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Ronald Reagan Presidential Library
Digital Library Collections
This is a PDF of a folder from our textual collections.
Collection: Roberts, John G.: Files
Folder Title: JGR/Trade (2 of 6)
Box: 55
To see more digitized collections visit:
https://reaganlibrary.gov/archives/digital-library
To see all Ronald Reagan Presidential Library inventories visit:
https://reaganlibrary.gov/document-collection
Contact a reference archivist at: [email protected]
Citation Guidelines: https://reaganlibrary.gov/citing
National Archives Catalogue: https://catalog.archives.gov/
THE WHITE HOUSE
WASHINGTON
September 11, 1984
MEMORANDUM FOR FRED F. FIELDING
FROM:
JOHN G. ROBERTS DR
SUBJECT:
Extension of Embargo Authorities
Richard Darman has asked for our approval as soon as possible
on a Presidential Determination to extend for an additional
year the exercise of certain authorities under the Trading
With the Enemy Act, 50 U.S.C. App. $ 5. When amendments to
that Act were passed in 1977, Congress provided that author-
ities under the Act that were then being exercised could be
extended for one-year periods upon a determination for each
extension that it was "in the national interest of the
United States." Pub. Law 95-223, 91 Stat. 1625 § 101 (b).
The extensions with respect to trade embargoes against
Kampuchea, Cuba, North Korea, and Vietnam; controls on the
exports of strategic goods; and the freezing of assets of
certain communist countries are due to expire on Septem-
ber 14. 48 Fed. Reg. 40695 (1983). The exercise of these
authorities has been extended every year since 1978, and the
proposed extension for this year is identical, mutatis
mutandis, to the previous extensions. The extension cites
the correct authority and contains the statutorily required
determination that extension is in the national interest. I
have no objections.
Attachment
THE WHITE HOUSE
WASHINGTON
September 11, 1984
MEMORANDUM FOR RICHARD G. DARMAN
ASSISTANT TO THE PRESIDENT
FROM:
FRED F. FIELDINQrig. signed by FFF
COUNSEL TO THE PRESIDENT
SUBJECT:
Extension of Embargo Authorities
Counsel's Office has reviewed the above-referenced Presi-
dential Determination, and finds no objection to it from a
legal perspective.
FFF: JGR:aea 9/11/84
CC: FFFielding/JGRoberts/Subj/Chron
ID #
CU
WHITE HOUSE
CORRESPONDENCE TRACKING WORKSHEET
0 . OUTGOING
H . INTERNAL
I . INCOMING
Date Correspondence
Received (YY/MM/DD)
/
/
Name of Correspondent:
Richard Darman
MI Mail Report
User Codes: (A)
(B)
(C)
Subject: Extension of Embargo Authorities
ROUTE TO:
ACTION
DISPOSITION
Tracking
Type
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of
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(Staff Name)
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CUHOU
ORIGINATOR 8409.10
1
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CUAT 18
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1 . Info Copy Only/No Action Necessary
A Answered
CA
Completed
C Comment/Recommendation
** Direct Reply w/Copy
B . Non-Special Referral
S Suspended
D Draft Response
$ For Signature
F
Furnish Fact Sheet
X -4nterim Reply
to be used as Enclosure
FOR OUTGOING CORRESPONDENCE:
Type of Response dnitials of Signer
Code "MA"
Completion Date - Date of Outgoing
Comments:
Keep this worksheet attached to the original incoming letter.
Send all routing updates to Central Reference (Room 75, DEOB).
Always return completed correspondence record to Central Files.
Refer questions about the correspondence tracking system to Central Reference, ext. 2590.
15/61
STATE BESTIVE UNITED OFFICE FRESIDEN
EXECUTIVE OFFICE OF THE PRESIDENT
7:1 3: 22
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON, D.C. 20503
SEP 10 1984
MEMORANDUM FOR: THE PRESIDENT
FROM:
David A. Stockman DAS
SUBJECT:
Extension of Embargo Authorities
The statutory authority under the Trading With the Enemy Act for
certain regulations administered by Treasury's Office of Foreign
Assets Control will expire on September 14, 1984, unless you
extend it. These regulations implement: (1) U.S. trade and
financial embargoes against Kampuchea, Cuba, North Korea, and
Vietnam; (2) controls on exports to communist countries of U.S.
strategic goods located abroad; and (3) the freezing of assets of
certain communist countries.
I recommend that you sign the attached Determination that it is
in the national interest to extend this authority for a one-year
period.
This document should be signed no later than Tuesday, September
11, 1984, so that the Determination can be published in the
Federal Register on September 12, prior to the expiration date of
the current authority. The Departments of State, Justice and
Treasury concur in this recommendation.
Attachment
THE WHITE HOUSE
WASHINGTON
Presidential Determination
No.
MEMORANDUM FOR THE SECRETARY OF STATE
THE SECRETARY OF THE TREASURY
SUBJECT: Extension of the Exercise of Certain Authorities
Under the Trading With the Enemy Act
Under section 101 (b) of Public Law 95-223 (91 Stat. 1625,
50 U.S.C. App. 5 (b) note), and a previous determination made
by the President on September 7, 1983 (48 Fed. Reg. 40695
(1983) ) the exercise of certain authorities under the Trading
With the Enemy Act is scheduled to terminate on September 14,
1984.
I hereby determine that the extension for one year of the
exercise of those authorities with respect to the applicable
countries is in the national interest of the United States.
Therefore, pursuant to the authority vested in me by
section 101 (b) of Public Law 95-223, I extend for one year,
until September 14, 1985, the exercise of those authorities
with respect to countries affected by:
(1) the Foreign Assets Control Regulations, 31 CFR
Part 500;
(2) the Transaction Control Regulations, 31 CFR
Part 505;
(3) the Cuban Assets Control Regulations, 31 CFR
Part 515; and
(4) the Foreign Funds Control Regulations, 31 CFR
Part 520.
This memorandum shall be published in the Federal Register.
THE WHITE HOUSE
WASHINGTON
October 25, 1984
MEMORANDUM FOR BEN ELLIOTT
DEPUTY ASSISTANT TO THE PRESIDENT
DIRECTOR, PRESIDENTIAL SPEECHWRITING
FROM:
JOHN G. ROBERTS JJR
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
Proposed Presidential Remarks:
Signing Ceremony for the Tariff
and Trade Act of 1984
Counsel's Office has reviewed the above-referenced draft
remarks. On page 2, line 12, "export" should be "import."
CC: Richard G. Darman
ID #.
