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PHL yet to consider retaliation on tobacco case vs. Thailand

Posted on September 1, 2014

By Kris M. Crismundo

MANILA, Sept. 1 (PNA) — The Philippines has yet to consider asking the World Trade Organization (WTO) for retaliation against Thailand on tobacco case.

In a WTO meeting last August 29, the Philippines said that it has only two actions for the outstanding issue with Thailand: to continue observation in the case or return it to dispute settlement.

Trade sources based in Geneva, Switzerland said the Philippines continues to ask the WTO’s Dispute Settlement Body (DSB) to observe that Thailand is implementing recommendations and rulings in this issue.

The Philippines has persistently raised its concerns regarding this dispute with Thailand including:

*the decision of Thailand’s Attorney General to charge a Philippine-based cigarette importer for declaring customs values, in which the WTO panel made a decision in favor of the complainant (Philippines) and the respondent (Thailand) has considered the decision as a measure needed to be implemented; and

*the complainant’s concerns on WTO-consistency of anther ruling by the Board of Appeals on entries subject to the recommendations and rulings of the DSB.

In the same meeting, Thailand responded that they already complied with the DSB’s recommendations and rulings after completing all necessary actions regarding this dispute.

Thailand just echoed its position in the previous DSB meeting in June 18 this year.

However, the Philippines insisted that the respondent has not fully complied with the WTO’s decision.

Thailand, on the other note, said their side will remain open in discussing particular concerns of the complainant on bilateral level.

To recall, this dispute rooted since 2006 when the Philippines filed a complaint to the WTO on the violation of Thailand in the General Agreement on Tariffs and Trade (GATT) of 1994.

The Philippines argued that Thailand imposed higher tax duties on imported tobacco products than domestic cigarettes, thus affecting Philippine cigarettes to Thailand and not promoting a fair trade competition.

Also, the country raised to WTO other issues on Thailand such as customs valuation practices, excise tax, health tax, TV tax, VAT regime, retail licensing requirements and import guarantees in which the Philippines claimed that Thailand administered those measures in a “partial and unreasonable manner.”

Even the WTO resolved this dispute in favor of the Philippines three years ago but the issue remains withstanding as Thailand asserted that it already complied with the recommendations and rulings while the Philippines insisted that the respondent has not yet completed the necessary actions regarding this dispute.

In this case, trade sources earlier said that the Philippines can ask for the WTO’s approval for retaliation or imposing sanctions to Thailand if the complainant sees the respondent as non-compliant.

If the Philippines will ask WTO to apply retaliation against Thailand and the WTO will approve it, the complainant is allowed to impose higher tax duties on an imported product from the respondent.

But based on the latest WTO meeting, the Philippines has yet to consider such actions against Thailand. (PNA)

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