US, EU reach provisional deal in beef dispute


May 28, 2010 Updated May 28, 2010 at 6:40 PM EDT

The United States and the European Union agreed in principle Wednesday to bury the hatchet in their long-running dispute over US hormone-treated beef.

The agreement would provide additional duty-free access to the EU market for US beef produced from cattle that have not been treated with growth-promoting hormones, a joint statement issued by the US Trade Representative's office said.

The access would begin with 20,000 tons of beef in the first three years and increasing to 45,000 tons beginning in the fourth year, the statement said.

The dispute has been festering since 1988 when the EU banned US beef on the grounds that US beef producers made use of certain growth-promoting hormones that are unapproved in the EU.

The World Trade Organization, the global trade watchdog, ruled 11 years ago that the ban was inconsistent with WTO rules.

Under the agreement reached Wednesday between US Trade Representative Ron Kirk and EU Trade Commissioner Catherine Ashton, Washington will maintain existing sanctions but will not impose new sanctions on EU products during the initial three-year period, according to the statement.

Washington will eliminate all sanctions during the fourth year.

"Following a very good discussion today, we have reached an understanding that provides a pragmatic way forward in the long-running beef dispute," Kirk and Ashton said in the statement.

"An agreement is in our mutual interest, and we will now discuss this with our respective stakeholders and constituencies in an effort to finalize it as soon as possible," they said.

The two sides will also refrain from further litigation at the World Trade Organization regarding the EU's ban on beef treated with hormones for at least 18 months.

Before the end of the four-year period, the two sides will seek to conclude a longer-term agreement, the statement said.

"Reaching an agreement on this issue will be a clear sign of our commitment to working through -- and, where possible, resolving -- the bilateral disputes in our trade relationship," Kirk and Ashton said.

"We will continue our close cooperation on other outstanding issues in the future," they said.

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