Byrd Foes: Concede Defeat at WTO
American Metal Market
February 19, 2001

By Nancy E. Kelly

WASHINGTON -- Consuming industries, including several steel-related interests, do not think the U.S. government should go to bat against the recent challenge to the so-called Byrd amendment, which would disburse collected dumping and subsidy duties to the petitioning companies instead of the U.S. Treasury.

Eleven countries filed a request for consultations with the World Trade Organization in December over the recently enacted "Continued Dumping and Subsidy Duty Offset Act of 2000." The act mandates the U.S. Customs Service to distribute annually the duties to petitioners or interested parties for certain expenditures, including those related to manufacturing facilities, equipment and acquisition of technology or raw materials. The act was widely applauded by the domestic steel industry.

But in response to a U.S. Trade Representative's office request for comments, the Consuming Industries Trade Action Coalition said it believed the Byrd amendment, named after the West Virginia senator responsible for its passage, violated U.S. obligations under the WTO agreements on dumping and subsidies.

"This approach distorts trade to the disadvantage of CITAC members of all downstream industries," CITAC wrote. Its members include the American Institute for International Steel, the American Wire Producers Association and the Precision Metal-forming Association.

According to CITAC , the act could discourage exports to the U.S., resulting in shortages and a lack of specialized material available only from foreign sources.

CITAC also stated that the act provided a financial incentive for domestic producers to support petitions, although the duties disbursed could not be used to offset legal expenses.

"We doubt whether, after full consideration of all aspects of this unhappy piece of legislation, a vigorous defense would be successful," CITAC concluded. "We also believe that the repeal of the Byrd amendment is in the best interests of the nation's economy.

Proponents of the act have argued that it is WTO-consistent and does not constitute a subsidy for U.S. industries because it is widely available to all industries, not just a specific few.

Reproduced with permission from American Metal Market.
Copyright 2001 Cahners Business Information, a Division of Reed Elsevier Inc. All rights reserved.