The President's chief trade negotiator yesterday accused U.S. Steel Corp. of irresponsibly using the courts to settle difficult questions of international trade policy.
Robert S. Strauss the U.S. special trade representative, called the giant steel maker's actions "unconsciounable".He said court in U.S. Steel's favor could mean the breakdown of the trade negotiations that have been under way in Geneva for four years.
Last week, U.S. Steel asked the U.S. Customs Court in New York for a summary judgment that the nine-member European Economic Community illegally subsidizes more than $2 billion in steel exports to the United States.
In a suit filed last year, U.S. Steel charged that by rebating an excise tax (called a value-added tax) on all exports, the European Community was subsidizing steel exports, and asked that the U.S. impose a duty in the amount of the rebated tax on all steel imported from Europe.
The case had been scheduled to go to trial next December, but after the Customs Court ruled that a similar tax that Japan rebates on electronic products was a subsidy, U.S. Steel last week asked for a summary, or immediate, judgment.
The United States Government opposed Zenith Radio Corp. in the Japanese suit and opposes U.S. Steel in the current suit.
At a luncheon meeting with reporters, Strauss said that he had unsuccessfully asked U.S. Steel last week to "let it sit."
"Anybody has a right to go to court for redress of injury," Strauss said.
"But certain issues don't really lend themselves to judicial solutions . . . This decision could cause chaos in international trade." producer tax in Japan are legal and Agreement on Tariffs and Trade - the international body which sets trade rules and oversees them - rebates of excise taxes such as the value-added tax in Europe or the producer tax in Japan are legal and are not considered government subsidies. The U.S. was instrumental in devising this rule in the 1940s.
Strauss charged that by forcing the question, U.S. Steel may push the nation into a position of telling "every country in the world that if they don't change their internal tax system, we'll level duties against them."
"It's an outrage," Strauss said. "They have moved for a summary judgment when they know how hard I'm trying to solve their problems."
U.S. Steel Corp. chairman, Edgar B. Speer could not be reached for comment yesterday.Speer charged late last mont that, because of short-sighted U.S. trade policies, the U.S. is already the only major industrial country that cannot supply all its steel needs during periods of peak demand.
The United States tried to institute special talks on the problems of international trade in steel at the Geneva talks, but met with resistance from Japan. However, Japan and Europe have agreed to informal talks on the trade problem in steel under the aegis of the Organization for Economic Cooperation and Development.
Those talks begin next month in Paris.
Strauss said he and Treasury Secretary W. Michael Blumenthal are determined to knock down the Zenith case on appeal, "but I don't think we've got more than a 50-50 chance of doing that. I'd be willing to flip a coin on the case right now . . . If we lost it, we have to go for legislative relief, and that opens up a Pandora's box. Everything in the trade field comes up for debate. That would destroy or distort our Geneva negotiations terribly."