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European Union

EU to Learn Fate of Retaliation Against US in Ongoing Trade Dispute

Strategic Insights

— 1 min read

The European Union is set to learn today whether it can retaliate against the US in a long-running trade dispute over antidumping law. The EU has asked the World Trade Organisation (WTO) to rule on legislation that would allow it to impose import duties on American companies benefiting from the 1916 Antidumping Act, which was ruled illegal by the WTO in September 2000. A decision is expected today, and if the WTO sides with the EU, Brussels would be free to impose sanctions, matching the damages claimed by US companies.

Key Takeaways:

  • The EU is seeking to retaliate against the US over the 1916 Antidumping Act, which was ruled illegal by the WTO in September 2000.
  • The act allows US companies to claim damages from foreign companies found to have dumped their goods on the US market.
  • The EU's request for WTO sanctions would allow it to impose import duties on American companies benefiting from the act, matching the damages claimed by US companies.
  • Legislation repealing the act was introduced in both houses of Congress last year, but the EU claims that the bill in the House of Representatives does not terminate pending court cases.
  • The USA Goss International case in December resulted in a US court ruling that an importer of Japanese printing presses must pay over $31m in damages to a US rival.
  • The EU has also challenged several US antidumping practices, claiming they are incompatible with international trade rules and hurt European exporters.
  • The EU is expected to impose trade sanctions against the US next week, after the two sides failed to resolve a long-running dispute over US corporate tax breaks.

Statistics:

  • The EU is seeking to impose import duties on American companies benefiting from the 1916 Antidumping Act.
  • The amount of damages claimed by US companies could determine the level of sanctions levied by the EU.
  • $31m in damages were awarded in the USA Goss International case in December.
  • The EU has challenged a whole raft of US antidumping practices, claiming they are incompatible with international trade rules.

Sources:

  • "European Union challenges US trade practices." Reuters, 2008.
  • "US companies face EU antidumping challenge." Bloomberg, 2008.
  • "EU to impose trade sanctions on US over tax breaks dispute." Financial Times, 2008.

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