Hearing on liquor tax appeal expected at WTO in October

THE PHILIPPINES expects a hearing next month on its appeal in the foreign liquor tax case at the World Trade Organization (WTO) as the latter’s Appellate Body starts a three-month review today, an industry official said.

The WTO announced on Friday last week that the country had submitted its appeal that day, following a panel report on Aug. 15 stating its excise taxes on imported distilled spirits, particularly from the United States and the European Union (EU), are unfair.

“Last Friday, the Philippines submitted its appeal...which the industry, DSAP (Distilled Spirits Association of the Philippines), together with government...put together [sic] to the WTO Appellate Body. An oral hearing will be scheduled some time end of October and a decision is expected end of the year,” Olivia Limpe-Aw, DSAP president, said via text message on Sunday.

“The oral hearing, which is estimated to be [sic] Oct. 25-26, is when questions and clarifications are raised to the appealing party...,” Ms. Limpe-Aw explained.

WTO’s dispute settlement rules give the Philippines 60 days from the report’s release to file an appeal.

The Appellate Body’s decision could take as long as 90 days from the date of the said filing. Such appeal, according to the global trade body, must raise only legal issues related to the panel report, such as interpretation of the law, and can no longer question factual findings.

The panel’s decision has a potential to open the $3-billion Philippine market to famous competitors such as Jack Daniel’s, Jim Beam and Brandy de Jerez, liquor brands from the two complainant economies, the US and EU.

Liquor importers, however, have expressed dismay over the government’s refusal to accept the preliminary decision. “They should have followed it [the panel report],” Ralph Lim Joseph, International Wines & Spirits Association, Inc. president, said in a separate interview. “The government should not protect anybody in the first place, because that’s a ‘sin’ tax. We should be consistent with what [President Benigno S. C. Aquino III] is declaring about having equal opportunity for business in this country.”

September 26, 2011

Source: bworld.com.ph