WTO - US rejected call by Indonesia to rule on dispute on ban of clove cigarettes in the US..

June 23, 2010 - As expected United States [government] rejected on Tuesday, June 22nd a call by Indonesia for a World Trade Organization (WTO) panel to rule on their dispute over the U.S. ban on clove-flavoured cigarettes. Under WTO rules, the defendant in a dispute is allowed to block the creation of a panel at the first request, but cannot obstruct it a second time. Indonesia's request is likely to go through at the next meeting on July 20, 2010.Directly related news briefs:
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A U.S. official said the ban did not discriminate against any country and Indonesia's request for a panel to rule on the dispute was premature as a scientific committee set up under the law to examine tobacco products would report by March next year.

Clove-flavoured cigarettes, known as kretek, dominate cigarette consumption in Indonesia, the world's fifth biggest tobacco market, but only small numbers are exported, and the unflavoured sort, or "white sticks", are gaining in popularity.

U.S. government surveys showed that menthol cigarettes accounted for 44 percent of cigarettes consumed by young people and 28 percent of all consumption, said Indonesian diplomat Nurlaila Nur Muhammad.

Clove cigarettes accounted for less than 0.05 percent of cigarettes smoked by young people, and 0.09 percent of all consumption, before the ban, she said.

The United States imported $15.2 million worth of kretek cigarettes in 2008, of which 99 percent came from Indonesia, according to U.S. data cited by Indonesian officials. Since the ban, sales have fallen to zero.

"In many parts of my country the main source of income and employment is the production of tobacco, clove and cigarettes," Muhammad said.

"Indeed, well over 6 million Indonesians depend directly or indirectly on clove cigarette production to put food on the table, clothes on their children's backs and day's wages in their pocket."

Reference: US rejects WTO panel on clove cigarette ban by Jonathan Lynn ((Editing by Mark Heinrich), Reuters, 6/22/2010.