CITAC: 'BYRD AMENDMENT' DISBURSEMENTS TO U.S. COMPANIES
SHOW NEED TO END WTO-INCONSISTENT PAYMENTS

Washington, DC — Members of the Consuming Industries Trade Action Coalition (CITAC) reacted to the U.S. Customs Service's announcement of the FY2002 disbursements totaling $329 million under the Continued Dumping and Subsidy Offset Act of 2000, known as the "Byrd Amendment," as a "distressing result of a trade distorting act declared illegal by the WTO."

The Customs announcement marks the second year of payouts under the Byrd Amendment, passed by Congress late in 2000. The Byrd law mandates distribution of antidumping and countervailing duties to companies that have petitioned the U.S. Government for protection, rather than to the U.S. Treasury, where other duties are sent. To date, the U.S. Government has paid approximately $560 million to U.S. companies who file antidumping and countervailing duties petitions. On January 16, 2003, the World Trade Organization (WTO) Appellate Body declared the Byrd Amendment illegal, finding that the Byrd Amendment is "inconsistent with certain provisions of the WTO agreements on antidumping and on subsidies." The Bush Administration has requested that Congress repeal the law.

CITAC's Chairman Michael Fanning stated, "For the sake of American consuming industries, we hope this is the last time that a few U.S. companies are rewarded by the U.S. Government for filing or supporting trade remedy cases. This measure taxes American consumers, and also violates international trade rules. We urge Congress to repeal the Byrd Amendment and comply with the WTO's ruling. The real focus should be in better developing the potential of American manufacturing."

"In addition to the obvious shortcomings of the Byrd law, there appears to be divergence between the claims made for Byrd funds and the economic reality," stated CITAC Counsel Lewis Leibowitz. "Several private companies cite 'qualifying expenditures' (such as costs of raw materials, wages, and research and development to run their businesses) that far exceed their gross revenues. In fact, looking at a number of these questionable figures used by claimants leads one to conclude that the Byrd Amendment actually encourages excessive claims in return for public dollars."

"There is something wrong with a law that gives a single candlemaker over $39 million from the U.S. Government in exchange for filing an antidumping case," stated Leibowitz. "This subsidy puts far too much money into the pockets of companies that have not made a valid claim for government assistance."

"The Byrd Amendment created incentives for companies to launch trade cases in an attempt to close the U.S. market to global competition and gain a big piece of these monies disbursed," said Fanning. "American manufacturers are already facing serious economic difficulties as a result of trade restrictions on steel, lumber, sugar and other products. The simple answer is to repeal the Byrd Amendment."

CITAC is a coalition of companies and organizations committed to promoting a trade arena where U.S. consuming industries and their workers have access to global markets for imports that enhance the international competitiveness of American firms.