Page last updated at 21:55 GMT, Wednesday, 6 May 2009 22:55 UK

EU and US reach deal in beef row

Existing US trade sanctions on EU products will remain

The US and the European Union (EU) have reached a provisional deal to end a dispute over an EU ban on US hormone-treated beef.

The move should prevent the US from implementing $116.8m (£77.5m) in new retaliatory duties on European products such as French cheese.

The EU claims that beef treated with certain growth hormones poses a health risk to humans.

The US had given the EU until 9 May to find a solution.

Mark Gregory
Mark Gregory, Europe Business Reporter, BBC News, Brussels
This deal is intended to end the longest running and most intractable trade dispute dividing Europe and America.

In the late 1980s, the European Union imposed a ban on consumption of meat from cattle given growth hormones.

The ban was imposed on health grounds but it had the effect of excluding most beef imports from the US, where cattle are routinely given hormones as part of their feed.

The US government and US farmers always maintained there was no evidence hormones were harmful to human health.

America took its case to the World Trade organisation and won. It was one of the first cases heard by the WTO. But Europe persisted with its ban.

At the root of it all are different cultural attitudes to farming practices. America and Europe have had rather similar rows over genetically modified foods and poultry treated with chlorine washes to kill pathogens.

European suspicion of high-tech farming practices has come up against American fears that health regulations are simply a cover for stopping lower cost US food producers from competing in European markets.

The four-year agreement will provide the US with additional duty-free access to the EU market for cattle that have not been treated with hormones.

"Following a very good discussion today, we have reached an understanding that provides a pragmatic way forward in the long-running beef dispute," said EU Trade Commissioner Catherine Ashton.

No new sanctions

The US has agreed not to impose new sanctions on EU products, though sanctions that are already in existence will remain in place for three years.

Sanctions on a range of EU products including Italian mineral water, truffles and French cheese had been due to be implemented this week.

Earlier this year, French cheese makers and farmers had protested outside the US Embassy in Paris to call on US President Barack Obama not to triple duties on Roquefort cheese.

Washington will remove all sanctions during the fourth year.

Before the end of the four-year period, the two sides will seek to conclude a longer-term agreement.

In 1998, the EU banned US beef on the grounds that US beef producers made use of hormones that are unapproved in the EU.

However, the World Trade Organization ruled 11 years ago that the ban was inconsistent with global trade rules.

The deal will need to be approved by EU governments and the US Congress.

"The European Union should reopen its market to all US beef, which is entirely safe," said Republican Senator Chuck Grassley of Iowa, a member on the Senate Finance Committee.

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