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The European Communities (European Union) had two importing regimes for bananas: a preferential regime for banana originating in former European colonies in Africa, the Caribbean, and Pacific states (ACP) states; and another regime for bananas coming from all other countries. ACP states were allowed to import their bananas duty-free up to a specific amount, after which they could continue to import by paying duty. Non-ACP states were not permitted duty-free access, and higher duty was applied to bananas from these countries than to bananas from ACP states when the amount of bananas imported from these countries reached a specific amount.
Question 1) Please explain whether the said European Communities importing regime is legal.
Question 2) If it is not legal, please name the GATT principle that has been violated.
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