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Project No.

CTI 06 2012T

Project Title

APEC Wine Regulatory Forum – Public-Private Dialogue: Risk Management and Certification Requirements for Regional Trade in Wine

Project Status

Completed Project

Publication (if any)

Fund Account

TILF Special Account

Sub-fund

None

Project Year

2012

Project Session

Session 1

APEC Funding

122,925

Co-funding Amount

123,794

Total Project Value

246,719

Sponsoring Forum

Sub-Committee on Standards and Conformance (SCSC)

Topics

Standards

Committee

Committee on Trade and Investment (CTI)

Other Fora Involved

Not Applicable / Other

Other Non-APEC Stakeholders Involved

Not Applicable

Proposing Economy(ies)

New Zealand

Co-Sponsoring Economies

Australia;Chile;United States

Expected Start Date

09/03/2012

Expected Completion Date

31/12/2013

Project Proponent Name 1

Mr David Reid

Job Title 1

Foreign Policy Officer

Organization 1

Ministry of Foreign Affairs and Trade

Postal Address 1

PO Box 1473, Wellington 6140, New Zealand/ Private Bag 18901, Wellington 5045, New Zealand

Telephone 1

+64 4 439 8596

Fax 1

+64 4 499 8508

Email 1

david.reid@mfat.govt.nz

Project Proponent Name 2

Ms Sirma Karapeeva

Job Title 2

Senior Policy Analyst

Organization 2

Ministry of Economic Development

Postal Address 2

PO Box 1473, Wellington 6140, New Zealand/ Private Bag 18901, Wellington 5045, New Zealand

Telephone 2

+64 4 470 2283

Fax 2

+64 4 499 8508

Email 2

sirma.karapeeva@med.govt.nz

Declaration

Ms Sirma Karapeeva / Mr David Reid

Project Summary

The Seminar will build on the momentum and the recommendations arising from the 2011 APEC Wine Regulatory Forum (WRF). As an regulator-industry collaboration initiative, it will focus on two key themes identified at the WRF as being specific issues in wine regulation that require further exploration and discussion:

1. Wine Trade and Risk (risk assessment and management; risk strategies).

2. Coordinating Approaches to Certification (simplifying certification requirements between APEC economies; trade facilitative approaches to certification; maximum residue levels).

It will also be an opportunity to continue the dialogue among regulators and with industry with a view to promoting regional economic integration via best-practice, least trade restrictive models for regulating wine within the APEC region.

The Seminar will be held in Auckland, New Zealand, 5-6 November 2012 on the margins of the 2012 World Wine Trade Group meeting.

Relevance

APEC region trade in rice, grape and other fruit wine is growing dramatically in importance for both exporting and importing economies. In 2010, the total wine trade in the APEC region rose to US $18 billion from US $7 billion in 2000. This has seen an increase in the value of wine exports from APEC economies soaring from US $1.1 billion in 2000 to US $3.6 billion in 2010, an increase of 223%. A good proportion of this is the result of wine exports from Asian APEC Member Economies which has climbed nearly fourfold to approximately US $665 million. APEC Member Economies now account for 24% by volume but 33% by value of all global wine imports. Furthermore, wine consumption in the region is forecast to grow by around 20% over the next five years.

Wine trade, however, tends to be burdened by major costs. TBT and SPS issues restrict sales and significantly increase costs for testing and labelling. In addition, compositional and residue limit standards vary from economy to economy and the number of new regulations increases each year. Wine-related non-tariff barriers in the region – such as divergent, redundant and non-transparent standards and testing protocols - are estimated to cost APEC economies and businesses a combined total of US $1 billion per year.

The different risk assessment and management strategies that underpin the various regulatory regimes often require multiple testing and certification. This comes at a significant cost for business who trade in those markets, could lead to delays in entry to market, and can also discourage smaller players altogether from entering the market. The focus on risk therefore is aimed at identifying the key elements in each economy’s strategy that could be aligned so as reduce the unnecessary burdens for business.

Promotion of transparent and consistent regulation and enforcement, the elimination of trade barriers arising from unnecessary certification and/or analytical requirements and greater cooperation around compositional and other requirements (such as the Maximum Residue Limits (MRLs) can greatly reduce those cross-border delays and costs. From a regulatory perspective, promoting a better understanding of different approaches to wine regulation will enhance capacity to regulate in line with international best practice and to achieve public health and safety objectives. This will promote greater economic integration across the region. From a consumer perspective, better aligned regulations will mean more product choice, lower prices and greater certainty as to the quality and safety of products on the market.

