Russia Loses Another WTO Fight

Piglets crowd a stall at a hog farm in Drahnsdorf, Germany. The world Trade Organization ruled on Friday that most of Russia’s 2014 bans on European Union exports of pigs, pork and other pig products were unjustified. ENLARGE
Piglets crowd a stall at a hog farm in Drahnsdorf, Germany. The world Trade Organization ruled on Friday that most of Russia’s 2014 bans on European Union exports of pigs, pork and other pig products were unjustified. Photo: Carsten Koall/Getty Images

Russia has lost its second case in a week at the World Trade Organization, with the agency ruling that most of its 2014 bans on European Union exports of pigs, pork and other pig products were unjustified.

Last week, Russia lost its first WTO decision since joining in 2012 over an EU challenge to Russian import duties on paper, refrigerators and palm oil products.

In Friday’s case, Russia had imposed the bans between January and September 2014, supposedly for sanitation reasons in response to some cases of highly contagious African swine fever close to the Belarus border in the EU.

However the bans also came at a time of heightened tensions between the EU and Russia over the crisis in Ukraine, which led the EU and the U.S. to impose a range of sanctions on Russia.

Russia formally retaliated against those sanctions by banning imports of other agricultural products, including many pig products, from the EU.

Reacting to the decision, the EU’s executive said that, even though Russia’s counter-sanctions meant many of the products will still be banned, the panel’s findings were “of systemic importance.”

“Today’s ruling confirms that the measures taken by Russia against the EU have little to do with any real sanitary or health risks,” the European Commission said in a statement. “The EU will continue to use WTO procedures to ensure that the international trade rules are effectively respected.”

The Russian pork ban targeted the whole of the EU, but the measures were particularly restrictive against Estonia, Latvia, Lithuania and Poland.

With the exception of an import ban for untreated pig products from Latvia, the WTO said the Russian measures were arbitrary, that Russia didn’t base the bans on an appropriate risk assessment, and that the prohibitions were significantly more restrictive than was necessary to deal with the threat.

The WTO also said Russia discriminated unjustifiably between EU member states where similar conditions applied. They said the measures effectively created a disguised restriction on international trade.

In 2013, before the bans, the EU exported around €1.4 billion ($ 1.6 billion) in pork exports to Russia, around a quarter of total EU sales to Russia.

EU exports of food and live animals to Russia dropped from €8.8 billion euros in 2013 to €3.3 billion in 2015.

Russia and the EU have 60 days to appeal the decision before the ruling is formalized. If there is no appeal, the two sides will then need to agree with the WTO a period for Russia to scrap the measures.

Since joining the WTO, Russia and the EU had clashed on a range of trade issues, from auto exports to agricultural sales. The two sides also battled over the EU’s trade and political deal with Ukraine, which Russia fiercely opposed, saying it would undermine economic relations between Russia and its neighbor.

“The Russian side doesn’t agree with part of the WTO conclusions as they are not just and not justified,” the Economy Ministry said.

The ministry said arguments for launching an appeal were “rather strong” and a decision would be made in coming weeks.

Write to Laurence Norman at [email protected]


WSJ.com: US Business

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