In the final stages of the Bush Administration, 100 per cent tariffs were placed on a swathe European goods, from Italian mineral water to certain meats, as retaliation for an EU ban on American beef that has been raised using certain growth hormones. A 300 per cent tariff was to be reserved for Roquefort alone. But despite the imposition of a 100 percent tariff in 1999, sales of the French blue-veined cheese had continued to rise.
However, the USTR and the EC have agreed to suspend the elevated tariff for at least three years, in exchange for a greater share of the European market for American beef that has not been hormone-treated.
Under the deal, the US will not impose the tariffs proposed for European ‘luxury goods’ by the outgoing Bush Administration for an initial three-year period, and will abolish all sanctions in the fourth year, the USTR said. In exchange, the US will gain duty-free access to the EU market for a further 20,000 tons of beef untreated with growth hormones, rising to 45,000 tons in year four. Both sides have arranged to try to find a longer-term agreement before the end of the fourth year.
However, the Société Roquefort, which has been campaigning against the tariffs, has expressed its displeasure about the decision. It said in a statement that it was disappointed that the 100 per cent tariff would continue for the next three years, despite the beef dispute having nothing to do with the Roquefort cheese industry.
WTO ruling
The World Trade Organization (WTO) ruled in April last year that the EU’s concerns over the safety of hormone-treated US beef were unfounded, and therefore the ban was not justified under international trade rules. Despite claims from the EU that the hormones could pose a health risk, the WTO has ruled that its concerns are not backed by sufficient scientific evidence.
United States Trade Representative Ron Kirk and EU Trade Commissioner Catherine Ashton issued the following statement after the initial agreement was announced on Thursday:
“Following a very good discussion today, we have reached an understanding that provides a pragmatic way forward in the long-running beef dispute.
“An agreement is in our mutual interest, and we will now discuss this with our respective stakeholders and constituencies in an effort to finalize it as soon as possible.
“Reaching an agreement on this issue will be a clear sign of our commitment to working through – and, where possible, resolving – the bilateral disputes in our trade relationship. We will continue our close cooperation on other outstanding issues in the future.”