The European Union (EU) has requested consultations, a World Trade Organization (WTO) dispute proceeding, with Colombia to address what it believes are discriminatory practices against spirits being imported from the EU into Colombia. The EU says that Colombian authorities treat imported alcoholic beverages from the EU in a manner that is inconsistent with the WTO.

The EU spirits face higher taxes than local brand spirits, and Colombia’s regional authorities impose market-access restrictions for imported spirits. The EU believes this creates a competitive disadvantage against EU spirits and is inconsistent with the non-discrimination obligations of the WTO rules.  Because the EU is the number one exporter of spirits into Colombia, it is most impacted by these discriminatory practices.

The EU and Colombia signed a comprehensive free trade agreement in 2013. The trade agreement aims at opening up both markets and committed Colombia to creating a level market for imported and local goods.  The August 2015 deadline has passed for these arrangements to come into effect, which has spurred the EU to initiate the consultations.

The objective of the consultations is for the parties to resolve the dispute themselves, without litigation. The bilateral consultation is the first step in the settlement process.  If the consultations fail, and the parties are unable to resolve the dispute within 60 days, the EU can request adjudication by a panel to rule on the compatibility of Colombia’s trade practices with the WTO rules.