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News article28 April 2022BrusselsDirectorate-General for Trade

WTO Panel rules against Turkey’s discrimination of foreign medicines in line with EU’s claims

The EU welcomes the WTO Panel ruling that Turkey cannot require foreign producers of pharmaceuticals to move their production to the country for those pharmaceuticals to be eligible for reimbursement under Turkish social security schemes.

The Panel also found that Turkey cannot prioritise reimbursement reviews and marketing applications of domestic pharmaceuticals over foreign ones. The Panel ruled that these localisation and prioritisation measures are discriminatory and incompatible with Turkey’s World Trade Organization (WTO) commitments. The verdict is a clear win for the EU, because all claims were decided in the EU’s favour. It also sends a strong signal discouraging other countries from continuing or pursuing similar discriminatory forced localisation policies. The EU will defend the ruling in the appeal arbitration process that Turkey triggered on 25 April.

Next steps

Under the appeal arbitration procedures agreed with Turkey, the appeal should be decided within 90 days, unless the parties agree otherwise on the request of the appeal arbitrators. Once the appeal is completed, and if the appeal arbitrators confirm at appeal that the Turkish measures are discriminatory, Turkey will have to remove the measures - either immediately, or within a period of time negotiated with the EU or fixed by a WTO arbitrator.

Background

This dispute (DS583) was submitted by the EU against Turkey in April 2019. Together with Turkey’s dispute on EU safeguard measures on steel products (DS595), it is covered by the appeal arbitration agreement between the EU and Turkey signed on 25 March 2022. The EU and Turkey have made sure that, despite the paralysis of the Appellate Body, these disputes can continue to benefit from a fully functioning dispute settlement system in the WTO.

For more information

WTO Panel Report annexed to Turkey’s Notice of Appeal

EU-Turkey agreed appeal arbitration procedures

EU submissions and other documents of the case

Dispute Settlement in a Nutshell

Details

Publication date
28 April 2022
Author
Directorate-General for Trade
Location
Brussels
Country or region
Turkey
Trade topics
Dispute settlement