Objectives

The Seminar will build on the APEC discussions to date and will respond to recommendations arising from the 2011 Wine Regulatory Forum (WRF) meeting which was held in September 2011 in San Francisco, USA. The Seminar is an important vehicle for on-going information sharing, capacity building and coordination among regulators on best practices concerning wine regulation. As such, the key objectives of the Seminar are:

1. To examine different issues relating to the nature and significance of risk and how to manage it in the least trade-restrictive way while ensuring that consumers are provided with same and trustworthy products. Participants will examine different strategies for the assessment and management of risk with a view to identifying best practices. In this context, participants will enhance their understanding of different regulatory approaches as well as key recommendations and guidelines issued by relevant international organisations;

2. To further elaborate the Compendium of Certification Requirements developed by the WRF in 2011 with an eye towards eliminating unnecessary barriers to trade by simplifying certification requirements between APEC economies. Participants will explore options for greater cooperation regarding certification and will share information on agricultural compound MRL regulations or requirements with a view to promoting better coordination in approaches; and

3. To develop a set of recommendations for future activities by the WRF aimed at tackling wine-related non-tariff barriers in the region.

Alignment

In 2009, APEC Leaders recognised the importance of reducing technical barriers to trade to the continued prosperity of APEC. The following year, Ministers Responsible for Trade emphasised the need to promote regional economic integration through efforts to reduce unnecessary technical barriers, including through greater regulatory cooperation. In 2011, APEC Ministers committed to concrete actions to strengthen economic integration and expand trade, including through advancing regulatory convergence and cooperation to achieve economic growth in the region. Specific mention was made to promoting regulatory cooperation on wine and Ministers instructed officials to make further progress to reduce needless technical barriers to wine trade in 2012.

The 2011 APEC Leaders’ Honolulu Declaration and AMM Statement on Regulatory Cooperation and Convergence confirmed the value placed on regulatory convergence and cooperation as a means to strengthen economic growth in the region.

The Seminar will help to implement the directions contained in the 2011 APEC Leaders’ Honolulu Declaration and AMM Statement on Regulatory Cooperation and Convergence, one of the three main priority areas for APEC in 2011, and an issue for which Russia, as host of APEC 2012, has also expressed on-going support. The Seminar will contribute to these goals by sharing information and experiences, discussing economy-wide and regional approaches to wine regulation and identifying scope for better regulatory alignment in the region.

The Seminar also responds to an on-going SCSC work programme aimed at reducing technical barriers to trade in wine. The Wine Regulatory Forum was established in 2008 to provide an avenue for regulatory cooperation among APEC members. The WRF is included in the SCSC TFAP II and in its plan for greater Integration with Business.

The Seminar will also contribute to the SCSC’s work plan of Promoting Good Regulatory Practices, alignment to international standards, increased business engagement in regulatory activities, and will discuss the use of international conformity assessment mechanisms.

TILF/ASF Justification

3. To develop a set of recommendations for future activities by the WRF aimed at tackling wine-related non-tariff barriers in the region.

Beneficiaries and Outputs

The direct beneficiaries of this project are government officials and regulators from all 21 APEC Member Economies who are involved with or have an interest in good regulatory practice in the wine sector. These officials are from the government agencies responsible for policy and regulation in this area, for instance Ministry of Agriculture and Forestry, New Zealand (MAF), General Administration of Quality Supervision, Inspection and Quarantine of People’s Republic of China (AQSIQ), Bureau of Standards, Metrology & Inspection of the Ministry of economic Affairs in Chinese Taipei (BSMI), Directorate of Standards, Metrology and Quality in Viet Nam (STAMEQ and Alcohol and Tobacco Tax & Trade Bureau in USA (TTB). This seminar targets officials who are directly responsible for developing the policy and implementing the regulations. The Seminar will provide these beneficiaries with the opportunities to share information and learn from others’ experiences and will enable them to apply this knowledge to their own regulations. It will also be an opportunity to foster a network of regulators that will be able to continue the dialogue and progress future cooperation and capacity building activities. Some developing economies within the APEC community are relatively new to wine regulation and bring some different perspectives to the table, ranging from how they define wine to how wine is culturally perceived in their economies. This seminar represents an opportunity to develop mutual understanding of these differences as well as to explore mechanisms for working through them where they may represent obstacles to trade.

