Jul 24, 1998
EC GIVES MORE DETAILS ON BANANA RULING IMPLEMENTATION
Geneva, 23 July (Chakravarthi Raghavan) -- The European Commission told the World Trade Organization's dispute settlement body Thursday that it had made "significant progress" towards implementing the rulings and recommendations of the DSB over the EC's banana regime.
But the EC statement, and reactions of some of the members, suggest that this dispute could go into some endless cycles of rulings, interpretations of rulings and rulings on compliance.
Couched in general terms, the EC statement by Amb. Roderick Abbot, merely cited the decision of the EC Council of Ministers to amend the existing regulations on this, and that another implementing regulation on the import licensing system would be soon issued, as also negotiations with exporting countries having a substantial interest in supplying bananas on allocation of the tariff quotas. The regulations for amending the import licensing scheme and the tariff quotas, will take effect three weeks after publication in the EC Official journal.
As Abbot explained, the rulings required the EC to change the import licensing scheme, change the tariff quota allocations change certain aspects of the EC's framework agreement with some of the exporting countries as part of the Uruguay Round, and change the treatment of traditional ACP suppliers to the EC market.
The licensing regulations themselves have not been yet adopted.
The EC regime has tariff quotas for all suppliers of 2.2 million tonnes, and a second autonomous tariff quota of 350,000 tonnes. Both will now be dutiable at 75 ECUs per ton. But each of these quotas will separately allocated to substantial suppliers of which there were four countries in Latin America and with whom the EC was negotiating.
The unallocated parts of the quotas would be available to all suppliers. There would be no quotas for ACP suppliers, but they will have a preferential duty free access within a limit of 853,000 tonnes.
Honduras in a statement on behalf Ecuador, GuatemalA, Honduras, Panama, Mexico and the US noted that they had been bringing up this issue at earlier meetings and explained their concerns over the EC proposals. The information about the EC scheme that they had and the current information by the EC showed little difference and "we still consider measures taken by the EC to be primarily cosmetic, while leaving in place a regime that will for the most part perpetuate the same kinds of discrimination" found to be inconsistent with WTO rules.
The EC regime restrict banana imports from ACP countries in a more favourable way than imports from Latin America, and the moves for allocation of import licenses would perpetuate the unfairness.
Honduras asked the EC whether it would be agreeable at this or the next meeting of the DSB to reconvene the banana panel under Art. 21.5 to resolve this question.
Under Art. 21.5 of the DSU, differences over the implementation of a ruling could be referred to the original panel, and the panel has to submit a ruling within 90 days.
Abbot responded at the end that he had no reply at this time for this question.
Colombia said this was an important issue affecting close to 40 members of the WTO. The modifications being effected by the EC reflected considerable efforts to comply with the ruling and the new regime gave the commission a negotiating mandate. But if there be a reference back to the panel under Art. 21.5, Colombia would reserve its third party rights.
Brazil also intervened to say that it was the world's second largest producer of bananas, with a 6 million tonne annual production, and so very interested in negotiating with the EC for a share of the tariff quota.
The EC reiterated in the DSB that it would implement the rulings within the time provided by the arbitrator, namely 1 January 1999, and the 'reasonable period of time' of 15 months and one week given by the arbitrator would be respected.