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WHITE HOUSE
CORRESPONDENCE TRACKING WORKSHEET
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I . INCOMING
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Name of Correspondent:
Richard Daman
MI Mail Report
User Codes: (A)
(B)
(C)
Subject: Proposed Presidential Remarks
Sig hing Ceremory for Tariffand
Prade Act of 6984
ROUTE TO:
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DISPOSITION
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Type
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Crittle
ORIGINATOR 84,10,25
1
BUATIS
Referral Note:
R 84,10,25
584,10,25
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COB
CMAT 17
I 84,10,25
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A Answered
C Completed
C . Comment/Recommendation
R - Direct Reply w/Copy
Non-Special Referral
. Suspended
D . Draft Response
S For Signature
F. - Furnish Fact Sheet
X - Interim Reply
to be used as Enclosure
OR OUTGOING CORRESPONDENCE:
Type of Response - Initials of Signer
Code - "A"
Completion Date - Date of Outgoing
Comments:
Keep this worksheet attached to the original incoming letter.
Send all routing updates to Central Reference (Room 75, OEOB).
Always return completed correspondence record to Central Files.
Refer questions about the correspondence tracking system to Central Reference, ext. 2590.
5/81
Document No.
WHITE HOUSE STAFFING MEMORANDUM
DATE:
10/25/84
ACTION/CONCURRENCE/COMMENT DUE BY: c.o.b. TODAY
PROPOSED PRESIDENTIAL REMARKS: SIGNING CEREMONY FOR TARIFF AND
SUBJECT:
TRADE ACT OF 1984
ACTION FYI
ACTION FYI
VICE PRESIDENT
MURPHY
MEESE
OGLESBY
BAKER
ROGERS
DEAVER
SPEAKES
STOCKMAN
SVAHN
DARMAN
P
SS
VERSTANDIG
FIELDING
WHITTLESEY
FULLER
TUTWILER
WIRTHLIN
HERRINGTON
HICKEY
BAROODY
>
ELLIOTT
McFARLANE
McMANUS
NISKANEN
REMARKS:
Please provide any edits/comments directly to Ben Elliott's Office
by close of business TODAY. Thank you.
RESPONSE:
Richard G. Darman
Assistant to the President
Ext. 2702
(Robinson/BE)
::
October 25, 1984
1:00 p.m.
PRESIDENTIAL REMARKS: SIGNING CEREMONY FOR
TARIFF AND TRADE ACT OF 1984
TUESDAY, OCTOBER 30, 1984
Good afternoon, and welcome to the White House for the
signing of the Tariff and Trade Act of 1984 -- a crucial piece of
legislation and a triumph for the legislative process. I believe
this bill represents the most important trade law approved by the
Congress in more than a decade.
In its first form, the bill was strongly protectionist. It
would have sharply limited our trade with other nations by
smothering that trade with restrictions, quotas, and regulations.
Yet, we know that if America wants more jobs, greater prosperity,
and a dynamic, competitive economy, the answer is more world
trade, not less. I could not in good conscience have signed the
bill as it stood, and I don't believe many Members of the
Congress were satisfied with it, either.
Then the bill went to a conference committee, and together,
Senators, Representatives, and Bill Brock, our United States
Trade Representative, rolled up their sleeves and went to work.
In the words of an editorial in the Washington Post, most
of the bad stuff [in the bill] got thrown out and all of the good
stuff stayed in." The result is a fine piece of legislation that
stands four-square behind free and fair trade.
To name some of the central provisions, this bill will
extend into a new decade the G.S.P., or Generalized System of
Preferences, that gives duty-free treatment to many products from
140 lesser-developed countries. This provision will give those
Page 2
countries the chance to help their people by benefitting from
America's powerful economic expansion. American industry will be
helped in turn, as these lesser-developed countries accept more
responsibility for protecting patents and trademarks.
While promoting free trade, this new act insists on
something just as important: fair trade. A section of the bill,
originally known as Senator Danforth's "Reciprocity" proposal,
gives the President new ability to lower foreign barriers to
trade -- especially in the dynamic and rapidly-growing areas of
services, investment, and high technology.
This bill gives the President new authority to enforce steel
export restraints. The legislation will, therefore, help us to
?
prevent steel from being dumped in the American market at
artificially low prices -- and that means we'll be able to help
make certain our steelworkers get the fair shake they've always
deserved.
To strengthen relations with one of our closest allies, the
bill contains a bold new initiative authorizing the establishment
of a free trade area agreement with Israel. When concluded, this
agreement will completely eliminate the trade barriers between
our two countries, allowing the duty-free entry of Israeli
products into the United States, while making the Israeli market
wide-open to American goods. Over the past 5 years, our trade
with Israel has been growing at an average annual rate of some
10 percent. This bill will enable that vital economic
partnership to grow even faster in years to come.
Page 3
Everyone who had a hand in passing this outstanding
legislation deserves our thanks. Congratulations to the
conferees, especially Congressman Dan Rostenkowski, chairman of
the House Ways and Means Committee; Congressmen Conable and
Frenzel; Senator Bob Dole, Chairman of the Senate Finance
Committee; and Senator John Danforth, chairman of the Senate
International Trade Subcommittee. Special thanks to our United
States Trade Representative, Bill Brock. Bill worked tirelessly,
with great skill and dedication.
This Tariff and Trade Act of 1984 signals to the world that
America does not fear free trade, because the American people can
produce and compete on a par with anybody in the world. Each of
you has my heartfelt thanks, and more important, the gratitude of
the Nation.
Thank you, God bless you, and now let me sign the bill.
THE WHITE HOUSE
WASHINGTON
October 25, 1984
MEMORANDUM FOR RICHARD G. DARMAN
ASSISTANT TO THE PRESIDENT
FROM:
JOHN G. ROBERTS 82R
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
H.R. 3398 -- Trade and Tariff Act of 1984
Counsel's Office has reviewed the above-referenced enrolled
bill, and finds no objection to it from a legal perspective.
ID # 244963 CU
WHITE HOUSE
CORRESPONDENCE TRACKING WORKSHEET
o . OUTGOING
H . INTERNAL
I . INCOMING
JGR
Date Correspondence
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/
/
Name of Correspondent:
Richar d Darman
MI Mail Report
User Codes: (A)
Subject: H.R 3398 - Trade and (B) Pariff (C) Act
of 1984
ROUTE TO:
ACTION
DISPOSITION
Tracking
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CUHOU
ORIGINATOR 84,1004
/ /
Referral Note:
CUAT 13
B 84,1024
584,10 D5
Referral Note:
noon
/ /
/ /
-
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1 1
1 J
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ACTION CODES:
DISPOSITION CODES:
A Appropriate Action
I . Info Copy Only/No Action Necessary
A Answered
c Completed
c - Comment/Recommendation
R. Direct Reply w/Copy
B Non-Special Referral
S Suspended
D . Draft Response
S For Signature
F - Furnish Fact Sheet
X Interim Reply
to be used as Enclosure
FOR OUTGOING CORRESPONDENCE:
Type of Response = Initials of Signer
Code
=
"A"
Completion Date = Date of Outgoing
Comments:
Keep this worksheet attached to the original incoming letter.
