Trade Commission Extends Tariffs on Spanish Black Olives

Summary

United States trade offi­cials voted unan­i­mously to extend tar­iffs on some Spanish table olive imports, as man­dated by the Uruguay Round Agreements Act, due to con­cerns about mate­r­ial injury to the domes­tic indus­try. The deci­sion came after a U.S. Court of Appeals upheld the legit­i­macy of the tar­iffs, despite crit­i­cism from Spain and the World Trade Organization, with the Olive Growers Council of America sup­port­ing the deci­sion to main­tain the tar­iffs to pro­tect U.S. grow­ers and pack­ers.

United States trade offi­cials marked the fifth anniver­sary of tar­iffs on some Spanish table olive imports by vot­ing unan­i­mously to extend them.

A four-mem­ber panel of the U.S. International Trade Commission (ITC) voted to keep tar­iffs on some Spanish black ripe table olive imports.

The vote was required under the Uruguay Round Agreements Act, which man­dates that tar­iffs must be reviewed every five years.

The com­mis­sion­ers deter­mined their removal would ​“lead to con­tin­u­a­tion or recur­rence of mate­r­ial injury within a rea­son­ably fore­see­able time.”

The deci­sion comes two months after a U.S. Court of Appeals upheld a U.S. trade court rul­ing that found the antidump­ing and anti­sub­sidy tar­iffs imposed by the U.S. Commerce Department on Spain’s three largest ripe table olive pack­ers and exporters to the U.S. were legit­i­mate.

The Court of Appeals’ rul­ing is expected to be final as the U.S. Supreme Court is highly unlikely to take the case if it is appealed.

The court’s deci­sion was in stark con­trast to the World Trade Organization’s November 2021 rul­ing, which said the U.S. tar­iffs were ille­gal under inter­na­tional law.

The U.S. rul­ing was also crit­i­cized by Spanish Minister of Agriculture, Fisheries and Food Luis Planas, who described the deci­sion as ​“absolutely unac­cept­able” at a meet­ing of European agri­cul­tural min­is­ters in Brussels.

“I hope we can resolve this,” he said. ​“We have gone from being the first to the third export­ing coun­try to the United States… This is a sit­u­a­tion that we hope can be resolved favor­ably because it is unac­cept­able.”

Shortly after the Court of Appeals’ rul­ing in May, Spanish Economy Minister Carlos Cuerpo vis­ited Washington, D.C., to dis­cuss the tar­iffs.

“We have seen a will­ing­ness to con­tinue mov­ing for­ward on the part of the United States, and a chan­nel of con­ver­sa­tion and nego­ti­a­tion has been opened to see if we can resolve it,” he told reporters in Washington.

However, the Olive Growers Council of America hailed the deci­sion to main­tain the tar­iffs as nec­es­sary to pro­tect U.S. grow­ers and pack­ers.

“The U.S. gov­ern­ment and court sys­tems have repeat­edly con­firmed over the last five years that the Spanish indus­try is still ben­e­fit­ing from unfair European Union sub­si­dies and is still dump­ing its ripe olives in the U.S. mar­ket,” said chair­man Michael Silveira.

“If it weren’t for the U.S. gov­ern­men­t’s ongo­ing AD/CVD [antidump­ing and coun­ter­vail­ing duties for sub­si­dized goods] orders on Spanish olives, American table olive pro­duc­tion, and hun­dreds of fam­ily farm­ers and allied jobs would be in seri­ous jeop­ardy,” he added.

The Court of Appeals’ deci­sion ended a seven-year legal saga, which began with legal action in 2017 by the Coalition for Fair Trade in Ripe Olives, spear­headed by Musco Family Olive Co. and Bell-Carter Foods.

The group filed a peti­tion with the Commerce Department alleg­ing that sub­si­dies pro­vided to olive grow­ers by the Spanish gov­ern­ment and the E.U. Common Agricultural Policy (CAP) unfairly ben­e­fited olive pack­ers and exporters.

The peti­tion­ers argued that the sub­si­dies allowed Spanish com­pa­nies to sell their pack­aged table olives in the U.S. at below-mar­ket prices.

In July 2018, the Commerce Department deter­mined that Spanish ripe table olives were being sub­si­dized. They passed this find­ing on to the ITC, which deter­mined that the sub­si­dized ripe table olive imports mate­ri­ally injured the domes­tic indus­try.

Based on the ITC find­ings, the Commerce Department autho­rized 35 per­cent anti-dump­ing and coun­ter­vail­ing duties (though they were later low­ered to 31 per­cent).

The tar­iffs’ impact was imme­di­ate, with Spain’s agri­cul­ture min­istry esti­mat­ing in February that they have cost pro­duc­ers, pack­ers and exporters more than €208 mil­lion since 2017.

In response to the tar­iffs, the table olive pro­duc­ers and the Spanish Association of Table Olive Exporters and Producers (Asemesa) sued the Commerce Department.

After unsuc­cess­fully jus­ti­fy­ing the tar­iffs at the U.S. Court of International Trade twice, the Commerce Department’s third sub­mis­sion was accepted. Asemesa quickly appealed.

Meanwhile, protests in the Andalusian cap­i­tal of Seville and pres­sure from the gov­ern­ment in Madrid spurred the E.U. to sue the U.S. at the WTO in January 2019.

In its com­plaint, the E.U. argued that the U.S. tar­iffs vio­lated inter­na­tional trade rules because the CAP does not pro­vide spe­cial ben­e­fits to table olive pro­duc­ers.

Adding to the pres­sure on Brussels, E.U. offi­cials pub­licly expressed con­cern that the tar­iffs set a dan­ger­ous prece­dent and might encour­age addi­tional lit­i­ga­tion against the CAP.

In November 2021, the WTO ruled in favor of the E.U. and found that anti-dump­ing and coun­ter­vail­ing duties imposed in 2018 by the U.S. on imports of ripe table olives from Spain were ille­gal under inter­na­tional rules.

In its rul­ing, the WTO told the U.S. to ​“bring its mea­sures into con­for­mity” with its General Agreement on Tariffs and Trade and other free-trade rules.

The U.S. declined to appeal the WTO rul­ing and agreed to revise the tar­iffs. However, the Commerce Department kept most of the tar­iffs in place, which led to a pub­lic rebuke from the WTO in February 2024.

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