EU okays sanctions against US products

European Union member states on Monday approved slapping sanctions on a range of US products imported into Europe beginning May 1 in a long-running row over a controversial US anti-dumping law.

The EU's Executive Commission last month called for an extra duty of 15 percent to be imposed on products ranging from paper to farm and textile products, in response to Washington's failure to repeal the so-called Byrd Amendment.

Foreign ministers of the EU's 25 member states meeting in Luxembourg approved the measure without debate, the EU said.

Under the 2000 law, the US government redistributed anti-dumping duties to US companies that alleged dumping, or the selling of items abroad at less than the market price in the domestic market.

The EU and six other countries (Brazil, Canada, India, Japan, Mexico, and South Korea) took the case to the World Trade Organisation (WTO), which last year authorised sanctions amounting to 72 percent of the sums reaped by the US law.

The EU executive said last month its proposed level of sanctions was based on the latest distribution of duties made under the Byrd Amendment, amounting to slightly under 28 million dollars (21.5 million euros).

It warned it would revise the sanctions depending on damage caused to European companies, and has drawn up a "reserve list" of products which could become subject to additional import duties if necessary.

Canada has also announced it will slap additional 15 percent duties on a range of US products.

Washington was targeted by the sanctions because the US Congress failed to repeal the legislation -- named after Democratic Senator Robert Byrd -- before a deadline of December 27, 2003.

US companies gained about 561 million dollars (463 million euros) as a result of the law in 2001 and 2002, according to US figures.

But according to the EU commission, the Byrd Amendment -- full name the Continued Dumping and Subsidy Offset Act of 2000 -- has distributed over one billion dollars in annual payments since it first came into force.

The main recipients have been in the bearing, steel and other metal, household item and food sectors, it said last month.

It added that a "substantial" increase is foreseen for the next distribution that could start on October 1 this year if the law is not repealed. That payment alone could amount to 1.6 billion dollars, it warned.