US Wins Stay Of Execution In Steel Tariff Dispute

by Ulrika Lomas, Tax-News.com, Brussels

01 December 2003

The United States has been given until December 10 to comply with a World Trade organisation ruling which compels it to remove tariffs on steel imports, leading some to speculate that the Bush administration is preparing to bow to international pressure and announce the lifting of the tariffs.

"The US asked whether we'd accept a postponement and we have said 'yes,'" Arancha Gonzalez, spokeswoman for EU trade commissioner Pascal Lamy commented last week. "I don't think they need to provide a reason why; this is the bread and butter of the WTO."

Consequently, WTO members will meet today to ratify a ruling made on November 10 rejecting the US appeal against a previous decision that the steel tariffs contravene world trade laws. Once this is approved, EU counter measures will automatically be triggered after a five day period.

However, well-placed observers now think that the US is giving up the fight and will remove the offending tariffs. These include Lode Van Den Hende, a Brussels trade lawyer who has represented both the EU and United States in disputes at the WTO. "If they say, 'We want 10 days more,' that means they think they can do something to avoid the sanctions in that time," Van Den Hende told the International Herald Tribune.

However, others are not entirely convinced of this: "There are two schools of thinking on this - President Bush is on a fund-raising trip to Pittsburgh next week and he doesn't want that to be diluted, or they're still ferociously debating inside the White House," suggested fellow Brussels-based trade lawyer, Richard Weiner.

All of the other plaintiff countries in the case (Japan, China, South Korea, Norway, Brazil, Switzerland, and New Zealand) have agreed to the stay of execution. Up to 1.9 billion euros of sanctions may be applied by the EU if the US fails to meet the deadline.

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