Digital tools to facilitate SPS market access

Countries increasingly use digital technologies within their sanitary and phytosanitary (SPS) systems, including SPS electronic certificates (e-certificates).

The OECD’s quantitative analysis shows that the use of e-certificates has had positive effects on trade volumes, notably for processed food, vegetable, and animal products.

While progress has been made in the adoption of electronic phytosanitary certificates for the international trade in plants and plant-based products, the implementation of electronic sanitary certificates for trade in animal products is more complex and challenging. This is due in part to the different approaches to e-certification being taken by internationally recognised SPS standards setting bodies and to the risks associated with trade in animal products.

Significant challenges remain in increasing the uptake of digital technologies in agro-food trade, including the mixed capacities of developing countries in particular to adopt these technologies. The successful expansion of digital tools requires careful planning and long-term investment, as well as the sharing of expertise. Targeted financial assistance and capacity building can support countries that currently lack the capabilities to adopt these tools.

What’s the issue?

Digital technologies are increasingly implemented by countries within their SPS systems. The disruptions caused by the COVID-19 pandemic motivated countries to adopt digital SPS systems more widely, including in the assessment of risk, the identification of risk management strategies, and the verification of SPS compliance in the movement of products. The technologies adopted include e-certificates, conformity assessment platforms, traceability and supply chain integrity technologies, remote pest screening, remote audits, and advanced consignment declarations and checks.

E-certificates create efficiencies in SPS compliance verification processes. They facilitate trade by lowering administrative costs for countries and traders. They can also reduce the risk of fraud, make trade systems more accessible for businesses, and help governments to address food safety risks and risks to human health.

Exchanges of e-certificates for trade in plant and animal products have been growing. Between 2010 and 2018

the number of bilateral trade flows of agricultural and food products covered by e-certification grew more than fivefold, from about 4 000 in 2010 to more than 20 000 in 2018 (Figure 1). Rapid growth in the use of e-certificates comes from the increasing number of countries using the EU TRACES NT platform and the implementation of new bilateral agreements on the exchange of e-certificates. In addition, the launch of the IPPC ePhyto Hub pilot in 2017 led to a rapid increase in the use of phytosanitary certificates, with the result that trade in vegetable products accounted for one-quarter of all e-certificates in 2018.

Using SPS e-certificates has positive effects on trade volumes, but the effects on trade flows do not materialise immediately. Gravity model estimates show that implementing e-certificates leads to an increase in export values, notably for animal products, vegetable products, and processed food, which experienced an increase in the total value of exports by 16%, 25% and 32%, respectively, two years after the creation of e-certificates (Figure 2).

Digital tools to facilitate SPS market access

Note: This figure shows the count of the number of bilateral trade flows, measured at HS 6 level and by section, that is covered by e-certification. It is not to be confused with the number of issued e-certificates at the individual transaction level, which is much larger. Section I represents animal products, Section II plant-based products, Section III animal or vegetable fats and oils, and Section IV processed food.

Source: OECD (2021), “Digital opportunities for Sanitary and Phytosanitary (SPS) Systems and the trade facilitation effects of SPS Electronic Certification”, OECD Food, Agriculture and Fisheries Papers, No. 152, OECD Publishing, Paris, https://doi.org/10.1787/cbb7d0f6-en

The adoption of sanitary (animal-based) e-certificates is less widespread and more challenging to implement. Regulatory frameworks for the production and trade of animal products are more complex than for plant products. While plant pests and diseases pose substantial economic and environmental risks, unlike animal diseases they do not usually pose a direct risk to human health or life. Multiple government authorities (i.e. veterinary and public health authorities) are involved in overseeing and certifying traded food products of animal origin to manage animal and public health risks. This contrasts

with the single national phytosanitary authority that usually oversees plant health.

To add to the complexities, importing countries often have their own requirements for sanitary and food safety certification, and for other matters such as religious requirements, production, processing, or quality attributes. This results in a myriad of combined animal and public health certificates used in the trade of food from animal products globally.

Source: OECD (2021), “Digital opportunities for Sanitary and Phytosanitary (SPS) Systems and the trade facilitation effects of SPS Electronic Certification”, OECD Food, Agriculture and Fisheries Papers, No. 152, OECD Publishing, Paris, https://doi.org/10.1787/cbb7d0f6-en

Figure 1. Annual number of bilateral trade flows covered by electronic certificates, by HS Section

Figure 2. Increase in export values from implementing SPS e-certificates (%)

E-certification requires alignment with IT standards along with the international SPS standards developed by the three sister organisations which have taken different approaches. For phytosanitary certification, the International Plant Protection Convention (IPPC) has a single generic certificate — International Standard Phytosanitary Measure (ISPM 12) — which facilities the use of its multilateral ePhyto Hub Solution. As of February 2023, 116 countries are registered to the IPPC ePhyto Hub with 74 countries using the system to exchange approximately 100 000 - 120 000 ePhyto certificates per month. To date, 3.3 million certificates have been exchanged in total. To enable countries without a national electronic system to exchange ePhytos via the Hub, the IPPC developed the Generic ePhyto National System (GeNS), a web-based systems that can produce and receive ePhytos.

