US exports of live ornamental freshwater and saltwater fish destined for the EU and UK are now collateral damage in the ongoing trade war over the trade in large civilian aircraft but impacting a long list of products in many sectors of the American economy. The information has been coming out in fits and starts over the past week, and this official statement from OATA offers a good summary.
via Ornamental Aquatic Trade Association (OATA)
November 18, 2020 – OATA is discussing the 25% tariff which has been introduced on imports of ornamental fish from the US with HMRC.
This surprise hike, which UK businesses were given no warning about, came into force on November 10th as a retaliatory measure to US tariff hikes (see letter from HMRC). HMRC is saying that for at least the remainder of the Transition Period the UK will apply the same retaliatory steps imposed by the EU and may extend it beyond that.
“25% duty on live fish orders coming from the US is a large hike and it is very disappointing that it was introduced without any formal warning to impacted businesses which would have allowed them to adjust their costs. As this arises from an EU regulation it is unlikely that much can be done but we are talking to HMRC to try to find out why there was no warning, how long this will continue, and whether a derogation can be considered for imports into the UK,” said OATA’s Chief Executive Dominic Whitmee.
“Importers may want to think about where they source some fish from to avoid this elevated tariff.”
The increase in tariffs for ornamental fish is one of many hitting goods coming to the EU from the US.
This comes on top of recent news that the EU is considering bans on the import of Euphyllia glabrescen, ancora, paraancora, Duncanops and Catalaphyllia corals from Australia at the next EU CITES Scientific Review Group (SRG) on December 3rd. OFI is working with the Australian government and exporters to provide the information necessary to avoid a ban, and OATA is seeking clarity on whether current permits issued with an expiration date after December 3rd would remain valid.
12 December 2020 update
We’re pleased to see this announcement from the [UK] Department of International Trade (para 4) that after 1 January 2021 it does NOT intend to continue with the additional tariffs, imposed recently by the EU, on US goods as a result of the Boeing dispute. This will be welcome news to importers who buy fish from America. It does however reserve the right to impose tariffs at any point ‘if satisfactory progress towards an agreeable settlement is not made’.
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Additional Insights
With American businesses are already hurting due to pandemic related closures and ongoing unemployment, the addition of new tariffs on American exports comes at a most inopportune moment. Producers and exporters of ornamental aquarium fish in the US now face an increasingly uncertain future, and more than one organization was completely caught off guard by this sudden development.
EU and UK businesses and aquarists will also feel the pain of price increases on all wild-harvested and captive-bred freshwater and marine fishes that are sourced from the US.
“Officially, we are concerned,” wrote L. Michael O’Bryan, sales and marketing manager for Vero Beach, FL-based Proaquatix, a producer of captive-bred marine ornamental fish with worldwide distribution. “It will be very interesting to see how large of an effect the sudden new tariffs will have on our EU business. We do not see how our EU customers can deal with such an increase to their end consumer without it not significantly affecting their sales volume.”
Another aquaculture company suggested that EU-wide tariffs on the fish they export would represent a significantly larger problem.
We will update further as additional statements come in from affected parties.
As of this time, there is no information on if, or when, these tariffs would be lifted. The US currently levies no tariffs on imports of live ornamental fish.
Additional Background
The new tariffs levied on US goods being imported to the UK and EU covers a vast range of items, but stems from a trade dispute over governmental subsidies offered to manufacturers of commercial aircraft, specifically Boeing and Airbus. These retaliatory tariffs appear to be recently authorized by the World Trade Organization (WTO). Both the US and the UK appear to have dueling complaints in what most of us would simply call a trade war over these airplanes, and stem from the Agreement on Trade in Civil Aircraft, which is described as a plurilateral agreement signed by 32 WTO member nations.
Tariff References
The current US tariff rates for live fish can be found in Chapter 3 of the Harmonized Tariff Schedule (2020 Revision 27 as of 11/20/2020).
For those reviewing the HMRC letter cited in OATA’s official statement , the TARIC code for live ornamental freshwater fish is 0301 11 00 00, and the TARIC code for live ornamental “other” fish is 0301 19 00 00. They are the first and second line items under Annex II.
Additional Reading
Brexit raises stakes for Britain in aircraft trade war. Reuters. October 3, 2019: https://www.reuters.com/article/us-wto-aircraft-brexit-analysis/brexit-raises-stakes-for-britain-in-aircraft-trade-war-idUSKBN1WI26G
The next fronts in the US trade war shift to Europe, UK. CNBC. January 25, 2020: https://www.cnbc.com/2020/01/25/us-uk-deal-a-priority-for-trump-but-food-and-health-concerns-remain.html
EU publishes list of US products subject to additional duties following WTO authorization. November 16, 2020: https://taxnews.ey.com/news/2020-2706-eu-publishes-list-of-us-products-subject-to-additional-duties-following-wto-authorization
Image Credits: Matt Pedersen unless otherwise noted.
