Five years after the United States’ tariff penalty on Spanish black olives, producers look back to Geneva (Switzerland), the headquarters of the World Trade Organization, with hope. After the case was reopened, Washington’s taxes were re-examined. conforming to international standards. On August 1, 2018, Washington increased export duties on this Spanish product from 21.60% to 34.75% to protect the California olive industry “against agricultural aid from the European Union”. Officials in Brussels battled at the WTO to remove tariffs, which they deemed “illegal”, and scored a partial victory in 2021 when the US cut the tax from 35% to 31%. The decision of the US administration to impose a tax on black olives already means a loss of 280 million for Spanish producers.
Now the case is reopened because the EU continues to argue that these taxes are not in line with international regulations, as farmers receive their aid through the CAP, not the producers. have WTO On July 28, it announced the creation of a new panel to determine whether the United States complied with a previous decision against tariffs on Spanish black olives.. Antonio Mora explains that the dispute between Brussels and Washington, which started in 2019 and is set to close in 2021, has resumed, “The tariffs are not fair and this is already recognized in the previous decision”. The Secretary General of the Spanish Mesa Olive Exporters and Industrialists Association (Asemesa) pointed out that as a result of the protest of the California olive sector, the Spanish producers lost 75 percent of their market in the USA. U.S. officials should investigate Spanish exports for assistance farmers receive through the Common Agricultural Policy (CAP).
“The EU considers that the United States has imposed tariffs on black olives from Spain. In a legal error as CAP assistance does not benefit producers, but delivered to farmers growing olive trees. The US Department of Commerce decision implementing the tariffs was based on this, which was already seen as a violation of WTO rules. “Given that subsidies are taken by olive growers, it is likely that the United States will not be able to continue to impose 35 percent taxes,” he said.
“On behalf of the Spanish Government and the European Union, we will exhaust all means possible to defend the interests of the Spanish black olive sector to finalize this process and its economic consequences. The request is partly due to the Commission’s submission of this compliance review panel at the World Trade Organization (WTO) on July 14. He also says he is participating in other actions initiated to finalize foreclosures, the European Commission and the Andalusian Junta,” according to sources, the Ministry of Agriculture.
“Legal tricks”
“They used all the legal tricks we had and got us out of the United States market. Egypt, Turkey or Morocco took advantage of that,” says Antonio Mora of Asemesa, noting that nothing else will happen until 2024. progress in this case. The European Union has prioritized this trade conflict as it influences its entire policy on agricultural subsidies through the CAP.. The Community bloc fears that a negative WTO decision on this issue could pose a threat to all aid left in Europe for agricultural activities.
Last February, both the EU and the US agreed to form a special group to examine whether the tariffs comply with international regulations. “Both sides agreed they would cooperate to allow a panel to produce a report within 90 days of its formation”says a WTO spokesperson. The special group has already been formed and will consist of Chairman Daniel Moulis and members Martín García and Charis Tan. Eight countries (Brazil, China, India, Japan, Russia, Switzerland and Turkey) joined the new group due to contention among third parties. Thus, these countries reserve the right to participate in the process before the WTO and will be able to testify before the board in the coming weeks.
Sources from the European Commission state that working groups established for this type of work usually announce their decisions within an average of 13 months, but they hope that they will be more agile in this case. This is a “simple legal issue”.