EU trade retaliation to get go-ahead

The World Trade Organisation is set to grant the EU and seven other states the right to retaliate against the US over an illegal anti-dumping law on Monday.

The US missed the 27 December 2003 deadline to repeal the so-called ‘Byrd Amendment’ – a law which redistributes funds to those American firms initiating cases against foreign competitors for flooding the US market with excessively cheap exports.

Previously the cash had gone straight into US treasury coffers, but Brussels among others claims that the law encourages American firms to engage in more anti-dumping cases than is fair.

A WTO dispute board looks ready to give the green light to the EU to launch counter-measures against the US – theoretically as of Tuesday.

Such swift action is, however, unlikely as Brussels has yet to decide on the method of retaliation let alone the amount of duties and what products will be targeted.

“We are not talking about products or amounts yet,” said a Brussels spokesman.

It is estimated that Washington has pocketed over €51 million from European businesses with the help of the Byrd amendment.

The US Trade Representation claimed the retaliation was “not entirely unexpected” and despite the “reasonable period of time” given to them by the WTO repealing the amendment “requires action from Congress”.

The Bush administration has recommended scrapping the legislation but Congress and Senate have a reputation for dragging their heels over repealing trade laws thus making a swift resolution unlikely.

“The timing is unpredictable,” said a spokesman for USTR.

This is just the next chapter in a drawn-out EU-US trade war that was threatening to rear its ugly head all last year.

There was a brief moment of respite last December when Washington repealed illegal steel tariffs, but disputes over hormone beef, illegal tax breaks and registering food names still threaten to sully the EU-US trade waters.

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