WASHINGTON, Dec. 8, 2016 - Too many regulatory agencies around the globe take too long to approve genetically modified plant traits, and the result is lost revenue and curbs on innovation, according to a new report that was commissioned by the U.S. and aimed at China.
The report focuses on the “asynchrony” of some international approvals, in which a country is still evaluating a biotech trait long after its trading partners have finished.
The report, titled “The Impact of Asynchronous Approvals for Biotech Crops on Agricultural Sustainability, Trade, and Innovation,” does not name countries specifically, but it was produced as part of the Obama administration’s efforts to work with China on speeding up the way it approves biotech traits.
“The uncertainty imposed by regulatory delays arising from asynchrony can also divert investment in biotechnology R&D away from crops in which research effort could bring benefits to producers and consumers,” according to the report, which was produced by the Council for Agricultural Science and Technology (CAST) at the request of USDA. “Delays translate directly into higher costs in terms of additional testing and reporting requirements and lost revenue from delayed product launches,” the report says.
China, a major importer of U.S. agricultural commodities, is also a source of frustration to the U.S. farm sector because it refuses to begin the approval process of a new biotech trait until after it has been approved elsewhere. Most countries agree to conduct the approval process for new traits simultaneously in order to speed the product’s commercialization.
It was during a U.S.-China Strategic & Economic Dialogue meeting in June that Chinese negotiators promised a later, “substantive” conversation on restructuring its approval process. In return, U.S. negotiators promised to conduct a study on the impacts of asynchronous approvals and give it to the Chinese.
A version of the report in Mandarin Chinese was presented to Chinese negotiators in November during the annual Joint Commission on Commerce and Trade (JCCT) meeting.
Most of the time seed companies will not commercialize a new product until all of the major trading partner countries have approved it, but that’s not always the case.
When a country inspects shipments of corn, soybeans or other commodities and discovers a genetically modified trait that it has not approved, the result can be a major trade disruption, the authors of the report said.
Most countries, including the U.S., do not have a low-level presence (LLP) threshold that tolerates trace amounts of an unapproved biotech trait.
“Experience with recent LLP incidents has affirmed that they can cause abrupt, large-scale trade disruptions, sustained changes in international trade patterns, and significant economic losses that are borne by both importers and exporters,” the report concludes. “There is also some evidence that regulatory asynchrony and LLP can cause delays in the implementation of existing innovations and hinder the development of future ones. Such impacts are generally less immediately apparent but potentially far more costly and sustained.”
One major disruption occurred in 2013 when China said it found traces of Syngenta's Viptera corn – a biotech trait that had been approved in the U.S. and elsewhere, but not China – in shipments from the U.S. Over the following two years China rejected about 2 million tons of U.S. corn after repeatedly claiming to find minute levels of Viptera.
These kinds of disruption are expected to continue unless countries improve their approval processes and develop acceptable LLP thresholds, the report said. The rise in asynchronous approvals, together “with a nearly universal policy of zero tolerance for unapproved events, the stage has been set for chronic and disruptive LLP incidents.”
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