HC Deb 20 May 2003 vol 405 cc716-7W
Angus Robertson

To ask the Secretary of State for Trade and Industry what her Department's policy is on the United States of America's Foreign Sales Corporations provision; and if she will make a statement. [113292]

Ms Hewitt

The Dispute Settlement Body (DSB) of the World Trade Organisation (WTO) has already found that the US Foreign Sales Corporation Tax is in breach of WTO rules on subsidies.

The EU, which brought the case on behalf of the member states, has been authorised by the DSB to take countermeasures against US goods to the value of $4 billion.

Whilst the EU has completed the technical process of finalising a list of US goods on which additional duties could be imposed should the US not comply with the ruling against it, we very much hope that the situation can be resolved without the need to resort to such countermeasures.

The Department of Trade and Industry consulted the UK business community on the contents of the countermeasures list and successfully achieved changes to it, reflecting the comments that we received.

No decision has been taken by the EU on whether or not to initiate countermeasures. Any decision to do so will only be taken if the US should fail to comply with the WTO ruling.

The US has signalled that it intends to comply with the ruling by amending its legislation. So long as it does so, the introduction of countermeasures will be unnecessary.

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