From the European Commission:
The Commission has completed a thorough investigation into the human rights situation in Sri Lanka and in particular whether Sri Lanka is living up to the commitments it made to respect international human rights standards when it became a beneficiary of the European Union's GSP+ trade incentive scheme which provides for additional trade benefits.
The report comes to the conclusion that there are significant shortcomings in this area and that Sri Lanka is in breach of its GSP+ commitments.
We will now consult with Member States on whether to prepare a proposal with a view to
temporarily suspending these additional trade benefits.
The official notice is here. And here are the Commission final report and Independent experts report. In terms of the likely outcome, the Times Online reports:
... Baroness Ashton said the result was almost a foregone conclusion. “It’s very difficult to see any other recommendation than to suspend it,” she said. “The report is clear in showing consistent human rights problems and no action from the government to address them.”
For some analysis of whether GSP+ is consistent with WTO rules, see "The WTO Legality of the EU's GSP+ Arrangement" by Lorand Bartels. From the abstract:
According to the EU, the GSP+ arrangement complies with the Appellate Body's interpretation of the Enabling Clause. This article argues that it does not. This is, on the one hand, because of the substantive criteria chosen by the EU to select GSP+ beneficiaries, which do not meet the Appellate Body's criteria for differential tariff treatment of developing countries; and, on the other, because of the EU's requirement that would-be beneficiaries must have applied by a certain date. This, somewhat oddly, replicates the problem of the 'closed list' of beneficiaries that was fatal to the earlier incarnation of the EU's GSP program.
