Japan may penalise US imports

The subsidies were being paid by the US under an anti-dumping programme ruled illegal by the World Trade Organisation.

   

It would be a first for Tokyo to impose retaliatory duties.

   

Tokyo is considering duties on US steel and ball bearing products, the Nihon Keizai Shimbun business daily reported on Thursday.

   

Using a 15% levy as a starting point, varying rates will be applied to ball bearing and other product categories, it said.

   

Japanese government officials were not immediately available for comment on the report, which was also carried by public broadcaster NHK.

   

Tokyo plans to keep the levies in place until the so-called Byrd amendment is repealed.

 

US payout

   

The US has paid out more than $1 billion to US ball bearing, steel, seafood, pasta, candle and other companies under the Continued Dumping and Subsidy Offset Act of 2000 – otherwise known as the Byrd amendment after one of its chief sponsors, Senator Robert Byrd, a West Virginia Democrat.

   

The programme distributes money raised by duties on imports the US has determined are subsidised or unfairly priced to companies that sought the protection.

 

The Bush administration is keen on striking the Byrd amendment

Previously, those funds went into the general US treasury.

   

In June, Washington began steps to pay hundreds of millions of dollars in new subsidies under the amendment.

   

The WTO has declared the programme to be illegal in a challenge brought by the EU, Canada, Japan and other trading partners.

   

Brussels has imposed about $28 million in retaliatory duties on US paper, clothing, fabrics, footwear and machinery, and Ottawa has imposed $14 million worth of similar duties on US cigarettes, oysters and live swine.

   

In June, Tokyo called on Washington to repeal the Byrd amendment by the end of July.

   

The Bush administration has repeatedly proposed repealing the Byrd amendment, but it remains popular with many members of Congress despite the WTO ruling.