Wine producers, importers and other business stakeholders will also benefit from the Seminar as they will gain a better understanding of regulatory requirements in the region. They will also have the opportunity to meet and network with key regulatory bodies thereby establishing on-going relationships. This will add weight to initiatives such as the TTB-lead regulators teleconference started after the first Wine Regulators Forum in San Francisco providing further concrete information & networking opportunities.

In the long term, industry and consumers will benefit from better regulatory alignment in the region which will see reduction in compliance costs, increases in consumer choice and appropriate management of health and safety issues.

Dissemination

The key target audiences will be APEC representatives from food safety/wine regulatory agencies, industry representatives and APEC trade representatives from all APEC economies that produce, export and import wine.

A report of the Seminar will be prepared and presented to the SCSC, CTI and other interested APEC fora for their information and discussion. Materials from the Seminar will be made available at no cost to all APEC Member Economies via the APEC Member Document Database as well as industry websites such as the NZ Winegrowers and the World Wine Trade Group. The project will comply with APEC publication, copyright and logo guidelines. The findings of the seminar will be used to inform the WRF forward work plan and, in particular, identify opportunities for capacity building activities in the region. The report will highlight key common concerns and areas where further work is needed and will recommend appropriate next steps to address these concerns. This will help beneficiaries to focus their efforts going forward, including as a tool for developing sound harmonised regulatory policy.

Consideration will be given to communicating the outcomes to other industries as a case study in future conferences on Good Regulatory Practice. Consideration will also be given to briefing general or specialist media about the project as well as providing media releases.

Gender

Project overseers will implement this project in a manner that takes gender considerations into account to ensure that it benefits both women and men and does not disadvantage women. During the planning stages, project overseers, one of which is a woman, will seek to achieve gender balance in the selection of workshop speakers and participants. Both men and women are well represented among current WRF Member Economies and equal participation of both men and women in the Seminar will be actively pursued. Project Overseers will also include women in the planning, management, allocation of resources and implementation of the project. Care will be given to ensure that the Seminar and all related administrative details are performed in a gender-neutral manner and in particular, in a manner that does not disadvantage women. Women, as members of the regulatory and business communities, civil society, academia, and as consumers, will benefit from the more open, well-functioning, transparent, and competitive markets that the Seminar encourages.

Work Plan

The key milestones for the Project include: Liaise with APEC economies regarding the seminar and begin logistical arrangements (Jan-Mar 2012); consult and develop seminar agenda (April-June); invite speakers and participants (July-Aug); finalise seminar agenda and logistics (Sep-Oct); host seminar (Nov); distribute seminar outcomes, final report and post documents on-line (Nov-Dec).

