Thread by @Jim_Cornelius

1/14

Here's an article on BrexitCentral by so-called tariff expert Dan Lewis from 2016 complaining about EU tariffs. There are a number of problems, but I'm not sure if this has been pointed out before.

Dan's got the whole thing backwards as we'll see.

brexitcentral.com/dan-lewis-unve…

2/14

The first thing he picks on is a 17.6% tariff on coconut water, enacted from 1 July 2016. Unfortunately Dan demonstrates here that he has little understanding of the subject he is proclaimed as being an expert in.

Coconut water code is 2009899996.

trade-tariff.service.gov.uk/trade-tariff/c…

3/14

If you simply look at the Overview page you'll see the 17.6% tariff that Dan has pointed out, but there are some important words there:

"unless subject to other measures".

We'll look at that, but first it's interesting that the new code was added on 1 July 2016.

4/14

Before that date it would have come under 200989999. which is for the same category of fruit juices but "Other". So even before July 2016 it would have been liable for a 17.6% MFN tariff.

So why was the new category created?

5/14

Well if you look import page you'll see this. An "Autonomous tariff suspension". There's a link to a Council Regulation on the right, but this is to a renewal of an earlier regulation. The original regulation is (EU) 2016/1051 from 24 June 2016.

6/14

Here is that regulation from June 2016,

140 products not already under autonomous suspension were added to the existing list as of suspended duties.

eur-lex.europa.eu/legal-content/…

7/14

Including, crucially from our point of view, coconut water!

So far from adding a duty to coconut water in June 2016 it was actually being removed!

This is the EXACT opposite of what Dan was suggesting!

But why was duty suspended?

8/14

Here's a page explaining a little bit about about autonomous tariff suspensions, giving three reasons, among others for doing so. Might one of these have something to do with it?

eur-lex.europa.eu/legal-content/…

9/14

You may have seen this in your supermarket recently. There's been a real fad for coconut water. Sales have gone through the roof.

But what you see here is a processed product made by Genuine Coconut in Europe. Not processed in Thailand where the coconuts are sourced.

10/14

Coconuts are on 0% tariff from everywhere, but until July 2016 Thailand's exports of coconut water would have been subject to the tariff as we have no FTA with them and the're not one of the countries benefiting EBA etc.

11/14

But ACP countries (many Commonwealth) were on 0% tariffs at this time. As was the Philippines who are on GSP+ (awarded before current President Duterte elected eeas.europa.eu/archives/deleg…)

So they benefited from a preference over countries with no preference with the EU

12/14

But the demand for coconut water couldn't keep up with supply.

Coconut and coconut exports all over the world are booming.

So the tariff was suspended to liberalise the trade increase exports of coconut water into the EU. This is not protecting EU processing of coconuts.

13/14

At some point in the future the tariff may be re-imposed so that ACP, GSP+/EBA countries and other countries with an FTA regain their advantage over other countries processing coconuts into coconut water.

14/14

In short Dan got this whole issue arse about face!

Instead of a new tariff being on coconut water it was the opposite. A tariff line was carved out of the existing schedule for coconut water so that an suspension could be set on it, making it for 0% for everywhere!

/END