BELGIUM: EU appeals to WTO in India duty row

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The European Union has asked the World Trade Organisation to get involved in its duty row with India.

The move follows India's failure to meet last Friday's deadline, imposed by the EU, to promise to liberalise its strict tax structure on wines and spirits.

Earlier this year, the European Commission concluded an eight-month investigation into a complaint lodged by EU wine and spirits producers.

The Commission concluded that India's duty system, which subjects imported spirits to a markedly higher tax burden than faced by Indian distillers, is so domestically-skewed that "the Indian market has remained essentially closed [for these products]".

A referral to the WTO means that the two parties will hold a formal 60-day dialogue to resolve the dispute. If no agreement is reached, a Dispute Settlement Panel - consisting of trade experts - may be established. The panel then makes recommendations on how the disputed measure can be made to conform to WTO rules.

EU wine and spirits producers welcomed the move today (20 November). "All we are asking for is a level playing field for international producers seeking access to the Indian market," said Jamie Fortescue of the European Spirits Organisation. "We would prefer that recourse to a WTO Dispute Panel decision could be avoided."

José-Ramón Fernández of the Comité Européen des Entreprises Vins (CEEV) added: "The benefits of lifting barriers to imports of EU wines and spirits will be reaped by all in India; most notably, consumers who would have greater choice at more competitive prices."

Gavin Hewitt, chief executive of the Scotch Whisky Association, said: "It is time for India to implement its international commitments and allow fair access for Scotch whisky, just as Indian spirit drinks have free access to the European market.

"We fully support referral of the matter to the WTO for formal consultations and hope that India will take this last opportunity to agree reform to its discriminatory duty arrangements for whisky, without the need for a dispute settlement panel being set up."

Sectors: Spirits, Wine

Companies: Scotch Whisky Association

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