Send all routing updates to Central Reference (Room 75, OEOB).
Always return completed correspondence record to Central Files.
Refer questions about the correspondence tracking system to Central Reference, ext. 2590.
5/81
THE WHITE HOUSE
WAEHINGTON
January =, 1985
MEMORANDUM FOR DONALD I. REGAN
CHIEF OF STAFF
Orig. signed by FFF
FROM:
FRED F. FIELDING
COUNSEL TC THE PRESIDENT
SUBJECT:
Japan/U.S. Trade
You have asked for my views on a response to the attached
letter from Senator Bradley to you, complaining about the
position taken by the Solicitor General as amicus curiae in
Matsushita v. Zenith. In that case, the Solicitor General
argued that certain Japanese television manufacturers should
not have been subject to a private antitrust suit, because
the challenged conduct was compelled by the Japanese govern-
ment. This "sovereign compulsion defense" is available in
private antitrust suits, but not in suits brought by the
United States.
It is our usual policy to avoid discussing the merits of
particular cases involving the United States that are
pending before the Supreme Court. The positions of the
Government in such cases are formulated by the Department of
Justice, and the arguments are articulated 1n the briefs.
Our policy of avoiding discussion of particular pending
cases helps preserve public confidence in the impartial
administration of the laws, provides some distance when, for
legal reasons, Justice must take politically unpalatable
positions, and avoids jeopardizing the normal litigation
process. h copy of a proposed reply to Senator Bradley, for
my signature, is attached.
Attachment
Approve
Disapprove
FFF JGR:aea 1/7/86
CC: FFFielding
JGRoberts
Subj
Chron
THE WHITE HOUSE
WAEFINGTON
January 7, 1985
Dear Senator Bradley:
Thank you for your recent letter to White House Chief of
Staff Dor. Regan. In that letter you objected to the amicus
curiae brief filed by the Department of Justice in Matsushita
Electric Industrial Co., Ltd. v. Zenith Radio Corporation.
That case was recently argued before the Supreme Court of
the United States, and is currently awaiting decision.
It is the general policy of the White House not to discuss
the merits of litigation pending before the Supreme Court
involving the United States. The views of the
Administration 11. such cases are formulated and presented by
the Department of Justice, in the briefs filed by that
Department 1r. the course of the litigation.
I have, however, taken the liberty of referring your
correspondence to the Department of Justice, so that
the Department will have the benefit of your views.
Sincerely,
Fred F. Fielding
Counsel tc the President
The Honorable Bill Bradley
United States Senate
Washington, D.C. 20510
FFF: JGR:aea 1/7/86
bcc: FFFielding
JGRoberts
Subj
Chron
THE WHITE HOUSE
WASHINGTON
1/7
TO: FFF
FROM: John G. Roberts, Jr.
Associate Counsel 8262
to the President
FYI
COMMENT
ACTION
THE ATTACHED REVISED MEMO
TO REGAN HAS AN "APPROVE/
DISAPPROVE" LINE TO TRIGGER
YOUR LETTER.
THE WHITE HOUSE
WASHINGTON
January 7, 1985
MEMORANDUM FOR D. LOWELL JENSEN
DEPUTY ATTORNEY GENERAL
U.S. DEPARTMENT OF JUSTICE
FROM:
FRED F. FIELDING
COUNSEL TO THE PRESIDENT
SUBJECT:
Japan/U.S. Trade
The attached correspondence from Senator Bradley, objecting
to the Department's filing as amicus curiae in Matsushita V.
Zenith, is forwarded for whatever consideration and response
you deem appropriate. I have also attached a copy of my
reply to Bradley.
Many thanks.
Attachments
FFF: JGR:aea 1/7/86
CC: FFFielding
JGRoberts
Subj
Chron
THE WHITE HOUSE
WASHINGTON
December 30, 1985
MEMORANDUM FOR FRED F. FIELDING
FROM:
JOHN G. ROBERTS
SUBJECT:
Japan/U.S. Trade
Senator Bradley has written Mr. Regan to complain about the
Justice Department filings as amicus curiae in Matsushita v.
Zenith, which was argued before the Supreme Court on
November 12. You may recall that the Chairman of Zenith
wrote Mr. Regan with the same complaint in October. A copy
of the memorandum I wrote for you at that time, summarizing
the case and the position of the Solicitor General, is
attached for your information.
I see no reason to debate Justice's position with Bradley; I
would leave that to Justice, if anyone. A standard "pending
litigation" response is attached for your signature, as is a
brief memorandum for Regan, explaining the proposed response.
Attachment
THE WHITE HOUSE
WASHINGTON
May 30, 1985
MEMORANDUM FOR DAVID L. CHEW
STAFF SECRETARY
FROM:
JOHN G. ROBERTS JJR
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
Commerce Recommendation Regarding No Trade
Sanctions Against USSR Under Pelly Amendment
(Report to Congress)
Counsel's Office has reviewed the letter to the President
from Secretary Baldrige concerning possible trade sanctions
against the Soviet Union under the Pelly Amendment, and the
accompanying proposed report to Congress. The report to
Congress complies with the reporting requirements of the
Pelly Amendment, 22 U.S.C. § 1978 (b), and this office has no
legal objection to its transmittal.
ID # 302934.
CU
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I - INCOMING
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Name of Correspondent: Dave Chew
MI Mail Report
User Codes: (A)
(B)
(C)
Subject: commerce recommendation re no trade
panctions against ussr under Pelly amendment
(repart to The Congress)
ROUTE TO:
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DISPOSITION
Tracking
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CHOLL
ORIGINATOR 85,65,29
/ /
Referral Note:
MHT 18
85,05,29
$ 85,05,30
-
12'N
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A Appropriate Action
I Info Copy Only/No Action Necessary
A Answered
C Completed
C Comment/Recommendation
R. Direct Reply w/Copy
B - - Non-Special Referral
S Suspended
D Draft Response
S - For Signature
F Furnish Fact Sheet
X . Interim Reply
to be used as Enclosure
FOR OUTGOING CORRESPONDENCE:
Type of Response = Initials of Signer
Code = "A"
Completion Date = Date of Outgoing
Comments:
Keep this worksheet attached to the original incoming letter.
Send all routing updates to Central Reference (Room 75, OEOB).
Always return completed correspondence record to Central Files.
Refer questions about the correspondence tracking system to Central Reference, ext. 2590.
