World Trade Organization Finds U.S. Noncompliant in Table Olive Trade Spat

Summary

The World Trade Organization ruled that the United States failed to com­ply with its deci­sion to remove tar­iffs on Spanish black table olive imports, poten­tially lead­ing to retal­ia­tory tar­iffs from the European Union. The Spanish Association of Table Olive Exporters and Producers called for the U.S. to elim­i­nate tar­iffs entirely, cit­ing sig­nif­i­cant losses in exports and dam­age to the sec­tor.

The World Trade Organization (WTO) pub­licly rebuked the United States, rul­ing ear­lier this week that it had failed to com­ply with its pre­vi­ous deci­sion to remove tar­iffs on Spanish ripe black table olive imports.

After nearly one year of delib­er­a­tion, the WTO said the European Union has demon­strated that the U.S. failed to bring its mea­sures into com­pli­ance with inter­na­tional law – essen­tially to remove the tar­iffs.

The WTO fur­ther con­firmed that the U.S. law cited by author­i­ties in their deci­sion to impose tar­iffs on Spanish table olives is incon­sis­tent with inter­na­tional trade law. It has opened the door to the E.U. impos­ing retal­ia­tory tar­iffs on U.S. exports.

Antonio de Mora, the sec­re­tary gen­eral of the Spanish Association of Table Olive Exporters and Producers (Asemesa), hailed the rul­ing but called on Brussels to impose retal­ia­tory tar­iffs until the U.S. tar­iffs are removed.

“[The U.S. must] elim­i­nate 100 per­cent of the tar­iff,” he said. ​“It will be nec­es­sary for the E.U. to act urgently by impos­ing retal­ia­tory tar­iffs on prod­ucts that the U.S. is export­ing to the E.U. as the only way to achieve the elim­i­na­tion of tar­iffs on olives.”

However, the U.S. deci­sion to remove the tar­iffs may come down to a sep­a­rate case being heard in the U.S. Court of Appeals for the Federal Circuit – Aceitunas Guadalquivir v. United States, Coalition for Fair Trade in Ripe Olives.

Lawyers involved in the case believe the court is more likely to reach a deci­sion now that the WTO has handed down its rul­ing, which would be defin­i­tive since the U.S. Supreme Court is highly unlikely to hear an appeal.

Still, Asemesa, a plain­tiff in the case cur­rently being heard in the U.S. Appeals Court, said the dam­age had already been done to the sec­tor, with many tra­di­tional buy­ers of Spanish table olives turn­ing to other coun­tries.

“The loss of 70 per­cent of exports to the U.S., to the ben­e­fit of coun­tries such as Morocco, Egypt or Turkey and com­mu­nity coun­tries such as Portugal or Greece, alters free com­pe­ti­tion and threat­ens Spain’s clear global lead­er­ship in this sec­tor,” de Mora said.

According to data from the Spanish Ministry of Agriculture, Fisheries and Food, total Spanish table olive exports to the U.S. in the first eight months of 2023 were 14 per­cent lower than in 2017, the last year before the tar­iffs were imposed. Over the same period, Spain went from sup­ply­ing 39 per­cent of U.S. table olives to just 19 per­cent in 2023.

The min­istry esti­mates that the tar­iffs on Spanish black table olive imports have cost pro­duc­ers, pack­ers and exporters a total of €208.6 mil­lion since 2017.

However, the gov­ern­ment data also pointed to bet­ter news for Spanish green table olive exports, which were hit with a 25-per­cent tar­iff in a sep­a­rate dis­pute between the U.S. and the E.U. over air­craft man­u­fac­turer sub­si­dies. Those tar­iffs have since been sus­pended.

While green table exports to the U.S. remain 12 per­cent below what they were before 2021 when the tar­iffs were imposed, the min­istry said they were con­tin­u­ing to climb.

• WTO