December 2000 News

NAFTA Tariff Acceleration Exercise

Mexico has provisionally agreed to eliminate tariffs on 92 line items ranging from footwear, chemicals, and batteries to electricity co-generation systems with a total value of approximately $733 million in U.S. exports annually as a result of the third round of NAFTA tariff acceleration discussions [View list]. Almost $300 million of this total were products identified by ITA for which Mexico had granted E.U. exporters duty-free treatment under the E.U.-Mexico Free Trade Agreement and the USG sought parity. The elimination of duties is expected to go into effect on January 1, 2001. The complete list of products was published in the Federal Register on November 27. Please contact Geri Word at (202) 482-1545 for further information.

MOU signed between U.S. SBA and U.S.-Nigeria Development Institute

On November 30, the Small Business Administration signed an MOU with the U.S.-Nigeria Development Institute. This is its first MOU with a Sub-Saharan country. The MOU aims to facilitate business development, job creation, and trade linkages between SMEs in both countries. The two parties intend to promote exchanges and visits, joint trade promotion ventures to strengthen the bilateral commercial relationship.

China: Court Protects Trademarks on Internet

A Beijing intermediate court extended the scope of China's trademark law to the Internet when it ruled in November in favor of U.S. firms DuPont and Proctor and Gamble to stop "cybersquatters" from registering the companies' trademarks as domain names in China. While the companies applaud the court's decision as a significant step towards more complete trademark protection in China, some legal scholars wonder if the court overreached its authority. The defendant in the DuPont case has already appealed the court's decision to the Supreme Peoples' Court. The deadline for filing an appeal in the Proctor and Gamble case is December 8. If the appeal is heard by the Supreme Peoples' Court, it could be several months before a final decision is reached. In the meantime, the offending web sites are still in operation.

Malaysia: IPR Raids Continue

On Nov 21, Ministry of Domestic Trade and Consumer Affairs (MDTCA) Secretary General Pahamin Rajab led a raid on a factory producing pirated optical disks outside Kuala Lumpur. The raid netted equipment, machinery, and other items worth over US $5.26 million. It was the fourth factory raid in the past three months. The raid was jointly conducted by MDTCA, the police, and officials from Business Software Association (BSA), motion picture association of Malaysia (MPA) and recording industry association of Malaysia (RIM). Pahamin told reporters that he believed at least 50 percent of the pornographic materials supplied to the black market had been cut off following this latest raid. Pahamin pledged that MDTCA would raid factories monthly, raid warehouses weekly and retail outlets on a daily basis.

WTO Appellate Body Rejects EU Appeal on U.S. Bananas Duties

On December 11, 2000 the Office of the U.S. Trade Representative announced that the World Trade Organization Appellate Body has rejected a European Union appeal claiming that U.S. tariffs now in place in the Bananas dispute violate WTO rules. The EU's complaint addressed the U.S. announcement of March 3, 1999 that it would change bonding requirements on certain imports from EU countries. The United States took this step in order to ensure that it could, from that date, collect any duties that might be applied after a WTO arbitrator in the Bananas dispute completed a report on the level of harm to the U.S., which had been scheduled for March 2. The effect of today's ruling is that the United States will not need to make any changes in the tariffs imposed on European imports in response the EU's WTO-inconsistent banana import regime. Read the USTR press release (no longer available)

WTO Finds Korea Maintains Inconsistent Restrictions on U.S. Beef Imports

On December 11, 2000, a World Trade Organization (WTO) Appellate Body report affirmed the findings of a July WTO panel which concluded Korea's import regime for beef discriminates against imports from the United States and other foreign suppliers. The Appellate Body also found that Korea did not compute its domestic support for beef in the manner required by the provisions of the WTO Agreement on Agriculture. Read the USTR press release (no longer available)

Canada: Leveling Playing Field for U.S. Long-Distance Providers

Canada: Leveling Playing Field for U.S. Long-Distance Providers On November 30, the Canadian Radio-Television and Telecommunications Commission (CRTC) announced that the "contribution" (i.e., access charge) mechanism will change significantly on January 1, 2001. Rather than an arbitrary contribution rate being collected exclusively from long-distance service providers, most telecom service providers will now contribute a percentage of their revenue to a subsidy fund. When implemented, this should make it less difficult for major U.S.-affiliated long-distance Service providers (such as AT&T Canada and Call- Net/Sprint Canada) eventually to become profitable. In December 1999, the CRTC denied a request by two major U.S.-based competitive long distance telecom firms to lower the "contributions" they must pay to cover the fixed costs of the incumbent telephone companies, and the competitive firms' subsequent appeals both to the CRTC and to the minister of industry. In March, 2000, the USG cited Canada's contribution regime under Section 1377 Trade Review as having the potential to unnecessarily burden Canada's long-distance providers, and disproportionately affect US providers. This change in contribution regime may be sufficient to eliminate the need for further action under the Section 1377 claim.Read the CRTC press release (offsite link).

Invitation for Comments: Free Trade Agreement Negotiations with Chile

The U.S. has announced its intent to conclude free trade agreement negotiations with Chile. The Trade Policy Staff Committee is requesting written comments from the public to assist USTR in formulating negotiating objectives for the agreement and to provide advice on how specific goods and services and other matters should be treated under the agreement. Read the Federal Register notice.

Croatia Becomes 140th WTO Member

On November 30 Croatia obtained membership of the World Trade Organization (WTO). Croatia is the 140th country to gain admission to the Geneva-based organization that seeks to ensure the free flow of global commerce.

Statement by the President on United States-Chile Free Trade Agreement Negotiations

On Novemember 29 President Clinton announced the beginning of negotiations which are expected to build on the progress made by U.S.-Chile Joint Commission on Trade (JCTI). Negotiation of the bilateral Free Trade Agreement (FTA) should provide further impetus for the Free Trade Area of the Americas (FTAA) negotiations. Read the full text

U.S. and Japan Complete Annual Review of Automotive Framework Agreement

The Governments of the United States and Japan met on November 28 and 29 in Seattle to conduct the annual review of the 1995 U.S.-Japan Automotive Framework Agreement. These talks, called for under the Agreement, are held every year to assess progress and were co-led by the Department of Commerce and the Office of the United States Trade Representative. More (offsite link)

U.S.: Special 301 Out-of-Cycle Reviews

On November 8, United States Trade Representative Charlene Barshefsky announced the outcome of Special 301 out-of-cycle reviews for El Salvador and Italy, as well as resolution of Trade-Related Aspects of Intellectual property rights (TRIPs) implementation concerns in Poland and Ireland. Read the full text

Czech Republic: Aircraft Tariff Waiver Approved

On December 4, the Czech government approved a temporary one-year tariff waiver, effective January 1, 2001 for large civil aircraft, helicopters and certain spare parts. The resolution allows for renewal of the waiver and instructs the government to review its possible extension in the latter half of 2001. The Czech government's decision removes a significant irritant from the U.S.-Czech trade agenda because it levels the playing field for U.S. bidders on future Czech aircraft procurement.