A detailed breakdown is provided in Risks section

Risks

Timeline	Actions and Involvement	Output	Risk	Management of Risk
January - March 2012	Project team to develop a draft agenda and to begin identifying potential expert speakers through consultation with co-sponsors.	Draft agenda	Draft agenda not completed or appropriately focused	Work closely with co-sponsors to ensure the Seminar builds on work done in 2011, meets the needs of stakeholders, including those from developing economies and adds value to APEC.
April-June 2012	The Project Overseers to circulate draft agenda and to call for participation of experts through the SCSC, Food Safety Cooperation Forum (FSCF), the Specialist Regional Bodies (SRBs) and other relevant APEC fora as well as industry stakeholders. Member Economies will have the opportunity to provide input into specific aspects of the Seminar. Developing economies will designate representatives for the participant and/or speaker funds. Developed economies will put forward speaker suggestions and/or self-funded participants. Project team to finalise venue arrangements – venue, dates and facilities and to begin to make the necessary logistical arrangements. Project Overseers to provide progress report to the SCSC.	Draft agenda confirmed Venue secured Initial list of participants and speakers developed The SCSC kept informed of progress	Member Economies do not respond to request for input	Maintain close and regular liaison with key representatives from member economies, including through the SCSC, regulators’ networks and industry networks.
July – August 2012	In collaboration with co-sponsors, the project team to finalise the agenda and to send out official invitations to speakers and participants.	Agenda confirmed and distributed to Member Economies and other stakeholders Speakers invited and confirmed	Speakers unavailable	Work closely with co-sponsors to identify and confirm alternative speakers.
September-October 2012	Project team to finalise the speakers and participants lists. Project team to liaise with APEC Secretariat for travel eligible economies travel arrangement. Participants to obtain necessary visas and make travel arrangements. Speakers to provide copies of their presentations Project team to being compiling Seminar materials	Confirmed lists of participants and speakers Confirmed travel arrangements for participants, including those from travel eligible economies Visas issued to participants and speakers. Presentations collected and posted on internet	Lack of interest in Seminar Delays in applying or obtaining visas Not all speakers provide presentation in a timely manner	Engage APEC Secretariat to assist with publicity. Contact relevant regulatory agencies and industry groups personally to invite participation. Work closely with participants and speakers to ensure timely visa applications. Project Overseers and co-sponsors to work closely with APEC Secretariat and Member Economies to ensure timely submittal of presentations and preparation of Seminar materials.
November 2012	Seminar held Public-Private Dialogue: Risk management and certification requirements for regional trade in wine	Successful seminar	Participants/speakers do not show up or cancel at last minute	Project Overseers will be in close contact with speakers and participants throughout the process to minimise any last minute cancellation.
November-December 2012	Immediately upon conclusion of the Seminar, project overseers will work with co-sponsors and other participants to draft a report on the results of the Seminar. Project overseers will work with the APEC Secretariat to publish the final report of the meeting and to make sure project documents are loaded onto the Meeting Document Database. Participants will also be surveyed for feedback on the seminar materials, speakers and outcomes.	Seminar report drafted and posted on APEC website together with project documents including presentations Seminar documents also posted on the NZ Winegrowers and the World Wine Trade Group websites.	Possible delay in finalising report and uploading documents	Ensure sufficient time to prepare Seminar report and adhere to strict internal deadlines.

Monitoring and Evaluation

The projects monitoring and evaluation plan will include:

- Keeping track of progress against the key milestones identified above and taking corrective action if necessary;

- Keeping statistical information about the participants and speakers and which economies they come from;

- Post-event stakeholder feedback via an evaluation questionnaire to assess the quality of the Seminar and the overall effectiveness of the project;

- Post-event group discussion among regulators on key recommendations or lessons learned from the Seminar;

- Keeping track of website hits once Seminar material is posted on-line.

Linkages

Engagement

During the project development phase, the Project Overseers will engage with and seek participation from other APEC fora with an interest in eliminating behind-the-border trade barriers and promoting good regulatory practices. These include the Committee on Trade and Investment, the Market Access Group and the FSCF. Participation will also be sought from the SCSC Specialist Regional Bodies (SRBs). With regard to fora outside of APEC, the Project Overseers will reach out to the World Wine Trade Group and the Codex to raise awareness of the Seminar and to promote coordination and synergies between the respective work programmes. The Project Overseers will also engage with the private sector in the APEC region. Opinions, assistance and participation from APEC and non-APEC fora and the private sector will be sought during the project planning and implementation stages. APEC Member Economies are expected to encourage their business stakeholders to attend the Seminar as participants and speakers.

Previous work

The Seminar builds on the work and recommendations of the 2011 WRF meeting which was held in September 2011, San Francisco, USA. The WRF developed a set of principles and a forward-looking work plan to simply and better align regulatory practices to achieve greater efficiency in wine trade. The recommendations include: increasing information exchange on regulatory developments and labelling issues in order to increase confidence among regulators; eliminating or reducing the need for export certification, possibly by achieving mutual acceptance of oenological practices under appropriate conditions, or by consolidating the information on various certificates into one; accepting an electronic means for the submission of export certificates; and identifying opportunities to continue the dialogue on these issues including identifying capacity building needs and activities. The Seminar will build on the outcomes of the 2011 WRF recommendations by taking a more in-depth look at key areas of common concern such as risk management and certification requirements. This will achieve on-going momentum of the initiative while avoiding duplication of previous work.

APEC’s comparative advantage

The project is focused on an area of growing trade in the APEC region. In 2010, the total wine trade in the APEC region rose to US $18 billion. During the same period, the value of wine exports from APEC economies soared to US $3.6 billion. In terms of imports, APEC economies now account for 24% by volume but 33% by value of all global wine imports. Furthermore, wine consumption in the region is forecast to grow by around 20% over the next five years.

