EU Threatens Countermeasures to Avoid Stall of WTO Dispute With Indonesia
The European Commission on July 7 opened a consultation on the use of its enforcement regulation in a World Trade Organization dispute on Indonesia's export restrictions on nickel. The move follows Indonesia's appeal of a WTO dispute panel ruling favorable to the EU. Due to the lack of a functioning Appellate Body, all appeals at the WTO are in limbo.
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The commission said EU stakeholders have until Aug. 11 to comment on the use of the enforcement regulation, which allows the EU to enforce internal obligations when a trade dispute is blocked. "Based on the results of the consultation, the EU may proceed to propose countermeasures in the autumn," the bloc said. Such measures could include "the imposition of duties or quantitative restrictions on imports/exports." The EU said it will continue searching for other ways to resolve the dispute with Indonesia, including inviting the country to join the Multi-Party Interim Appeal Arrangement, an alternative to the Appellate Body.
Simon Lester, president of WorldTradeLaw.net and a former WTO staffer, said in a blog post that while the move may not be "ideal in terms of the rule of law," it may be the "best option under the circumstances." Given the number of current trade disputes between the EU and Indonesia, Lester said, a resolution could be reached as "part of a broader package."