An advisory panel to the trade minister voiced concern in an annual report released Friday over a U.S. antidumping law that may violate the World Trade Organization’s international trade rules. The Subcommittee on Unfair Trade Policies and Practices under the Industrial Structure Council calls in the report for continued efforts to have the United States abide by international trade rules. Japan and eight countries started consultations with the U.S. under the WTO after Washington enacted the so-called Byrd Amendment in the fall. The law allows the U.S. government to distribute antidumping and countervailing duties among American industries suffering from cheap imports.

The law is problematic because it gives American industry unnecessary incentives to file antidumping cases, which may impede free trade, the report says. The 2001 Report on the WTO Consistency of Trade Policies by Major Trading Partners calls on Japan’s trading partners to strictly abide by trade rules under the WTO and harmonize domestic regulations with international rules. The 10th annual report reviews trade policies and practices by Japan’s 12 major trading partners in light of two WTO principles of most-favored-nation and national treatment, as well as 13 sectoral rules such as safeguard measures and antidumping.

As an increasing number of less-developed countries have taken antidumping measures in recent years, the panel stressed the importance of paying special attention to those nations to see if their antidumping practices accord with WTO rules. The report adds that, although developed countries used to be the main users of antidumping measures, less-developed countries, including Brazil, India and South Korea, are increasingly using such measures.

As a new case this year, the report takes up South Korea’s subsidies to the ship-building industry and recommends the issue be given special attention from the viewpoint of conformity with WTO rules. The report also points out that the imposition of “safeguard” import restriction measures and the launching of investigations to start safeguard measures are becoming more common.

Mentioning that safeguard measures should serve only as an emergency measure, the report stresses that countries should not abuse them. The report extensively analyzes the service and agriculture sectors, which are expected to be the subject of full-scale discussions at the WTO in the near future, citing 24 cases by 10 countries as possibly problematic. Among these practices are domestic rules banning the establishment of branches of foreign banks in some states of the U.S. and subsidies to cheese exports by the European Union.

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