The original complaint was about India’s additional duties, which India did waive in July 2007 after heavy pressure from both the US and the EU. The EU subsequently dropped its complaint, but the US did not.

India's basic import duties on wine were kept at 150 %, within WTO limits. However, state governments levy surcharges that take the taxes up to as high as 430%. In the state of Tamil Nadu, foreign liquor has been shut out completely and allows the sale of Indian wine only.

The US, EU and Japan, by contrast, allow nearly all wines and spirits to enter their markets duty-free. China charges only a nominal duty on foreign wines although it has a burgeoning domestic industry.

While rejecting the US complaint, the WTO observed, “we do not wish to suggest that the entry into force of the new customs notifications necessarily implies that the AD (Additional Duty) on alcoholic liquor, to the extent it still exists, and the SUAD (Sales Tax, Value Added Tax, local tax or any other charges ) are WTO-consistent.”