Fischler remains resolute over beef ban despite WTO findings

Date: 22/05/1997

AGRICULTURE Commissioner Franz Fischler will seek to maintain the EU's import ban on hormone-treated meat, even if the Union suffers its anticipated defeat in the World Trade Organisation.

After recent leaks of the WTO dispute settlement panel's interim report, European Commission officials suggested that the EU would rather pay compensation to the injured parties than lift its restrictions on hormone use in beef farming. “This is the most likely scenario,” said one.

The panel's initial findings, while not unexpected, are very damning about the Union's adherence to a ban which, it says, cannot be justified on scientific grounds.

Commission officials are trying to remain upbeat, claiming that “where the report hits, it hits quite hard, but it does not hit all over”. But one third country diplomat said: “There is no area of comfort for the Europeans.”

Fischler is, however, determined to uphold the ban, stressing that European consumers are not interested in eating meat produced with the aid of the six treatments approved in the US. Above all, the Commission is concerned to avoid yet another slump in beef sales as the markets struggle to recover from the BSE crisis.

But Commission plans to simply buy off those who have challenged the hormone ban - the US and Canada, supported by Argentina, New Zealand and Australia - may not be as easy to achieve as Fischler and Trade Commissioner Sir Leon Brittan hope. “Compensation is irrelevant; there is no such thing as permanent compensation. Perhaps they can pay for an interim period, but our understanding is that they have to change their rules. We want market access,” said a US official.

After the EU introduced its ban in 1988, the US initially retaliated by increasing tariffs on Union exports of tomato and veal products, among other things, worth around 85 million ecu. This was the value of trade Washington felt it was losing through the European embargo. The retaliation was dropped last year.

American officials stress levels of compensation would be impossible to calculate. They claim the US would have been able to negotiate better access to the Union market at the last trade round if the ban had not existed, and that the true damage to US jobs cannot be gauged.

The panel suggested that the Union was operating double standards, accepting no risk from hormones but being much more lax on other growth promoters such as feed additives. One possible let-out for the Union suggested in its report would be the voluntary labelling of non-hormone treated beef. But WTO experts believe this would only be legal if the EU also allowed hormones in beef production. Otherwise, it would constitute discrimination against imported products.

Following the aggressive reaction from France to the panel's provisional findings, Brittan has appealed to member states to respect WTO procedures. Under the complex appeal process, a final ruling is unlikely within six months.