From iatp@igc.apc.orgTue Feb 27 22:29:11 1996 Date: Tue, 27 Feb 1996 14:58:44 -0800 (PST) From: IATP To: Recipients of conference Subject: Corrected Trade News 2-27-96 TRADE NEWS Produced by the Institute for Agriculture and Trade Policy Volume 5, Number 5 FEBRUARY 27, 1996 _________________________________________ Headlines: - U.S. TO APPEAL WTO RULING ON GASOLINE - EU MOVES ON JAPAN COPYRIGHTS - POORER NATIONS RESIST TRADE-LABOR LINK - U.S., GULF STATES TO STRENGTHEN TIES - APEC WILL FORM NEW ADVISORY COUNCIL - CANADIAN STEELMAKERS SEEK NAFTA RULING _________________________________________ WTO NEWS SUMMARY _________________________________________ U.S. TO APPEAL WTO RULING ON GASOLINE On February 19, the United States announced that it would appeal a World Trade Organization (WTO) ruling that U.S. environmental measures on clean gasoline discriminated against imports from Venezuela and Brazil. The U.S. appeal to the WTO's "appellate body" is based on the grounds that member nations are allowed to take measures contrary to global rules, if those measures are viewed as necessary to protect human, animal or plant life and health. Under WTO rules, the appeals body may uphold, modify or reverse the legal findings and conclusions of the first report. It must rule within 90 days. The U.S. appeal comes after the U.S. Environmental Protection Agency (EPA) considered revising the rule to comply with the WTO but was blocked from doing so by Congress, which passed a measure forcing EPA to keep it. U.S. lawmakers argued that accepting the ruling would leave other U.S. environmental rules vulnerable to trade challenges. The U.S. appeal is being supported by a political diverse coalition of constituency groups, including environmental organizations and independent oil refiners. The WTO dispute panel had ruled January 17 that the U.S. measures requiring more stringent quality requirements for imported gasoline were not necessary to improve environmental standards. The rule in question states that domestic refiners could use their own 1990 fuel baseline from which to measure improvements needed to meet standards for reformulated gasoline, but that foreign refiners need to use the average of 1990 U.S. gasolines as their baseline. "U.S. to Appeal WTO's Imported Gasoline Finding," REUTERS, February 21, 1996; John Zarocostas, "U.S. Appeals Trade Panel's Ruling Against Clean-Gasoline Rules," JOURNAL OF COMMERCE, February 22, 1996. EU MOVES ON JAPAN COPYRIGHTS The European Union (EU) has opened proceedings in the World Trade Organization (WTO) against Japan over its failure to grant full copyright protection to recordings produced by European musicians since 1945. The European Commission said it was responding to complaints from companies that claim they are losing annual sales valued at $120 million in the Japanese market. The EU's action comes just weeks after the United States launched its own proceedings against Japan in the WTO. Brussels and Washington will hold joint consultations with Tokyo under the WTO's dispute settlement procedures, which give parties 60 days for talks. Failing agreement, the complaint will be referred to a full WTO dispute settlement panel. At issue is Tokyo's failure to implement WTO intellectual property rules that came into effect on January 1, 1996. The rules require WTO members to give full copyright protection to sound recordings produced within the last 50 years. Japan grants protection only to recordings produced since 1971. Under Japanese law, compact disc companies are free to release compilations of some of the best known artists in both pop and classical music produced in the 1950s and 1960s without paying royalties or copyright fees to the rights holders. Japan is the second biggest national market for the music industry, with annual sales of $6 billion. Katherine Butler and John Zarocostas, "EU Joins Battle Against Japan on Full Copyright Protection," JOURNAL OF COMMERCE, February 23, 1996. POORER NATIONS RESIST TRADE-LABOR LINK Recent efforts by the European Union (EU) to deepen the connection between trade and labor rights within the World Trade Organization (WTO) have met stiff resistance from developing country members who believe the labor issue is a pretext for industrial country protectionism. "There will be no trade-off" on trade and labor standards, said a developing country official. The skirmish comes shortly after the EU announced that it will try to use the WTO trade minister's summit in Singapore in December as a forum for launching a global trade watchdog body within the WTO to examine the relationship between social standards and trade. "This labor-trade issue cannot come on the Singapore agenda even for discussion," said an Asian country trade official. Developing nation officials say the International Labor Organization (ILO) is the proper forum to examine the subject, not the WTO. John Zarocostas, "Third World Nations Resist Trade, Labor Links," JOURNAL OF COMMERCE, February 13, 1996. _________________________________________ REGIONAL/BILATERAL AGREEMENTS _________________________________________ U.S., GULF STATES TO STRENGTHEN TIES The U.S. Department of Commerce announced this week that the United States and six Persian Gulf states will hold meetings March 10-13 in Manama, Bahrain to promote closer economic and trade ties. Government officials from the United States and six Gulf countries -- Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates -- will exchange views in their seventh annual "economic dialogue," to be followed by the second annual U.S.