By Natalia Freitas for atuna.com

The international trade specialist lawyer, Dan Horovitz, gives his insights about the current situation on EU import duties on ASEAN countries’ canned tuna and talks about a future with trade liberalization.

As the end of the quota agreements for canned tuna imports from ASEAN countries approached in July 2008, the discussions over the 24% duty imposed by the European Union (EU) on the item came back to the tuna industry agenda.

The Association of Southeast Asian Nations (ASEAN) region is formed by 10 member countries such as: Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Vietnam, Lao, Myanmar and Cambodia. From which Thailand and the Philippines are the main canned tuna exporters.

In an interview for Atuna.com, the attorney representing the ASEAN interests, Mr. Dan Horovitz, gives us some clarity on the past facts and current situation of the negotiations to lower or even extinguish the EU - ASEAN 24% duty.

Mr. Horovitz is a specialist in EU and World Trade Organization (WTO) regulation and conflict resolution. He started his career in the competition department of the European Commission and is working with international trade for over 25 years. Currently he is a partner with the international law firm Holman Fenwick Willan.

Atuna.com: Can you please tell me your role in current negotiation between EU and ASEAN?

Mr. Horovitz: As a lawyer I’ve been always very much involved with Asian trade to the EU and to other world regions, which brought me also to the negotiations between the Thai and the Philippine tuna industry and the EU in the WTO in early 2000, and I’ve been in touch with the ASEAN association ever since. 

Atuna.com: When did the negotiations start?

Mr. Horovitz: The issues in tuna trade between EU and ASEAN countries have been happening for a long time. The reason is the high import duties imposed to the ASEAN countries: 24%. This is very unusual. Nowadays, the average level of duties are one or very low two digits, certainly not 24%. Most of the imports of canned tuna into the EU enter zero duty, so we have an unbalanced situation. Of course, this is my opinion as a lawyer on the side of the ASEAN countries.

Atuna.com: What do you mean by unbalanced situation?

Mr. Horovitz: In 2001, when in the Lome Convention the EU needed the WTO members’ approval to the 0% duty on tuna products from the ACP countries, the Philippines and Thailand said that they would agree, but that something had to be done about the 24% duty imposed to them. In a way, that was the first time the problem was “put on the table”. As a result, the EU agreed in solving the 24% problem. However, nothing happened. WTO mediation between Philippines and Thailand and the EU finally led the EU to agree in establishing quotas with lower duties. This policy started in 2003, but it ended in June 2008. So, now we have a very unusual situation. Basically in EU international trade negotiations practice, every time there’s an agreement to liberalize trade, tariffs go lower and in this case the duties went back to what they used to be.

Atuna.com: What is usually the procedure in these cases?

Mr. Horovitz: The EU has trade agreements with all over the world, where trade has been liberalized, however not to Asian countries. We should add here a very important development, that the EU began sometime ago the negotiation of the creation of a Free Trade Area (FTA) with the ASEAN countries. The objective was to benefit the EU, as you know Asian countries are constantly developing. In parallel, there were also negotiations in the WTO for the reduction of restrictions regarding processed fish. So we have two trends for liberalization.

Atuna.com: Can you tell us the reason you believe for the ASEAN countries to have such high restrictions in exporting canned tuna to the EU?

Mr. Horovitz: That’s a very good question that can be answered by historical reasons. Most of the countries possessing trade agreements with the EU are former colonies. The Portuguese, Spaniards, Dutch, English, French benefited from those colonies for many years; but more important than that, is to understand that those relations created patterns of international trade between countries. Most of the countries present in the creation of the EU had colonies, so all the other countries that joined the Union had also links of preference to the former colonies. In addition, historically you have a lot of investments from the colonizers in their former territories, and no such relationship with Asian countries.

Atuna.com: Do you believe that EU would benefit with the EU-ASEAN FTA?

Mr. Horovitz: At the end of the day, the EU will lose for not having the FTA with ASEAN. The basic issue I believe EU’s tuna industry is concerned about is the fact that under the WTO rules, if you have a FTA, duties will have to go down to zero. Not at once, but at the end of the day, the restrictions would have to go down to zero. That is already happening with ACP countries, Andean countries, Mediterranean countries, and if the FTA EU-ASEAN is approved, there will be no restrictions whatsoever, and not only on tuna, but on all the products in both ways, to the benefit of the economies of both parties. That’s a big change, and people don’t always like change. It’s the role of the government to prepare the countries and the people towards trade liberalization.

Atuna.com: What’s the legal perspective in the current situation?

Mr. Horovitz: In my opinion, the fact that there is such a high duty on canned tuna from ASEAN while there’s no duty or very little duty in almost all other destinations is unlawful under the WTO rules, unlawful.

Atuna.com: Do you believe the negotiations in the WTO and for the FTA will result in a change soon?
Mr. Horovitz: I don’t think we are going into a conflict now, once the basic idea is to try to smooth things. However, the idea of extending the quotas is not a viable option. The WTO negotiations were put on hold, but I hope that we would soon see some positive progress in the FTA negotiations. However, these negotiations are quite complex due to the number of countries involved and the very complicated issues to be considered. We heard comments about the EU preferring not to negotiate with all the nations at the same time, but I’m optimistic about the final outcome. As a person and a lawyer I don’t believe there is any other option than negotiating this issue. I cannot tell you about the future consequences of an FTA between those countries for sure, but we have history and history shows that whenever we had international trade liberalization, people benefited. The WTO rules are there to liberalize global trade; the best solution is to follow the rules and bring about a balanced solution.