Threat Of EU Tariff On Dry Pea And Chickpea Eliminated



he amendment to repeal the "grandfather" clause has put the United States in compliance with the WTO ruling and will allow the European Union to drop the tariff on peas and chickpeas.

Bismarck, ND May 20, 2006 -- In February of 2006, the World Trade Organization ruled in favor of a European Union complaint against the grandfather clause/phase out of the Foreign Sales Corporation (FSC/ETI) which would have continued to provide a tax breaks for several major United States companies during the phase out period.

On May 16, 2006, the European Union was scheduled to impose a tariff on several United States products, including peas and chickpeas, if the "grandfather" clause was not eliminated by the U.S. Government. "The tariff would have had a very large negative impact on our producers and our ability to move large amounts of peas following harvest," stated Eric Bartsch Executive Director of the North Dakota Dry Pea & Lentil Association (NDDPLA). The North Dakota Dry Pea and Lentil Association in conjunction with the USA Dry Pea and Lentil Council urged Congress to make changes to remove the tariff on peas and chickpeas.

The recently passed tax reconciliation bill contained an amendment to repeal the "grandfather" clause of the Foreign Sales Corporation (FSC/ETI) Legislation passed in October, 2004. The amendment to repeal the "grandfather" clause has put the United States in compliance with the WTO ruling and will allow the European Union to drop the tariff on peas and chickpeas.

"This was a significant victory for pea and chickpea producers in North Dakota and Montana with Spain being our largest dry pea export market," stated Eric Bartsch NDDPLA Executive Director. In 2005, Spain imported an estimated 70,000 metric tons of peas from the United States with a majority of those coming from the North Dakota and Montana growing regions.





Threat Of EU Tariff On Dry Pea And Chickpea Eliminated