News Release
 |
 |
Franz Fischler |
Pascal Lamy |
No. 142/04
October 15, 2004
EU COMMISSION APPEALS WTO SUGAR RULING
Today, the World Trade Organization (WTO) has circulated and made public the
panel reports in the dispute brought by
Australia,
Brazil and
Thailand against the EU
sugar regime. In response, the EU Commission announced that it would appeal
the ruling.
EU Agricultural
Commissioner
Franz Fischler stated: "We are dissatisfied with this ruling and will
appeal it. But the EU's appeal will not prevent the EU to plough on with a radical
overhaul of its sugar regime. This reform is necessary for internal reasons. It
will make the EU sugar sector more competitive and trade friendly."
EU Trade Commissioner
Pascal Lamy
added: "The WTO decision calls into question the texts and commitments
unanimously agreed upon by all WTO Members during the Uruguay Round. The EU will
abide by its international obligations. But at the same time we will defend the
legitimate interests of EU sugar producers and the preferential access enjoyed
by developing countries into the EU."
The main conclusions of the panel are that, since 1995, the EU's total exports
of sugar exceed its final quantity commitment level for export subsidies, which
is 1,273,500 tons per year, because Footnote 1 to the respective part of the EU’s
WTO schedule (on exports equivalent to ACP/Indian
imports of sugar) is without legal effect. The panel recommends that the EC brings
its sugar regime into conformity with its obligations under the Agreement on Agriculture.
The appellate review of the panel reports must start before their adoption in
the WTO
Dispute Settlement Body, for which there is a deadline of 60 days from today.
The duration of the appellate procedure is 90 days, after which the (modified)
panel reports and the Appellate Body's report must be adopted within 30 days.
The African, Caribbean and Pacific (ACP) countries' strong intervention against
this challenge indicates that the case also threatens the value of the current
preferential access arrangements which the EU has had in place for decades.
The EU has always made clear that Australia, Brazil and Thailand are calling into
question the texts and commitments negotiated and agreed upon by all WTO Members
during the Uruguay Round. The EU has also drawn attention to inconsistencies between
the complainants' claims and the structure of their own past and present sugar
regimes.
In this dispute, Australia, Brazil and Thailand are challenging two types of EU
exports of sugar as being allegedly subsidised contrary to the WTO Agreement.
The first claim relates to the export of so-called "C sugar." The complainants
have alleged that these exports benefit from export subsidies by being cross-subsidised
with revenues from production under A and B quotas.
The second point relates to export refunds on 1.6 million tons of sugar which
are equivalent to preferential EU imports from ACP countries and India. The complainants
have alleged that, as a result, the EU exceeds its export subsidy reduction commitments
and is in breach of the WTO Agreement.
The EU's position has been that exports of "C sugar" do not benefit
from export subsidies, among other things because this claim is based on an erroneous
interpretation of the WTO provisions on agricultural export subsidies and inconsistent
with the obligation of good faith. The EU also insists that exports of ACP/India
equivalent sugar are in full conformity with the EU's schedule of commitments
and WTO provisions regarding agricultural export subsidies.
For more information on the Commission's sugar reform proposal and the EU sugar
market see IP/04/915
and MEMO/04/177.
Press Contacts: |
Anthony Gooch
202-862-9523
|
Maeve O'Beirne
202-862-9549
|
