The European Union is in the final stages of taking formal action against Ukraine for what it sees as persistent breaches of the terms of the Partnership and Cooperation Agreement which came into force during 1998. At issue, says the EU, are the discriminatory advantages given to Daewoo to install a car-production plant in 1997, and a range of measures that in effect prevent the import of second-hand cars into the country. Now, after repeated consultations, and after successive deadlines have passed without any remedial action by Ukraine, the EU Council of Ministers is preparing to refer the matter to the Cooperation Council set up under the PCA.

What the EU will be seeking via the Cooperation Council disputes procedure is that Ukraine brings its legislation in line with the principles of non-discrimination that underpin the PCA - and that are also a feature of World Trade Organisation rules. Specifically...

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