EU seeks WTO talks with Canada over 'discriminatory' new wine and beer tax
AP
December 01, 2006
The European Union said Wednesday it will seek World Trade Organization talks over Canada's "discriminatory" wine and beer tax that it claims punishes European imports while giving Canadian drinks a free ride.
"This measure is unfair and I urge Canada to end this discrimination against our products," said EU Farm Commissioner Mariann Fischer Boel. "European wines and beers are second to none. We can compete with anyone as long as we have a level playing field on which to operate."
Beginning July 1, Canada has given excise tax relief to its own wine and beer while leaving intact rates on EU imports such as French wines and Belgian beer.
The new tax rules are due to be formally adopted next month - after Parliament gives its backing - and applied retroactively from July, although in practice the measures are already in place.
The European Commission said it hoped it could find a solution at the WTO, saying it had already "expressed its concern" to Ottawa in recent months.
The EU exported wine worth 446 million euros (US$586 million) and beer valued at 110 million euros ($145 million) last year.
The WTO talks form the first stage of legal action under global trade rules. If the two sides don't reach a deal within 60 days, the EU can ask for the WTO to set up a panel to rule whether Canada is acting legally - which could ultimately force it to drop the tax exemption.
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