EU Files Claim with WTO against Korea for Subsidies to Shipbuilders

On September 27, 2002, the EU announced that their negotiations with South Korea with regard to the shipbuilding industry have ended up without anything. Thus, it will file a claim with the WTO and allows its member countries to help their countries’ business entities with subsidies.

The spokesperson of EU’s Executive Board contended, “The EU has made various efforts to make a compromise with South Korea. But Korea has rejected all of these.” During the negotiations, the EU has warned that if the negotiations with Korea failed to bring about any results, it would reinstate the subsidies to the shipbuilding industry, which had been repealed in 2000. The final determination by the WTO on EU’s claim will come out in 21-24 months after the claim is filed. South Korea and the EU held talks on Sep. 25th and 26th in Brussels, Belgium to resolve the dispute over the subsidies to the industry. The EU has been arguing that Korean shipbuilding companies including the world’s No. 1 ship-builder, Hyundai, receive government subsidies. South Korea’s market share last year was 32% in the world market for shipbuilding.

Ja-Ryong Koo Jei-Gyoon Park bonhong@donga.com phark@donga.com