. /.  WORLD TRADE  
ORGANIZATION  WT/MIN(05)/2 
8 November 2005 
 (05-5248) 
Ministerial Conference 
Sixth Session Hong Kong, 13 - 18 December 2005 Original:   English 
 
  
EC COMPLIANCE WITH ALL MFN RIGHTS AND INTERESTS ON BANANAS UNDER 
THE DOHA MINISTERIAL DECISION OF  14 NOVEMBER 2001 (WT/MIN(05)/15), 
THE AWARD OF THE ARBITRATOR OF 1 AUGUST 2005 (WT/L/616), 
THE AWARD OF THE ARBITRATOR OF 27 OCTOBER 2005 (WT/L/625), 
GATT ARTICLE XIII, GATT ARTICLE XXVIII 
AND ALL OTHER WTO OBLIGATIONS 
 
Communication from Honduras
 
 
  The following communication, dated 7 November 2005, is being circulated at the request of the Delegation of Honduras.   
_______________ 
 
  The 14 November 2001 Ministerial Decision, European Communities – The ACP-EC 
Partnership Agreement  (the “Doha Waiver”), reached in Doha, Qatar, requires that with respect to 
bananas, any new EC “rebinding” installed as of 2006 must “result in at least maintaining total market 
access for MFN banana suppliers,” taking into account “all EC WTO market-access commitments 
relating to bananas.”
1  To uphold that standard, the Doha Waiver authorizes two rounds of special 
arbitration, and provides that if both arbitrations determine that the EC’s envisaged rebinding(s) fail 
the Doha Waiver standard, the Waiver of GATT Ar ticle I must cease to apply to bananas upon entry 
into force of any new EC tariff regime.  Under th e terms of the Doha Waiver, both the arbitration 
procedures and Article XXVIII negotiations must be  concluded before any new EC banana regime 
may be put into effect.   Two Arbitration Awards have now found against the EC’s 2006 banana proposals.  The first 
Award, issued on 1 August 2005, found that the EC’s  proposed increase in the MFN banana tariff to 
230 €/mt would not satisfy the Doha Waiver standard.
2  The second Award, issued on 27 October 
2005, found that the EC’s proposed 187 €/mt MFN tariff, ACP tariff rate quota (TRQ), and zero-
duty/quota-free treatment for countries covered by  “Everything But Arms” (“EBA”) would fail to 
“rectify the matter.”3  As required under the terms of the Doha Waiver, that second determination 
against the EC will cause the Waiver of GATT Artic le I on bananas to terminate upon implementation 
of any EC tariff-only regime.  The EC has yet to cl arify how it intends to proceed in light of these 
findings. 
                                                      
1 WT/MIN (01)/15, 14 November 2001; WT/L/436, 7 December 2001. 
2 European Communities - The ACP-EC Partnership Agre ement – Recourse to Arbitration Pursuant to 
the Decision of 14 November 2001, Award of the Arbitrator , WT/L/616, dated 1 August 2005. 
3 European Communities - The ACP-EC Partnership Agreement – Second  Recourse to Arbitration 
Pursuant to the Decision of 14 November 2001, Award of the Arbitrator , WT/L/625, dated 27 October 2005. WT/MIN(05)/2 
Page 2  
 
  During the second arbitration, on 7 October 2005,  the EC lodged a request with the WTO to 
extend the existing banana waiver of GATT Ar ticle XIII through 31 December 2007 to cover a 
proposed enlarged ACP TRQ of 775,000 mt.
4  The EC has not explained how that TRQ would fit 
within the new 2006 regime, nor how that collective arrangement would fulfill the requirements of the 
Doha Waiver and Arbitration Awards. 
 
 The EC has likewise failed to explain how it will fulfill all GATT Article XXVIII obligations 
before any new EC banana regime takes eff ect, as required by the Doha Waiver and GATT 
Article XXVIII.  The only Article XXVIII talks held  by the EC thus far on the 2006 banana regime 
occurred in November/December of 2004, when the EC briefly discussed with Panama, Ecuador, 
Costa Rica, and Colombia, a tariff rate of 230 €/mt.  That tariff rate has since been invalidated in 
arbitration.5  Although Honduras properly submitted a clai m of substantial supplying interest under 
Article XXVIII, the EC has not been willing to recognize that legitimate  claim.  Honduras has 
accordingly reserved its Article XXVIII rights and referred the non-recogniti on of its substantial 
supplying interest to the General Council, where the matter remains unresolved.6 
 
 Thus, despite repeated WTO findings against the EC’s past and proposed  banana policies, and 
a Ministerial Decision reached at the Doha Ministerial Conference that requires the EC to maintain total MFN access on bananas into the future, the EC has yet to demonstrate how it will uphold those 
MFN rights for the developing country banana suppl iers of Latin America from 2006 forward.  If a 
new EC banana regime is to be installed as of 1 January 2006, the EC must clarify to the MFN 
supplying interests how it will fully comply with  the 14 November 2001 Ministerial Decision, the 
Arbitration Awards of 1 August and 27 Octobe r 2005, GATT Article XIII, GATT Article XXVIII, 
and all other WTO obligations.   
__________ 
 
 
                                                     
 
4 Request for Extension of a Waiver Under GATT Article XIII, Tariff Rate Quota for Bananas of ACP 
Origin , dated 7 October 2005, G/C/W/529, circulated on 11 October 2005.  The EC’s existing GATT Article 
XIII:1 and Article XIII:2 waiver covering its 750,000 mt reserve quota for bananas originating in ACP countries 
lapses on 31 December 2005.  European Communities – Transitional Regime for the EC Autonomous Tariff 
Rate Quotas on Imports of Bananas , Decision of 14 November 2001, WT/MIN(01)/16.   
5 European Communities - The ACP-EC Partnership Agre ement – Recourse to Arbitration Pursuant to 
the Decision of 14 November 2001, Award of the Arbitrator , WT/L/616, dated 1 August 2005. 
6 WT/GC/85, dated 4 December 2004 and WT/GC/90 , dated 18 May 2005.  The non-recognition was 
referred pursuant to the 1980 Procedures for Negotiations under Article XXVIII,  para. 4, C/113 and Corr. 1, 
10 November 1980.