Fight's Over: WTO Rules Against ''Byrd Amendment''
Selected countries and the EU can now impose punitive tariffs on US exports
GENEVA, Switzerland - 08/31/04 - The World Trade Organization (WTO) has ruled that a US trade law permitting American companies to share in part of the proceeds of anti-dumping judgments violates international trade law.
Today's ruling backs vocal and sometimes heated opposition to the so-called Byrd Amendment, which was named for its principal sponsor, Democrat Sen. Robert Byrd of West Virginia since it became law in 2001.
The Geneva-headquartered WTO said that seven countries - Brazil, Canada, Chile, India, India, Japan, Korea, and Mexico, and the 25-member European Union - are now entitled to impose varying levels of sanctions on US goods to recoup the duties paid to US companies over the past three years.
The decision, it said, allows the complainants to fine the US up to 72% of duties collected under the amendment.
In a prepared statement reacting to the WTO decision, EU Trade Commissioner Pascal Lamy said, "I hope the United States will now take action to remove this measure, thus avoiding the risk of sanctions."
A total of $231 million was distributed to US companies in 2001 and $330 million in 2002, the EU said, adding that the level of sanctions that individual EU countries can impose is more than $150 million.
Lamy's reaction was underscored by Japan's Economy, Trade and Industry Minister Shoichi Nakagawa, who said, "Japan strongly hopes the United States will repeal the Byrd Amendment at an early date, so that we can avoid invoking our right to take countermeasures."
Nakagawa was quoted by Japan's Kyodo News Service and the Associated Press as saying that if the United States refuses to repeal the Byrd Amendment, Japan will ask the WTO to approve specific retaliatory measures possibly as soon as this fall.
The WTO decision is expected to drive up the cost of US exports while a spokesman for the Office of the US Trade Representative telling reporters that the US would comply with the WTO ruling and that the Bush Administration "will work closely with Congress to do so in a way that supports American jobs and American workers."
According to the USTR, the WTO ruling will not affect Washington's powers to impose duties on countries that unfairly dump cut-price goods on the US market, since the Byrd Amendment only concerns how those duties are disbursed.
The amendment has drawn consistent fire from foreign companies arguing that the law is unfair because it amounts to a form of double punishment - namely that they are compelled to pay the duties, while their US competitors add to their bottom line.
Despite the fact that President Bush has repeatedly said in the past that he is in favor of overturning the amendment, action on the issue has stalled in Congress.
The WTO had given the US until the end of last year to repeal or amend change the law.
(For a breakdown by country of the World Trade Organization decision, go to http://www.wto.org/english/news_e/news_e.htm)
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