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US Byrd Amendment – WTO says eight WTO Members may retaliate against the US – Joint Press statement by Brazil, Canada, Chile, the EU, India, Japan, Korea, and Mexico

August 31, 2004

Today, the WTO given a green light for eight WTO Members to retaliate up to more than $150 million against the U.S. for failing to comply with its international trade obligations. In January 2003, the WTO ruled as illegal a piece of U.S. legislation commonly known as the “Byrd Amendment”, under which anti-dumping and countervailing duties are distributed to the domestic companies that had requested or supported the imposition of those duties. The WTO gave the U.S. until December 2003 to comply with the WTO ruling but the U.S. missed this deadline. The failure by the U.S. to bring its measure into conformity with WTO rules prompted eight WTO members - Brazil, Canada, Chile, the EU, India, Korea, Japan and Mexico – to request authorization from the WTO to impose additional import duties on US products or to suspend other obligations to the US.

Further to today’s award, the co-complainants may exercise their retaliatory rights, at any time deemed appropriate, in accordance with the award and the requirements of the WTO rules on the settlement of trade disputes.

Background:  The Continued Dumping and Subsidy Offset Act of 2000 (so-called Byrd amendment) mandates the distribution of the anti-dumping and countervailing duties to the companies that brought or supported the complaints. It therefore creates an undue incentive for U.S. industries to seek the imposition of duties on imported goods, thereby improving their competitive position and receiving cash payments.

A total of US $ 231 million was distributed in 2001 and around US $ 330 million in 2002. The main recipients have been in the bearing, steel and other metal, household item and food (in particular pasta) sectors. Though 2003 data regarding disbursements has yet to be finalized, information published so far indicates that distribution for that year would amount to about US $ 240 million.