A World Trade Organization panel on Friday ruled that the U.S. practice of collecting cash deposits in the form of bonds from Thai and Indian shrimp exporters subject to tariffs violates international trade law. U.S. Customs and Border Protection enacted the practice in mid-2004 to curb tariff evasion.
Also on Friday, the WTO's Dispute Settlement Body ruled that the U.S. practice of "zeroing" is illegal, agreeing with Thai shrimp exporters that the U.S. Department of Commerce artificially inflated Thai shrimp tariffs using the controversial methodology. Last year, the WTO concurred with Ecuadoran shrimp exporters that zeroing is unlawful, and subsequently the DOC revoked Ecuadoran shrimp tariffs.
Friday's decisions confirm preliminary rulings made last October.
"We therefore recommend that the United States bring its measures into conformity with its obligations" under international trade law, the WTO said.
Thailand, India and Ecuador are three of the six Asian and Latin American countries the DOC hit with shrimp tariffs in early 2005 after the Southern Shrimp Alliance, an eight-state group of shrimpers and processors, filed an antidumping petition in late 2003.
