WTO Authorizes Sanctions Against US Over Antidumping Rules

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The World Trade Organization decided Tuesday to authorize the imposition of sanctions against the United States by the European Union and other leading U.S. trade partners in response to illegal antidumping rules, officials said. The WTO was expected to announce the decision later Tuesday at its headquarters in Geneva, but EU Trade Commissioner Pascal Lamy already welcomed the ruling which had been leaked to reporters in Brussels.
"This was as we expected," Lamy said.

A copy of the ruling seen by Dow Jones Newswires showed the EU and other complainants will be authorized to fine the United States up to 72 percent of money collected under an U.S. antidumping law known as the Byrd Amendment. However, Lamy said the 25-nation EU had not yet decided whether to impose the sanctions. "This is a decision that still has to be taken," he told reporters. The EU may prefer to use the threat of sanctions to force the United States to repeal the legislation more quickly or to obtain concessions in other trade negotiations.

Named for its sponsor Sen. Robert Byrd, a West Virginia Democrat, the three-year-old amendment allows the United States give U.S. companies money collected in fines against foreign exporters judged to be selling products in the United States at artificially low prices.
The WTO ruled the measure illegal in 2002, backing claims that it punishes exporters to the United States twice because first they are fined and then those fines are passed on to their competitors.

The U.S. steel industry has been the major beneficiary of the hundreds of millons of dollars handed out under the law. Other recipients include makers of pasta and candles. The WTO had given the United States until the end of last year to change the law, but Congress has yet to act even though the Bush administration recommended the amendment should be repealed. Japan, Brazil, Canada, Chile, India, South Korea and Mexico joined the EU in contesting the laws. They sought the right to impose sanctions by increasing import tariffs on selected U.S. goods by the same amount that was collected in fines charged on their exporters in the previous year.

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