Undertaking this project in APEC provides a unique opportunity to bring together regulators from economies with established wine industries and those from emerging wine producing economies as well as importing Member Economies to share information and experiences, particularly as many of the emerging wine producers are Asian APEC Member Economies. This work supports APEC’s overarching goal of liberalising trade and investment in the region and promoting regional economic growth and integration.

The project also supports a number of on-going SCSC initiatives, namely:

- Promoting regulator-to-regulator dialogue and cooperation in specific sectors,
including wine;

-    Supporting enhanced understanding and application of good regulatory
   practices for the application, adoption and implementation of technical
   regulation; and

- Facilitating engagement of business in the activities of the SCSC.

Sustainability

It is expected that once the momentum is consolidated in 2012, on-going engagement and convergence will be achieved by way of regular electronic contact between regulators, which is already underway, as well as appropriately scheduled meetings. In addition, expressions of interest will be sought at this coming WRF for hosting and participation in the next WRF, to take place in 2013 or 2014.

The Compendium of Certification Requirements, which will be brought up to date during the Seminar, will be made available as a resource for exporters and regulators. As far as practicable, and subject to confidentiality concerns, information gathered at the Seminar will also be made available on the internet. The Compendium is useful information resource tool that sets out the key elements of certification requirements in the region; As such it provides transparency and clarity. It also identifies areas where regulatory alignment can be pursued. This database can be kept up to date electronically by regulators, either at regular intervals or as certification requirements are changed. The exercise of bringing the Compendium up to date represents an opportunity for discussion and for economies to seek clarification from one another where any doubts exist. Once the Compendium is agreed by members as a true and comprehensive representation of requirements, this will be a helpful reference point when any out of the ordinary documentation is sought in the future.

Consideration will be given to regulator exchanges and other capacity building mechanisms, as well as other means of sharing information in order to continue building on the outputs and outcomes of the Seminar. Project Overseers will work with the WRF secretariat in Australia to build a plan of follow up activities and to look at the hosting of future regulatory forums.

Project Overseers

Ms Sirma Karapeeva is a Senior Analyst with the Trade Environment Team of the Ministry of Economic Development where she leads the team’s international technical barriers to trade agenda. She has extensive experience with the negotiation of TBT provisions in free trade agreements as well as the negotiation of government to government arrangements such as mutual recognition arrangement and regulatory cooperation arrangements. Ms Karapeeva represents New Zealand at the APEC Sub-Committee on Standards and Conformance (SCSC) and at the WTO TBT Committee.

Mr David Reid is a Foreign Policy Officer at the Ministry of Foreign Affairs and Trade. At the Ministry he has worked at the Ministry’s Economic Division and as a project manager looking after leverage and legacy for the Rugby World Cup, including logistics and management of international VIPs. In his current role David deals with Agricultural Trade, and takes a close interest in wine issues.

Other key members of the Project Team include:

- Wade Armstrong, Principal Advisor Trade Policy, Ministry of Foreign Affairs and
Trade

- Kay Shapland, Manager Food Production and Processing, Ministry of
Agriculture and Forestry

- Kate Smith, Senior Advisor, Wine and Plant, Ministry of Agriculture and
Forestry

- Chris Langley, Head of APEC Unit, Ministry of Foreign Affairs and Trade

- John Barker, General Counsel, New Zealand Winegrowers

- Kristy McKay, Trade and Advocacy Manager, New Zealand Winegrowers

Cost Efficiency

This project offers APEC the maximum value for money and maximises cost efficiency by:

-    Holding the Seminar alongside another international event for wine regulators
   and wine industry (the 2012 meeting of the World Wine Trade Group) to
   maximise the interest of the participants and to capitalise on the synergies
   between the two events;

- Seeking a level of self-financing from supporters continuing to labour, travel
and other budget areas;

- Using Seminar participants as presenters and moderators thereby enhancing
the participatory process;

- Using an electronic post-event survey; and

- Dissemination of Seminar material on-line.

Drawdown Timetable

Not Applicable

Direct Labour

Not Applicable

Waivers

We seek approval of a waiver in relation to travel expenses for Officials from Governments and International Organisations and for active participants from travel-eligible Member Economies to receive per diems prior to travel. This will assist with good planning by allowing the travel eligible regulators to budget ahead and consequently allowing the organisers to confirm attendance and plan ahead.

Are there any supporting document attached?

APEC Project Proposal