BRUSSELS, Belgium - Even before the reports of the projected Monsanto merger with Pharmacia & Upjohn, which will certainly lead to a European Union assessment of how any such deal would affect competition in Europe, the European Commission was evaluating whether it will join a class action lawsuit launched in the United States against Monsanto over development of genetically modified organisms (GMOs).

EC officials have been following closely the suit, filed Dec. 15 by a group of farmers in the federal court in Washington, alleging Monsanto had failed to undertake the necessary tests in developing new products derived from modern genetic engineering, and had abused its position to dominate the market. The initial reaction from the commission on the competition elements of the case was that it had not received any complaints accusing biotechnology firms of illegal practices. The lawsuit accuses Monsanto of creating a global cartel to control the patents and sale of genetically altered seeds.

Although the case involves mainly American farmers, if it is successful, it could reinforce the current EU trend to freeze out GM-food imports. Forecasts that sales in the biotechnology crop sector would rise to euro 70 billion (US$71 billion) by 2020 from euro 1.2 billion in 1998 have been hit by recent hostility by EU governments to GM foods.

So far, only GM tomato puree and soya are being marketed in the EU, but soya is an ingredient in about 60 percent of processed foods. Many stores label foods made with GM products, but there is still no obligation on anyone to label GM "derivatives" such as oil and lecithin, an emulsifier made with soya and starch from GM maize. GM products are present in baby formula and also bread, soup and pasta, all staples of the early years. GM material is getting into the food chain in other ways, too. Most animal feed now contains GM maize, but it is not labeled, representing a big regulatory loophole, critics say.

Senior U.S. officials preparing for the EU-U.S. summit last week denied that they were in any way resentful of the apparent contamination of U.S. public opinion by widespread European concerns on biotechnology in general and genetically modified foods in particular. But privately, U.S. diplomatic sources warn that in financial terms, a full-scale EU-U.S. battle over GMOs could eventually dwarf the millions of euros at stake in the ongoing banana and beef-hormone wrangles.

Meanwhile, the European Parliament, meeting in Strasbourg, France, on Dec. 15, adopted a resolution which calls on the European Commission to come up with a new strategy and new proposals to deal with labeling of genetically modified food products. Members said they want a coherent labeling policy to give consumers a clear choice and the option to buy or not buy GM-free food. They want the commission to incorporate a strictly time-limited review clause in the new regulation, with a view to possible tightening of the requirements after 12 months (the commission's current proposal is to exempt products with less than 1 percent of GM content per ingredient).

The parliament also wants legislation to be accompanied by a list of products that do not contain substances generated through DNA or GM techniques. It also wants the commission to come up with proposals for GM labeling in animal feed and clarification of another regulation on pre-packed products. The parliament is considering a ban on GM food from all its restaurants and cafeterias. n