On December 20, 2024, a Panel in Mexico — Measures Concerning Genetically Engineered Corn ruled against Mexico, regarding its ban on genetically engineered corn (GMO corn).Footnote ¹ The United States invoked the panel under the United States-Mexico-Canada Agreement (usmca).Footnote ² In its Final Report, the Panel found Mexico’s ban on GMO corn for human consumption was inconsistent with usmca provisions on Sanitary and Phytosanitary Measures (SPS). SPS measures seek to protect human, animal, and plant life or health. Mexico claimed to have enacted the ban to protect biodiversity, “biocultural wealth, peasant communities, gastronomic heritage and human health” (para. 55). In finding it unlawful, the Report breaks new ground on SPS rules, illuminating how trade obligations impact the ability to pursue domestic food regulations.

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The dispute arose from a presidential decree, issued on February 13, 2023 by the government of Mexico, to regulate the use of GMO corn, defined as corn with “a novel genetic combination, generated through the specific use of biotechnology techniques”Footnote ³ (para. 52). The Decree identified three categories of the grain: corn for human consumption in tortillas and masa (dough);Footnote ⁴ GMO corn in industrial use destined for human food;Footnote ⁵ and GMO corn in animal feed.Footnote ⁶ In Article 6, the Decree expressly banned GMOs in corn for human consumption, e.g., tortillas or masa, out of concern for human health and biodiversity. It did not ban GMO corn in animal feed or for industrial use. Instead the Decree described what must be done before Mexico enacts these prohibitions. Specifically, Article 8 required Mexico’s food safety agency to examine national food security needs and research the risks to human health from GMO corn in animal feed and industrial use.

The United States requested a panel on August 17, 2023, after technical consultations with Mexico in March and dispute consultations in June. It argued that the Decree was inconsistent with multiple obligations from Article 9.6 Science and Risk Analysis and Article 2.11 Import and Export Restrictions. Canada joined as a third party to the dispute. In addition, the panel granted requests from nine non-governmental entities to submit their written views.

The Panel Report found the Decree was inconsistent with multiple commitments in Articles 9.6 and 2.11 and found the Decree did not fall within the exceptions Mexico raised.Footnote ⁷ First, the Panel Report described new ground for the scope of SPS commitments, emphasizing that signals to the market trigger requirements under Chapter 9. Chapter 9 commitments apply to SPS measures “that may, directly or indirectly, affect trade.”Footnote ⁸ The panel found that Mexico’s plans to eventually to prohibit GMO corn in animal feed and for industry qualified as an SPS measure.Footnote ⁹ The Report specifically looked at Decree Articles 7 and 8. Article 7 called for these eventual bans but explained that Mexico’s food safety authorities would still issue authorizations for these types of GMO corn.Footnote ¹⁰ Article 8 described the conditions, including examinations of scientific risks and food security, needed to institute these eventual prohibitions.Footnote ¹¹

The Panel Report emphasized that Decree Article 7 “sends a powerful signal to the market” and this may impact GMO corn exports for industrial use and for livestock (para. 116). The Report added that the absence of any timeline for implementing the bans and the studies required by Article 8 did not change that the Decree “may effect trade” (id., emphasis removed).

This reasoning deviates from established World Trade Organization (WTO) doctrine that a measure “must be applied” to trigger SPS commitments.Footnote ¹² The WTO Agreement on the Application of Sanitary and Phytosanitary Measures defines an SPS measure as “[a]ny measure applied ….”Footnote ¹³ The usmca incorporates this definition and expressly affirms rights and obligations from that agreement.Footnote ¹⁴

The Panel Report explained that it interprets the word “applied” as a “link” between the measure and “its SPS objectives” (para. 111). The Panel disagreed with Mexico’s interpretation that “applied” requires taking concrete steps (id.). The Report explained that the term “applied” does not “distinguish between degrees of implementation” (id.).

Second, the Panel Report made significant legal findings regarding the Appropriate Level of Protection (ALOP). This is “[t]he level of protection deemed appropriate by” a party “establishing a[n SPS] measure … within its territory.”Footnote ¹⁵ Mexico argued that it chose an ALOP of “zero risk” given the scientifically demonstrated risks of contaminants and toxins in GMO corn, such as transgenic proteins and glyphosate.Footnote ¹⁶ Likewise, Mexicans are highly exposed and vulnerable to these risks given their high consumption of corn on a daily basis.Footnote ¹⁷ The panel found that when devising an SPS measure a party can determine its own ALOP which could be “zero risk,” but this must be accompanied by an “appropriate” risk assessment (para. 181). This effectively analyzes ALOP and risk assessment together.