5/81
Document No. 302934ss
WHITE HOUSE STAFFING MEMORANDUM
DATE:
5/29/85
NOON TOMORROW 5/30
ACTION/CONCURRENCE/COMMENT DUE BY:
COMMERCE RECOMMENDATION RE NO TRADE SANCTIONS AGAINST USSR
SUBJECT:
UNDER PELLY AMENDMENT (REPORT TO THE CONGRESS)
ACTION FYI
ACTION FYI
VICE PRESIDENT
LACY
REGAN
McFARLANE
STOCKMAN
OGLESBY
BUCHANAN
ROLLINS
CHAVEZ
RYAN
CHEW
P
SS SPEAKES
DANIELS
SPRINKEL
FIELDING
SVAHN
FRIEDERSDORF
TUTTLE
HENKEL
HICKEY
HICKS
KINGON
REMARKS:
Please provide any comments/recommendations on the attached report
to the Congress by noon tomorrow, 5/30. Thank you.
RESPONSE:
III 4:47
David L. Chew
Staff Secretary
Ext. 2702
9
934
DEPARTMENT OF COMMERCE
THE SECRETARY OF COMMERCE
A.Kingen
Washington, D.C. 20230
UNITED
AMERICA
STATES
of
MAY 2 8 1985
The President
The White House
Washington, D.C. 20500
Dear Mr. President:
On April 1, 1985, I certified to you, under the Pelly Amendment to the Fishermen's
Protective Act of 1967, that nationals of the Soviet Union were conducting whaling
operations that diminished the effectiveness of the International Whaling Commission
(IWC) conservation programs. I stated at the time that the Department of Commerce
would develop recommendations on fish import prohibitions authorized by the Pelly
Amendment and on any further actions that should be taken as a result of my
certification.
I do not believe that an embargo under the Pelly Amendment on Soviet fish imports
would add much to other U.S. efforts to change Soviet whaling policy. Such other
efforts include reducing Soviet fishing in our exclusive economic zone by the
required 50 percent under the Magnuson Fishery Conservation and Management Act,
as well as persuading the Japanese to close their markets to Soviet whale products
taken in excess of IWC limits. The effects on the Soviet Union of a Pelly Amend-
ment embargo would probably be negligible because the imported products are
highly desired items, like king crab, for which the Soviet Union could readily
find other markets.
At the same time, U.S. fishing interests could be significantly harmed if the
embargo resulted in the elimination of the single U.S.-USSR joint venture company,
which provides the largest single groundfish market for U.S. fishermen on the
west coast.
I therefore recommend that no trade sanctions be imposed on the Soviet Union at
this time. I have consulted with the Departments of State and Treasury in
developing this recommendation. If no progress is made in bringing the Soviet
Union into compliance with the objectives of the IWC conservation program, I may
recommend additional actions.
In accordance with my recommendation, I enclose a proposed Report to Congress,
for your submission by the statutory deadline of June 1, 1985. It states that no
action is being taken at this time for the reasons set forth above, and indicates
that you will inform Congress of any further developments.
Sincerely,
Secretary of Commerce
Enclosure
TO THE CONGRESS OF THE UNITED STATES:
Pursuant to the provisions of subsection (b) of the
Pelly Amendment to the Fishermen's Protective Act of 1967,
as amended (22 U.S.C. 1978 (b) I am reporting to you
following certification by the Secretary of Commerce that the
Soviet Union has conducted whaling activities that diminished
the effectiveness of the International Whaling Commission
conservation program.
Under the Pelly Amendment, when the Secretary of
Commerce determines that a foreign country is conducting a
fishing operation that diminishes the effectiveness of an
international fishery conservation program, he will certify
this determination to the President. After receiving a
certification, the President may direct the Secretary of the
Treasury to embargo the offending country's fishery products
to the limits of the General Agreement on Tariffs and Trade.
Within 60 days following the certification, the President is
required to notify the Congress of any action taken under the
certification.
On April 1, 1985, Secretary of Commerce Malcolm Baldrige
certified the Soviet Union for whaling that diminished the
effectiveness of the International Whaling Commission (IWC)
conservation program. Secretary Baldrige based his deter-
mination on: (1) the Soviet harvest of Southern Hemisphere
minke whales was greater than the level the United States
considered the U.S.S.R.'s traditional share; (2) the 1984-85
IWC quota for Southern Hemisphere minke whales was exceeded
due to Soviet harvest; and (3) there had been no indication
that the Soviets intended to comply with IWC standards.
Southern Hemisphere minke whales are taken by the
Soviet Union, Japan, and Brazil. The quota for these minke
whales is divided into six areas. Brazil harvests whales
from a land-based operation in Area Two, and Japan and the
Soviet Union then divide the quota for the remaining five
areas.
2
The Soviet Union, Japan, and Brazil have objected to the
IWC Southern Hemisphere minke whale quota and, consequently,
are not bound by the quota under international law. Even
though the objections release the governments from any treaty
obligation to observe the IWC limit, the taking of more minke
whales than established by quota is inconsistent with this
international conservation standard and, in the absence of any
indication of compliance with IWC standards, diminishes the
effectiveness of the Commission and its conservation program.
For the 1984-85 whaling season, Japan and the Soviet
Union agreed not to exceed their 1983-84 harvest levels of
3027 and 3028, respectively, of Southern Hemisphere minke
whales. These levels, if met, would exceed the 1984-85 IWC
quota of 4224. Based on past allocations, the United States
indicated that Japan and the Soviet Union could each take 1941
minke whales and remain consistent with the IWC limit. Japan
has observed this limit, but the Soviet Union has not. We
have taken a number of steps to resolve the Soviet whaling
problem.
The trade sanctions authorized by the Pelly Amendment
against Soviet fish products will not aid other Administration
efforts to change the Soviet whaling policy. Under the
Packwood-Magnuson Amendment, WE cut in half Soviet-directed
fishing allocations in our exclusive economic zone. We have
also encouraged the Japanese to refrain from importing Soviet
whale products taken contrary to the IWC conservation program,
and Cabinet-level officials have met with Soviet officials to
resolve the problem. These actions are designed to encourage
the Soviet Union to observe the IWC program. A Pelly
Amendment embargo, however, will have a negligible effect on
the Soviet Union, as most of the products imported into the
United States, such as king crab, are highly marketable
elsewhere.
3
In addition, United States fishing interests could be
seriously harmed by such a sanction. An embargo imposed in
1985 would cost the United States 90,000 metric tons of
expected joint-venture catch and over $12 million. An embargo
could result in the permanent dissolution of the U.S.-U.S.S.R.
joint-venture company, which provides markets for underuti-
lized species and fish that might solely be harvested by
foreign vessels. Unemployment of U.S. fishermen and other
related workers could also result from the loss of this joint-
venture company.
In light of this assessment of the effect of an embargo
on Soviet fishery products, I have not taken any action
against the U.S.S.R. under the Pelly Amendment. If the Soviet
Union makes no progress towards complying with the IWC pro-
gram, I intend to reassess my position and take necessary
action. I will send you a supplemental report at that time.
