BioWorld International Correspondent

BRUSSELS, Belgium - A tough debate among the European Union's environment ministers in Luxembourg Oct. 17 failed to resolve some of the outstanding issues holding up EU trade in genetically modified organisms or products containing them.

Discussion of the draft rules on the traceability and labeling of GMOs for trade within the EU continued to divide ministers into two opposed camps (as it did at the meeting of EU agriculture ministers a week earlier). France, Luxembourg, Greece and Austria are pursuing their hard line of demanding labeling whenever a product contains more than 0.5 percent of GMOs, while other member states and the European Commission believe that threshold is unfeasibly low and favor a more liberal threshold of 1 percent. The issue has been sent back to EU officials for further study and discussion in a bid to overcome the deadlock.

The failure to reach agreement on that point also blocked any chance of lifting the de facto moratorium on authorizations for the marketing of GMOs in the EU, in place now for four years because of resistance - led by France and Austria - to new authorizations. The continuing lack of accord on traceability and labeling is providing those countries with a powerful pretext for maintaining the moratorium.

Ironically, the modified EU rules for GMO authorizations, agreed to in 2001 by all member states, came into legal effect on the day the environment ministers were meeting in Luxembourg. The European Commission insisted in a statement to the meeting that all technical conditions are now in place for a resumption of the authorization process. Companies can re-submit updated requests for authorization (including for the 11 products whose authorization procedures have been suspended since 1998) to their national authorities.

But the new rules do not, of themselves, offer a solution, European biotechnology executives told BioWorld International. They are subject to a time limit: Companies must have their applications in by Jan. 17. And companies cannot make the system work on their own; each firm is dependent on the member state where its application is made because it is the member state's national authority that is responsible for processing the application through to the European level where a final decision will be made.

The office of the U.S. Trade Representative also greeted the entry into force of the new rules with skepticism. In a statement, it questioned whether it will lead to the lifting of a de facto four-year moratorium on biotech product approvals, which the U.S. says is illegal and based on politics rather than science.

"The moratorium has been a result of decisions taken by a number of EU member states and only they can end it - through an immediate, unconditional and unambiguous statement that the biotech approvals process is restarting now," USTR spokesman Richard Mills said.

Meanwhile, European Health and Consumer Protection Commissioner David Byrne has claimed that the EU is "slowly but surely" moving toward lifting the ban. "There will be a lifting of the moratorium; when is not clear but we have made progress," he said in the wake of the ministerial discussions.

And speaking at a Brussels conference on science and society on Oct. 15, Commissioner for Research Philippe Busquin said, "New technologies that can bring real benefits to citizens and improve the competitiveness of European agriculture should not be discarded through ignorance and prejudice." Because the use of GMOs remains controversial and subject to criticism in Europe, with several GMO research field trials having been vandalized over the last months, there is "a relocation of industrial GMO research facilities to less hostile shores, which is a cause of great concern for European competitiveness," he said.

Ministers in Luxembourg did manage to get closer to a preliminary agreement on rules governing exports to non-EU countries of GMOs. Those new rules are intended to put into effect the Cartagena Protocol on Biosafety (which aims to protect biological diversity and human health by limiting the transfer and use of GMOs). But the majority of ministers also want to require EU exporters to obtain prior informed consent from importing countries and oblige them to label GM-containing exports, and to carry out special procedures for exports of GM-products that have not yet been authorized within the EU.

This agreement still will have to be fine-tuned through further discussion among officials and may not be finalized until December - after which the European Parliament will debate the proposal. Germany and Italy made clear at the meeting that they are not happy with the current position. Nor is European Environment Commissioner Margot Wallström, who fears the package that most ministers are favoring goes too far in adding controls that are not required by the Cartagena Protocol. EU Trade Commissioner Pascal Lamy also is worried that ministers may provoke another conflict at the World Trade Organization by imposing barriers that could impede international trade.

It is particularly on the requirements for identification of products exported that there still is no agreement. The UK, the Netherlands and Ireland want only a labeling that says the product "may contain GMOs"; but France, Austria, Belgium, Italy, Greece, Spain and Luxembourg, championing the right of consumers to comprehensive information, are insisting that documents must specify whether each product "contains" GMOs or not.

New EU Drive For Biotechnology Competitiveness

Biotechnology is one of the areas that could be designated as a priority for the process of legislative simplification that the European Union is conducting. EU ministers responsible for competitiveness have been holding informal exchanges over the last week on how to boost the chances for European industry by reducing unnecessary or outdated controls. The result could be a more detailed scrutiny of all new legislative proposals to check that they do not have an unduly negative impact on business, research and innovation.

The process is being driven by the European commissioner responsible for enterprise policy, Erkki Liikanen of Finland. Haunted by Europe's continuing relative decline against U.S. performance benchmarks, he told ministers in a letter last week that a lot of catching up needs to be done urgently. The EU's gross domestic product per head is less than 70 percent of the United States level, he pointed out.

Commissioner Liikanen highlighted specific sectors where additional efforts by EU ministers responsible for competitiveness could make a difference. In the pharmaceuticals industry, he said there is not enough investment, research is fragmented and the legal framework is inadequate. In biotechnology, funding is way lower than in the U.S., access to risk capital is poor and there is a skills shortage. In addition, intellectual property rules vary widely and the Council has still not agreed on the terms of the EU patent under discussion now for more than five years.