India blocks WTO probe on US wine

04 June 2007

India has succeeded in blocking an investigation by the WTO on its import duties on American wines and spirits, temporarily delaying a US government complaint over allegations that Indian rules discriminate against products such as Napa Valley wine and Jack Daniel''s whiskey.

The Geneva-based WTO is currently reviewing a European complaint on restrictive tariffs on wines and liquors from a number of state governments in India.

A second investigation by a panel to examine a similar complaint from the US is expected to be established at a meeting later this month of the WTO''s dispute settlement body as under WTO rules, a second request for a formal investigation is automatically approved.

A case can result in punitive sanctions being authorized, but panels take many months, and sometimes years, to reach a decision.

It is unclear if the U.S. and the EU will seek to become co-complainants by combining their separate WTO cases.

US trade representative Susan Schwab said last month while announcing its intention to seek litigation, "The layers of customs duties India applies to US products, in particular to wine and distilled spirits, are not in line with its WTO commitments. We must ensure a level playing field for US products around the world."