| Wto rules us steel tariffs illegal { November 10 2003 } Original Source Link: (May no longer be active) http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1066565763384http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1066565763384
WTO rules US steel tariffs illegal By FT reporters Published: November 10 2003 13:54 | Last Updated: November 10 2003 15:04 The World Trade Organisation has ruled that tariffs imposed by the US on some steel imports violate international trade rules, strengthening European Union calls for Washington to scrap them.
Diplomats in Geneva said the WTO's appellate body, the organisation's highest trade court, upheld an earlier finding that the tariffs violated WTO rules. The appellate body is due to issue its official ruling at 3.30pm and the decision must then normally be adopted by the organisation's member bodies within 30 days.
George W. Bush, US president, now faces a tough choice over how to react to the ruling.
Any move to scrap the tariffs altogether risks antagonising voters in the so-called rust-belt states ahead of next year's presidential elections.
However, Pascal Lamy, EU trade commissioner, last week warned that if the US did not drop the steel tariffs, retaliation of up to $2.2bn of punitive duties on US goods would be "a racing certainty in mid-December". These would target exports such as citrus fruit and Harley Davidson motorcycles that are produced in key electoral districts.
Mr Lamy said the EU had little choice but to insist on compliance with the WTO rules, as the US has done in previous disputes over bananas and beef hormones.
The steel tariffs were adopted by the US in March last year and range from 8-20 per cent on selected types of steel imports from the EU, Japan and six other countries. The move was designed to protect struggling domestic steel companies from competition from overseas producers.
Grant Aldonas, US undersecretary of commerce for international trade, has already ruled out compromise options such as expanding the number of steel products excluded from the tariffs, saying this would do little to help US manufacturers that have complained about higher prices on basic steel products. But
The steel dispute comes at a time of worsening trade relations between Washington and Brussels. Mr Lamy has warned that a separate retaliation could begin early next year if the US does not eliminate a tax subsidy for exporters that has already been ruled illegal by the WTO.
The other countries involved in the steel dispute, in addition to the EU and Japan, are South Korea, China, Brazil, Switzerland, Norway and New Zealand.
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