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EC COMMISSION REACTS TO U.S. DUMPING DUTIES ON STEEL

 WASHINGTON, Jan. 27 /PRNewswire/ -- The EC Commission issued the following:
 The U.S. Department of Commerce (DOC) has announced that it will subject the imports of flat steel products from its main steel trade partners including the European Community to stiff preliminary anti- dumping duties. This means that all entry of such products into the United States will require a cash deposit or bond equivalent to the preliminary determined anti-dumping duty. These duties are in addition to the preliminary countervailing duties determined by the DOC on Nov. 30, 1992, in respect of the same products. These decisions concern some 2 million metric tons of Community steel exports a year, estimated at a value of $1 billion.
 Sir Leon Brittan, EC commissioner for external economic affairs, reacted sharply to the news:
 "This action is unwarranted and wholly disproportionate. It is also particularly unfortunate and inopportune at the beginning of a new United States administration. I shall raise the matter in the EC Foreign Affairs Council next week, and shall discuss it as a matter of urgency with Mickey Kantor, the U.S. trade representative, and Ronald H. Brown, U.S. secretary of commerce when we meet in Washington on February 11.
 "Such heavy-handed action -- targeting not only Community steel exporters but also those from Japan, Korea, Brazil, Canada, Mexico, Poland, Romania, Finland, Argentina, Australia, New Zealand, Austria, and Sweden -- will further weaken the chances of reaching a multilateral steel agreement, which the U.S. has hitherto supported.
 "The U.S. industry wants two bites at the cherry, and this is simply unacceptable. EC and other steel suppliers entered into global voluntary restraint agreements (VRAs). These ran for 10 years up until March 1992, and were highly advantageous to the U.S. steel industry. The Community's steel exporters always scrupulously respected these voluntary restraint agreements and indeed their quotas under these agreements were not even fully used up.
 "Now the United States is seeking to impose anti-dumping (AD) and countervailing duties (CVD) against Community exporters covering exports to the U.S. over exactly the same period, even though it had been agreed that import restraints would settle any question of duties or injury while the VRAs lasted. The U.S. is therefore breaking the spirit of its previous agreement with the Community. Furthermore, the extraordinarily high level of anti-dumping and countervailing duties sought to be imposed by the DOC has no justification whatsoever.
 "Our steel industry can be assured that the Commission is absolutely determined to get this issue resolved. I have instructed my services to seek consultations with the U.S. under the GATT in order to protect the EC steel industry's interest in these matters. I hope this is merely an unfortunate spill-over from the past. I am looking for a cooperative approach from the new United States administration on this as in all issues, but I reserve all the Community's rights if it is not forthcoming".
 BACKGROUND ON U.S. STEEL DUTIES
 The preliminary anti-dumping duties announced by the U.S. Department of Commerce affect four types of flat steel products from the Community. These duties are added to those imposed by the provisional countervailing duty determination announced on Nov. 30, 1992. These decisions concern a volume of trade of approximately 2 million tons/year valued at nearly $1 billion according to 1991 figures (see annex for details).
 The flat-rolled case is the most important of a series of AD and CVD petitions launched by the U.S. steel industry against its main steel trade partners. It concerns U.S. imports from seven EC member states, namely Germany, France, the United Kingdom (UK), Italy, Belgium, Spain and the Netherlands and 13 other countries (Japan, Korea, Brazil, Canada, Mexico, Poland, Romania, Finland, Argentina, Australia, New Zealand, Austria, and Sweden). In total these cases cover $3 billion of steel imports into the U.S. which equals 6 million metric tons.
 The AD and CVD cases concerning U.S. steel imports from the EC:
 -- Lead and bismuth steel carbon bars: petition filed by the U.S.
 industry on April 13, 1992 which concerns 200,000 metric tons
 of EC exports valued at some $71 million (member states:
 France, Germany and the UK).
 -- Steel rails: filed on May 1, 1992 concerning 40,000 metric
 tons of trade valued at some $18 million (member states:
 Luxembourg, UK).
 -- Flat steel products: filed on June 30, 1991 concerning EC
 exports of approximately 2 million metric tons valued at
 approximately $1 billion (member states: Germany, France, UK,
 Italy, Belgium, Spain and the Netherlands).
 -- Stainless wire rod: filed on December 30, 1992 concerning EC
 trade for 5,000 metric tons or $17 million (member states:
 France).
 Imports of these products into the U.S. market have been subject to quantitative restrictions from 1982 to March 1992 under a system of Voluntary Restraint Agreements (VRAs) renegotiated for the last time in 1989. The VRA scheme was intended to provide U.S. producers with an opportunity to restructure and restore their competitiveness. EC producers have consistently respected the quotas allocated and even during the last years of the scheme EC exports have remained at a level significantly lower than the allocated quotas.
 -0- 1/27/93
 /NOTE: Additional graphs and tables are available./
 /CONTACT: Maeve O'Beirne, 202-862-9549, or Ella Krucoff, 202-862-9540, both of the EC Commission/


CO: EC Commission ST: District of Columbia IN: MNG SU:

TW -- DC014 -- 9714 01/27/93 13:30 EST
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