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The EU and the WTO | Geneva, 8 November 2012

EU and Latin American countries formally end banana disputes

The EU and ten Latin-American countries signed today, in the presence of WTO Director General Pascal Lamy, a Mutually Agreed Solution through which they agree to end eight pending banana dispute settlement proceedings. The Mutually Agreed Solution was notified to the chair of the Dispute Settlement Body, Ambassador Shahid Bashir of Pakistan. The signature follows the certification by the WTO of reductions in EU banana tariffs, agreed as part of the “Geneva Agreement on Trade in Bananas” (GATB) that the EU concluded with Latin American countries in December 2009.

“Today’s signature and notification put past disagreements fully and formally to rest,” said Angelos Pangratis, EU Ambassador to the WTO, following his signature of the mutually agreed solution, adding that “an irritant that plagued EU bilateral relations with Latin American partners in the past 15 years has been fully removed.”
 

Background

The EU and ten Latin-American countries concluded on 15 December 2009 the "Geneva Agreement on Trade in Bananas" (GATB). As part of the GATB, the EU agreed to gradually reduce its tariff for bananas from 176 € per tonne to 114 € per tonne within 8 years.

While the agreed tariff cuts were already provisionally applied by the EU since June 2010, the GATB entered formally into force on 1 May 2012 after the last of its signatories completed its ratification procedures. The entry into force triggered the obligation for the EU to submit the new tariff line at the WTO for certification, the procedure for formally modifying a schedule of tariff concessions. The certification of the EU banana tariff line was launched on 27 July 2012. As there was no WTO Member opposing the said changes in the certification procedure the new EU banana tariffs replaced the former entry in the EU schedule by virtue of an act of the WTO Director General on 27 October 2012.

According to paragraph 5 of GATB, certification triggers the settlement of the disputes. Within two weeks after certification, the relevant parties to the agreement shall jointly notify the Dispute Settlement Body that they have reached a mutually agreed solution through which they have agreed to end the disputes. On 8 November, the EU and the Latin American banana producing countries signed the mutually agreed solution which brings the bananas ‘saga’ to a definitive end.