USTR Seeks Comments on Establishment of WTO Dispute Panel on the American JOBS Creation Act of 2004
The Office of the U.S. Trade Representative (USTR) has issued a notice requesting public comments regarding a World Trade Organization (WTO) dispute settlement panel (DSP) has been established at the request of the European Communities (EC) with respect to the American JOBS Creation Act of 2004 (JOBS Act).
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(According to the EC, the JOBS Act (Public Law 108-357, which repealed the Foreign Sales Corporation (FSC)/FSC Replacement and Extraterritorial Income Exclusion Act (ETI) tax regime) was intended to implement the recommendations and rulings of the WTO Dispute Settlement Body (DSB), but fails to do so properly and is WTO inconsistent.
In particular, the EC considers that Section 101 of the JOBS Act contains transitional provisions that will allow U.S. exporters to continue to benefit from the FSC/ETI tax regime as follows: (a) in the years 2005 and 2006 with respect to all export transactions; and (b) for an indefinite period with respect to certain contracts.)
EU Could Reimpose Additional Duties on U.S.-Origin Products if WTO Finds JOBS Act to be WTO-Inconsistent
On January 31, 2005, the European Union (EU) Council adopted a regulation which suspended, retroactive to January 1, 2005, the additional customs duties it had been imposing on certain U.S.-origin products in connection with this dispute.
The suspension of such additional duties is effective until January 1, 2006 or 60 days after confirmation by the WTO DSB, whichever date is later, that certain aspects of the JOBS Act are WTO inconsistent.
EU sources have previously confirmed that if additional duties are re-imposed, they would be set at 14% (in addition to the normally applicable customs duties) and would be applied to products listed in the regulation's Annex. See ITT's Online Archives or 02/03/05 news, 05020310, for BP summary.
(See ITT's Online Archives or 01/04/05 news, 05010433, for BP summary of USTR's notice on EC's request for WTO consultations on this dispute.)
- comments should be submitted on or before May 2, 2005.
USTR contact - William Hunter (202) 395-3582
USTR notice (D/N WTO/DS108, FR Pub 04/11/05) available at http://a257.g.akamaitech.net/7/257/2422/01jan20051800/edocket.access.gpo.gov/2005/pdf/05-7143.pdf