Product/process Distinction

The product/process distinction first refers to the isolation of information pertaining to the consumer good as such (its proximate attributes) from that pertaining to the means by which it is made (its peripheral attributes). The proximate attributes of a consumer good refer namely to its price, quality, and safety, whereas peripheral attributes point to the environmental effects entailed by its production, the working conditions under which it comes into being, as well as the treatment of animals involved in its production chain, among other familiar examples. In a more general way, one may refer to the first type as 'product information', and to the second as 'process information', in line with a distinction brought under controversial light by the WTO in 1991.

In some specialized circles, the product/process distinction is a method used by the World Trade Organization (WTO) to determine whether or not a complaint filed by an importing nation is valid and warrants trade barriers against the exporting nation. Under WTO rules, an importing nation can lodge a complaint with the WTO that the exporting nation uses methods for obtaining or producing the good in question that an importing nation finds to be immoral or unethical. If the independent World Trade Organization Advisory Board, made up of a panel of international law and trade experts, finds that the importing nation has a legitimate complaint, enforces said ethical standards for domestic production, and isn't trying to merely skirt its free trade obligations, the Board will rule that trade barriers are justified. However, despite what World Trade Organization officials have said, in practice the World Trade Organization finds these complaints illegitimate the vast majority of the time.

For example, if the European Union (EU) wants to ban imports of cosmetics that were tested on laboratory animals on ethical grounds, it can file a complaint with the World Trade Organization and, in theory, would be allowed to enact trade barriers provided that the EU bans its own domestic cosmetic producers from testing on laboratory animals. In these cases, however, the World Trade Organization has consistently ruled that because only the process is different, and not the final product itself, such barriers are illegal. The World Trade Organization has stated that if nations were able to enact barriers merely because the importing nation's standards differ from their own, control could be lost and barriers could be enacted around the world for frivolous reasons. However, many complain that these rulings go against the stated intentions of the World Trade Organization, and prove that the organization often puts commercial interests above environmental, ethical, or even human interests.