Byrd Amendment
Encyclopedia
The Byrd Amendment is also known as the Continued Dumping and Subsidy Offset Act of 2000 (CDSOA). The act is American
legislation closely associated with its chief sponsor, Democratic
Senator
Robert Byrd
of West Virginia
. The act changed the disposition of funds raised from duties on imports that the US government has determined to be subsidized or otherwise unfairly priced. Prior to the act, those funds were incorporated into the US budget. The Act specifies that the funds be distributed to the US companies that file pricing complaints. In short, this meant that non-US firms which sell below cost price in the US can be fined, and the money
given to the US companies who made the complaint in the first place. The act has since been repealed.
and seven other countries — Brazil
, Canada
, Chile
, India
, Japan
, South Korea
and Mexico
— filed a formal protest with the World Trade Organisation (WTO). The European Commission claimed that since 2000, US companies had received $1 billion in anti-dumping fees redistributed to them under the Byrd Amendment. The WTO eventually ruled the Byrd Amendment wholly illegal
in 2002. It said that the European Union
(EU) and the other countries could introduce measures which penalize the US for up to 72% of the monies raised and distributed through the Byrd Amendment.
On April 4, 2005, now with the permission of the WTO, the EU announced plans to implement limited sanctions on a selection of US goods, charging a 15% levy
on U.S. paper
, farm goods
, textiles and machinery from May 1, 2005. This was in light of the continuing failure of the United States to bring its legislation in conformity with its international obligations. Also, on May 1, Canada imposed a 15% surtax sanction on US imports of cigarette
s, oyster
s and live swine
. On September 1, 2005, the Japanese government introduced 15% retaliatory duties on U.S. steel
imports.
called for the Act's repeal, however with little progress. Eventually, after growing pressure on multiple fronts, the United States Congress
in December 2005 and January 2006 repealed the amendment. However, the act's provisions stayed in place until October 1, 2007 and money continued to be redirected to companies during this time.
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
legislation closely associated with its chief sponsor, Democratic
Democratic Party (United States)
The Democratic Party is one of two major contemporary political parties in the United States, along with the Republican Party. The party's socially liberal and progressive platform is largely considered center-left in the U.S. political spectrum. The party has the lengthiest record of continuous...
Senator
United States Senate
The United States Senate is the upper house of the bicameral legislature of the United States, and together with the United States House of Representatives comprises the United States Congress. The composition and powers of the Senate are established in Article One of the U.S. Constitution. Each...
Robert Byrd
Robert Byrd
Robert Carlyle Byrd was a United States Senator from West Virginia. A member of the Democratic Party, Byrd served as a U.S. Representative from 1953 until 1959 and as a U.S. Senator from 1959 to 2010...
of West Virginia
West Virginia
West Virginia is a state in the Appalachian and Southeastern regions of the United States, bordered by Virginia to the southeast, Kentucky to the southwest, Ohio to the northwest, Pennsylvania to the northeast and Maryland to the east...
. The act changed the disposition of funds raised from duties on imports that the US government has determined to be subsidized or otherwise unfairly priced. Prior to the act, those funds were incorporated into the US budget. The Act specifies that the funds be distributed to the US companies that file pricing complaints. In short, this meant that non-US firms which sell below cost price in the US can be fined, and the money
Money
Money is any object or record that is generally accepted as payment for goods and services and repayment of debts in a given country or socio-economic context. The main functions of money are distinguished as: a medium of exchange; a unit of account; a store of value; and, occasionally in the past,...
given to the US companies who made the complaint in the first place. The act has since been repealed.
World response
The European CommissionEuropean Commission
The European Commission is the executive body of the European Union. The body is responsible for proposing legislation, implementing decisions, upholding the Union's treaties and the general day-to-day running of the Union....
and seven other countries — Brazil
Brazil
Brazil , officially the Federative Republic of Brazil , is the largest country in South America. It is the world's fifth largest country, both by geographical area and by population with over 192 million people...
, Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
, Chile
Chile
Chile ,officially the Republic of Chile , is a country in South America occupying a long, narrow coastal strip between the Andes mountains to the east and the Pacific Ocean to the west. It borders Peru to the north, Bolivia to the northeast, Argentina to the east, and the Drake Passage in the far...
, India
India
India , officially the Republic of India , is a country in South Asia. It is the seventh-largest country by geographical area, the second-most populous country with over 1.2 billion people, and the most populous democracy in the world...
