EU imposes additional trade sanctions against US

Brussels, May 1:

The European Union (EU) imposed $9.1 million in additional retaliatory sanctions against the United States today in response to antidumping measures meant to protect US companies. The World Trade Organisation (WTO) had declared the US rules illegal.

EU trade commissioner Peter Mandelson’s office said the new measures were justified because US government payments to American companies are scheduled to continue for two more years despite the disputed trade law being repealed in February. The new $9.1 million in EU sanctions, brings the total amount of penalties levied against the US in response to the disputed trade law to $36.9 million, the European Commission said.

Since May 2005, Europeans have had to pay more for US clothing, textiles, machinery,

paper products and sweet corn as part of the EU trade sanctions. The EU executive said the measures would counter US government payments to American companies estimated to be worth more than $2 billion over the next two budget years, ending 2008.

The US payments are part of a law known as the Byrd amendment, which allows American companies to receive proceeds from antidumping duties levied on foreign rivals. “As long as the distributions continue, the US will not be in compliance with WTO rules,” the commission said.