EUROPEAN COMMUNITIES – MEASURES AFFECTING THE TARIFF QUOTA FOR FRESH OR CHILLED GARLIC
Document: Request for Consultations by Argentina
Date: 12 September 2006
Document codes: WT/DS349/1; G/L/785
Complainant: Argentina
Respondent: EU
Dispute stage: Consultation
Agreements cited: Art. XXVIII, XXIV:6  GATT 1994Art. XVI:4  Agreement Establishing the World Trade Organization

EUROPEAN COMMUNITIES – MEASURES AFFECTING THE TARIFF QUOTA
FOR FRESH OR CHILLED GARLIC

Request for Consultations by Argentina

 The following communication, dated 6 Septem ber 2006, from the delegation of Argentina to
the delegation of the European Communities and to the Chairman of the Dispute Settlement Body, is
circulated in accordance with Article 4.4 of the DSU.

 The Government of Argentina has instructed me to request consultations with the European
Communities pursuant to Article 4 of the Understanding on Rules and Procedures Governing the
Settlement of Disputes (DSU) and Article XXIII:1 of the General Agreement on Tariffs and Trade
1994 (GATT 1994) with regard to certain measures ta ken by the EC that affect the tariff quota for
fresh or chilled garlic (tariff item 0703 20 00) to the detriment of Argentina's rights under the WTO
Agreements. The said quota was the subject of negotiations between the EC and Argentina under
Article XXVIII which resulted in the Agreement in th e form of an Exchange of Letters contained in
document
1, approved by Decision 2001/404/EC of 28 May 2001.

 In the framework of the ongoing negotiati ons under Article XXIV:6 of the GATT 1994 on the
accession of ten new member States to the European Union, the EC conducte d bilateral negotiations
with the People's Republic of China as a result of which it adopted measures providing for a 20,500
tonne increase, for China, in the volume of the tari ff quota for garlic. Argentina was not informed of
these negotiations although it was conducting its own negotiations under Article XXIV:6 of the
GATT 1994 in connection with the mentioned enlargement process. Argentina considers that through
the negotiations with the People's Republic of China, the EC has modified the tariff quota for garlic in
breach of Argentina's initial negotiating right.

 The measures referred to above include, but are not limited to, the following:

 - Council Decision 2006/398/EC, published in the Official Journal of the EU on
8 June 2006, approving the bilateral agre ement concerning the Community tariff
quota for fresh or chilled garlic under tariff item 0703 20 00 resulting from the recent
negotiations conducted between the EC and the People's Republic of China pursuant
to Articles XXIV:6 and XXVIII of the GATT 1994
2;

1 Agreement in the form of an Exchange of Letters between Argentina and the EC of 28 May 2001.
2 Agreement in the form of an Exchange of Letters between the EC and the People's Republic of China,
the Annex of which provides for an increase of 20,500 to nnes in the quantity allocated to the People's Republic
of China in the Community tariff quota for garlic, fresh or chilled, under tariff item 0703 20 00, published in the
Official Journal of the EU on 8 June 2006.

 - Commission Regulation (EC) No. 991/2006 amending Regulation (EC)
No. 1870/2005 – published in the Official Journal of the EU on 1 July 2006 –
implementing the decision to grant the People's Republic of China an increase of
20,500 tonnes in the tariff quota for garlic as from the 2006/2007 season.

 For each of the measures referred to above, this request also covers any amendments,
replacements, extensions, implementing measures or other related measures.

 Argentina submits that the EC has disr egarded its initial negotiating right under
Article XXVIII and the Understanding on the Interpretation of Article XXVIII. That right is the result
of the renegotiation of the original concessions relating to item 0703 20 00 co nducted with Argentina
in 2001 in view of its principal supplying interest – at the request of the EC itself – and which resulted
in the opening of the tariff quota.

 At the same time, since Regulation (EC) No. 991/2006 provides for the allocation of the
additional volume granted to the People's Republic of China as from the 2006/2007 season (beginning
in June 2006), the current situation impairs the concession initially negotiated with Argentina.

 The violation of Article XXVIII by failing to follow the procedure established for
renegotiation, and in particular of the provisions of Regulation (EC) No. 991/ 2006, alters the general
level of reciprocal and mutually advantage ous concessions and undermines the security and
predictability of the tariff concessions which the Article XXVIII procedure is intended to guarantee.

 Argentina also considers these measures to be c ontrary to the provisions of Article XXIV:6 of
the GATT 1994 and paragraph 6 of the Understanding on the Interpretation of that Article, since these
provisions refer, for the negotiation of concessions in connection with the formation or enlargement of
a customs union, to the procedures established in Article XXVIII of the GATT 1994 and related
provisions.

 In view of these considerations, Argentina cons iders that the EC measures at issue violate,
inter alia and not exclusively, the following provisions:

 - Article XXIV:6 of the GATT 1994 and th e Understanding on the Interpretation of
that Article, since they provide for the a pplication of the procedure set forth in
Article XXVIII and related provisions;

 - Article XXVIII of the GATT 1994, the Unders tanding on the Interpretation of that
Article and related provisions (Guide lines on Procedures for Negotiations under
Article XXVIII), since the EC has modified the tariff quota without prior negotiations
with Argentina, a Member with initial negotiating rights, thereby violating the
established mechanism for the modification of concessions and at the same time
altering the existing general level of r eciprocal and mutually advantageous
concessions;

 - Article XVI:4 of the Marrakech Ag reement Establishing the World Trade
Organization, since as a result of the measures at issue, the EC is in breach of the
obligations set forth in that Agreement as regards the conformity of its laws,
regulations and administrative procedur es with its obligations under the WTO
Agreements.

 Consequently, it is proposed that the requested consultations be held as soon as possible at a
date and venue to be agreed upon by both Members. In addition, I have been instructed to indicate
that my Government reserves the right to raise further factual or legal claims during the consultations.