The European Union (EU) reported today at the World Trade Organization (WTO) Argentine restrictions on imports, reports that Brussels was studying for some time and that has accelerated following the nationalization of YPF.
“I ordered the EU delegation in Geneva to initiate WTO proceedings against restrictions on imports from Argentina. Argentina imposes restrictive trade measures since 2005 (…) And these actions are illegal,” said European Commissioner for Trade Karel De Gucht.
The EU has taken the step of resorting to international arbitration to resolve a problem that has been documented in recent months with evidence submitted by European companies affected.
The EU considers incompatible with WTO rules subordination Argentina imposed on imports of all goods to a system of prior authorization and pre-registration, call early import affidavit.
The EU claims that hundreds of goods require an import license, a procedure that “systematically delayed imports or cause them to reject them for reasons that are not transparent.”
In that regard, he recalled that in early 2011 that affected licensing more than 600 types of products such as electrical machinery, vehicle parts and chemicals.
In 2011 were affected European exports to that country worth about 500 million euros (total EU exports to Argentina that year amounted to some 8,300 million euros).
As explained by the commissioner, from February 2012 that prior approval requirement applies to all imports.
Finally, the Commission indicated that Argentina requires importers balance imports with exports, to increase the local content of products made in Argentina or not to transfer their income abroad.
“This practice is systematic, not written and lack of transparency”, summed up the EC, adding that the acceptance by the importers’ seems to be a condition for obtaining the license that allows them to import their goods. ”
These measures also delay or block the goods at the border and cause “significant losses for the EU industry and the whole world,” said the Commission.
The action taken by the EU in Geneva, which coincides with the celebration in Argentina of the national holiday, he ordered the country to discuss possible solutions for up to 60 days, with the WTO as an arbitrator.
If you concluded that there is no consensus within the EU can request the establishment of a special panel to rule on the legality of the Argentine measures.
The Commission made clear today that the open procedure is not related to the expropriation of Spanish Repsol YPF, but a “separate issue, related to restrictions on imports and trade in goods.”
In any case, EU sources stated that “it is fair to say” that both restrictions on imports and measures against Repsol show “political leadership in Argentina is very worrying for European companies.”
For De Gucht, the oil company “was perhaps the most visible protectionist measures taken by Argentina and made headlines, but if you look deeper, Argentina’s trade policy has taken root in unfair trade practices.”
The Commissioner insisted that the EU is not the only one affected, and recalled that fourteen countries (EU, U.S., Japan, Australia, Israel, South Korea, New Zealand, Norway, Panama, Taiwan, Thailand and Turkey) issued last March 30 a joint statement in Geneva accusing Argentina of seriously hinder free trade.
Category: Mutual Funds