The Office of the U.S. Trade Representative (USTR) is
expected to announce within days revisions to its list of
products from the European Union (EU) subject to retaliatory
tariffs in disputes over bananas and hormone-treated beef.
Such revisions are required under the "carousel" provision of
the Africa-Caribbean trade bill passed by Congress and signed by
President Clinton in May.
Except in certain circumstances, the provision requires USTR to
change twice a year the products subject to retaliatory tariffs
in cases when a losing party fails to implement a World Trade
Organization (WTO) dispute settlement ruling in favor of the
United States -- as in the bananas and beef hormones cases.
The EU requested June 5 consultations in the WTO over the
carousel provision, which its representative argued violates the
WTO's Dispute Settlement Understanding because such retaliation
is not approved by WTO members.
BANANAS CASE
July 1, 1993 : The EU adopts a new bananas import regime that
favors bananas from domestic producers and from former European
colonies in Africa, the Caribbean and the Pacific.
1994 : A General Agreement on Tariffs and Trade (GATT) panel
rules that the new regime violates GATT obligations, but the EU
blocks adoption of the ruling by the full GATT.
1996 : The United States along with Ecuador, Guatemala, Honduras
and Mexico, challenge the new regime under the WTO
dispute-settlement mechanism.
May 22, 1997 : A WTO panel rules that the EU bananas import
regime violates WTO obligations under the General Agreement on
Trade in Services (GATS) and the Agreement on Import Licensing
Procedures.
September 1997 : The WTO Appellate Body upholds the panel
ruling. The WTO grants the EU 15 months, until January 1, 1999,
to comply with the ruling.
January 1999 : The deadline for EU compliance expires. The EU
implements a slightly modified regime that perpetuates earlier
WTO violations. The United States seeks WTO authorization to
impose retaliatory tariffs.
April 19, 1999 : The WTO Dispute Settlement Body (DSB)
authorizes U.S. retaliatory tariffs amounting to $191.4 million
a year, the level of damage to U.S. companies calculated by
arbitrators.
BEEF HORMONES CASE
1985-1988 : The EU adopts, without sound scientific basis, a
directive prohibiting imports of animals and meat from animals
produced with hormones to stimulate growth in 1985 and readopts
it in 1988.
May 1996 : The United States challenges the EU ban on imports of
hormone-treated beef under the WTO dispute-settlement mechanism.
August 18, 1997 : A WTO panel rules that the EU ban violates the
WTO Agreement on Sanitary and Phytosanitary Measures (SPS).
January 16, 1998 : The WTO Appellate Body upholds the panel
decision.
May 1998 : The WTO grants the EU until May 13, 1999, to comply
with the ruling.
May 1999 : The deadline for EU compliance expires. The United
States seeks WTO authorization to impose retaliatory tariffs.
July 26, 1999 : The DSB authorizes U.S. retaliatory tariffs
amounting to $116.8 million a year, the level of damage to U.S.
producers calculated by arbitrators.