, Japan
Japan
Japan is an island nation in East Asia. Located in the Pacific Ocean, it lies to the east of the Sea of Japan, China, North Korea, South Korea and Russia, stretching from the Sea of Okhotsk in the north to the East China Sea and Taiwan in the south...
, South Korea
South Korea
The Republic of Korea , , is a sovereign state in East Asia, located on the southern portion of the Korean Peninsula. It is neighbored by the People's Republic of China to the west, Japan to the east, North Korea to the north, and the East China Sea and Republic of China to the south...
and Mexico
Mexico
The United Mexican States , commonly known as Mexico , is a federal constitutional republic in North America. It is bordered on the north by the United States; on the south and west by the Pacific Ocean; on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of...
— filed a formal protest with the World Trade Organisation (WTO). The European Commission claimed that since 2000, US companies had received $1 billion in anti-dumping fees redistributed to them under the Byrd Amendment. The WTO eventually ruled the Byrd Amendment wholly illegal
Law
Law is a system of rules and guidelines which are enforced through social institutions to govern behavior, wherever possible. It shapes politics, economics and society in numerous ways and serves as a social mediator of relations between people. Contract law regulates everything from buying a bus...
in 2002. It said that the European Union
European Union
The European Union is an economic and political union of 27 independent member states which are located primarily in Europe. The EU traces its origins from the European Coal and Steel Community and the European Economic Community , formed by six countries in 1958...
(EU) and the other countries could introduce measures which penalize the US for up to 72% of the monies raised and distributed through the Byrd Amendment.
On April 4, 2005, now with the permission of the WTO, the EU announced plans to implement limited sanctions on a selection of US goods, charging a 15% levy
Tax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...
on U.S. paper
Paper
Paper is a thin material mainly used for writing upon, printing upon, drawing or for packaging. It is produced by pressing together moist fibers, typically cellulose pulp derived from wood, rags or grasses, and drying them into flexible sheets....
, farm goods
Farm equipment
Agricultural machinery is any kind of machinery used on a farm to help with farming. The best-known example of this kind is the tractor.-Soil cultivation:*Cultivator*Cultipacker*Chisel plow*Mulch tiller*Harrow**Spike harrow**Drag harrow...
, textiles and machinery from May 1, 2005. This was in light of the continuing failure of the United States to bring its legislation in conformity with its international obligations. Also, on May 1, Canada imposed a 15% surtax sanction on US imports of cigarette
Cigarette
A cigarette is a small roll of finely cut tobacco leaves wrapped in a cylinder of thin paper for smoking. The cigarette is ignited at one end and allowed to smoulder; its smoke is inhaled from the other end, which is held in or to the mouth and in some cases a cigarette holder may be used as well...
s, oyster
Oyster
The word oyster is used as a common name for a number of distinct groups of bivalve molluscs which live in marine or brackish habitats. The valves are highly calcified....
s and live swine
Pig
A pig is any of the animals in the genus Sus, within the Suidae family of even-toed ungulates. Pigs include the domestic pig, its ancestor the wild boar, and several other wild relatives...
. On September 1, 2005, the Japanese government introduced 15% retaliatory duties on U.S. steel
Steel
Steel is an alloy that consists mostly of iron and has a carbon content between 0.2% and 2.1% by weight, depending on the grade. Carbon is the most common alloying material for iron, but various other alloying elements are used, such as manganese, chromium, vanadium, and tungsten...
imports.
Repeal
For years, U.S. President George W. BushGeorge W. Bush
George Walker Bush is an American politician who served as the 43rd President of the United States, from 2001 to 2009. Before that, he was the 46th Governor of Texas, having served from 1995 to 2000....
called for the Act's repeal, however with little progress. Eventually, after growing pressure on multiple fronts, the United States Congress
United States Congress
The United States Congress is the bicameral legislature of the federal government of the United States, consisting of the Senate and the House of Representatives. The Congress meets in the United States Capitol in Washington, D.C....
in December 2005 and January 2006 repealed the amendment. However, the act's provisions stayed in place until October 1, 2007 and money continued to be redirected to companies during this time.
External links
- A brief history of the bill
- BBC report that EU may fight against the bill
- BBC report on the WTO ruling
- BBC report on the proposed European sanctions on US goods
- Foreign Affairs and International Trade Canada - Canada authorized to sanction the United States for Byrd Amendment
- World Trade Organisation dispute page for DS217, the CDSOA