By Lewis Crofts - 27th January 2004
Brussels is “a matter of weeks” away from diving into another trade dispute with Washington - this time over calculation methods for anti-dumping duties.
The EU and the US have been locked in talks over ‘zeroing’ - a controversial method of calculating to what extent domestic products are being undercut by foreign imports – but have failed to settle amicably.
Now Brussels is planning to lodge an official complaint at the World Trade Organisation “in a couple of weeks,” according to an EU official.
Anti-dumping duties are usually measured by taking the difference between the price the goods sell at in the home country, and the lower pricetag unfairly placed on the exported goods.
The EU believes that the US method – known as ‘zeroing’ – “inflates” the calculation by not taking into account certain amounts of an exported good that are often sold abroad for the same price or sometimes higher than the price at home.
These amounts should be discounted from any calculation.
The official said that it was as yet difficult to calculate how European industry has suffered but the steel industry is known to be one of the sectors most affected by ‘zeroing’.
The total impact is thought to be in the realm of several hundred million dollars.
The dispute has been simmering for some time but EU officials finally asked Brussels to act at a committee meeting on Friday following clear signs from Washington that it would not back down.
This move comes against a background of EU-US trade acrimony.
On Monday, Brussels and Washington became further embroiled in another bitter anti-dumping case and a March 1 deadline is fast approaching when the EU has vowed to retaliate against a US system of export subsidies.
Relations remain prickly with other disputes over hormone beef and genetically modified crops.
Furthermore, there has been plenty of mud-slinging over who was to blame for the collapse of WTO development talks at Cancun and who should give most ground to kick start the talks.
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