THE WHITE HOUSE,
THE WHITE HOUSE
WASHINGTON
May 30, 1985
MEMORANDUM FOR DAVID L. CHEW
STAFF SECRETARY
FROM:
JOHN G. ROBERTS ODR
ASSOCIATE COUNSEL TO THE PRESIDENT
SUBJECT:
Proposed Executive Order Entitled
"Trade in Services"
Counsel's Office has reviewed the above-referenced proposed
Executive Order, and finds no objection to it from a legal
perspective.
ID #. 271589
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5/81
Document No. 271589
WHITE HOUSE STAFFING MEMORANDUM
DATE: 5/29/85
ACTION/CONCURRENCE/COMMENT DUE BY: NOON Friday, May 31, 1985
SUBJECT: PROPOSED EXECUTIVE ORDER ENTITLED "TRADE IN SERVICES."
ACTION FYI
ACTION FYI
VICE PRESIDENT
LACY
REGAN
McFARLANE
STOCKMAN
OGLESBY
BUCHANAN
ROLLINS
CHAVEZ
RYAN
CHEW
P
55
SPEAKES
DANIELS
SPRINKEL
FIELDING
SVAHN
FRIEDERSDORF
TUTTLE
HENKEL
CLERK
HICKEY
HICKS
KINGON
REMARKS:
Please submit your comments by noon Friday, May 31. Thank you.
RESPONSE:
1005 IIII 20 711 5:00 5:
David L. Chew
Staff Secretary
Ext. 2702
ENESIDENT
OFFICE
EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE
UNITED
OFFICE OF MANAGEMENT AND BUDGET
SIECINE
WASHINGTON, D.C. 20503
STATES
May 28, 1985
MEMORANDUM FOR:
THE PRESIDENT
FROM:
DAVID A. STOCKMAN/ PAS
SUBJECT:
PROPOSED EXECUTIVE ORDER ENTITLED "TRADE IN
SERVICES"
SUMMARY. This memorandum forwards for your consideration a
proposed Executive order, submitted by the Secretary of Commerce,
that would implement the provisions of the Trade and Tariff Act
of 1984 (Public Law 98-573) relating to collection of information
concerning trade in services.
BACKGROUND. The International Investment Survey Act of 1976
directed the President to collect data regarding investment by
Americans abroad and by foreign nationals in the United States.
That statute was implemented by Executive Order No. 11961 of
January 19, 1977, which vested the President's authority in the
Director of the Office of Management and Budget and further
provided that, unless the Director otherwise indicated,
responsibilities with respect to portfolio investment would be
performed by the Department of Treasury and those with respect to
direct investment by the Department of Commerce.
Section 306 of the Tariff and Trade Act of 1984 directed the
Secretary of Commerce to establish a development program for
services industries and directed the United States Trade
Representative to develop and coordinate the implementation of
policies on trade in services. That measure also amended the
1976 statute by granting the President additional authority to
collect information and report to Congress regarding trade in
services. The proposed Executive order would implement that
provision by further amending Executive Order No. 11961 to add
this data collection responsibility to the functions to be
performed by the Secretary of Commerce, subject to the overall
authority of the Director of OMB.
None of the affected agencies has objected to the proposed
Executive order.
RECOMMENDATION. I recommend that you sign the proposed Executive
order.
Enclosure
U.S. Department of Justice
Office of Legal Counsel
Received #
Office of the
Washington, D.C. 20530
Assistant Attorney General
MAY 29 1985
The President,
The White House.
My dear Mr. President:
I am herewith transmitting a proposed Executive order
entitled "Trade in Services."
This proposed order was submitted by the Department of
Commerce and has been forwarded for the consideration of this
Department as to form and legality by the Office of Management
and Budget with the approval of the Director.
The proposed Executive order is approved as to form and
legality.
Respectfully,
W.
Ralph W. Tarr
Acting Assistant Attorney General
Office of Legal Counsel
EXECUTIVE ORDER
TRADE IN SERVICES
By the authority vested in me by the International Investment
and Trade in Services Survey Act (Public Law 94-472, as amended
by Section 306 of Public Law 98-573), and in order to assure that
information necessary for developing, formulating and
implementing United States policy concerning trade in services is
collected, analyzed and disseminated, it is hereby ordered that
Executive Order No. 11961 of January 19, 1977, as amended, is
redesignated "International Investment and Trade in Services" and
is further amended by (1) substituting "International Investment
and Trade in Services Survey Act" for "International Investment
Survey Act of 1976" wherever it appears; (2) substituting "(5)"
for "(4)" in Section 2; (3) adding "and trade in services" after
"investment" in Section 3; and (4) adding ", (5)" after "(4)" in
Section 3.
THE WHITE HOUSE,
THE WHITE HOUSE
Office of the Press Secretary
For Immediate Release
May 31, 1985
TO THE CONGRESS OF THE UNITED STATES:
Pursuant to the provisions of subsection (b) of the
Pelly Amendment to the Fishermen's Protective Act of 1967,
as amended (22 U.S.C. 1978 (b)) I am reporting to you
following certification by the Secretary of Commerce that the
Soviet Union has conducted whaling activities that diminished
the effectiveness of the International Whaling Commission
conservation program.
Under the Pelly Amendment, when the Secretary of
Commerce determines that a foreign country is conducting a
fishing operation that diminishes the effectiveness of an
international fishery conservation program, he will certify
this determination to the President. After receiving a
certification, the President may direct the Secretary of the
Treasury to embargo the offending country's fishery products
to the limits of the General Agreement on Tariffs and Trade.
Within 60 days following the certification, the President is
required to notify the Congress of any action taken under the
certification.
On April 1, 1985, Secretary of Commerce Malcolm Baldrige
certified the Soviet Union for whaling that diminished the
effectiveness of the International Whaling Commission (IWC)
conservation program. Secretary Baldrige based his deter-
mination on: (1) the Soviet harvest of Southern Hemisphere
minke whales was greater than the level the United States
considered the U.S.S.R.'s traditional share; (2) the 1984-85
IWC quota for Southern Hemisphere minke whales was exceeded
due to Soviet harvest; and (3) there had been no indication
that the Soviets intended to comply with IWC standards.
Southern Hemisphere minke whales are taken by the
Soviet Union, Japan, and Brazil. The quota for these minke
whales is divided into six areas. Brazil harvests whales
from a land-based operation in Area Two, and Japan and the
Soviet Union then divide the quota for the remaining five
areas.
The Soviet Union, Japan, and Brazil have objected to the
IWC Southern Hemisphere minke whale quota and, consequently,
are not bound by the quota under international law. Even
though the objections release the governments from any treaty
obligation to observe the IWC limit, the taking of more minke
whales than established by quota is inconsistent with this
international conservation standard and, in the absence of any
indication of compliance with IWC standards, diminishes the
effectiveness of the Commission and its conservation program.