The panel accepted Mexico’s ALOP but explained that the Decree must be based “on an assessment, as appropriate to the circumstances” (id.). The Panel emphasized that the requirement for an “appropriate” risk assessment “must be interpreted with some rigor” (id.). Its basis for this was that the Decree did not adhere to any international standards, as mentioned in Article 9.6.3.Footnote ¹⁸

Article 9.6.3 does not require adherence to the international standards. It states parties “shall base” measures on international standards. ^{Footnote 19} This is different from adherence. This distinction is consistent with WTO Appellate Body findings that SPS measures do not need to conform with international standards.Footnote ²⁰

Third, the Panel determined that Mexico did not conduct a risk assessment, as required by Article 9.6.8.Footnote ²¹ It described what Mexico offered as a risk assessment as a database of materials “without any analysis of their contents” (para. 195). It found this to be insufficient for many reasons. ^{Footnote 22} Mexico’s database did not identify the experts who participated in creating it. It did not identify potential hazards, characterize the hazards, or assess exposure to them. Further, it failed to examine prior assessments used to authorized for GMO corn, done pursuant to Mexico’s Biosafety Law from 2005 and 2008 Biosafety Regulations. It is not immediately apparent that the usmca requires these. Chapter 9 does not define what is needed for risk assessments, instead it refers to definitions from the SPS Agreement,Footnote ²³ which include a definition for risk assessment.Footnote ²⁴

The Report clarified some of what is needed for a risk assessment, explaining that international organizations “provide a framework” and a “process for conducting risk assessment” (para. 183, emphasis removed). ^{Footnote 25} Unconvincingly, Mexico used the SPS Agreement’s definition of risk assessment as guidance for what is needed in Article 9.6.8.Footnote ²⁶ In sum, the Report determined Mexico did not meet the procedural criteria of a risk assessment.

Fourth, the Panel determined that a lack of risk assessment makes the Decree inconsistent with several more obligations in Chapter 9. These obligations are that a measure: be based on scientific principles,Footnote ²⁷ be applied only to the extent necessary, ^{Footnote 28} and not be more trade restrictive than required. ^{Footnote 29}

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Four takeaway points can be highlighted from this case, regarding SPS doctrine and the application of SPS measures. First, the panel’s reasoning was not limited to established understandings of SPS rules. In some instances, the Report deviated from settled interpretations of the SPS Agreement, despite requirements in the usmca to incorporate definitions from the SPS Agreement and to recognize rights and obligations in the SPS Agreement.Footnote ³⁰ These departures include what constitutes an SPS measure. The Report found that a measure falls within the definition of an SPS measure even if it has not been implemented.Footnote ³¹

The Report merged ALOP and risk assessment.Footnote ³² This requirement is new and effectively limits a party’s authority to establish its own ALOP. With a long history of addressing this matter, WTO SPS doctrine protects this ALOP deference whenever parties pursue SPS measures.Footnote ³³ This discretion is “wide” and “unambiguous.”Footnote ³⁴

usmca provisions appear to continue this. In various places, Article 9.6 expressly repeats that a party instituting an SPS measure determines its own ALOP.Footnote ³⁵ Nonetheless, the panel’s reasoning is novel by correlating ALOP with risk assessment.

Second the panel’s reasoning is not limited to the text of usmca provisions. This is most obvious in how the Report elevates the substantive significance of a risk assessment. It adds risk assessment, an independent commitment from Article 9.6.8, to its analysis of usmca provisions covering scientific principles, necessity, and trade restrictiveness. Risk assessment is not mentioned in the text of these relevant articles.Footnote ³⁶

The Report mixed the obligation to conduct a risk assessment with separate commitments regarding scientific principles, necessity, and trade restrictions.Footnote ³⁷ There is no reference, expressed or implicit, to risk assessment in the texts of Articles 9.6.6(b), 9.6.6(a), and 9.6.10.

Article 9.6.6(b) requires that an SPS measure be based on scientific principles. The Panel found that without a risk assessment there was “no evidence” the Decree was based on relevant scientific principles (para. 202). Here, the report merged the process of examining risks with scientific principles. Scientific principles and risk assessment are quite distinct from each other. They require different things and seek different objectives. Scientific principles are laws and rules used in science. While risk assessment is an identification and evaluation of risks that an SPS measure addresses. The United States also comingled these two obligations in its written submission.Footnote ³⁸

Next, the panel added risk assessment to its examination of a measure’s necessity and its commercial impact. Specifically, it referred to risk assessment obligations in its analysis of commitments under Article 9.6.6(a) and Article 9.6.10. It reasoned that since Mexico did not conduct a risk assessment, the Decree could not have been tailored to meet the requirements of either article (paras. 220, 236).

These usmca provisions do not mention risk assessment. Article 9.6.6(a) requires that measures be applied “only to the extent necessary” to protect human or plant life. It does not refer to risk assessment. This article commits parties to choose SPS measures that are not excessive in their protections.

