EU takes Russia’s ‘discriminatory’ car recycling fee to WTO

Russia – The EU has raised the issue of Russia’s ‘discriminatory’ car recycling fee with the World Trade Organization (WTO), Bloomberg has reported. Imposed on imported cars and trucks, it is argued that vehicle exports to Russia have dropped 7% since the fee was introduced.

Fees begin at around Euro 420 (US$ 541) for small cars and increase with the size of the vehicle; the sums can be as high as Euro 2700 (US$ 3540) for new cars and Euro 17 200 (US$ 22 551) for used ones. Countries such as Kazakhstan and Belarus are exempt from the measure, unlike all the EU nations.

Highly ‘incompatible’

The dip in vehicle exports to Russia translates into a business loss of Euro 10 billion per year. Clearly, says EU trade commissioner Karel De Gucht, the fee is ‘severely hampering’ trade in a sector which is key for the European economy. ‘The fee is incompatible with the WTO’s most basic rule prohibiting discrimination against and among imports,’ he states.

The European Commission has pursued ‘every diplomatic channel for almost one year now’ to resolve the matter with its Russian counterparts – ‘but to no avail’, laments De Gucht. ‘We gave Russia until July 1 to lift these recycling fees and it failed to do so, so that is why we are taking this to the WTO,’ he has told Reuters.

The EU expects Russian officials to co-operate in finding a speedy solution to this problem. De Gucht concludes: ‘It is important to remember that Russia, as a WTO member, has to play by global trade rules.’