EU Requests WTO Dispute Settlement with US and Canada Over Beef Hormones

Strategic Insights -

The European Union (EU) has taken a formal step to resolve the long-standing trade dispute over hormone-treated beef with the US and Canada by requesting consultations within the World Trade Organization's (WTO) dispute settlement system. The three parties have a two-month window to reach an agreement; failing that, the case will proceed to arbitration, potentially taking eight to nine months. EU Trade Commissioner Pascal Lamy asserts that the EU's ban on hormone-treated beef is compliant with international obligations, while the US and Canada are maintaining "unilateral sanctions" and refusing to lift retaliatory tariffs imposed in 1999. The dispute's roots date back to the 1980s, when the EU began banning anabolic steroids in cattle farming for human and animal health reasons, and by 1988, expanded the ban to include two synthetic hormones widely used in North America. The US and Canada imposed retaliatory sanctions in 1999, affecting EU exports, but the EU has since reevaluated its stance and aligned itself with WTO rules, arguing that scientific risk assessments justify the ban.

Key Takeaways:

  • The EU's ban on hormone-treated beef, which started in the 1980s, is now inclusive of oestrogens, gestagens, and thyrostatic substances, including synthetic hormones like Trenbolone and Zeranol.
  • The WTO ruled in 1998 that the EU's initial ban was illegal, citing a lack of risk assessment.
  • The US and Canada imposed retaliatory sanctions in 1999, including a 125% tariff on EU mustard, truffles, Roquefort cheese, and textiles.
  • The EU reevaluated its stance and aligned itself with WTO rules in 2003, basing the EU Hormones Directive on a full scientific risk assessment.
  • The EU argued that six different growth hormones, with resulting residues in beef, "present potential risks to human health".
  • Retaliatory tariffs worth US$116.8 million and CAN$11.3 million (approximately $9.5 million) remain in effect.

Statistics:

  • By 1988, the EU's ban on hormone-treated beef covered all synthetic hormones used in beef production, including Trenbolone and Zeranol.
  • 125% tariff imposed on EU mustard, truffles, Roquefort cheese, and textiles in 1999.
  • Retaliatory tariffs: US$116.8 million and CAN$11.3 million (approximately $9.5 million).
  • EU Hormones Directive: six different growth hormones pose risks to human health, per EU evaluation.
  • Two-month window for resolving dispute between EU, US, and Canada.
  • 8-9 months for WTO dispute arbitration, if no settlement is reached.

Sources:

  • EU trade official's statement to the press
  • WTO ruling in 1998
  • US and Canadian retaliatory sanctions in 1999
  • EU Hormones Directive of 2003