WTO issues mixed ruling on US-Indonesia clove cigarette spat

2nd September 2011, Comments 0 comments

The World Trade Organization ruled Friday that the US flouted trade rules by banning the sales of Indonesian clove cigarettes, but said Washington's aim of cutting youth smoking with the restriction was "legitimate."

Washington had banned the production and sales of clove cigarettes under a health act that also blocks the sales of other cigarettes with flavours such as grape, coffee or strawberry, in a bid to prevent the young from getting hooked on smoking.

The move prompted Indonesia to lodge the case against the US at the WTO, with Jakarta arguing that the act had not been applied uniformly as it did not cover menthol cigarettes, a claim that the WTO upheld in its ruling.

"By banning clove cigarettes while exempting menthol cigarettes from the ban ... accords imported clove cigarettes less favourable treatment than that it accords to domestic menthol cigarettes," the WTO said in its ruling.

However, the WTO threw out the Indonesien claim that the ban was unnecessary.

The WTO said "it failed to see how any of this would call into question the conclusion that the ban on clove cigarettes is aimed at reducing youth smoking, and that this is a legitimate objective."

The WTO concluded by asking the United States to bring its restrictions into conformity with international trade rules.

Either party has 60 days to appeal the ruling.

© 2011 AFP

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