Sunday, June 10, 2018

Having a Cow: WTO's Endless Beef Hormone Case

Like the banana dispute, the beef hormone case is one of the longest running episodes to be litigated at the WTO's dispute settlement mechanism. The case is relatively straightforward to understand: nearly all beef raised by the US (and Canada) use growth hormones. However, in 1989, EU countries stopped acceptance of beef imports using these hormones. The EU has maintained that food safety concerns lie behind its refusal to import hormone-fed beef, while the US accuses the EU of protectionism plain and simple. Diplomatic wrangling then enters the picture. In 1995, the US took the EU to the WTO on this case, making it one of the first to be tried at the newborn institution. By 1997, the WTO ruled in favor of the US, stating the Europeans did not establish a scientific basis for banning such imports. The EU appealed but lost in 1998, paving the way for retaliatory tariffs on EU exports to the US including pork, French mustard, truffles, Roquefort cheese and fruit juices. Since 1999, the US has applied $116.8 million worth of such sanctions annually against the EU.

In 2003, the EU amended its ban on hormone-fed beef making it, from its point of view at least, WTO-compliant. Given this amendment, the EU took the US to the WTO in 2004, requesting that sanctions against it be lifted. In March 2008, however, the WTO found that the EU has not yet met conditions in the Sanitary and Phytosanitary Agreement (SPS) which would permit enforcing its ban. The EU filed an appeal in May on this ruling while the US made a cross-appeal pertaining to procedural matters. The long and the short of it is that while the US made some procedural errors in continuing to apply sanctions, these sanctions remain valid as per the original case.

If you're further interested, the WTO site has the case summaries involving the US and Canada. Meanwhile, the US Trade Representative offers a PDF press release concerning this latest episode. On this matter at least, I believe the Americans are far more convincing than the Europeans. Keep in mind that this saga is not yet over. The latest ruling still leaves unsettled the matter of whether the EU's amendments have made its treatment of hormone-fed beef WTO-consistent. It appears that the case will ramble on after the Bush administration is gone.

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