US involves WTO in EU IT tariff dispute

The US has called on the WTO to find agreement between it and Japan and the EU in a trade dispute thats has been rumbling for months over tariffs the European Union have been – unfairly the US and Japan argue – imposing on foreign imports of selected flat screen monitors, set top boxes and multifunctional printers.

The US and Japan are angry over the EU’s continued insistence on charging tariffs on the products despite – as the US and Japan argue – the products falling under the 1996 WTO Information Technology Agreement that bans import tariffs on imported IT products, but many commentators are now suggesting that the terms need to be updated to reflect 12 years of technological development.

The full list of products that are banned from having tariffs imposed on them include computers, telecommunications equipment, semiconductors, semiconductor manufacturing equipment, software and scientific equipment. However, the EU is arguing that the particular models they are taxing have features that mean they can function as devices that are not exempt and therefore can be taxed.

Specifically, it argues that flat screen monitors – that under ITA regulations are exempt – that come with DVI interfaces can be used with consumer electronics such as DVD players and games consoles and therefore should not be exempt.

In the case of set top boxes, the rule state that if they can access the internet they are exempt, but the EU argues not all can do so and because they have hard disk drives inside them that are used for pausing live TV, they should be classed as video recorders – which are not exempt.

As for printers, the EU has accused the US of hypocrisy, alleging that it initially objected to all photocopiers being included in the ITA regulations, with the two trade blocs eventually settling on all but those using electrostatic print engines being included – the technology that modern multifunction printers use – and as as result, the EU is arguing that these can be taxed on import.

In a statement, US trade representative Susan Schwab said: "The EU should be working with the United States to promote new technologies, not finding protectionist gimmicks to apply new duties to these products.

"Therefore, we urge the EU to eliminate permanently the new duties and to cease manipulating tariffs to discourage technological innovation," she added.

However, the EU was quick to respond, saying: "The EU has always expressed its willingness to reassess product coverage under the ITA to reflect changes in technology since 1996. The ITA has a review clause which can be invoked by members at any time.

"The EU has said it is willing to negotiate with all other ITA members," continued the spokesperson. "The US is now willing to do this."

Source: The Register