European Commission publishes 2000 Report on US Trade Barriers Brussels, 1st August 2000

What's New

The European Commission released today its sixteenth annual Report on Barriers to Trade and Investment in the United States. The Commission expresses its expectation that the WTO rulings on the Foreign Sales Corporation will be implemented by 1 October 2000 and reiterates its opposition to the so-called 'carousel' legislation. The report provides an update on all major obstacles that EU companies face when exporting and investing in the US. It also draws attention to persisting US unilateral and extraterritorial legislation, abusive use of US trade policy instruments and export subsidies. There are also many differences in the legal and regulatory systems, leading to non-tariff barriers. The Commission attaches the utmost importance to market access barriers in emerging sectors, notably in information technologies.

The transatlantic economic relationship has grown particularly strongly over the years, to the benefit of both economies and is underpinned by the most extensive trade and investment links in the world. The EU and the US have committed in the New Transatlantic Agenda of 1995 and in the Transatlantic Economic Partnership of 1998, to strengthen and consolidate the multilateral trading system and to progressively reduce or eliminate barriers that hinder the flow of goods, services and investment.

Nevertheless, European companies continue to face important problems when exporting to the US. The European Commission's 2000 report on US trade barriers gives full detail on the considerable number of impediments, ranging from more traditional tariff and non-tariff barriers, to differences in the legal and regulatory systems, and to the absence or limitation of internationally agreed rules and disciplines, which still need to be tackled. These barriers include standards and certification procedures as well as sanitary and phytosanitary requirements. Restrictions in the Government procurement sector (such as the Federal Buy America legislation) as well as in the air and maritime transport also substantially reduce trade and investment opportunities.

The European Commission has been very active and is determined to defend the rights of EU companies with its market access strategy, also using the Trade Barrier Regulation and dispute settlement in the WTO when warranted.

The EU has currently 11 cases against the US in the WTO. We have won panels against the abusive use by the US of trade policy instruments (Anti-dumping Act 1916, British Steel, safeguards on wheat gluten), we have been fighting US export subsidies (Foreign Sales Corporation), we have defended the EU intellectual property rights in the US (Homestyle exemptions, section 211). The European Commission expects the US to fully implement these WTO rulings and will closely monitor US compliance in these cases. Especially, US compliance by 1 October 2000 in the FSC case will restore a level playing field between US and EU companies.

The European Commission has also been combating US unilateralism in trade policy (Section 301, Helms Burton, Banana sanctions). More recently, the US has adopted the so-called carousel legislation which is disregarding the fundamental principles of the Dispute Settlement Understanding. This legislation obliges the USTR to rotate every 6 months the list of products under sanction. This creates a total uncertainty on the market, hampering EU exports to the US way beyond what has been authorised by the WTO as a result of the bananas and beef hormones. The Commission has immediately challenged this legislation in the WTO.

The European Commission is attaching the utmost importance to the emerging sectors and in particular information technologies. European and foreign-owned firms seeking access to the US market for communication services still face considerable barriers, particularly in the satellite services and the mobile services sectors. This situation is not in line with the market access policy advocated by the US, and provides a competitive advantage to the significant number of US companies that have already access to the European market in these fields. Furthermore, the Commission has identified a number of US laws and policies on Internet and electronic commerce which could impact negatively on the business of European companies, particularly in the fields of Internet domain names and cybersquatting, encryption and patentability of software and business methods.

The Commission is firmly committed to address the barriers listed in the report, and further brought to its attention, these through the appropriate instruments.

The Report is available on this website by clicking here.

The printed version of the report will soon be available and could be ordered from:

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