• Dr Lockwood Smith
International Trade

Trade Minister Lockwood Smith has welcomed the World Trade Organisation's (WTO) decision to establish a disputes settlement panel to consider New Zealand's case against the United States lamb safeguard action which restricts imports of New Zealand lamb.

The United States imposed a tariff on imports of lamb from New Zealand under the WTO Safeguards Agreement in July this year, following an investigation by the United States International Trade Commission (ITC).

The New Zealand Government believes the tariff is contrary to the rules of the WTO, and initially sought formal consultations with the US, as required under WTO rules. The consultations were held in late August but failed to resolve the issue, and New Zealand has actively sought a WTO disputes settlement panel to rule on the matter.

The establishment of a panel is welcome news, and means that we should have a final ruling on this case by the middle of next year," Dr Smith said.

"The US Government's decision to introduce trade restrictions on lamb imports must be challenged. Acceptance of the US interpretation of the safeguard action would set an unfortunate precedent within the WTO, and could lead to the potential misuse of the WTO rules to restrict fair trade in goods and services.

"The disputes settlement body has also approved a request for a panel from Australia on the US safeguard action, and one panel will be established to hear both cases. The panel will be made up of three panellists who will be selected over the next few weeks," Dr Smith concluded.