EEC Minimum Import Prices

EEC minimum import prices in Global Commerce Policy

In this regard, eec minimum import prices is: a complicated case brought by the United States against the European Economic Community (EEC) in 1978. The entries on trade policy are here. It took two years to sort it out. The United States made three claims: (a) that the EEC system of minimum import prices for tomato concentrates was not consistent with its GATT obligations, (b) that the EEC licensing and surety systems were similarly inconsistent with GATT obligations, and (c) that the EEC systems of minimum import prices, licensing and surety deposits nullified or impaired benefits accruing to the United States. The complaint followed the adoption by the EEC of several regulations setting a minimum import price for tomato concentrates. These required importers to obtain an import certificate and to lodge a security to guarantee that the products would be imported by a certain date. The import security was forfeited if there were no imports within the specified time. There was an additional security for tomato concentrates which was aimed at ensuring that the price of the imported product would at least equal the minimum internal price. The panel first considered the import certificate and the associated security system. The entries on trade policy are here. It found that the EEC system of issuing import certificates was not different to similar systems operated by other GATT members, and that it was in keeping with the rules applicable to automatic import licensing. The entries on trade policy are here. As automatic licensing did not fall under Article XI (General Elimination of Quantitative Restrictions), the import certificate and security system was not inconsistent with the EEC ™s obligations under this Article. The panel then looked at the implications of the system in terms of Article VIII (Fees and Formalities connected with Importation and Exportation). The entries on trade policy are here. In particular, it examined whether the fees and charges levied were limited in amount to the approximate cost of services rendered, as required by Article VIII:1(a). The panel found that this was the case. The entries on trade policy are here. It considered that the forfeiture of import deposits did not fall within the ambit of this provision since it only applied when no imports had been made. Nor was the obligation to obtain an import certificate an onerous requirement. The entries on trade policy are here. It also concluded that the ability of the EEC to stop issuing certificates in response to safeguard action was not inconsistent with its obligations under Article VIII. The entries on trade policy are here. In relation to Article II (Schedules of Concession), it considered that the interest charges and costs connected with the lodgement of securities did not contravene the requirement that fees or other charges are commensurate with the cost of services rendered as required by Article II:2(c). Next, the panel considered the minimum import price and associated additional security system. The entries on trade policy are here. It concluded that tomato concentrate qualified as an agricultural or fisheries product, imported in any form  as intended by Article XI:2(c) which, under certain conditions, suspends the requirement for the general elimination of quantitative restrictions. The entries on trade policy in the Encyclopedia are here. One of these conditions is the need to enforce governmental measures. The panel found that the minimum import price and associated system for tomato concentrate satisfied this criterion. The entries on trade policy are here. It examined in some detail whether fresh tomatoes and tomato concentrate could be considered like products. The entries on trade policy in the Encyclopedia are here. On balance, it thought that this was not the case, and it found that this system was inconsistent with the EEC ™s obligations under the GATT. The entries on trade policy are here. It then also found that the interest charges and costs and the possibility of forfeiture associated with the system were in excess of the bound tariff rate as decribed in Article II. Finally, the panel concluded that, regardless of whether a guarantee had to be given by the importer or the government of the exporting country, there would be no discrimination terms of Article I:1 (General Most-Favoured-Nation Treatment) if the guarantee was necessary for all imports from all potential third-country suppliers. See also variable levies.[1]

EEC minimum import pricesin the wold Encyclopedia

For an introductory overview on international trade policy, see this entry.

Resources

Notes and References

1. Dictionary of Trade Policy, “EEC minimum import prices” entry (OAS)

See Also