* U.S. says whiskey brands shut out of Philippines market
* WTO panel to probe complaint; already raised by EU
* Panels on Vietnam, S.Korea and China complaints deferred
(Adds single panel for Philippine cases, comments, US/China)
By Jonathan Lynn
GENEVA, April 20 The World Trade Organization
is to investigate a U.S. complaint that Philippines duties on
distilled spirits discriminate against foreign suppliers of
liquor, trade sources said on Tuesday.
The United States says that Manila taxes alcoholic products
made from domestic materials such as sugar or palm at lower
rates than imported spirits made from other materials, hurting
sales of U.S. brands such as Jack Daniel's or Jim Beam whiskey.
The United States is one of the largest exporters of
distilled spirits, with worldwide exports averaging more than $1
billion a year from 2006 to 2008.
But U.S officials say the Philippine tax system -- imposing
duties 10-40 times higher on spirits not distilled from
materials produced in the Philippines -- means it has failed to
gain more than 5 percent of the $3 billion local spirits market.
The case could help U.S. producers like Brown-Forman Corp
(BFb.N), which owns Jack Daniel's, and Fortune Brands Inc
FO.N, which makes Jim Beam, break into the market.
The Philippines said its policies are consistent with WTO
rules, and it believed the dispute could have been settled
through talks respecting the interests of each side.
"It was in this spirit that we consulted with the United
States last February, with the participation of the European
Union, and we clarified the non-discriminatory and impartial
nature of our excise tax regime on distilled spirits," it said
in a statement to the WTO's dispute settlement body.
A meeting of the body decided to refer the complaint to a
panel of experts for a ruling, combining it with an
investigation already in progress into a complaint about the
same issue raised by the European Union.
The Philippines blocked a previous U.S. request for a panel
on April 8, but under WTO rules was not allowed to prevent it
going ahead at the second request. [ID:nLDE63614T]
The panel would be expected to rule on the complaint in six
to nine months, but both sides could appeal its findings.
Three other calls for panels to investigate complaints were
rejected as they were the first request, but are likely to go
ahead at the dispute settlement body's next meeting on May 18.
They all involve anti-dumping measures -- duties imposed on
goods that the importer says are unfairly priced below cost.
One case involves Vietnam's first challenge at the WTO -- a
dispute against U.S. anti-dumping duties on shrimp imports.
Vietnam only joined the WTO three years ago and the dispute
involving one of its key exports will give it valuable
experience in handling international trade litigation.
In another dispute, China is challenging EU anti-dumping
tariffs on imports of Chinese shoes, a case pitting some
European shoe makers against consumer groups and manufacturers
with production facilities in China. [ID:nLDE63815F]
And South Korea is challenging the United States over
Washington's use of the controversial "zeroing" method for
calculating anti-dumping duties on imports of South Korean steel
All the WTO's 153 members except the United States reject
zeroing, which has been repeatedly condemned by the WTO, and
which critics say unfairly inflates anti-dumping duties.
China told the meeting that it now complied with a WTO
ruling condemning its regime for protecting intellectual
property, after completing the necessary changes to its laws.
But the United States said it was examining whether this was the
case and had already raised some questions directly with China.
(Editing by Charles Dick)