The European Union (EU) on October 10 requested the establishment of a dispute settlement panel at the World Trade Organization (WTO) in Geneva to rule on the legality of the so-called "recycling fee" which Russia imposes on imported vehicles, a European Commission (EC) press release said.
The EC argues that the fee creates an additional burden for EU exports and offsets the reduction in import tariffs Russia accepted when joining the WTO. The fee, introduced on September 01, 2012, only days after Russia's WTO accession, is levied on imported cars, trucks, buses and other motor vehicles. For cars, it ranges from about EUR420 to EUR2,700 for a new vehicle and from EUR2,600 to EUR17,200 for a vehicle older than three years. For some vehicles, such as certain mining trucks, the fee is as high as EUR147,700. According to Russia's own estimates, the fee brings an additional EUR1.3bn a year into the country's coffers.
The fee, which the EU considers discriminatory towards imports since it does not appy to vehicles made in Russia and its Customs Union partners Kazakhstan and Belarus, has a severe impact on EU vehicle exports to Russia, worth EUR10bn a year, the press release says. The EU has repeatedly raised the issue in bilateral talks with Russia, and then in formal WTO consultations. However, the fee continues to be applied more than a year after it was introduced.
The request for a WTO panel is the next step under WTO litigation procedures, after the EU held formal consultations with Russia in July this year.
"We've used all the possible avenues to find with Russia a mutually acceptable solution," said EU Trade Commissioner Karel De Gucht. "As the fee continues to severely hamper exports of a sector that is key for Europe's economy, we are left with no choice but to ask for a WTO ruling to ensure Russia complies with its international obligations."