Brussels, 05/11/2003 (Agence Europe) - As we expected (EUROPE yesterday p 13), on Wednesday the Commission sent a first warning shot in Washington's direction, as part of the Foreign Sales Corporations (FSC) affair. Adopting a draft regulation to impose countermeasures on selected US products in connection with the long-standing WTO dispute on the US Foreign Sales Corporations, countermeasures would be imposed gradually starting from 1 March 2004 and aim to pressurise the USA to make their export companies comply with WTO decisions.
Pascal Lamy said that the Commission therefore hoped, "to pass a very clear message to the US that their continued failure to implement 3 years after the expiry of the original WTO deadline is unacceptable. I have just been to Washington and have clearly explained our position. Still, we have opted for a measured approach and have actually left the door open for US action before countermeasures are to be applied in March 2004". He also said that he hoped that Washington would seize this opportunity. The Commission proposal intends from 1 March 2004 to gradually raise customs duties on certain US products. Set at 5% next March, this rise will be followed by automatic monthly rises from 1% to a ceiling of 17% by March 2005. The operation will increase EU customs receipts to the tune of EUR 290 in 2001 and EUR 615 million in 2005. Products affected include: meat, milk, fruit and vegetables, cereals, sugar, soap, hides, wood, paper, publishing products, textiles and clothing, footwear, ceramics, glass, cast iron, steel, tools, nuclear and electrical equipment and toys etc.