-Gulf Cooperation Council business conference. According to U.S. officials, the talks are likely to focus on intellectual property rights, technology transfers, product standards and tax policy. U.S. two-way trade with Gulf Cooperation Council countries exceeds $20 billion a year and at the end of 1994, U.S. direct investment in the region totaled almost $4 billion. About 200 U.S. companies are to participate in the conference with about as many gulf state businesses also taking part. "U.S., 6 Gulf States to Meet on Broadening Trade Ties," JOURNAL OF COMMERCE, February 26, 1996. APEC WILL FORM NEW ADVISORY COUNCIL In mid-February, at a meeting held in Manila of more than 500 delegates, members of the Asia Pacific Economic Cooperation (APEC) forum announced that they would form a new business advisory council to help guide the association's work. The new council will replace the so- called eminent persons' group, which has acted as a steering committee for the 18-member grouping of nations on both sides of the Pacific. All APEC members are expected to submit nominations in May for the council. Only the Philippines and Chile have submitted nominations so far. APEC nations are Australia, Brunei, Canada, Chile, China, Hong Kong, Indonesia, Japan, Malaysia, Mexico, New Zealand, Papua New Guinea, the Philippines, Singapore, South Korea, Taiwan, Thailand, and the United States. It envisions free trade among developed members by the year 2010 and for developing members 10 years later. P.T. Bangsberg, "New Advisory Panel Council Planned for APEC," JOURNAL OF COMMERCE, February 13, 1996. CANADIAN STEELMAKERS SEEK NAFTA RULING Canadian steelmakers have filed three requests for dispute settlement panels under the North American Free Trade Agreement (NAFTA), the first such panels Canada has sought over problems with Mexico. In the first case, Canadian steelmaker Dofasco, Inc. sought a panel over Mexican unfair trade findings ended on December 27, 1995, affecting cold rolled steel. A second panel was sought by Dofasco, Stelco, Inc., The Titan Industrial Corporation and Algoma, Inc. for penalties imposed on December 28, 1995, against Canadian plate steel. A third panel was sought by steelmakers Dofasco, Stelco and Algoma for penalties imposed on December 30, 1995 against hot rolled steel. The cases all pre-date the NAFTA, which means the steelmakers cannot challenge the original decisions by Mexican commerce officials, but instead must limit their challenge to how Mexican laws were followed after NAFTA took effect in January 1994. "Canadian Steelmakers Seek Ruling Under NAFTA on 3 Trade Disputes," JOURNAL OF COMMERCE, February 13, 1996. _________________________________________ RESOURCES _________________________________________ NGO Campaigning on Trade Issues: Perspectives from Europe, a report by Development Initiatives for Christian Aid and the Catholic Institute for International Relations (CIIR). This 50-page report provides an in-depth examination of how European NGOs have campaigned on trade issues over the past 20 years, and draws lessons from that experience. Copies of the report are available from Christian Aid, PO Box 100, London, England, SW1 7RT, ph.: 0171-620-4444; fax: 0171- 620-0719. Reshaping the World Trading System: A History of the Uruguay Round, by John Croome. This book, by a senior official in the GATT Secretariat who was involved in the Uruguay Round negotiations from their beginning, is the most comprehensive history of the round to date. The book covers the years between the close of the Tokyo Round and the official start of the Uruguay Round (1979- 1986), all the major events and declarations leading up to and during the round, details of the negotiations, and analyses of the Uruguay Round agreements themselves. To order, contact: Publication Services, World Trade Organization, 154, rue de Lausanne, CH-1211 Geneva 21; tel.: 41-22-739; fax: 41-22-739-5458. __________________________________________ Trade News is produced by the Institute for Agriculture and Trade Policy, Mark Ritchie, President. Editor: Orin Kirshner. E-mail versions of Trade News are available free of charge for Econet/IATP Net subscribers. 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