| GENEVA, June 12
GENEVA, June 12 Turkey told the World Trade
Organization on Wednesday that it would retaliate against a
Ukrainian tariff on car imports, while Japan and the European
Union signalled they could follow suit.
Turkey's retaliation was tiny in global trade terms,
amounting to a 23 percent tax on Ukrainian walnuts which Turkey
estimates will raise $6.1 million, equivalent to the damage done
to Turkey's car exports by Ukraine's tax.
But it amounts to a warning shot for Ukraine, signalling
that other disgruntled WTO members may take similar action - and
any future retaliation would hurt much more than Turkey's
"If we don't act we risk losing our rights. We may
retaliate," one EU official said.
The European Union, Japan, South Korea and Russia are all
car exporters to Ukraine and have demanded an explanation for
the tax, which came into force in March for three years.
Under the WTO rules, member countries can impose "safeguard"
tariffs to protect a sector if there is a threat of serious
damage to producers from a surge in imports. But there are
strict rules about their use, which Ukraine is accused of
"Countries are clearly looking at next steps as Ukraine is
not cooperating or upholding the safeguard agreement," the EU
Diplomats say the car tariff is part of a pattern of
aggressive and eccentric behaviour by Ukraine, which is vetoing
Yemen from joining the WTO, pursuing a legal challenge to
Australian tobacco laws and undermining the WTO system by
demanding a far-reaching renegotiation of its tariffs.
Ukraine's critics say it had no grounds to use safeguards,
should have given prior warning that it was thinking of doing
so, and did not give car exporters a chance to negotiate
equivalent "payment" in some other sector, as it should have.
In a filing to the WTO, Japan said it had requested a
meeting with Ukraine, but there was no response, at least until
it was too late and the tariff was already in force. Japan and
other WTO members asked for the meeting to take place in Geneva,
but Ukraine wanted it in Kiev, without specifying a date.
"This unilateral imposition of additional duties is clearly
inconsistent with the relevant WTO agreements. Japan reiterates
its request to Ukraine that it immediately terminate this
unjustifiable imposition of additional duties," said Japan's
notification, published on the WTO website on Wednesday.
"In the event of Ukraine's failure to do so, Japan will
consider taking necessary steps under the WTO agreements."
Japan did not specify what sanctions it might use, as Turkey
did, but notified the WTO's Council on the Trade in Goods of
Ukraine's breach of the rules. The Council meets on July 11 and
is set to rubber-stamp Turkey's retaliation, which comes into
force the following day.
The EU official said the five complainants were cooperating
in their challenge against Ukraine.
(Reporting by Tom Miles; Editing by Michael Roddy)