990539 Canada to Ask to Retaliate in EU Beef Fight

Ottawa - Canada said it would join the United States in seeking World Trade Organization authority to retaliate for the European Union's failure to open its market to beef from cattle treated with hormones.

“Canada plays by the rules, and expects others to do as well,” International Trade Minister Sergio Marchi said in a statement.

“The WTO has ruled twice in our favor, yet the EU (European Union) has failed to comply with the ruling. This is unacceptable.”

He said Canada would be seeking authority to increase tariffs on selected products imported from the EU for approximately C$70 million worth of lost beef exports due to the ban. Under WTO rules it has until June 12 to request this authority.

“If we cannot find a mutually agreeable solution, we will not hesitate to exercise our WTO rights,” Agriculture Minister Lyle Vanclief said in a statement.

Vanclief told reporters earlier that the amount of goods on which the higher tariffs would apply would probably approximate the value of the lost beef exports.

“In the meantime we will be continuing, naturally, the entry of the (EU) products, but also the compensation package,” Vanclief said. Under that arrangement, the EU would temporarily compensate Canada for lost sales as a result of the import ban.

“Certainly we want compensation, and the last time that I heard about it, the compensation discussion was going -- not going extremely well, but it was still going ahead.”

Vanclief said Canada was drawing up a list of EU goods that it would hit with 100-percent duties for retaliation. The goods will be drawn from a preliminary list of EU food and beverages that was drawn up by Canada's Trade Department in April.

The EU imposed the ban 10 years ago on the grounds that hormone-treated beef was not healthy, but the WTO found that it had not based its conclusion on proper scientific evidence.

The United States said on Friday it would seek WTO authority to impose $202 million in duties on EU products.

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