Feb 13, 1989

SPECIAL MEETING OF COUNCIL FEBRUARY 21 ON BRAZIL-U.S. DISPUTE.

GENEVA, FEBRUARY 9 (IFDA/CHAKRAVARTHI RAGHAVAN)ó A special meeting of the GATT Council will be held on February 21 over Brazil's complaint against the U.S. for latter's imposition of discriminatory 100 percent, tariffs on imports of some products from Brazil.

Announcing the special meeting dates Thursday, GATT spokesman, David Woods said that while the meeting was in response to the request from Brazil, put in Wednesday evening, in accordance with usual practices other pending issues are also likely to be brought up on the agenda of the special meeting.

Brazil had announced its intention of seeking a special meeting, ahead of the normal meeting of the Council on March 8, when the U.S., at the Council meeting Wednesday, had blocked reference of the dispute to panel. Brazilís request had been supported by 50 other, delegations, an unusual and impressive show of support.

Before the Council had considered the issue Wednesday evening, there had been a general debate in the morning, at the instance of the EEC, on the entire issue of unilateralism in trade, when U.S. actions under section 301 had come in for a round of condemnation from most speakers.

The U.S. imposed on October 20, hundred percent tariffs on imports from Brazil of non-benzenoid drugs, paper products and consumer electronics.

Acting under section 301 of its trade and tariff act, the U.S. had given as the reason for its action the purported failure of Brazil to provide adequate protection to intellectual property rights of U.S. drug companies.

Brazil has rejected this charge, underscoring the point that the Brazilian laws on patents and other intellectual property rights were fully in accord with the Paris Union Conventions governing this matter.

When the issue had come up in the GATT Council Wednesday, the U.S. delegate had claimed among others that the authorities in the new U.S. Administration were still consulting (among themselves) on this matter.

The U.S. had initially announced its intention to impose such tariffs as early as July 22, 1988. Brazil had immediately raised the issue in GATT and had sought "consultations", a preliminary step to adjudication. At that time the U.S. had said it would hold consultations when it actually decided on the imposition.

Brazil sought promptly such consultations on October 20, when the levy of the duties were announced. After some delay, the U.S. held such consultations only on November 29.

In other matters that came up before the council Thursday, the U.S. also blocked reference to a panel of the dispute raised by the European Community over imposition of similar discriminatory penal tariffs, also after section 301 proceedings in U.S., on a range of EEC exports.

The U.S. has argued that it had imposed the taxes because of the EEC regulations banning use of hormones in meat for human consumption. The EEC ban applies both to domestically raised cattle and on imported. The ban on domestic cattle went into effect in January 1988 and that on imports in January this year, after more than a year of consultations between the two had failed to resolve the dispute.

In blocking the panel request, the U.S. cited the refusal of the Community to agree to have the technical issue, whether use of hormone-treated meat was harmful to human health referred to the committee on technical standards and adjudicated there.

Both sides Thursday noted however next week's talks in Washington between the EEC external relations commissioner, Franz Andressen and the new U.S. trade representative Mrs Carla Hills, and hoped the talks would resolve the dispute.

Among others, Canada disagreed with the rationale behind the EEC ban on hormone treated meat, but agreed that unilateral actions (taken by the U.S.) were contrary to GATT.

The EEC request was supported by Chile, Brazil and Nicaragua.

In another dispute, the EEC request for a panel to go into the United States sugar import regime, operated behind the waiver granted to the U.S. on agricultural matters, the U.S. again refused to accept the request for a panel.

The U.S. argued that the Community had not clearly stated what exactly it wanted to get adjudicated. The U.S. also said it could not agree to the panel until the terms of reference of the panel on the U.S.-EEC Soya dispute was settled.

The panel has been established in this dispute, but its terms of reference have not been agreed upon.