French Fry Clash Heads to WTO as EU Gets Salty With Bogota

(Bloomberg) --

The European Union will launch a dispute at the World Trade Organization against Colombia in response to the tariffs the South American country imposed on imports of frozen French fries from Belgium, the Netherlands and Germany.

EU trade chief Cecilia Malmstrom on Monday said the duties were “completely unjustified and they are harming European companies.”

The latest action adds a new, if much smaller dispute, to the list of trade conflicts being dealt with in the EU, including a spat with the U.S. over aircraft subsidies that could lead to levies being imposed on $7.5 billion of European products later this week. EU exports of frozen fries to Colombia totaled $33.5 million last year, according to the Geneva-based International Trade Center.

Though the dispute covers a relatively small amount of EU-Colombian trade, fries have an important cultural resonance in Belgium, which is home to the European Commission’s headquarters.

Malmstrom said that EU officials have reached out to Colombia multiple times over the past two years but “haven’t received a satisfactory response.”

The move comes after the Colombian government applied levies of as much as 8% against EU frozen fry exporters in November on the grounds that they were selling their product below cost, a practice known as dumping.

A WTO request for consultations marks the first phase of the WTO’s dispute settlement process.

If the EU and Colombia can’t resolve the matter after 60 days, Brussels may then ask the WTO to establish a dispute settlement panel to determine whether Colombia’s measures comply with WTO rules.

To contact the reporter on this story: Bryce Baschuk in Geneva at bbaschuk2@bloomberg.net

To contact the editors responsible for this story: Brendan Murray at brmurray@bloomberg.net, Richard Bravo, Nikos Chrysoloras

©2019 Bloomberg L.P.