The Carter administration intends to seek corrective legislation from Congress if pending court decisions force the Treasury-Department to apply countervailing, or retallatory duties, on a whole range of imported Japanese electronic and on European steel products.
This was revealed yesterday at a press conference by Special Trade Representative Robert Strauss, who said, "I think I have a good chance of slipping in and slipping out and getting something done (by Congress) if I do it the right way."
There are two cases involved. The first, concerning Japanese electronics products, was brought by Zenith Radio Corp, which won an initially favorable ruling by the U.S. Customs Court. Zenith argued that Japan fails to levy the same indirect sales-type tax on exports that it does on consumption on a number of electronics items.
Zenith claimed, and the Customs Court agreed, that this is the equivalent of a tax rebate or export subsidy. The Treasury is appealing the Customs Court decision to the Customs and Patent Appeals Court here. If the lower court decision were left stabbing, it could require an additional 15 per cent countervailing tax at some future date on current imports.
Strauss said that whichever way the decision goes, it will be appealed to the Supreme Court by one side or the other. But if Zenith wins the pending round, the official said, the government won't wait for the Supreme Court decision, but will try immediately for legislative relief.
On the basis of the Zenith case, U.S. Steel Corp. last week asked the Customs Court for a summary judgment, without further argument, that would slap countervailing duties on European steel products. In sharp language, Strauss has attacked the steel petition as counter-productive.
"The steel industry has a lot of problems," Strauss said yesterday, "and it needs something done (to help it), but not countervailing duties."
He said Congress would be asked "to cure the defect" by a change in definition to make clear that the indirect taxes do not constitute the kind of export subsidy triggering countervailing duties.
"But we don't want a trade policy debate - that would be a shambles, possibly right in the middle of the Geneva (trade and tariff) talks," Strauss added.
Strauss also confirmed a story in yesterday's Washington Post to the effect the administration has no present plans for additional "orderly marketing agreements" such as those recently put into effect to restrict imports of shoes and television sets.
At the same time, he acknowledged that his present efforts to reduce textile imports into this country by bi-Lateral agreement, within the so-called Multi-Fiber Agreement (MFA) that expires this year, amount to the same thing as an OMA.
Strauss said that he opposes the combined textile industry-labor drive to reduce from 6 per cent to 3 per cent the allowable annual growth in textile imports under the MFA. "But we're goint to grant relief" in bilateral negotiations, he said.
He cited as an example that 20 per cent of U.S. textile imports come from Hong-Kong: "We're going to work out some adjustments there." He conceded that the sum of bilateral adjustments would be to reduce the 6 per cent annual growth figure.