United States Removes Banana War Sanctions

July 2001

On July 1, 2001, United States Trade Representative Robert Zoellick announced that the United States was lifting retaliatory duties against certain European goods imposed as part of the Banana War. This dispute arose when the United States, among others, objected to the European Union's regime for the importation of bananas into the EU. Under an understanding reached in April 2001, the EU was to modify its current banana import regime in two steps. The first step, which involved the granting of banana licenses based on the historic access to the EU market, was completed prior to July 1, 2001. Completion of this step caused the United States to remove its 100% tariff on selected products from the EU for goods entered, or withdrawn from warehouse for consumption on or after July 1, 2001.

The second step, which involves a modification of the EU's tariff rate quotas for imports must be completed by January 1, 2002. In addition, by January 1, 2006, the EU must introduce a tariff-only regime for banana imports. The USTR will seek comments regarding this proposed settlement. However, while the USTR version of this request for comments indicates that comments are due no later than 5:00 p.m. on August 7, 2001, it should be noted that this version is not the official Federal Register notice, as published. Therefore, this date may change. Please contact Barnes, Richardson & Colburn to confirm the final date on which comments are due.

This agreement was entered into in the wake of decisions by a WTO arbitrator, WTO Appellate Body, and WTO Dispute Resolution Panel. Under United States law and the WTO decisions, the United States will monitor the EU's implementation of this agreement, and may re-impose punitive tariffs if the EU fails to properly implement this agreement.