CITAC applauds bill to end "Byrd Amendment"

Members of the Consuming Industries Trade Action Coalition (CITAC) applauded Reps. Jim Ramstad (R-MN) and Clay Shaw (R-FL) for their introduction March 3 of HR 1121 that would repeal the "Continued Dumping and Subsidy Offset Act," commonly referred to as the "Byrd Amendment."

"As a recent Congressional Budget Office (CBO) report showed, this illegal trade subsidy provides incentives for companies to seek antidumping and countervailing duty rewards rather than seeking new markets for their products," said Ramstad. "This is time, effort, and capital that are being wasted chasing court cases instead of contributing to our economy and creating jobs."

The Byrd Amendment doles out monies to companies that petitioned or supported antidumping and countervailing duty actions, while other duties are distributed to the U.S. Treasury. To date, the U.S. Government has paid more than $1 billion directly to U.S. companies who file and support antidumping and countervailing duty petitions that result in duties. In 2004 Byrd payments totaled $284 million.

Along with its pledge of support to Reps. Ramstad and Shaw, CITAC also announced its plan to implement a public affairs and advocacy campaign to repeal the Byrd Amendment through the formation of the Byrd Amendment Working Group, a multi-industry cooperative effort by companies impacted by the higher duties and by potentially significant retaliation against U.S. exports, together with trade associations and other industry groups with affected members.

The Byrd Amendment Working Group, which emerged from CITAC's "The CDSOA Reform Coalition," is seeking to end payments to private corporations of public funds under the law. The Group will incorporate a strategy consisting of a major media and communications effort, Capitol Hill and Executive Branch lobbying campaigns, combined with a legal strategy to press the strongest arguments for repeal and to secure industry and political support.

Steve Alexander, CITAC Executive Director and President of lobbying firm The CMR Group, said, "With more companies receiving government handouts in the form of Byrd Amendment payments, there is a battle in front of us on this issue, and we are ready to take it on several fronts. The Byrd Amendment Working Group will give a strong voice to those U.S. consuming industries who are suffering from the Byrd Amendment. All industrial sectors damaged by the Byrd amendment should join us in this fight."

"We cannot support a law that mandates a government subsidy to a small group of favored companies funded by a tax on their competitors and customers," said Lewis Leibowitz, a lawyer at Hogan & Hartson and counsel to CITAC. "This law is of the most striking current examples of corporate welfare. There is no excuse for a subsidy for its own sake, which is what we have with the Byrd Amendment."

In 2002, a World Trade Organization (WTO) dispute settlement panel ruled the Byrd Amendment in violation of U.S. trade obligations, a decision later upheld by the WTO Appellate Body, clearing the way for retaliatory sanctions unless the U.S. repeals the law. The decision was based on the fact that the law allows distribution of money on top of antidumping and countervailing duties. The U.S. missed the WTO's December 27, 2003 deadline for compliance, yet the Bush Administration has agreed to continue to work diligently for repeal. Failure to comply with the WTO ruling could lead to billions of dollars of potential retaliation by more than 10 countries.