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Iceland/European Union: Reduction in Import Duties, Increase in Quotas for Agricultural Products

(Oct. 20, 2015) On September 17, 2015, Iceland’s government and the European Union agreed on new terms for agricultural trade. (Press Release, EU and Iceland Strike Deal to Protect Geographical Indications and Enhance Trade for Agricultural and Food Products (Sept. 18, 2015) EUROPA.) Under the new agreement, Iceland will reduce the tariffs on agricultural products imported by Iceland from the EU. (EU-Iceland Tariff Barriers Deal, MBL.IS (Sept. 18, 2015).)

The move, which is a bilateral decision between the European Union and Iceland to ease trade restrictions, in addition to reducing Icelandic tariffs on some other European products, will allow 91.3% of agricultural exports from the EU to enter Iceland duty free. (Press Release, supra.) Currently, only about 60% of European agricultural exports enjoy duty-free status when imported to Iceland. (EU-Iceland Tariff Barriers Deal, supra.)

Under the agreement, Iceland promises to increase its quotas of cheese, beef, pork, and poultry imports from the European Union. In turn, Iceland will see an increase in European import quotas for its Skýr products (a cultured dairy product similar to yogurt) from the present 380 tons to 4,000 tons per year, over a four-year period. (Id.)

Increased protection of Geographical Indicators (GI) is also covered by the agreement. This means that agricultural products from certain geographical areas, such as Champagne, will enjoy the same protection of their name in Iceland as they currently do in the EU. (Press Release supra.)

The agreement has not yet entered into force, as it must first undergo legal scrutiny both in Iceland and the EU. It is expected to become effective beginning in 2017. (EU-Iceland Tariff Barriers Deal, supra.)