WTO Probes EU Tech Taxes

World Trade Organization launched an investigation into the legality of European taxes on imports of high-tech goods, acting on a complaint by the U.S., Japan and Taiwan.

GENEVA (AP) -- The World Trade Organization launched an investigation Tuesday into European taxes on imports of high-tech goods, acting on a complaint by the U.S., Japan and Taiwan.

The trade body established an investigative panel to examine the legality of European tariffs on flat-panel computer monitors, cable and satellite boxes that can access the Internet, and printers that can also scan, fax and copy.

The United States, Japan and Taiwan charge the 27-nation bloc with reneging on a 1996 agreement that ended tariffs on information technology equipment.

The EU "and its member states promised duty-free treatment to those products," the United States told the WTO's dispute settlement body. "We spent over two years trying to work with the (EU) to address our concerns, without success."

Washington said Brussels' taxes on these products impede trade and "threaten to undermine tariff commitments on information technology products, which are so important to trade and investment."

Last week, the EU proposed eliminating the taxes by reopening the WTO's 12-year-old agreement. It says the monitors, satellite boxes and printers are not covered by the deal as they are new products that have entered the market since the accord went into effect.

On Tuesday, it told the WTO that it has "offered on many occasions ... to solve these issues through negotiations." This has not occurred because the U.S., Japan and Taiwan "have so far not demonstrated any willingness" to resolve the disagreement outside of litigation, the EU said.

The duties, which are as high as 14 percent, make U.S. exports less competitive in the European Union, according to the Information Technology Industry Council, a trade association. The group's members include Hewlett-Packard Co., Apple Inc. and Cisco Systems Inc.

Leading manufacturers of flat-panel computer displays include Dell Inc. and Hewlett-Packard.

The EU delayed a formal WTO investigation into its tariffs last month, but could not under the rules do so a second time.

Japan said it supported the statement by the United States, and criticized the EU for failing to end duties on goods as it is required to.

Taiwan said the WTO panel was necessary.

"As one of the largest suppliers of IT products in the world, our trade interests have been seriously injured by the (EU's) measures," Taiwan said.

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