Colombia has brought a new complaint against the European Union's (EU) import rules for bananas, a sign that one of the World Trade Organisation's (WTO) longest-running disputes is spreading.

Colombia made the move late Wednesday, a day after Ecuador asked the global trade body to examine whether Brussels' banana tariffs comply with WTO rulings, trade officials said.

The spat, which dates back to 1996, has previously involved the United States and other Latin American countries. While they have voiced support for Ecuador's position, Colombia is the first country to join the dispute or launch its own proceedings against the bloc.

The WTO has consistently ruled against how the EU sets tariffs for bananas, forcing the 27-nation bloc to overhaul a system that grants preferential conditions for producers from African and Caribbean countries, including Jamaica, which are mainly former British and French colonies.

Latin American producers and banana companies based in the United States have long complained about the preference. The U.S., in 1999, and Ecuador a year later both won the right to impose trade sanctions on European goods after the WTO found the EU's rules to be illegal.

A deal in 2001 gave the 27-nation EU five years to comply with WTO rulings. Brussels says a new banana tariff established last year - ?176 (US$234) per tonne - has brought its banana rules into compliance.

Further action against preferences could badly hurt Caribbean exporters, such as Dominica and St. Vincent, which have seen their industries, on which their economies depended heavily, go into sharp decline. Hundreds of people have been thrown out of jobs in those countries.

In Jamaica, the attacks on the preferences have also helped to weaken an industry, which has, in recent years, suffered from storms. Exports last two years have dipped to less than half of the more than 40,000 tonnes at the start of the decade.

Colombia's WTO mission said it could not immediately comment on its move.

Ecuador, the world's largest banana producer, says the new tariff has actually taken away some of its market share in Europe, hurting more than 1 million Ecuadorians dependent on the banana industry. It has cost the country about US$131 million (?98 million), according to trade negotiator Juan Holguin.

The EU has expressed disappointment with Ecuador's action and accused the country of seeking preferential treatment at the expense of some of the most vulnerable countries in the global trading system. Brussels says it supports a negotiated settlement.

Cameroon, the Dominican Republic and Jamaica are among the countries backing the EU. Colombia, Costa Rica, Guatemala, Honduras, Nicaragua and Panama voiced support for Ecuador's position.

The 11-year-old dispute spawned a series of cases in the WTO as lawyers wrangled over procedural intricacies and legislation which had previously never been tested.

Taken from the Financial Gleaner, Friday March 23, 2007.