After months of silent scramble, a battle between the EU and the US on IT customs tariffs erupted after Washington decided to file a formal complaint to the World Trade Organisation (WTO) against European duties on certain high tech goods, including flat-screen TVs and multifunctional printers.
The official complaint was filed by the US, along with Japan, on Wednesday (28 May). It targets tariffs imposed by the European Union on a range of IT products, of which global exports are estimated to amount to more than €450 billion.
The American and Japanese authorities are first requesting WTO dispute settlement consultations with the EU to resolve the issue. But the consultation procedure can only last a maximum of two months, and after that, in the absence of an agreement, WTO experts will be forced to take a legally-binding position.
What has angered the US and Japan is the EU’s policy not to consider new products developed from goods already in the ITA as covered by the agreement. In other words, while traditional printers are duty-free in the EU, more recently evolved versions, also capable also of scanning or faxing, are not.
The US argument is that such technological developments were foreseeable and that new machines should benefit from similar tariff reductions as those already developed ten years ago. “We all know that technology is organic. New features are developed, and advances are made, almost before we walk out of the store, and certainly before the ink is dry on most of our agreements,” said US Trade Representative Susan Schwab.
But the EU retorts that the deal made in 1996 is explicit regarding the products it covers. It insists that the only way to review the list is therefore to proceed to new overall negotiations on the ITA. Brussels says it has requested this already on several occasions but that the US has always opposed it.
The products under scrutiny are LCD monitors and flat-screen TVs, which Brussels argues are different from computer displays, indeed covered by the ITA. The US and Japan are also calling for multifunctional digital printers (alongside traditional printers) and video recorders (alongside set-top boxes able to record but mainly to connect to the Internet) to be included.