Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: sciAticA errAticA who wrote (33313)	5/8/2003 12:53:01 PM
From: sciAticA errAticA	Read Replies (1) \| Respond to of 74559

EU gets WTO approval for record trade sanctions against US US vows to comply with WTO ruling on tax break WASHINGTON, May 7 (AFP) - The United States, responding to new pressure from Europe, said on Wednesday it intends to comply with a World Trade Organization ruling on a law that gives tax breaks to US exporters. The office of the US Trade Representative (USTR) said it is working with Congress on the Foreign Sales Corporation (FSC) law, which gives tax breaks to US exporters. The statement came after the European Union said it would impose a record four billion dollars in sanctions on US products if Washington failed to act this year. The European Commission issued a warning after the World Trade Organization (WTO) approved a list of products on which the EU could impose punitive levies. "This is part of the process, and the EC is acting within their rights," USTR spokesman Richard Mills said in a statement. "As we've made clear, the United States intends to comply with our international obligations, we are continuing to consult with the EC, and the executive branch is working with Congress to comply with these obligations." Mills added that Congress is "increasingly focused" on the matter, while arguing for an amicable resolution of the matter. "Retaliation is a double-edged sword, with economic consequences on both sides of the Atlantic," he said. "The EC has indicated that they would prefer compliance over retaliation. We prefer this, as well, because US exporters, including European firms with operations in the US, and European consumers will bear the brunt of any retaliation." The US Congress in 2000 passed legislation overhauling the law after the WTO ruled against Washington, but the EU complained to the WTO that the changes were inadequate. The WTO confirmed in January 2002 that the FSC system flouted global trade rules, and arbitrators later agreed with the EU that just over four billion dollars would constitute "appropriate countermeasures" based on the trade impact of the US policy. US companies such as Boeing and Microsoft have benefited from the FSC system, which allows US firms carrying out business through subsidiaries in offshore tax havens to benefit from reduced export taxes. eubusiness.com