WTO sides with bloc against US tariffs on Spanish olives

The latest development in the long-standing trade spat comes as a WTO compliance panel report made public on Tuesday (20 February) confirmed the EU’s justification for challenging US tariffs on Spanish black olives.

The case dates back to 2017 when the US imposed tariffs on Spanish olives, citing harm caused to American producers due to EU subsidies directed at Spanish olive producers through the Common Agricultural Policy (CAP).

Subsequently, the US Department of Commerce levied anti-subsidy and anti-dumping duties ranging between 30% and 44% on imports of Spanish black olives.

The EU challenged these measures at the WTO, leading to a legal battle spanning over four years and formally concluded in November 2021, when a first panel ruled that the US administration’s actions were in breach of WTO rules.

In particular, the measures presumed the automatic and full pass-through of subsidies from the producer to the transformer of agricultural products which is not enough to justify the impose of tariffs, the first panel found.

In its final report, the compliance panel echoed the conclusions of the previous ruling and recalled that the US had failed to implement the WTO recommendations outlined in the 2021 finding.

“We call on the US side to swiftly bring itself into compliance and provide relief to the Spanish olives sector, which has been unlawfully hit by the US anti-subsidy duties since 2018,” said the EU executive’s vice-president for trade Valdis Dombrovskis.

The latest decision allows Brussels to take further means, including retaliatory measures, to ensure the US fully implement the panel recommendations.

“This is a compliance panel, so we now expect to work on compliance,” a commission spokesperson told Euronews, adding that the EU executive intended to strongly engage with the US on compliance before considering further options.

The outcome of this dispute may have broader implications beyond the European olive industry for how EU farming subsidies – historically contested as an anti-competitive practice favouring massively European farmers – are perceived at the WTO level.