EU threatens WTO action over US beef hormone sanctions

(BRUSSELS) - The European Commission said Thursday it planned to take WTO action against a US decision to impose new tariffs on EU products covered by sanctions in a beef hormone row.

"It is clear that this move by the US administration means that we will have no choice but to start preparations in order to take this to the World Trade Organization," the commission said in a statement.

"A great deal of effort had been put into finding a mutually agreed settlement to this on-going dispute. This task has now become much more difficult," it added.

Washington imposed new tariffs on European products in retaliation for an EU ban on US hormone-treated beef, escalating a longstanding trade dispute.

US penalties tripled in one case, on French-produced Roquefort cheese. The US updated its list of punitive duties, adding some products while deleting others.

"We had already been taxed at 100 percent for nine years," said Robert Glandieres of the French association of roquefort producers.

"Now, with 300 percent, sales of roquefort to the United States will be finished."

The EU has had a ban on hormone-treated beef in place since the early 1980s which has long been a source trade disputes with trade partners such as the United States and Canada.

The World Trade Organization in 1998 ruled that the EU had violated trade rules by banning the hormone-treated beef, thereby allowing the United States and Canada to impose trade sanctions on the bloc.

But the EU argued in 2003 that it had scientific grounds for the ban, thus making the restriction valid under trade rules. However, the argument was rejected by the United States and Canada and the two countries maintained trade sanctions against the bloc.

In what it described as "a clear attempt to escalate the EU-US hormones dispute," the commission said the outgoing US administration had decided to suspend its existing sanctions regime, which would allow Washington to revise the list of targeted goods every six months.

With the value of the existing fixed list of targeted goods at 116.8 million euros (153 million dollars), the commission said the prospect that the list could change regularly would increase uncertainty for exporters.

"This action is most regrettable in view of many attempts by the EU to find a solution to the long-standing trade dispute over hormone-treated beef," EU Trade Commissioner Catherine Ashton said in the statement.

"A large number of EU exporters will be hit by these illegal sanctions. We look forward to working with the new administration to address this situation," she added.