The World Organisation for Animal Health (WOAH) and the Codex Alimentarius Commission (Codex) have published relevant model certificates for the international trade of animal products, including Codex productspecific models for meat, dairy products, and fish. Codex updated its certification guidelines in 2021 with the addition of guidance in Annex II on paperless exchanges and it recommends data models developed by the World Customs Organisation (WCO) and the United Nations Centre for Trade Facilitation and Electronic Business (UN/ CEFACT). WOAH has agreed to update Chapter 5.2. of the Terrestrial and Aquatic Codes to address e-certification in more detail, and to align as relevant with the revised Codex Guidelines.

Various channels and data models exist to send and receive SPS e-certificates. E-certificates can be sent and received under bilateral arrangements (most common for sanitary e-certificates) as well as part of plurilateral (i.e. EU TRACES NT and the ASEAN Single Window) and multilateral (IPPC ePhyto Hub) approaches. E-certification systems are based on data models i.e. the UN/CEFACT Refence Data Model or the WCO Data Model. The UN/ CEFACT standard is used by the ePhyto Hub, the EU TRACES NT and in many bilateral exchanges between SPS certificate management systems. Exchanges can also

What should policy makers do?

• Expand the use of digital technologies within SPS systems to create greater efficiencies, facilitate trade, and assist with the safe supply of food products to improve global food security.

• Pursue the use of e-certification with the aim of building momentum for wider uptake, in particular for sanitary certificates.

• Simplify certification requirements by recognising the equivalency of trading partner’s national SPS standards.

occur using the WCO Data Model in a Single Window environment. When e-certification IT systems are based on the same data model interoperability between the systems is not an issue and data can be exchanged easily (e.g., in 2020 the EU TRACES NT connected with the ePhyto Hub). Using an internationally recognised data model is important to ensure interoperability.

Developing countries often require assistance to design and implement SPS digital systems, technical support, and to train national staff. Technical assistance for e-certification is provided by the WTO’s Standards and Trade Development Facility (STDF), the World Bank, the Global Alliance for Trade Facilitation (GATF), and the IPPC to name a few. Australia, the Netherlands and New Zealand actively provide technical assistance to implement e-sanitary exchanges. Efforts to establish a paperless exchange with a trading partner means that agreements with other exporters are finalised more quickly due to the existence of platforms and the accumulation of experience and expertise. Establishing bilateral e-certification on an ad hoc country-by-country basis continues to involve additional time and expense for countries, in contrast with the use of a multilateral exchange agreement like the IPPC ePhyto Hub. If technical assistance is not based on the relevant international standards, it may contribute to divergent approaches. Furthermore, not all countries are offered the opportunity to participate in bilateral pilots which could facilitate learning and adoption.

More broadly, shifts by countries towards e-certification can be part of a wider trend towards the digitalisation of all government services, including customs and border services, as seen by the growing adoption of Single Window trade systems. These systems are streamlined government-mandated platforms allowing the electronic submission of all information to fulfil regulatory and commercial requirements (i.e. permits, licences and certificates for customs purposes and commercial documents, including bills of lading, letters of credit, certificates of origin, and commercial contracts) between supply chain actors and government authorities.

• Update national SPS legislation to allow the use of e-certification and co-ordinate between national authorities for plant, human, and animal health, customs and the private sector to develop strategic frameworks for using digital tools and ascertain the technical requirements.

• Participate in a whole of government push to digitalise services by supporting the establishment of a Single Window to facilitate trade.

Digital tools to facilitate SPS market access

• Explore the transmission of sanitary e-certificates using the IPPC Hub and GeNS via a large-scale pilot project.

• Work with other countries and the international standard setting bodies, including the UN/CEFACT and WCO, to improve the harmonisation of e-certification systems and the interoperability of the data models on which these are based.

• Contribute to studies analysing the trade impacts of e-certification so that the trade-facilitating benefits can be quantified. This would allow countries to evaluate e-certification systems with a view to their specific circumstances.

• Develop country case studies to illustrate the successful adoption of these digital technologies.

• Exchange best-practice guidance with other countries to develop a shared pool of expertise.

• Take into account the implications that adopting e-certification will have for developing and least developed countries. Where necessary, these countries should be provided with the capacity-building tools to ensure wider international adoption of e-certification.

• Ryan, M., E. Avery and S. Kahn (2023), “Electronic sanitary certificates for trade in animal products: Opportunities and Challenges”, OECD Food, Agriculture and Fisheries Papers, No. 190, OECD Publishing, Paris, https://doi.org/10.1787/5417ff4f-en

• OECD (2021), “Digital opportunities for Sanitary and Phytosanitary (SPS) Systems and the trade facilitation effects of SPS Electronic Certification”, OECD Food, Agriculture and Fisheries Papers, No. 152, OECD Publishing, Paris, https://doi.org/10.1787/cbb7d0f6-en