The South Korean government is planning on implementing a suspension of concession in response to the European Unions’ steel safeguard. The suspension can be defined as tariff re-imposition or imposition of a higher tariff.
The Ministry of Trade, Industry and Energy sent a written notification to the WTO on April 2, saying that it may implement a suspension of concession worth 56.81 million euros on products imported from EU member countries. Earlier, the steel safeguard was adopted on Feb. 2. The value of 56.81 million euros is based on additional tariffs on South Korean steel estimated to be caused by the safeguard.
In the case of an EU safeguard for responding to an absolute increase in imports, the suspension of concession that can be exercised by a counterpart can become effective from the earlier of two dates. One is three years after the implementation of the safeguard and the other is the date of the WTO Dispute Settlement Body’s determination that the safeguard is in violation of the WTO Agreement, which takes two to three years.
The ministry explained that its suspension of concession that is equivalent to 22.63 million euros is related to the EU safeguard entailed by no absolute increase in imports and that portion can be implemented in less than three years according to Article 8 of the WTO Safeguard Agreement.
Regarding washing machine disputes between South Korea and the United States, in the meantime, the WTO ruled in February that the South Korean government can implement a suspension of concession of US$84.81 million a year on products imported from the United States. The ruling came out in 65 months after the suit was initiated.
At that time, the United States did not implement the WTO appellate ruling of the case it lost in September 2016 until the deadline of Dec. 26, 2017. In response, the South Korean government filed for a suspension of concession of US$711 million per year in January last year. Also, the government notified the WTO of another suspension on U.S. products in April last year after a U.S. safeguard against solar panels and washing machines became effective on Feb. 7, 2018.
Source: Business Korea
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