Europe has claimed a decisive win in the black olive trade dispute with the United States within the framework of the World Trade Organization (WTO). The WTO confirmed on Tuesday that the European Union was right in challenging Washington for not complying with a ruling tied to black olives imported from Spain. The trade barriers imposed had caused losses estimated around 280 million euros for Spanish exporters, according to figures published by Spain’s agricultural sector. Reclaiming the American market represents a major challenge for Spanish companies, given years of limited activity there, where black olives are primarily used in pizza production. The ruling matters because Europe feared that a favorable WTO decision for the United States could be used as a precedent to question EU agricultural subsidies under the Common Agricultural Policy (CAP).
Note: The report issued by the WTO Special Panel this week describes the EU’s position as a clear and definitive victory. The final finding states that the United States did not implement the Special Panel’s initial recommendation, specifically the conclusion that the U.S. law imposing countervailing duties on Spanish black olives is incompatible with WTO rules. The WTO report asserts that the entirety of the benefit from a granted agricultural subsidy automatically and fully transfers from the producer to the processor, a concept known as the “benefit transfer.” The panel also concluded that this incompatibility demonstrates that the U.S. law breaches WTO norms. (Attribution: WTO and EU communications.)
Principal exporter to the United States
In 2017, before these tariffs began, Spain stood as the leading supplier of black olives to the United States, with exports valued at about $67 million and accounting for roughly 76% of U.S. imports of black olives. By 2022, Spanish exports to the United States had fallen to around $20 million, representing about 26% of U.S. imports in this category. Following today’s report, both sides may request the WTO’s Dispute Settlement Body to adopt the Special Panel’s findings on compliance at the earliest opportunity in a meeting scheduled at least twenty days after the compliance report’s publication. If adopted, the ruling would be binding on the EU and the United States, prompting immediate行动 by U.S. authorities to implement the resolution and remove the tariffs.
Antidumping duties
The U.S. Department of Commerce set antidumping and countervailing duties on Spanish black olives on August 1, 2018, ranging between 30% and 44% depending on the company involved. The European Union challenged these measures at the WTO, arguing they were unjustified. On November 19, 2021, a WTO panel ruled in favor of the EU, finding that the U.S. duties violated WTO norms. On July 14, 2023, the EU asked the United States and the WTO to establish a compliance panel to assess actions taken by the U.S. Commerce Department that related to the transfer of benefits from producers to processors under the U.S. tariff statute, specifically Article 771B of the 1930 Tariff Act.