Taiwan won a trade dispute against the European Union at the World Trade Organization last month that may save the country's liquid crystal display manufacturers more than NT$19.6 billion (US$611.54 million) annually.

The Taiwanese LCD manufacturers said the EU had violated its obligations under the 1994 WTO Information Technology Agreement by imposing a 14% tariff on imports of LCD panels that are larger than 19 inches and equipped with high definition interface (HDI) terminals and digital video interface (DVI) terminals.

They said the panels should be considered information technology products that enjoy duty-free trade under the above agreement. EU officials, however, defined them as a consumer product because they can be used with DVD players, home-use projectors, video cameras and video game players.

After three fruitless consultations with the EU, Taiwan asked for the establishment of a panel to settle the dispute in August 2008 along with the United States, which complained about the EU's 13.9% tariff on its television set-top boxes, and Japan, which complained about the EU's 6% tariff on its multi-functional products.

During the dispute-solving process, the EU has stopped levying duties not only on products covered in the case, but also on other controversial Taiwanese products, such as cell phones that could be used as TV sets and global positioning system devices.

The officials said one difficulty in the case lies in the fact that the products at the center of the dispute had not been developed in 1994, so they weren't specifically addressed in the 1994 agreement.

Noting that Taiwan exported NT$140 billion worth of LCD panels involved in the dispute, economics officials estimated the WTO decision will save local manufacturers NT$19.6 billion in tariffs and greatly boost their competitiveness.

Taiwan produces NT$1.34 trillion worth of LCDs in 2009, representing a 17% plunge from the previous years. The industry is expected to grow by 8.2% this year to NT$1.45 trillion, according to statistics compiled by the Industrial Technology Research Institute. (Focus Taiwan News Channel)

Story filed 19.07.10