The Reagan administration's decision to cut imports of steel pipes and tubes from Europe ran into a threat of economic retaliation yesterday from the European Community and the promise by American importers to seek an injunction today stopping the U.S. embargo.
U.S. Trade Representative William E. Brock predicted "stormy weather" between the United States and its closest economic and political allies in Western Europe as a result of the decision. The administration will embargo imports of European pipe and tube starting at 12:01 this morning for the rest of the year and plans to cut those imports for next year by more than half.
Pipe and tube imports from the EC, which now take about 14 percent of the U.S. market, would be restricted to 5.9 percent under the administration order.
Brock's prediction of ill will appeared to be borne out by European reaction. EC Industry Commissioner Etienne Davignon, who had been negotiating with Brock last week, said in Brussels yesterday the Reagan administration "had not been very courteous" in its treatment of an "important trading partner."
He said the action was "protectionist and discriminatory," while the foreign ministers of the 10-nation Common Market described the U.S. embargo as "unprecedented."
Davignon said the EC is drawing up a list of American exports to Europe that could be subject to retaliatory tariffs. He declined to specify what they might be, but in an earlier dispute over U.S. restrictions on European specialty steel imports, the EC placed extra duties on such unrelated products as chemicals and sporting goods.
In New York, meanwhile, the American Institute for Imported Steel prepared to seek a temporary injunction in the U.S. Court of International Trade blocking the embargo. Alfred McCauley, a Washington lawyer representing the steel importers, said the injunction will be sought on the grounds the government gave no notice that it was imposing an embargo on European steel.
"There are shipments on the high seas," he said, and importers who will be forced to store steel in bonded warehouses for more than a month until it can come into the country in January will be "penalized heavily."
The EC, in negotiations with Brock over the weekend, had agreed to limit its shipments of pipe and tube to 7.6 percent of the U.S. market. The American steel makers, however, said this was unacceptable and pressed Brock to make the EC stick to a 1982 agreement that set the 5.9 percent limit.
"It is disturbing to see that the U.S. administration accepts the American steel industry's view rather than seeking agreement with its major trading partners," Davignon said yesterday in Brussels. He acknowledged, however, that the current 14 percent level of European exports of pipe and tube was "fairly excessive" and an "obvious problem."
Brock, though, said the Reagan administration's embargo on EC pipe and tube will help in current negotiations to cut all steel imports to about 18 1/2 percent of the U.S. market from their third-quarter level of 30.1 percent.