A WTO panel gave broad backing on Monday to the US, Japan and Taiwan in their complaint over controversial European duties on electronics products and told Brussels to bring its trade measures into line with international rules.
The panel said the EU had imposed the duties on flat-panel displays, multifunctional printers and TV set-top boxes in violation of the WTO’s Information Technology Agreement (ITA).
US trade officials estimated global trade in the three products at US$44 billion last year, with EU imports accounting for US$7 billion.
The European Commission criticized the 704-page ruling before it was published, repeating its view that negotiations on a comprehensive revision of the agreement were preferable to litigation on only a few aspects of it.
“The report does not establish general principles that would imply any form of generalized conclusions,” it said in a statement. “Negotiations are the vehicle for mutually beneficial liberalization.”
But it remains to be seen how seriously the EU’s partners will take the call for negotiations on a revised pact when they believe Brussels is not even living up to the existing one.
Japanese Minister of Economy, Trade and Industry Masayuki Naoshima welcomed the ruling and called on the EU to remove the illegal tariffs immediately.
US Trade Representative Ron Kirk said the US had won an “important victory.”
US and Asian electronics producers such as Hewlett-Packard Co, Motorola and Cisco unit Scientific Atlantic are awaiting any sign that the EU might appeal the WTO panel’s findings.
The parties have 60 days in which to appeal, but the commission said Brussels had not yet decided whether to do so.
“The EU has lost on everything, so if it appeals, it has nothing to lose. I think they will appeal,” said Philippe De Baere, a partner at Van Bael & Bellis, which has represented Taiwan and Japan in the case.
The US Information Technology Industry Council also welcomed the ruling and said it was encouraging that Taiwan and Japan had fully backed the US.
“For us, it was a clear indication that the ITA, which is extremely important for our industry, is alive and well, and we’re very pleased with the outcome,” said John Neuffer, council vice president for global policy.
The three countries launched the case in June 2008. In September of that year Brussels proposed updating the agreement to take account of new technologies, a week before the three plaintiffs secured the creation of a WTO panel to rule on the dispute after consultations had failed to resolve it.
Officials in Taiwan said last month the ruling would save its exporters of flat-screens up to US$611 million a year in tariffs.
Major flat-screen makers in Asia include South Korea’s Samsung Electronics and LG Display and Taiwan’s AU Optronics (友達光電).
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