EU Raises Two Disputes in WTO Against India and Turkey

The European Union (EU) has announced that it has launched two World Trade Organization (WTO) cases on unlawful import duties on information and communication technology (ICT) products and unlawful measures on pharmaceuticals, against India and Turkey, respectively.

“Today the EU is showing once again that it will not hesitate to use the multilateral system to enforce the rules when others violate them. India must abide by its own commitment to allow duty free trade in ICT products. Technological innovation keeps our companies competitive in the global market and supports hundreds of thousands of high-value jobs across Europe,” said commissioner for trade Cecilia Malmström in an April 2, 2019 press statement. “Turkey is discriminating against EU pharmaceuticals producers by forcing them to move production there. This is a clear violation of WTO rules and puts many EU jobs at risk. We hope that we will be able to resolve both cases during the upcoming WTO consultations.”

Both cases have significant economic ramifications for the EU. However, in the case against Turkey-which concerns measures that force foreign procedures of pharmaceuticals to move their production to the country-in order for the medicines to be eligible for reimbursement for consumers, it has been estimated that EUR 460 million (approximately US$516 million) worth of pharmaceutical exports are affected. If the measures, which are a violation of Turkey’s WTO obligations to treat foreign companies equally to domestic ones, is further implemented then the economic impact on EU exports is anticipated to potentially reach EUR 2.5 billion (US$2.8 billion).

The initial part of the dispute settlement comprises a 60-day long consultation period. Should a satisfactory solution not be found within the consultation period to resolve the disputes, the EU can then move to set up a panel for each case in order to rule on the issues raised in the disputes.

Source: European Commission