The European Union and Canada have concluded a deal temporarily resolving their long-running World Trade Organization dispute over the EU's ban on hormone-treated beef. The agreement comes in the form of a bilateral memorandum of understanding setting out a road map that will provide a temporary solution to the dispute.
Under the roadmap, Canada will suspend all its existing trade sanctions on European imports stemming from the WTO dispute, while the EU will increase market access opportunities for beef imports, the Commission said.
This means that Canada has agreed to suspend its C$11.3 million (US$11.5 million) in annual sanctions on EU imports while the EU would extend its duty-free tariff-rate quota on high quality beef by an additional 1,500 tonnes until August 2012. This quantity, which covers only hormone-free beef, could be increased to 3,200 tonnes for the following year.
The EU's agreement with Canada follows a separate memorandum of understanding deal concluded between the EU and the United States in May 2009. Under that deal, the EU agreed to provide additional duty-free access for high-quality grain-fed beef produced from cattle that have not been treated with growth-promoting hormones.
Both Canada and the United States won the right to impose sanctions on EU imports after the WTO ruled in 1998 that the EU failed to comply with an earlier trade body ruling which found the EU's import ban on hormone-treated beef was not supported by scientific evidence and therefore violated WTO rules.
A year later the WTO gave the U.S. permission to impose up to $116.8 million in increased tariffs on EU imports as a result of Brussels' failure to comply with its ruling, while Canada was given the right to impose up to C$11.3 million in additional tariffs.
