ISLAMABAD - The Ministry of Commerce has decided to continue with a dispute initiated at the WTO in the year 2014 against imposition of countervailing duties (CVD) on exports of Polyethylene Terephthalate (PET) from Pakistan.
The duty was imposed by the EU on the 30th September 2010 for a period of five years and the duty was lifted in September 2015 after a sunset review conducted by the EU. Despite removal of this duty by the EU, similar duties may come in the future due to the modality used by the EU and tariff authorities of other WTO members to impose the duties.
Therefore, the Ministry of Commerce has decided to complete the dispute settlement proceedings in the WTO to ensure that Pakistan’s systemic interests are protected and its WTO-compliant incentives and schemes for the business community are not wrongfully challenged.
According to the details, the EU imposed CVD of 44.02 euro per tonne for Pakistani companies, 42.34 euro per tonne for Emirati companies and 139.70 euro per tonne for Iranian companies. After countless informal and formal attempts to get the duty removed, Pakistan finally initiated formal dispute settlement proceedings against EU at the WTO in November 2014 and the said consultations were held on the 17th of December 2014 in Geneva.
Several technical and informal discussions took place in Brussels between Pakistan’s economic minister and the EU authorities during February and March 2015. Pakistan resultantly requested establishment of a panel at the WTO which was established on March 25, 2015. In September of this year, after the sunset review conducted by the EU authorities, the CVD was not renewed and PET exports are re-allowed to enter EU duty free under GSP Plus scheme.
Although that the measures of the EU being challenged by Pakistan have expired after review yet the panel will issue its examination of the challenges by Pakistan and release its judgment on the dispute within six months from date of initiation.