The US government has not complied with the WTO judgement on the EU-US trade dispute over the US Foreign Sales Corporations regime, a report by the World Trade Organisation has confirmed.

As a result, the EU will, from May 13, re-impose retaliatory measures on a range of US imports, including some fruit and vegetables.

Commenting on the situation, the FPC said it had hoped the trade dispute was over at the beginning of last year after additional import duties had been introduced in 2004 on a range of US products, including asparagus, peaches, nectarines and plums as well as the US government’s legislative reformation to bring it in compliance with the WTO judgement on the issue.

The EU suspended the retaliatory measures against the US last January, but reserved the right to reintroduce the penalty import duties if the US did not comply sufficiently with the WTO judgement.

And a report released by the WTO last month found the US was still in breach of its trade obligations.

In response, the EU is to re-introduce retaliatory measures on May 13 - sixty days after the adoption of the WTO reports.

These measures will take the form of a fixed increase of 14 per cent on import duties for a list of specified goods of US-origin. Goods in-transit from the US to the EU on 13 May will command the higher duty upon their arrival.

EU trade commissioner Peter Mandelson expressed hope that it would still be possible for the EU and the US to find a solution to the dispute.

But the EC has pledged to legally prevent the reintroduction of retaliatory measures only if an immediate and mutually acceptable solution is found.

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