Peru Appeals WTO Panel Ruling in Agricultural Duties Case

The WTO’s highest court is set to hear the case between Peru and Guatemala over the former’s duties on certain agricultural imports, after Lima filed a formal notice appealing a previous dispute panel ruling last week.

At issue in the case is Peru’s “additional duty” on certain agricultural imports, such as rice, sugar, maize, milk, and certain dairy products. The panel had ruled largely in Guatemala’s favour late last year.

In the appeal notice submitted last week, Peru has specifically flagged the panel’s finding that Guatemala did not violate “good faith” obligations in launching the dispute, and has also asked the Appellate Body to reconsider whether the duty violates global trade rules.

The dispute (DS457) was launched nearly two years ago, with Guatemala filing a request for consultations in April 2013. While the panel report was circulated last November, both sides agreed to extend the usual 60-day appeal deadline through 25 March 2015.

FTA legal status

This dispute has drawn particular attention for the questions it raises on whether and how commitments under FTAs interact with WTO obligations.

The “additional” duties imposed by Peru on these agricultural imports are determined using a mechanism known as the Price Range System (PRS). This system uses a range set by a price floor and ceiling, reflecting international prices over the last 60 months.