19 Dec

Mexico Blocks Probe of Olive Oil Duties

Mexico has temporarily blocked a World Trade Organization investigation into whether duties it imposes on European olive oil violate international commerce rules, officials said Tuesday.

However, an investigative panel will automatically be established next month, if the 25-nation European Union repeats its complaint at the WTO’s dispute settlement body, trade officials said.

The move to bring the case to the Geneva-based trade referee comes after months of fruitless consultations between the EU and Mexico, which says its countervailing duties are necessary because of European olive oil subsidies.

“There was no movement on the Mexican side,” said EU trade negotiator Raimund Raith. “This case is of great importance for the (EU) given its economic significance, but also because it highlights certain systemic problems of Mexican investigations, which affect market access to (EU) exporters.”

Mexico told the dispute settlement body that it regretted the EU had chosen the path of litigation, but insisted that the olive oil levies were consistent with WTO rules.

A WTO investigation can last months or even years before a final judgment, but could eventually result in the authorization of punitive sanctions.

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