The creation of the internal market within the European Community (EC) made it
necessary to integrate the differing national arrangements that were still existing by
1993 with regard to a variety of goods. One of these Community-wide regimes adopted
is the EC banana regime. It is one of the most disputed regimes so far1
An import tax of 20 was in force in the open, free market economies of the
Benelux, Ireland and Denmark before the EC banana regime came into force. Only in
Germany was no import tax levied because of the Banana Protocol of 25 March 1957.
Bananas from ACP countries could be imported into all EC countries as a matter of
principal tax free pursuant to Art. 168 of the Lomé Convention IV. After 5 years of negotiation2 the common market organization for bananas came
into force on 1 July 1993. The legal basis is the Council Regulation (EEC) 404/933, a
brief summary of which follows. Its regime discriminates against banana producers who
are not based in the EC or in countries of the African, Caribbean or Pacific area (ACP),
and against companies that distribute bananas that originate in those countries. At
present imports of bananas from twelve previously determined traditional ACP
countries enter the Community duty free, up to a maximum quantity fixed for each
country in the regulation. Non-traditional ACP and third-country imports are subject to
a tariff quota which lies well below the quantity these countries exported to the EC
before the new banana regime was introduced with an import tax of 100 ECU per tonne.
Furthermore, out of quota shipments are subject to a prohibitive duty, which renders
importation uneconomical, that is 750 ECU per tonne for imports from ACP states and
850 ECU per tonne for third country bananas. Licensing requirements are applied to
imports of traditional as well as non-traditional ACP- and third countries. As a result of
these regulations, operators who traditionally marketed third country bananas have a
competitive disadvantage over those who marketed Community bananas.4 Licenses for
importation of bananas from non-traditional ACP and third countries are issued to three
market sharing groups. Accordingly the earlier importers of these bananas only receive
a quota of 66.5%.
[...]
Table of Contents
I. The EC common market organization for bananas
II. WTO Panels relating to the EC banana regime
III. Judgment of the European Court of Justice
1. Germany v. Council [Bananas]
2. Criticism of this judgment
IV. The EC banana regime before the national courts
V. Conclusion
Research Objectives & Key Themes
This work examines the legal and political tensions surrounding the European Community's banana import regime, specifically analyzing the conflicts between the EC's internal regulatory framework and international obligations under WTO law. The research aims to evaluate whether the European Court of Justice should recognize the binding effect of WTO law and explores the implications of this dispute for the relationship between national, European, and international legal systems.
- The structure and discriminatory nature of the EC banana import regime.
- The clash between WTO dispute settlement findings and EC legal practice.
- The jurisdictional battle between the ECJ and German courts regarding the supremacy of Community law.
- The broader impact of the dispute on the European Union's credibility and its adherence to international trade rules.
Excerpt from the Book
II. WTO Panels relating to the EC banana regime
Shortly before the common market organization for bananas was enacted in July 1993, a GATT Panel had already found that banana regimes of several member states violate GATT law. Less than one year later, another panel reached the same conclusion with regard to the new banana regime which had been established Community wide. However the findings of either panel were adopted unanimously by all GATT CONTRACTING PARTIES as was necessary under the rules of GATT 1947.
Most of the complaining contracting parties of the second banana panel negotiated the „Framework Agreement on Banana Imports“ with the EC. They agreed thereby not to pursue the adoption of the panel report, while the EC made concessions with regard to the size of the basic tariff quota and other specifications. As this agreement discriminated against other GATT contracting parties and the discrimination inherent in the common market organization persisted as well, Ecuador, Guatemala, Honduras, Mexico and the United States requested the establishment of new panels, which delivered their opinion in May 1997. The panel decisions, which confirmed several infringements of WTO law, were appealed by the EC and the recently installed Standing Appellate Body had to decide on the issue.
Summary of Chapters
I. The EC common market organization for bananas: Outlines the origins of the banana regime established in 1993 and describes the complex licensing and quota system that disadvantaged third-country banana producers.
II. WTO Panels relating to the EC banana regime: Details the series of GATT and WTO legal challenges against the EC regime and the subsequent findings of non-compliance with international trade rules.
III. Judgment of the European Court of Justice: Analyzes the ECJ's controversial decision in the case Germany v. Council, where the court refused to use GATT law as a basis to invalidate Community regulations.
IV. The EC banana regime before the national courts: Explores the resistance from German courts, which questioned the ECJ's supremacy and argued that the banana regime violated both international law and German constitutional principles.
V. Conclusion: Summarizes the potential for conflict created by the regime and calls for the ECJ to integrate WTO rules into the Community legal order to move towards a rule-oriented international system.
Keywords
EC banana regime, WTO law, European Court of Justice, GATT 1947, European Community, International trade, Banana organization dispute, Judicial review, Supremacy of Community law, Import quotas, Licensing requirements, Legal conflict, German Constitutional Court, Trade policy, Dispute settlement.
Frequently Asked Questions
What is the core subject of this publication?
The work investigates the "Banana Regime" of the European Community, focusing on the legal conflicts that arose between this internal market regulation and the rules of international trade law governed by the WTO.
What are the primary thematic areas covered?
The central themes include the mechanics of the EC's banana import system, the repeated legal challenges by international trading partners, and the jurisdictional tension between the ECJ and national courts regarding the validity of Community acts.
What is the primary goal of the author?
The author aims to analyze how the ECJ's refusal to acknowledge the direct effect of WTO law has created unnecessary legal and political friction, ultimately proposing a shift toward a more rule-oriented approach in European jurisprudence.
Which scientific methods are employed in this analysis?
The study employs legal analysis, including the interpretation of Council Regulations, the review of WTO panel reports, and an examination of landmark judicial decisions from both the ECJ and German constitutional and fiscal courts.
What issues are addressed in the main body?
The main body examines the specific regulatory framework of the banana regime, the procedural history of the WTO dispute settlement cases, and the domestic legal challenges filed by German entities against the EC regulations.
Which keywords characterize this work?
Key terms include EC banana regime, WTO law, European Court of Justice, supremacy of Community law, and international trade disputes.
How does the author interpret the ECJ's position in the Germany v. Council case?
The author is highly critical of the ECJ's decision, arguing that the Court was mistaken in deciding that a potential violation of GATT provisions did not need to be considered when challenged by an EC member state.
What is the author's argument regarding the role of German national courts?
The author argues that while German courts have voiced significant concerns, they should generally respect the unity of Community jurisdiction, reserving challenges only for cases involving obvious and long-lasting breaches of fundamental national constitutional standards.
- Quote paper
- Dr. Gerald G. Sander (Author), 1998, The EC Banana Regime - a Testcase for the Relationship between WTO, Regional and National Law, Munich, GRIN Verlag, https://www.grin.com/document/7266