For the 1984-85 whaling season, Japan and the Soviet
Union agreed not to exceed their 1983-84 harvest levels of
3027 and 3028, respectively, of Southern Hemisphere minke
whales. These levels, if met, would exceed the 1984-85 IWC
quota of 4224. Based on past allocations, the United States
indicated that Japan and the Soviet Union could each take 1941
minke whales and remain consistent with the IWC limit. Japan
has observed this limit, but the Soviet Union has not. We
have taken a number of steps to resolve the Soviet whaling
problem.
2
The trade sanctions authorized by the Pelly Amendment
against Soviet fish products will not aid other Administration
efforts to change the Soviet whaling policy. Under the
Packwood-Magnuson Amendment, we cut in half Soviet-directed
fishing allocations in our exclusive economic zone. We have
also encouraged the Japanese to refrain from importing Soviet
whale products taken contrary to the IWC conservation program,
and Cabinet-level officials have met with Soviet officials to
resolve the problem. These actions are designed to encourage
the Soviet Union to observe the IWC program. A Pelly
Amendment embargo, however, will have a negligible effect on
the Soviet Union, as most of the products imported into the
United States, such as king crab, are highly marketable
elsewhere.
In addition, United States fishing interests could be
seriously harmed by such a sanction. An embargo imposed in
1985 could cost the United States 90,000 metric tons of
expected joint-venture catch and over $12 million. An embargo
could result in the permanent dissolution of the U.S.-U.S.S.R.
joint-venture company, which provides markets for underuti-
lized species and fish that might solely be harvested by
foreign vessels. Unemployment of U.S. fishermen and other
related workers could also result from the loss of this joint-
venture company.
In light of this assessment of the effect of an embargo
on Soviet fishery products, I have not taken any action
against the U.S.S.R. under the Pelly Amendment. If the Soviet
Union makes no progress towards complying with the IWC pro-
gram, I intend to reassess my position and take necessary
action. I will send you a supplemental report at that time.
RONALD REAGAN
THE WHITE HOUSE,
May 31, 1985.
########
THE WHITE HOUSE
WASHINGTON
June 5, 1985
MEMORANDUM FOR DAVID L. CHEW
STAFF SECRETARY
FROM:
ASSOCIATE COUNSEL JJJ TO THE PRESIDENT
JOHN G. ROBERTS
SUBJECT:
Section 301 Determination Regarding
Discriminatory Tariff Treatment by
EEC on Imports of U.S. Citrus Products
Counsel's Office has reviewed the memorandum for the President
from the Acting United States Trade Representative on the
above-referenced subject, and finds no objection to it from
a legal perspective. We also have no legal objection to the
draft memorandum from the President, making a determination
and announcing appropriate action under Section 301 of the
Trade Act of 1974, 19 U.S.C. § 2411.
ID #
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try products the EEC on imports of U.S. Citrus
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5/81
Document No.
WHITE HOUSE STAFFING MEMORANDUM
DATE:
5/31/85
ACTION/CONCURRENCE/COMMENT DUE BY:
June 5th
DETERMINATION UNDER SECTION 301 RE DISCRIMINATORY TARIFF TREATMENT
SUBJECT:
BY THE EEC ON IMPORTS OF U.S. CITRUS PRODUCTS
ACTION FYI
ACTION FYI
VICE PRESIDENT
LACY
REGAN
McFARLANE
STOCKMAN
OGLESBY
BUCHANAN
ROLLINS
CHAVEZ
RYAN
CHEW
P
SS SPEAKES
DANIELS
SPRINKEL
FIELDING
SVAHN
FRIEDERSDORF
TUTTLE
HENKEL
HICKEY
HICKS
KINGON
REMARKS:
Please provide any comments/recommendations by Wednesday, June 5th.
Thank you.
RESPONSE:
David L. Chew
Staff Secretary
1985 MAY 31 PM 3: 01
Ext. 2702
THE UNITED STATES TRADE REPRESENTATIVE
WASHINGTON
Received US
20506
May 30, 1985
MEMORANDUM FOR THE PRESIDENT
FROM:
Michael B. Smith, Acting
H
SUBJECT:
Determination Under Section 301 of the Trade Act of
1974 Regarding Discriminatory Tariff Treatment by
the European Economic Community on Imports of U.S.
Citrus Products
You must decide by June 20 what action, if any, to take in
response to the European Community's (EC's) practice of discrim-
inating against U.S. exports of citrus products. An interna-
tional dispute settlement panel found that this practice distorts
conditions of competition in the EC market with respect to trade
in oranges and lemons and recommended that the EC reduce its
most-favored-nation tariff rate, thus reducing the degree of
discrimination. However, the EC has refused to accept the
panel's finding or recommendation or to negotiate a compromise
solution.
Section 301 gives you broad discretionary authority to respond to
foreign practices which deny benefits to the U.S. arising under a
trade agreement or which are otherwise unreasonable or discrimi-
natory and restrict U.S. commerce. For the reasons set forth
below and described more fully in the attached background docu-
ment, I am recommending that you exercise this authority in a
moderate way by imposing increased duties on U.S. imports of
pasta products from the EC until such time as the citrus issue is
resolved or the EC provides adequate compensation. This measure
will restore the balance of concessions in U.S.-EC trade and will
demonstrate a firm yet flexible response to unfair trade prac-
tices. The EC will react adversely tc this duty increase. More-
over, because the EC has blocked acceptance of the panel's
findings, our action will be taken without GATT authorization.
Nevertheless, I believe action is necessary both to re-balance
the level of U.S.-EC trade concessions and to meet your commit-
ment to respond to unfair trade practices especially in the agri-
cultural sector.
This recommendation has the support of the Departments of
Agriculture, Commerce, Justice, Labor, and Treasury as well as
the Office of Management and Budget and the Council of Economic
Advisors. The Department of State has not taken a position on
the recommendation.
2 I I
If you approve this recommendation, we wil
tion to implement your decision.
