WASHINGTON, D.C. - United States Trade Representative Susan C. Schwab today announced that the United States has requested a World Trade Organization panel to review whether the European Union’s (EU) banana import regime breaches the EU’s WTO obligations. 

The U.S. request relates to the EU’s apparent failure to implement the WTO rulings in a 1996 proceeding initiated by Ecuador, Guatemala, Honduras, Mexico and the United States.  That ruling said the EU’s banana regime discriminates against bananas originating in Latin American countries and against distributors of such bananas, including several U.S. companies.  The EU was under an obligation to bring its banana regime into compliance with its WTO obligations by January 1999.

”We regret that efforts between the EU and its Latin American trading partners to negotiate a solution to the banana issue have not been successful,” said Ambassador Schwab.  “We share the concern of Ecuador and several other Latin American banana exporters regarding the continued existence of a discriminatory tariff rate quota in the EU’s current banana regime.  We are hopeful that this formal step will facilitate the removal of that discrimination.”

A similar request for panel establishment was submitted by Ecuador on February 23, and a compliance panel was composed in response to that request on June 15.  Ecuador and the United States had been authorized once before by the WTO to take action against the EU for its failure to implement the 1996 rulings.  The United States terminated that action after the EU committed to shift to a tariff-only regime for bananas no later than January 1, 2006.

Despite these commitments, the EU banana regime put in place on January 1, 2006 features a zero-duty tariff rate quota that is allocated exclusively to bananas from African, Caribbean, and Pacific (ACP) countries.  Bananas of Latin American origin do not have access to this duty-free tariff rate quota and are subject, instead, to a 176 euro/ton duty.