Subject: Banana deadlock plunges WTO into unprecedented dilemma GENEVA, Jan 29 (AFP) - World Trade Organization chief Renato Ruggiero was holding urgent talks with EU and US ambassadors on Friday as the transatlantic banana feud plunged the world body into an unprecedented dilemma, trade diplomats said. The relentless row between the two trade superpowers over a fruit which is not even produced in the United States is sending shivers around many world capitals because of fears it could fatally damage the global rules-based trading system. A meeting of the WTO's row-handling dispute settlement body (DSB), which began on Monday with a brief to try and produce a solution to the crisis, was set to be resumed on Friday afternoon, having become bogged down again late on Thursday. The United States is seeking authorization from the DSB to apply 100-percent tariffs up to a value of 520 million dollars (593 million dollars) on a series of European imports which have nothing to do with bananas. It is taking the step because of its judgement that Brussels has not complied with a WTO ruling last year that its banana import regime is illegal because it favours produce grown in Caribbean, African and Pacific (ACP) nations, and damages imports of fruit marketed mainly by US companies in Latin America. Brussels believes it has rectified the situation by making changes to its regime with effect from January 1, but the amendements are seen as derisory by the United States, which argues it is within its rights to retaliate. US ambassador to the WTO Rita Hayes insists the DSB is legally bound to grant Washington sanctions permission -- and before a deadline of midnight January 30 -- with the idea that sanctions would take effect March 3. But many of the WTO's 133 members feel that the United States, even if within its legal rights, could jeopardize the entire organization if it goes its own way on sanctions before WTO experts rule whether in fact Brussels' case has true legal merit. A panel decision is expected mid-April. The relevant WTO rules in the case are far from clear, and are even contradictory. The atmosphere of hostility between the protagonists is visibly growing, with both sides pointing the finger at each other. Meanwhile, other dispute-related work at the World Trade Organization has virtually come to a standstill. -------------------------------- -- For MAI-not (un)subscription information, posting guidelines and links to other MAI sites please see http://mai.flora.org/