In the face of the US attack on EU agricultural aid to Spanish olives, which is nevertheless classified at the World Trade Organisation (WTO) as aid that does not generate trade distortions (aid decoupled from production, classified in the 'green box'), the European Commission called, on Monday 20 June, for the EU to limit its 'orange box' aid as much as possible (aid coupled with production, generating the most distortions) as part of its post-2020 Common Agricultural Policy (CAP).
The US decision on 12 June to establish anti-dumping and anti-subsidy duties on its imports of Spanish olives (which still needs to be confirmed by the US International Trade Commission at the end of July – see EUROPE 12040) "is of great concern to us", the general director of the European Commission's DG Trade, Jean-Luc Demarty, told the European Parliament's international trade committee on Wednesday. "We will need to see what the American measures are in concrete terms and what the implementation of them will be in order to see if we can contest them at the WTO", he said.
"We also need to think about the CAP. This is the systemic element that goes beyond the stake of olives. It would be important for our 'green box' not to start being challenged at the WTO by the back door, and our subsidies justified or not (...) The anti-subsidy part (Ed: of the US action against Spanish olives) mainly targets subsidies from the 'green box' that are unjustly contested. But this shows that, in the present and future CAP, we must avoid multiplying sectoral subsidies in the 'orange box' and keep to 'green box' aid", Demarty warned.
"I know a member state that has 40 sectoral aid schemes classified in the 'blue box' (Ed: which comprises aid linked to the precise level of production of an agricultural product, along with a commitment to lower this production), but which could be in the 'orange box'. This type of support could be challenged at the WTO by partners and targeted in anti-subsidy measures", he stated. (Original version in French by Emmanuel Hagry)