U.S. technology companies are worried a victory against European Union tariffs at the World Trade Organization last year may not yield the bonanza they expected because of the way the EU intends to implement the decision, industry representatives said on Wednesday.
The solutions they offered for each of the products were very disappointing and left a lot of ambiguity where there could have been clarity, said John Neuffer, vice president for global policy at the Information Technology Industry Council.
It left us asking a lot of questions about what was going to happen to these products when they hit the border.
The United States, Japan and Taiwan several years ago challenged EU tariffs on flat-panel computer displays, multi-function printers and television set-top boxes that they said violated the WTO's Information Technology Agreement, or ITA, which eliminated duties on certain tech goods.
A WTO panel broadly backed the three countries in a ruling last year that the EU decided not to appeal.
We'll comply with this panel, the conclusions, but not more than that, Jean Luc Demarty, a top European trade official, told reporters during a visit to Washington on Tuesday with EU Trade Commissioner Karel De Gucht.
I know that there are some frustrations here and there. We continue the dialogue, but it will be full compliance by the deadline of the end of June, Demarty said.
U.S. trade officials estimated worldwide trade in the three products at $44 billion in 2009 and said the EU's 27 member states imported about $7 billion worth of that total.
David Weller, a partner with the WilmerHale law firm that has represented U.S. industry in the case, said there were two problems with how the European Commission proposes to comply.
The guidance the commission has provided EU member states gives customs officials a lot of discretion to decide how they are going to classify flat-panel displays and set-top boxes, not giving any legal certainty that these products will actually get duty-free treatment, Weller said.
There is a similar problem with the guidance for multi-function printers, with the additional concern that the European Commission has decided a portion of them should face a 2.2 percent duty instead of zero, he said.
Neuffer said the industry hoped the EU would offer a better solution before the June 30 deadline for compliance. After that, it will be monitoring U.S. exports of the three products to the EU to see how they are treated by customs officials.
It is possible the United States will have to return to the WTO if it judges the EU is not complying with the panel ruling and no other solution can be reached, Weller said.
(Reporting by Doug Palmer; Editing by Peter Cooney)