BRUSSELS - The European Union said Thursday it regretted a WTO ruling upholding an earlier decision that EU subsidies for sugar production are illegal but pledged to respect the finding.
"We will abide by our international obligations on the sugar regime and will work closely with member states on the necessary reforms ahead of the WTO Ministerial in December," EU trade commissioner Peter Mandelson said in a statement.
The organisation's appellate body rejected an appeal by the EU against a ruling last October and upheld an earlier ruling favouring a complaint by Australia, Brazil and Thailand.
The WTO disputes settlement body (DSB) had ruled last October that the EU's subsidised exports had been exceeding an agreed 1,273,000-tonne-a year limit since 1995.
EU agriculture commissioner Mariann Fischer Boel said: "We presented our case forcefully and I had hoped that the appellate body would take greater account of our arguments.
"Naturally, I will take account of this verdict when I finalise the reform proposals we are due to publish on 22 June," she added
The commission also said it expected a "political agreement" on sugar reform by EU agriculture ministers before the WTO ministerial gathering in Hong Kong in December, which would boost efforts to reach a comprehensive package in the so-called Doha round of multilateral trade liberalization talks.
04/28/2005 15:53 GMT