WTO authorizes sanctions against U.S.

BRUSSELS, Belgium — The World Trade Organization authorized the European Union and seven other leading U.S. trading partners Tuesday to impose more than $150 million worth of sanctions against the United States for failing to repeal anti-dumping rules deemed illegal by the WTO.

The ruling by the Geneva-based organization allows the complainants to fine the United States up to 72 percent of money collected from foreign exporters under the so-called Byrd Amendment.

That legislation, dating from 2000, empowers Washington to hand over to U.S. companies the duties imposed on foreign firms judged to be unfairly dumping cheap goods on the U.S. market. A statement from the eight complainants estimated that money totaled about $240 million last year.

“It is clear that the Byrd Amendment is a WTO-incompatible response to dumping … and must therefore go,” said EU Trade Commissioner Pascal Lamy.

However, the EU and the other complainants — Japan, Brazil, Canada, Chile, India, South Korea and Mexico — indicated they would hold off from imposing sanctions. Instead they are likely to use the threat of retaliation to press the U.S Congress for an early repeal of the legislation.

A joint-statement from all eight said they could “exercise their retaliatory rights, at any time deemed appropriate.”

EU and Japanese officials said they hoped quick action by Washington would avoid sanctions.

“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,” Japan’s economy, trade and industry minister, Shoichi Nakagawa, said in Tokyo.

Nakagawa was quoted by Japan’s Kyodo News service as saying that if the United States refuses to repeal the Byrd Amendment, Japan will ask the WTO to approve, “possibly this fall,” specific retaliatory measures.

U.S. officials pointed out that the WTO’s ruling did not fully meet the requests of the complainants who had sought the right to increase import tariffs on selected U.S. goods by the total amount collected in fines against their exporters in the previous year.

“The arbitrators’ determinations fell far short of the amount requested by the complaining parties,” U.S. trade spokesman Christopher Padilla said in a statement.

He said the Bush administration would work with Congress to comply with the WTO “in a way that supports American jobs and American workers.”

Democratic presidential nominee John Kerry said the Bush administration hadn’t pushed the WTO hard enough so that it would accept the Byrd Amendment.

“Once again the Bush administration failed to stand up for American companies and workers at the WTO, and as a result, unfair trade practices are hurting our economy and middle-class families,” Kerry said in a statement.

Named for its sponsor, West Virginia Senator Robert Byrd, the three-year-old amendment primarily benefited American steel manufacturers. Other recipients include makers of pasta and candles.

The WTO ruled the measure illegal in 2002, backing claims that it punishes exporters to the United States twice because they are fined first, and then those fines are passed on to their competitors.

Padilla said the ruling would not affect Washington’s powers to impose duties on countries that unfairly dump cut-price goods on U.S. markets, since the Byrd Amendment only concerns how those duties are disbursed.

The WTO had given the United States until the end of last year to change the law. Although the Bush administration recommended the amendment should be repealed, U.S. Congress has yet to make the changes.