Uneasy truce in transatlantic trade war
The EU is to lift millions of pounds in punitive tariffs on US goods after Washington repealed corporate tax breaks that were ruled illegal by the World Trade Organisation.
“We shall be putting an end to our sanctions,” said EU Trade Commissioner Pascal Lamy.
But the two-decade transatlantic fight will continue because of EU concerns about loopholes in the bill signed into law by President George Bush last week. That allows big exporters like Boeing to benefit from the breaks beyond the two-year transition period agreed to by the EU.
Lamy said he would ask the WTO for another ruling on whether the new US law fully complies with global trade rules.
“There are certain provisions on which we have our doubts,” he said.
The EU sanctions, which will be lifted on January 1, could potentially return if the US law is judged to be noncompliant with the WTO ruling – as happened to the first reform passed by the US Congress in 2000.
