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Back to square one with the rice federation and EU

Sorn Sarath / Khmer Times Share:
Cambodian rice at the centre of a legal dispute on tariffs with the European Commission. KT/Chor Sokunthea

Cambodia and the Cambodia Rice Federation (CRF) will have to start legal proceedings against the European Commission (EC) again if they want tariffs lifted on Indica rice imports.

The European General Court, which has only an advisory rather than a statutory role (that is reserved for the EU Court of Justice to where the case could ultimately be sent), decided the Kingdom’s complaint against the commission’s decision to maintain tariffs on the staple crop is merely still valid, contrary to some media reports that hailed it as a victory for Cambodia and the CRF.

It follows a drawn-out, complex legal bid by the Kingdom and CRF to lift the tax, claiming it was part of a generalised tariff preference granted by what is now the European Union (EU)  in the 1970s to encourage developing countries to reduce poverty.

The EC, the “civil service” wing of the EU parliament, argued that because Italy, one of the EU’s members, produces rice, it was subject to safeguard measures that allowed duty to be imposed on imports to protect its own industry. After a series of back-and-forth legal arguments, the court eventually agreed Cambodia and the CRF could appeal against a decision to allow tariffs on rice imports if it so decided.

Observers noted Vietnam and Thailand sell much more rice to the EU at a lower price.

Song Saran, who was elected president of the CRF in 2019, when the EC’s three-year safeguard measures were put into effect, said that Cambodia and the CRF filed a complaint against the commission’s decision last April. The issue taking the situation back to square one was decided earlier this month.

“Initially, when the EC imposed a safeguard on Cambodia’s rice exports to the EU market that were subject to tariffs, we filed a lawsuit against the decision, but the EC in the meantime asked the court to dismiss our complaint,” he said. “As a result, the court rejected the commission’s request, so our case is still valid. We still hope to demand that the EC will rescind this decision.”

A court order dated Sept 10 said the EC had submitted a plea requesting the court to dismiss Cambodia’s complaint and regard it as inadmissible.

It is almost two years since the EC imposed the import duty on Cambodia rice, effective from Jan 18, 2019, and a new case has yet to be brought for hearing. If it does, it could last many months.

“Our case has yet to receive a full hearing. Complaints have been lodged since April 2019. It has been almost two years now and next year [the safeguard measures] will be over,” he said. “It is still in its infancy. We have no hearing yet and this will require us to prepare for the future, so for now we don’t know how successful we can be,” he added.

“I do not know much about this because it happened before I became president and we have our lawyers working on it. I am contacting the former president of the CRF, from when the case began.”

The safeguard measures require Cambodia to pay import duty of about $205 per tonne in the first year and about $175 and about $146 per tonne in the second and third years respectively, effective from Jan 18, 2019.

Cambodia exported 397,660 tonnes of milled rice from January to June this year, an increase of 42.25 percent, compared with 281,538 tonnes in 2019, according to the Minister of Agriculture, Forestry and Fisheries.

Cambodia exports milled rice to more than 56 countries. Of which 24 countries are in the European Union, China, six countries in Asean and another 28 countries.

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