Brussels, 11/02/2008 (Agence Europe) - “The United States has been proved right in this dispute with the EU” over banana imports, a US government official, who wished to remain anonymous, said on 8 February. On 29 June 2007, the US government followed several Latin American countries in registering a complaint at the World Trade Organisation (WTO) against the new EU import system put in place in 2006 (see EUROPE 9459). The EU, having already been found guilty several times in the 1990s of hindering free competition, ended the quota system which benefited the ACP (Africa, Caribbean, Pacific) countries which had preferential agreements with the EU. Since 1 January 2006, the EU has recognised two categories of importer: the ACP countries, which have a quota of 775,000 tonnes free of customs duties, and the others, so-called “dollar” banana producers, who pay a tax of €176 per tonne.
The European Commission considers the decision of the WTO panel (if it is confirmed in the final report expected in some weeks' time) to be “a bad precedent”. On the one hand, the decision is irrelevant: the preference granted to ACP countries since 2006 “is no longer in existence”, the Commission says. Since 1 January 2008, preferences to ACP countries have been granted under WTO-compliant economic partnership agreements (EPAs) or interim agreements leading to EPAs. The new trade regime, which includes bananas, allows ACP countries to export all their products (apart from sugar and rice) to the EU, free of customs duties. In exchange, these countries have to gradually open 80% of their market to European products.
On the other hand, the WTO decision could encourage complaints to the WTO by countries which are not affected by the measures that have been censured. Unlike the Latin American countries (Ecuador, Colombia, Panama and others), the United States exports hardly any bananas. US production is only 30,000 tonnes (Puerto Rico and Hawaii). The fact that US-based multinationals (Chiquita, Del Monte and Dole) market Latin American bananas in Europe should not be sufficient to establish a prejudice under the WTO Dispute Settlement Understanding, the Commission argues.
The Commission still claims the US has infringed WTO rules. Data show that, since 2006, banana imports from Latin American countries into the Community have increased substantially (by more than 10%), so the WTO panel should have concluded that the Cotonou preference was still protected by a waiver until 31 December 2007, the Commission says.
The WTO panel report remains confidential until its official publication in a number of weeks. The Commission regrets that the US has breached the confidentiality requirements of the WTO. (L.C.)