[Federal Register: March 7, 1997 (Volume 62, Number 45)]
[Notices]
[Page 10604-10605]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr07mr97-151]

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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE

[Docket No. WTO/DS-16]


WTO Dispute Settlement Proceeding Regarding European Communities'
Tariff Treatment of Some Computer Equipment

AGENCY: Office of the United States Trade Representative.

ACTION: Notice; request for comments.

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SUMMARY: Pursuant to section 127(b)(1) of the Uruguay Round Agreements
Act (URAA) (19 U.S.C. 3537(b)(1)), the Office of the United States
Trade Representative (USTR) is providing notice that the United States
has requested the establishment of a dispute settlement panel under the
Agreement Establishing the World Trade Organization (WTO), to examine
tariff increases by the European Communities (EC) and its member States
on certain local area network (LAN) equipment and personal computers
(PCs) with multimedia capacity. More specifically, the United States
has requested the establishment of a panel to determine whether the EC
has acted inconsistently with its obligations under Article II of the
General Agreement on Tariffs and Trade 1994 (GATT 1994) in that the EC
and its member States have increased tariffs above rates bound during
the Uruguay Round for (1) LAN adapter cards, (2) other LAN equipment
and (3) PCs with multimedia capability (including PCs with CD-ROM
drives and cards enabling television reception.) USTR also invites
written comments from the public concerning the issues raised in the
dispute.

DATES: Although USTR will accept any comments received during the
course of the dispute settlement proceedings, comments should be
submitted on or before April 2, 1997, to be assured of timely
consideration by USTR in preparing its first written submission to the
panel.

ADDRESSES: Comments may be submitted to Ileana Falticeni, Office of
Monitoring and Enforcement, Room 501, Attn: EC LAN Dispute, Office of
the U.S. Trade Representative, 600 17th Street, N.W., Washington, DC
20508.

FOR FURTHER INFORMATION CONTACT:
Andrea Casson, Attorney, 202-395-3582 or Matthew Rohde, Director for
Customs Affairs, 202-395-3063, Office of the U.S. Trade Representative,
600 17th Street, N.W., Washington, DC 20508.

SUPPLEMENTARY INFORMATION: On February 11, 1997, the United States
requested establishment of a WTO dispute settlement panel to examine
whether the following measures are inconsistent with the EC's
obligations under Article II of the GATT 1994: (1) Regulation No. (EC)
1165/95, which reclassifies certain LAN adapter cards from category
8471, ``automatic data processing machines and units thereof,'' to
category 8517, ``telecommunications apparatus;'' (2) the actions of
customs authorities in EC member States in reclassifying and increasing
tariffs on imports of all types of LAN equipment--including hubs, in-
line repeaters, converters concentrators, bridges and routers; and (3)
the actions of customs authorities in EC member States in reclassifying
and increasing tariffs on imports of PCs with multimedia capacity.
    The WTO Dispute Settlement Body (DSB) considered the U.S. request
at its meeting on February 25, at which time a panel was established.
Members of the panel are currently being selected. Under normal
circumstances, the panel would be expected to issue a report detailing
its findings and recommendations within six to nine months after it is
established.

Major Issues Raised by the United States and Legal Basis of
Complaint

    In its schedule of tariff concessions under the GATT 1994, the EC
and its member States have agreed to a bound tariff rate for automatic
data processing (ADP) equipment and units, staged from the base rate of
4.4 percent ad valorem in 1995 to 2.5 percent ad valorem in 1999. The
EC's adoption in June 1995 of the regulation reclassifying certain LAN
adapter cards from the ADP category to the category for
telecommunications apparatus resulted in an increase in tariffs on
imports of such products to rates above the bound rate for ADP
equipment.
    In addition, since 1995, customs authorities in EC member States,
including but not limited to those in the United Kingdom and Ireland,
have reclassified all other types of LAN equipment from the ADP
category to the telecommunications category, increasing the tariffs on
these products above the bound ADP rate. Also, customs authorities in
EC member States, particularly those in the United Kingdom, have
reclassified certain PCs with multimedia capacity, formerly dutiable
under the ADP category, to the ``video apparatus'' or ``television''
categories, dutiable at rates above the bound rate for ADP equipment.
    Article II of the GATT 1994 provides that each WTO Member shall
afford the trade of other WTO Members treatment that is no less
favorable than that provided for in the importing Member's schedule of
tariff concessions, and that imports shall be not be subject to duties
in excess of those provided for in that schedule. The United States
contends that, in reclassifying imports of LAN equipment and multimedia
PCs, the EC and its member States have increased duties on these
products above the bound rates, and have afforded products imported
from the United States treatment less favorable than that provided for
in the EC schedule. In the view of the United States, these actions are
inconsistent with the EC's obligations under Article II of the GATT
1994.

Public Comment: Requirements for Submissions

    Interested persons are invited to submit written comments
concerning the issues raised in the dispute. Comments must be in
English and provided in fifteen copies. A person requesting that
information contained in a comment submitted by that person be treated
as confidential business information must certify that such information
is business confidential and would not customarily be released to the
public by the commenter. Confidential business information must be
clearly marked ``BUSINESS CONFIDENTIAL'' in a contrasting color ink at
the top of each page of each copy.
    A person requesting that information or advice contained in a
comment submitted by that person, other than business confidential
information, be treated as confidential in accordance with section
135(g)(2) of the Trade Act of 1974 (19 U.S.C. 2155)--
    (1) Must so designate that information or advice;
    (2) Must clearly mark the material as ``SUBMITTED IN CONFIDENCE''
in a contrasting color ink at the top of each page of each copy; and
    (3) Is encouraged to provide a non-confidential summary of the
information or advice.
    Pursuant to section 127(e) of the URAA, USTR will maintain a file
on this dispute settlement proceeding, accessible to the public, in the
USTR Reading Room: Room 101, Office of the United States Trade
Representative, 600 17th Street, N.W., Washington DC 20508. The public
file will include a listing of any comments received by USTR from the
public with respect to

[[Page 10605]]

the proceeding; the U.S. submissions to the panel in the proceeding;
the submissions, or non-confidential summaries of submissions, to the
panel received from other participants in the dispute, as well as the
report of the dispute settlement panel and, if applicable, the report
of the Appellate Body. An appointment to review the public file (Docket
WTO/DS-16-EC LAN) may be made by calling Brenda Webb, (202) 395-6186.
The USTR Reading Room is open to the public from 9:30 a.m. to 12 noon
and 1 p.m. to 4 p.m., Monday through Friday.
Irving Williamson,
Acting General Counsel.
[FR Doc. 97-5569 Filed 3-6-97; 8:45 am]
BILLING CODE 3190-01-M