Article 9.6.10 requires that a Party select a measure “that is not more trade restrictive than required” (para. 228). It does not mention risk assessment. This provision seeks to limit the commercial impact of an SPS measure.

The Panel reasoned that since Mexico did not conduct a risk assessment, the Decree could not have been tailored to meet the requirements of either Article 9.6.6(a) or Article 9.6.10 (paras. 220, 236). This is novel, since risk assessment is not mentioned in the text of either article. This effectively mixes an evaluation of risks with other commitments in Chapter 9.

In sum, with the Panel’s findings on scientific principles, necessity and trade restriction, risk assessments acquire substantive weight far beyond the procedural obligations in the text of Article 9.6.8. Trade lawyers and trade negotiators should make note of these changed approaches to interpreting SPS rules.

Third, the case points to an evolving economic context for trade disputes, when commercial harms are not immediately obvious. As the dispute was litigated, Mexico imported record levels of corn from the United States, including GMO corn, in 2023 and 2024.Footnote ³⁹ During this time, the United States claimed Mexican regulations on GMO corn hurt American access to Mexico. There is a mismatch between trade figures and some of the most public pronouncements during this dispute.Footnote ⁴⁰ The Decree only constrained trade in GMO corn in tortillas and masa.

For the neighbors, trade and consumption are integrated, creating a dependency on exports and vulnerability from imports. The United States is the largest producer and exporter of corn.Footnote ⁴¹ This can lead to lower prices for corn sales, when domestic and overseas demand do not meet American supply. For producers, this strain is compounded by recent export gains from Brazil and the loss of corn exports to China.Footnote ⁴² On the import side, Mexico is the leading buyer of American corn. It has been the number one or two buyer for decades. The grain is the main source of proteins for Mexicans. Corn carries significant cultural and historical value in Mexican society.

The dispute offers valuable illumination regarding SPS rules and their role in trade in food and agricultural goods. As the panel explained, SPS measures are a legal concern when they provide “signal[s] to the market” (para. 116). A three-fold fear likely drives these trade actions: changes in overseas regulations, price depreciation, and mounting global competition. Accordingly, trade enforcement functions as a tool to fortify trade relationships secured with the North American Free Trade Agreement and WTO three decades ago. This develops even as important elements of that global trade regime have changed, especially when it comes to dispute settlement.

With corn, similar dynamics exist beyond North America. It is the most widely produced crop in the world and the preferred staple for over 1.2 billion people in Sub-Saharan Africa and Latin America.Footnote ⁴³ Like with Mexico, national governments may increasingly value protecting food security and the health of consumers.

For this trade and others involving food safety, there is a latent tension between SPS rules and trade obligations.Footnote ⁴⁴ American trade policy objectives keenly identify national SPS regulations as threats. A report last year from the U.S. trade representative made this point repeatedly.Footnote ⁴⁵ It identified potential trade barriers in at least twenty economies, alarmed by national controls of GMOs and other biotechnologies. Expected examples, like China, the European Union, and Russia, made the list.Footnote ⁴⁶ But so did less obvious cases, with smaller economies like Angola, wartime economies like Ukraine, and potential trade partners Kenya and Taiwan.Footnote ⁴⁷ Aside from the report, common trade and food safety fears continue over food born illnesses and pests.Footnote ⁴⁸ Negotiations over recent American tariffs will likely address SPS rules and trade in agricultural, including concerns over beef treated with hormones and pork treated with ractopamine.Footnote ⁴⁹

The lesson from the GMO corn dispute is export losses are not needed for legal tensions between national measures and international commitments. The Panel Report found signals to the market, from a measure not yet implemented, can trigger SPS obligations.

Fourth, the decision offers new indications on how SPS rules impact food safety. These are informative even when states are not parties to the usmca. The United States promotes its approach to food safety when negotiating trade agreements.Footnote ⁵⁰ In addition, the SPS Agreement and other trade agreements contain similar SPS provisions as the usmca.

National food policymakers should take note of how the ruling: defines an SPS measure, employs risk assessment obligations, and treats glyphosate. The Panel Report suggests that SPS obligations can be triggered by measures that have not been implemented. It emphasized “signals” to the market to determine when SPS commitments apply (id.). Next, the obligation to conduct a risk assessment can impact how additional rights and obligations are examined. This has consequences for setting an ALOP. It impacts additional commitments that measures are based on scientific principles, necessary, and not more trade restrictive than required. Said plainly, how a government evaluates food safety risks implicate many other SPS obligations, even if they appear distinct. Lastly, glyphosate does not enter an examination of SPS commitments. Despite both the parties indicating glyphosate is an essential part of trade in GMO corn or not, the report’s analysis does not mention the herbicide.Footnote ⁵¹