EU rules on deforestation and carbon tax pave way for new “mirror clauses”

New European legislation on a carbon border tax and a ban on imports linked to deforestation is paving the way for progress on international negotiations on “mirror clauses” in agricultural trade with non-EU countries.

Ensuring that imports meet the same production requirements as those in the EU, notably concerning rules on pesticide use and animal welfare standards, has been a key demand of European farmers in recent months.

Speaking to the Spanish news agency Efeagro, European Commission agriculture spokesman Olof Gill said that “mirror clauses” are negotiated on a case-by-case basis with trading partners, as part of trade agreements or in multilateral fora.

Regarding pesticide use, EU legislation sets a residue limit for each substance and establishes a common evaluation system for all agrifood products in line with World Trade Organisation (WTO) standards, Gill explained. 

The spokesman stressed that the EU is “committed to continued transparency” in implementing the Green Deal and will continue to work with its trading partners on pesticide residues at the WTO’s Committee on Sanitary and Phytosanitary Measures.

The bloc introduced its first environmental mirror clause in February 2023, prohibiting food imports containing traces of thiamethoxam and clothianidin, two neonicotinoids banned by the EU for their toxicity to pollinators, from 2026.

The EU has also defended the compatibility of its new carbon border tax (CBAM) with WTO rules, saying that importers will pay “the same price” for their products’ carbon footprint as EU producers.

Gill argued that the will for “cooperation, transparency, and open dialogue” also prevails in implementing the anti-deforestation regulation, which will force companies to prove that products placed on the EU market have not contributed to deforestation.

Cocoa growers face production shortage as EU anti-deforestation rules loom

As cocoa prices surge to record highs and Central and West African growers grapple with the impact of climate change, the cocoa sector is rushing to adapt its production to the EU anti-deforestation regulation (EUDR), which will take effect from January 2025.

International disputes

Petros Mavroidis, an expert on trade law at Bruegel, told Efeagro that the EU also has the right to impose stricter restrictions on imports—even if international standards exist—if they are backed by scientific evidence or if they invoke the precautionary principle.

He explained that “mirror clauses” must comply with the most favoured nation principle. In WTO jargon, this means that trading partners must be treated equally, and any advantage granted to one country must be extended to any similar product from the other parties.

Although it remains to be seen how the carbon tax will be applied, Mavroidis pointed out that the regulation will comply with international trade rules if all similar products face the same burden.

On deforestation, in March, a WTO panel ruled in favour of the EU dispute brought by Malaysia, a major palm oil producer, over EU restrictions on the use of palm oil for biofuels.

Complaints from the agrifood sector

Meanwhile, EU farm lobby COPA and COGECA highlighted a “lack of coherence” between internal and external policies, particularly on trade. 

The organisation explained that trading partners are interested in accessing the higher-priced EU market but noted that they have an advantage over EU farmers if they don’t face the same stringent regulations. 

“Often the argument is that we have the Common Agricultural Policy (CAP) and subsidies, but many other countries also have support schemes without necessarily facing the same sustainability requirements to access them,” COPA and COGECA sources told Efeagro.

[Edited by Angelo Di Mambro & Chris Powers]

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Polish farmers lift blockades at all Ukraine crossings

Warsaw, April 29, 2024 (AFP) - Polish farmers have lifted blockades at border crossings with Ukraine, officials said Monday, ending a two-month protest over farm imports from the war-torn neighbouring country.

Farmers had blocked border crossings with Ukraine since February to protest at what they said was unfair competition from goods that undercut local market prices.

Disputes over farm imports have strained ties between the neighbours, even as Poland has shown staunch support for Ukraine over Russia's invasion.

"The traffic through all the border crossings (with Ukraine) is possible," Michal Derus, a spokesman for the tax administration chamber in Poland's Lublin region told AFP after farmers ended the last blockade at the Hrebenne border crossing.

The crossing reopened after local authorities in Hrebenne declined to extend permission for protests at the checkpoint.

"All trucks are allowed to pass as long as they are not carrying sanctioned goods," Derus added, referring to the grain imports from Ukraine that Poland imposed a temporary embargo on.

Ukraine has seen its agriculture sector crippled by Russia's 2022 invasion. Many of its major export routes through the Black Sea have been blocked and much farmland left unusable by warfare.

In a bid to help Kyiv economically, the European Union in 2022 scrapped tariffs on Ukrainian goods transiting the 27-nation bloc by road.

But many Ukrainian cereal exports destined for non-EU countries have accumulated in Poland and elsewhere, undercutting local producers.