INDIA – CERTAIN TAXES AND OTHER MEASURES ON IMPORTED WINES AND SPIRITS
Document: Request for Consultations by the European Communities Addendum
Date: 17 December 2008
Document codes: WT/DS380/1/Add.1; G/L/855/Add.1; G/SCM/D79/1/Add.1
Complainant: EU
Respondent: India
Dispute stage: Consultation
Agreements cited: Art. III:2, III:4, XI, XVII  GATT 1994Art. 3.1(b), 3.2, 4.2  Subsidies and Countervailing Measures (SCM)

INDIA – CERTAIN TAXES AND OTHER MEASURES ON
IMPORTED WINES AND SPIRITS

Request for Consultations by the European Communities

Addendum

 The following communication, dated 15 Decembe r 2008, from the delegation of the European
Communities to the delegation of India and to th e Chairman of the Dispute Settlement Body, is
circulated in accordance with Article 4.4 of the DSU.

 The European Communities hereby re quests supplementary consultations
1 with India
pursuant to Article 4 of the Understanding on Rules and Procedures Governing the Settlement of
Disputes (DSU) and Article XXII:1 of the General Agreement on Tariffs and Trade 1994
(GATT 1994) regarding discriminatory taxation applie d on imported bottled wines by the Indian state
of Karnataka. These measures adversely affect exports of wines and spirits (codes 22.04, 22.05, 22.06
and 22.08 of the Harmonised System) from the European Communities to India.
Discriminatory taxation applied by the Indian State of Karnataka
 The European Communities understands that th e State of Karnataka appears to apply the
"additional special fee" and the "special fee" in a wa y that subjects imported wines to internal taxes in
excess of domestic like products. Notification IV No FD 20 PES 2005 of 27 September 2008
amending the Karnataka excise (excise duties and fees), Rules, 1968 sets a new "additional special
fee" at the rate of 300 RS/per bulk litre for wine manufactured outside India and imported into
Karnataka. The "additional special fee" is not app lied on domestic in-state lik e products. The "special
fee" appears to tax imported bottled wines in excess of domestic in-state like products.
 The measures in question include but are not limited to:
− The Karnataka Excise Act 1965;
− The Karnataka excise (exci se duties and fees) rules 1968, as amended by the Karnataka
excise (excise duties and fees) rules 2003 and Notification No FD 20 PES 2005 of 27
September 2008, including Notification IV therein;
− Notification No FD 02 PES 2008 of 1 April 2008.

1 This request supplements the request of consultations entailed in document WT/DS380/1, G/L/855,
G/SCM/D79/1 dated 25 September 2008 with regard to measures not mentioned in the latter request.

 The European Communities considers that these measures are inconsistent with Article III ,
paragraph 2 of the GATT 1994. In particular:
− The "additional special fee " is inconsistent with India's obligations under Article III:2 of
the GATT 1994, because it subjects imported BIO bottled wines to internal taxes that are
in excess of internal taxes applied on domestic like products;
− The "special fee" is inconsistent with I ndia's obligations under Article III:2 of the
GATT 1994, because it subjects imported BIO bottled wines to internal taxes that are in
excess of internal taxes applied on domestic like products.
 The European Communities considers that these measures also nullify or impair the benefits
accruing to the European Communities under the GATT 1994.
 For each of the measures referred to in this document, the request for consultations also
covers any amendments, replacements, extensions, implementing measures and the related measures.
 The European Communities reserves the right to address additional measures and claims
under other provisions of the WTO Agreement regard ing the above matters during the course of the
consultations.
 The European Communities looks forward to receiving in due course a reply from India to
this request. The European Communities is ready to consider with India mutually convenient dates to
hold consultations.