WASHINGTON, Dec. 22, 2016 – The Office of the U.S. Trade Representative is threatening to bring back tariffs against certain European Union agricultural exports if the trading bloc doesn’t ease its ban on U.S. beef treated with hormones.
USTR says the EU’s 20-year-old ban is not based on sound science and discriminates against American beef farmers, ranchers and producers. Acting on the request of the U.S. beef industry, USTR scheduled a hearing on Feb. 15 where a committee of trade experts and economists will review public comments on the products that may be subject to the tariffs, with the goal of resolving the dispute. Information about the hearing and how to submit comments can be found by accessing the agency’s Federal Register notice.
In 1998, the EU lost a case at the World Trade Organization for banning American beef and in the following year WTO authorized the U.S. to impose tariffs on EU products with a total annual trade value of $116.8 million. In 2009, the U.S. agreed to postpone a decision while it negotiated an agreement to allow a modest degree of market access for specially-produced beef that meets the EU's standards, but that agreement has not worked as intended. The European Commission – the EU’s executive arm – had argued that this issue should be resolved through the Trans-Atlantic Trade and Investment Partnership. However, given that European officials decided after their trade minister's meeting in September not to complete T-TIP this year, now is the time to take action, USTR said.
"The WTO determined that the European Union's ban on U.S. beef imports violates its international trade obligations," said U.S. Trade Rep Michael Froman. "The EU has failed to live up to assurances to address this issue, and it's now time to take action. Today's action holds the EU accountable and is an important step in encouraging the Commission to come back to the table to ensure that American ranchers have access to Europe's market and that European consumers have better access to high-quality U.S. beef."
USTR pointed out that the U.S. beef industry exports an average $6 billion per year, producing an estimated $7.6 billion in economic activity and supporting 50,000 jobs nationwide. “The industry is essential to the overall strength of the nation’s economy, and to rural communities seeking ways to access new customers in foreign markets,” USTR said in a release.
“American ranchers raise some of the best beef on the planet, but restrictive European Union policies continue to deny EU consumers access to U.S. beef at affordable prices,” Agriculture Secretary Tom Vilsack said. “For several years we have been asking the EU to fix an agreement that is clearly broken, despite its original promise to provide a favorable market for U.S. beef.”
The U.S. Meat Export Federation and the National Cattlemen’s Beef Association applauded the USTR’s actions.
“Over the past seven years, U.S. cattlemen and meat packers have made significant investments to meet the requirements of the EU market, only to see the U.S. share of the market undermined by producers in Australia, Uruguay and Argentina,” USMEF CEO Philip Seng said in a statement. “This situation is unsustainable and demands a firm and decisive response.
“The U.S. beef industry has supported our government’s efforts to find a commercially feasible way for us to participate in the EU market. The 2009 agreement initially appeared to represent a step in that direction, but unfortunately it has not lived up to the industry’s expectations. Under the circumstances, we cannot agree to stand by as our competitors take an ever-expanding share of a quota that was specifically created to compensate the United States.”
NCBA President Tracy Brunner said the EU “has left us no choice but to seek compensation for the long-standing mistreatment of U.S. beef exports.”
“Our temporary agreement with the EU was meant to be an opportunity to build a bridge of trust between U.S. beef producers and EU consumers, and to compensate the United States for the losses we have suffered as a result of the EU’s hormone ban. The EU has violated the spirit of that agreement and caused U.S. beef exports to become a minority interest in a quota meant to compensate U.S. beef producers.”
Key U.S. lawmakers welcomed the USTR’s actions.
Senate Agriculture Committee Chairman Pat Roberts, R-Kan., said “the patience of U.S. beef producers has worn then, as has my own.”
“Our government must take proactive steps to enforce the rules of international trade, as it is critical to American beef industry. I will continue to monitor the situation and work in a bipartisan fashion to make sure our ranchers are given a fair shake.”
House Ways and Means Chairman Kevin Brady, R-Texas ; Rep. Adrian Smith, R-Neb., a Ways and means member and the chair of the Modern Agriculture Caucus; and Rep. Collin Peterson of Minnesota, the top Democrat on the House Agriculture Committee, also commended the USTR.
“This announcement is welcome news for America's beef producers,” Peterson said.
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