Glass Industry Biz News 

May 2000

Industry Still Concern, but no Super 301 Threats

    While expressing concern about the three Japanese market sectors, the so-called Super 301 and Title VII reports did not identify any single "priority" trading practice of U.S. trade partners that would be subject to negotiations under the threat of possible sanctions.

    The Super 301 report identified Japan's automobile and auto parts market and flat glass sector as areas of "significant concern."

    The report commended Japan for taking market-opening and deregulatory steps to increase foreign access to its auto and auto parts market under a 1995 bilateral agreement, but said Tokyo has been reluctant to make any further move since 1997.

    The Japanese government "has remained reluctant to take additional meaningful steps to actively deregulate and fully open its automotive sectors, or to create an environment that would help promote a more competitive market in this sector," the report said.

    On a U.S. proposal to renew the 1995 accord after its expiration at the end of 2000, the report said the USTR is consulting with U.S. industry, labor, Congress and nongovernmental organizations to develop a position on what type of followup agreement it should seek.

    On flat glass trade, the report said the U.S. goal of opening the Japanese market remains unfulfilled under a bilateral accord that expired at the end of 1999 and accused three major Japanese glass makers of maintaining a "highly oligopolistic market structure" and tight control in distribution.

    Another report, compiled under the Title VII "Buy American" law to assess procurement practices of foreign governments, said the U.S. has "serious concern" about Japan's public works market.

    Japan maintains "a significant and persistent pattern of practices of discrimination" impeding U.S. companies from doing business in the Japanese public works sector, the report said.

    The report complained of "rampant" bid-rigging, "unreasonable" restriction on the formation of joint ventures and "unreasonably" vague and discriminatory evaluation criteria.

    "If these concerns are not resolved in a timely manner, the United States will initiate the steps necessary to identify Japan under Title VII," the report said.

    Last year, the administration of President Bill Clinton reinstated the Super 301 provision of the Omnibus Trade and Competitiveness Act of 1988, which empowers it to slap sanctions on countries found to maintain serious trade barriers against U.S. goods and services.

    Title VII of the 1988 trade act was also revived last year.

    Priority foreign country practices will become the subject of investigation under the Super 301 provision, with the first step of that process being consultations with the designated foreign country in an effort to reach an accord.

    If no agreement is reached, the investigation will continue for up to 90 days. Trade action could result if the practices are not eliminated.

    Super 301 was introduced in 1988 as a temporary law and extended twice before expiring at the end of 1997.

    As in the case of the 1999 report, this year's Super 301 report focused more on cases Washington would bring to the World Trade Organization rather than trade proceedings that would lead to unilateral sanctions using its own trade laws.

    The report said the U.S. will invoke WTO dispute-settlement procedures in seven cases involving six countries -- Brazil, Romania, India, the Philippines, Argentina and Denmark.

    "These cases underscore our determination to take vigorous action against foreign government practices that conflict with international obligations," Barshefsky said.

source: The Japan Times