Approve (Sign Memo
Disapprove
Background
Based on petitions filed in 1976 by the Florida Citrus Commis-
sion, California-Arizona Citrus League, Texas Citrus Mutual, and
Texas Citrus Exchange. - TR initiated an investigation concerning
the EC's tariff to
of U.S. citrus exports. As a result of
this investic
e found that as part of broad preferen-
tial tr>
e EC has, since the late 1960's,
le"
rts of citrus from the Mediterranean
on imports from the U.S. The level
cant. In some cases the U.S. pays a
that paid by other suppliers. This
it has impaired the ability of U.S.
will prepare a proclama- A)
ir fruits in the EC and, in our
EC's obligations under interna-
ign we Memorandum at Tab
litical importance to the EC of
the U.S. made extensive efforts
this issue through bilateral
al challenge to EC practices.
efforts.
a
: decided, in November, 1981,
nces under the rules and
onal trade agreement, the
ts appointed by the GATT to
mously that the EC prac-
ions with respect to two
The panel recommended that
ate of duty on these
accept the findings and
1 the matter in the GATT.
the issue bilaterally:
Clercq, the EC Commis-
al Policy, to seek a
sent letters to his
ting our willingness
ng of the likelihood
ition is reached.
trus products, the
1 EC is no longer
the dispute set-
'ide adequate
e level of trade
g increased
? damage our
I therefore recommend that you proclaim an increase in duty on
pasta imports from the EC to a level of 40% ad valorem on pasta
not containing egg and 25% ad valorem on pasta containing egg.
This duty increase is a very moderate response to the EC's unfair
practice. The value of concessions being withdrawn (approxi-
mately $30 million) is conservative compared with the $48 million
estimated annual trade damage to the U.S. citrus industry result-
ing from EC preferences. Moreover, the duty increase could be
rescinded at such time as the EC modifies its practice with
respect to citrus or otherwise compensates the U.S. The selec-
tion of pasta for this action is appropriate because pasta was
the subject of an earlier U.S.-EC trade dispute in which the EC
also blocked a GATT decision favorable to the U.S. Because the
EC has blocked further action in GATT, the U.S. does not have
GATT authorization to take this measure. Thus we run the risk
that the EC will accuse the U.S. of ignoring our own interna-
tional obligations, or that the EC will retaliate by restricting
imports of other U.S. products.
However, we believe we have no choice but to take that risk. We
cannot credibly defer action to allow further time for negotia-
tion, because the EC has consistently, clearly and publicly
rejected the possibility of a negotiated solution. In these
circumstances, failure to act will have adverse implications for
both domestic and international trade policy. An essential cor-
ollary of our efforts to resist protectionist pressures is our
commitment to combat unfair foreign trade practices and to seek
improved international rules. While actual trade levels involved
in the citrus case are relatively small, failure to act will
impair the credibility of an approach dependent on international
rules and could be used domestically as a symbol of our unwill-
ingness to respond to unfair practices and will encourage those
in Congress who prefer to administer trade policy through legi-
slation. Inaction in the face of the EC's refusal to respect
panel findings will also encourage other countries to flout
international rules.
TAB
A
THE WHITE HOUSE
WASHINGTON
MEMORANDUM FOR THE
UNITED STATES TRADE REPRESENTATIVE
SUBJECT: Determination Under Section 301 of the Trade Act
of 1974
Pursuant to Section 301 (a) of the Trade Act of 1974, as
amended (19 U.S.C. 2411 (a)) I have determined that the pref-
erential tariffs granted by the European Economic Community
(EEC) on imports of lemons and oranges from certain
Mediterranean countries deny benefits to the United States
arising under the General Agreement on Tariffs and Trade
(GATT), are unreasonable and discriminatory, and constitute a
burden and restriction on U.S. commerce. I have further
determined that the appropriate course of action to respond
to such practices is the withdrawal of equivalent concessions
with respect to imports from the EEC. I will therefore pro-
claim an increase in duties on pasta products classified in
items 182.35 and 182.36 of the Tariff Schedules of the United
States imported from the EEC. This action has been necessi-
tated by the unwillingness of the EEC to negotiate a mutually
acceptable resolution of this issue. At such time as the
United States Trade Representative makes a determination that
a mutually acceptable resolution has been reached, I would be
prepared to rescind this measure.
Reasons for Determination
Based on petitions filed by the Florida Citrus Commission,
the California-Arizona Citrus League, the Texas Citrus Mutual
and the Texas Citrus Exchange, the United States Trade
Representative initiated an investigation in November, 1976
concerning the EEC's preferential tariff treatment with respect
to citrus imports from certain Mediterranean countries. The
petitions alleged that these discriminatory tariffs, which are
granted in the context of broader trade agreements with the
Mediterranean countries, are inconsistent with the most-
favored-nation principle of the GATT and placed U.S. exporters
at a competitive disadvantage in the EEC market. Similar
complaints had been filed by the U.S. industry in 1970 and
1972 under Section 252 of the Trade Expansion Act of 1962.
2
As a result of this investigation, we have found that since
the 1960's, the EEC has levied a higher duty on imports of
citrus from the United States than that levied on imports from
certain Mediterranean countries. The level of discrimination
is significant. In some cases the United States pays a duty
five times greater than that paid by other suppliers. This
discriminatory tariff treatment has impaired the ability of
U.S. citrus exporters to market their fruits in the EEC and
is, in the view of the United States, inconsistent with the
EEC's obligations under the GATT.
Nevertheless, recognizing the political importance of these
preferential tariffs to the EEC, the United States made
extensive efforts over the course of a number of years to
resolve the matter through bilateral consultations rather
than mount a legal challenge against the EEC in the GATT.
The United States also tried to resolve this issue in the
context of tariff concessions granted during the Tokyo Round
of Multilateral Trade Negotiations. With the exception of a
few minor tariff reductions resulting from the Tokyo Round,
these efforts were without success. Following the conclusion
of the Tokyo Round, the United States initiated consultations
under the provisions of the GATT, but the EEC again rebuffed
all efforts to reach a compromise solution.
With any possibility of a negotiated settlement thus ruled
out, the United States invoked the dispute settlement
procedures of the GATT as the only alternative means of
seeking a redress of our complaint. In 1983, a panel was
established to review the U.S. complaint. Throughout this
procedure, the United States has continued to demonstrate its
willingness to seek a mutually acceptable solution to this
problem. For example, the United States agreed to the unusual
step of allowing the Director-General of GATT to attempt to
arbitrate the dispute before pressing its request for forma-
tion of a dispute settlement panel. Unfortunately, the
attempt failed. The EEC rejected all efforts at compromise.
In December, 1984, based on a voluminous record, the panel
found unanimously that the EEC preferences nullified and
impaired U.S. benefits arising under the GATT with respect
to U.S. exports of oranges and lemons, two of the eight
categories of U.S. citrus exports affected by the tariff
preferences. The panel recommended that the EEC reduce its
MFN rate of duty on fresh oranges and lemons no later than
October 15, 1985.
3
Although the panel did not rule on this issue, the United
States continues to believe that the EEC citrus preferences
are inconsistent with the most-favored-nation principle of
the GATT, and thus nullify or impair U.S. benefits with
respect to exports of the other citrus items as well as lemons
and oranges. Nevertheless, the United States has been willing
to accept the panel's more limited recommendation for the
following reasons. The sole interest of the United States
in bringing this issue to the GATT has been to obtain the
elimination or reduction of a barrier to U.S. citrus exports.
