§ Mr. Dorrellasked the Secretary of State for Trade and Industry what retaliatory measures he will recommend to his European Economic Community counterparts if the United States manufacturing clause is not allowed to lapse on 1 July.
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§ Mr. Alan ClarkThe manufacturing clause, as S601 of the United States Copyright Act 1970 is widely known, in effect prevents the importation into the United States of copyrighted non-dramatic material written in English by United States nationals but printed outside the United States and Canada. In 1984 a GATT panel found that this was a breach of United States international obligations. This finding was unanimously endorsed by GATT members. There is no doubt that the clause seriously hinders the ability of the printing industry in the United Kingdom and in other countries to export to the United States. Preliminary estimates of the trade loss caused to the European Community range between $300 million and $500 million.
Although the clause is due to expire at the end of June, there are proposals before Congress which would re-enact it. The Community has made it clear to the United States that it will be forced to seek GATT authority to take retaliatory action against imports from the United States if a renewal Bill is enacted. The Community is considering this week a formal request to GATT for authority to retaliate in the event of renewal and is examining the scope and detail of possible retaliation measures. Products that will be under consideration include products from the United States paper and tobacco manufacturing industries and certain printed matter.