariat report summarising the work of the committee from 1 January to 31 December 2014. This is the twentieth report covering the committee’s activities. It is available here.

According to the report, 2014 was the busiest year for the TBT Committee since 1995, with 2,239 notifications submitted and 47 new STCs raised. This sustained upward trend from 2005 is driven by a growing number of notifications from developing members. In 2014, 80% of TBT notifications were submitted by developing countries. Over the past twenty years, 23,403 TBT notifications have been submitted by 126 members.

Members’ proposals to improve the committee’s work

Members discussed several proposals to improve the committee’s work under the Seventh Triennial Review of the TBT Agreement. These touched upon notifications, regulatory cooperation between members, good regulatory practice and the organization of dedicated thematic sessions on specific topics during the committee meetings.  These proposals were brought forward by Canada, Mexico, Switzerland and Uganda.  

 

Good regulatory practices

Members will continue to discuss a voluntary list of steps and mechanisms that governments may consider when setting, adopting and applying product requirements — known as “good regulatory practices” —  in the next meeting of the TBT Committee. The Chairman put this work on hold due to continued disagreements between members over the need for a disclaimer stating that the voluntary list would not have a bearing on legal disputes in the WTO.
More details

 

Background

The TBT Committee allows members to share information about the challenges they face in implementing the TBT Agreement. These discussions aim to increase the predictability of regulations and standards, increase transparency and avoid — even diffuse — trade frictions down the road. In this sense, the committee’s work has a pre-emptive function. Trade officials, regulators and representatives of standards bodies regularly participate in the committee’s meetings to help improve coherence in government policies and to balance more open trade with the pursuit of legitimate public policy objectives. The full list of observer organizations working with the TBT Committee is here. 

Specific trade concerns: full list.