While the panel's recommendation does not call for the elimi-
nation of the barriers, we believe its implementation by the
EEC would significantly increase access for key U.S. citrus
exports to that market. Moreover, the panel's recommendation
does not require the EEC to take action inconsistent with its
preferential trading arrangements; indeed it would result in
lower tariffs for the preference receiving countries as well.
The EEC, however, has been unwilling to accept either the
panel's findings or recommendation and has effectively
prevented a resolution of this issue in the GATT. Thus, U.S.
attempts to resolve this problem at the bilateral or multi-
lateral level have not succeeded.
In light of the results of the USTR's investigation, I believe
we must recognize that the level of trade concessions between
the United States and EEC is no longer in balance. We esti-
mate that the value of annual U.S. exports of oranges and
lemons would increase by more than $48 million if the EEC had
implemented the panel's recommendation.
The EEC's unwillingness to implement the panel's finding or to
otherwise provide adequate compensation to the United States
requires us to re-balance the level of concessions in U.S.-EEC
trade. Increasing the duty on pasta imports from the EEC is a
reasonable and appropriate means by which to achieve this.
This determination shall be published in the Federal Register.
5/3/85
Memorandum of Determination Under Section 301
of the Trade Act of 1974
Memorandum to the United States Trade Representative
Pursuant to Section 301 (a) of the Trade Act of 1974, as
amended (19 U.S.C. 2411(a)), I have determined that the preferen-
tial tariffs granted by the European Economic Community (EEC) on
imports of lemons and oranges from certain Mediterranean coun-
tries deny benefits to the United States arising under the
General Agreement on Tariffs and Trade (GATT), are unreasonable
and discriminatory, and constitute a burden and restriction on
U.S. commerce. I have further determined that the appropriate
course of action to respond to such practices is the withdrawal
of equivalent concessions with respect to imports from the EEC.
I will therefore proclaim an increase in duties on pasta products
classified in items 182.35 and 182.36 of the Tariff Schedules of
the United States imported from the EEC. This action has been
necessitated by the unwillingness of the EEC to negotiate a mutu-
ally acceptable resolution of this issue. At such time as the
United States Trade Representative makes a determination that a
mutually acceptable resolution has been reached, I would be pre-
pared to rescind this measure.
Reasons for Determination
Based on petitions filed by the Florida Citrus Commission,
the California-Arizona Citrus League, the Texas Citrus Mutual and
- 2 -
the Texas Citrus Exchange, the United States Trade Representative
E
initiated an investigation in November, 1976 concerning the EC's
preferential tariff treatment with respect to citrus imports from
certain Mediterranean countries. The petitions alleged that
these discriminatory tariffs, which are granted in the context of
broader trade agreements with the Mediterranean countries, are
inconsistent with the most-favored-nation principle of the GATT
and placed U.S. exporters at a competitive disadvantage in the EC
market. Similar complaints had been filed by the U.S. industry
in 1970 and 1972 under Section 252 of the Trade Expansion Act of
1962.
As a result of this investigation, we have found that since
the 1960's, the EC has levied a higher duty on imports of citrus
United States
from the U.S. than that levied on imports from certain Mediter-
ranean countries. The level of discrimination is significant.
In some cases the U.S. pays a duty 5 times greater than that paid
by other suppliers. This discriminatory tariff treatment has
impaired the ability of U.S. citrus exporters to market their
unter Stated
fruits in the EEC and is, in the view of the U.S., inconsistent
with the EEC's obligations under the GATT.
Nevertheless, recognizing the political importance of these
preferential tariffs to the EEC, the United States made extensive
efforts over the course of a number of years to resolve the mat-
ter through bilateral consultations rather than mount a legal
state
challenge against the EEC in the GATT. The U.S. also tried to
resolve this issue in the context of tariff concessions granted
during the Tokyo Round of Multilateral Trade Negotiations. With
- 3 -
the exception of a few minor tariff reductions resulting from the
Tokyo Round, these efforts were without success. Following the
united take
conclusion of the Tokyo Round, the U.S. initiated consultations
under the provisions of the GATT, but the EEC again rebuffed all
efforts to reach a compromise solution.
With any possibility of a negotiated settlement thus ruled
contrattoler
out, the U.S. invoked the dispute settlement procedures of the
GATT as the only alternative means of seeking a redress of our
complaint. In 1983, a panel was established to review the U.S.
Dates
complaint. Throughout this procedure, the U.S. has continued to
demonstrate its willingness to seek a mutually acceptable solu-
unterstates
tion to this problem. For example, the U.S. agreed to the
unusual step of allowing the Director-General of GATT to attempt
to arbitrate the dispute before pressing its request for forma-
tion of a dispute settlement panel. Unfortunately, the attempt
failed. The EEC rejected all efforts at compromise.
In December, 1984, based on a voluminous record, the panel
found unanimously that the EEC preferences nullified and impaired
U.S. benefits arising under the GATT with respect to U.S. exports
of oranges and lemons, two of the eight categories of U.S. citrus
exports affected by the tariff preferences. The panel recom-
mended that the ESC reduce its MFN rate of duty on fresh oranges
and lemons no later than October 15, 1985.
Although the panel did not rule on this issue, the United
States continues to believe, that the EEC citrus preferences are
inconsistent with the most-favored-nation principle of the GATT,
and thus nullify or impair U.S. benefits with respect to exports
- 4 -
of the other citrus items as well as lemons and oranges. Never-
interestate
theless, the U.S. has been willing to accept the panel's more
limited recommendation for the following reasons. The sole
intention
interest of the U.S. in bringing this issue to the GATT has been
to obtain the elimination or reduction of a barrier to U.S.
citrus exports. While the panel's recommendation does not call
for the elimination of the barriers, we believe its implementa-
tion by the EEC would significantly increase access for key U.S.
citrus exports to that market. Moreover, the panel's recommenda-
tion does not require the EEC to take action inconsistent with
its preferential trading arrangements; indeed it would result in
lower tariffs for the preference receiving countries as well.
The EEC, however, has been unwilling to accept either the
panel's findings or recommendation and has effectively prevented
a resolution of this issue in the GATT. Thus, U.S. attempts to
resolve this problem at the bilateral or multilateral level have
not succeeded.
In light of the results of the USTR's investigation, I
believe we must recognize that the level of trade concessions
United States
between the U.S. and EEC is no longer in balance. We estimate
that the value of annual U.S. exports of oranges and lemons would
increase by more than $48 million if the EC had implemented the
panel's recommendation.
The EEC's unwillingness to implement the panel's finding or
united State
to otherwise provide adequate compensation to the U.S. requires
us to re-balance the level of concessions in U.S.-EC trade.
Increasing the duty on pasta imports from the E EC is a reasonable
and appropriate means by which to achieve this.
This determination shall be publiched the Federal Register