Geneva, Sept 4 - A World Trade Organisation (WTO) panel ruled largely against Mexico in a European Union complaint about olive oil, according to a report made public on Thursday.
The dispute, which began in 2006, centres on penalties or countervailing duties imposed on EU olive oil entering Mexico.
Brussels claimed that Mexico violated trade rules when it determined the imported products had been unfairly subsidised, and imposed provisional duties on them in 2004.
The WTO dispute panel agreed with several of the EU's complaints and dismissed others. Most critically, it found that Mexico's duties violated several provisions of the WTO Agreement on Subsidies and Countervailing Measures (SCM) and said they should be brought into line with the pact.
"Having found that Mexico has acted inconsistently with provisions of the SCM Agreement ... we recommend that Mexico bring its measures into conformity," it wrote.
EU spokesman Peter Power welcomed the ruling.
"We now expect Mexico to abolish the duties as quickly as possible," he said after the report was distributed.
Unless Mexico or the EU appeals, the panel report is set to be adopted by the WTO's Dispute Settlement Body within 60 days.
According to EU figures, EU exports of olive oil to Mexico in 2007 were worth 33 million euros ($48 million). The EU is Mexico's second-largest trading partner after the United States, with bilateral trade of nearly 33 billion euros in 2007.