Plans under consideration by the European Commission include wide-ranging sanctions in the form of 100 percent tariffs on selected imports from the United States, worth about $300 million annually, which would start on June 18. Items on the list that could be targeted include fruit, textiles, steel products, and firearms. To go into effect this proposal needs to receive majority backing from the 15 EU-member states.

In a speech in New York in mid-April, Gordon Brown, the United Kingdom chancellor, called upon Washington to drop these tariffs as a step toward breaking down trade barriers with the EU. Some other EU states, reports the Financial Times, such as Germany and the Nordic countries, have expressed concern about the implications of the commission’s planned retaliatory actions.

The European Commission is demanding that Washington compensate EU countries for lost steel sales resulting from the U.S. trade restrictions. It has drawn up an even broader list of $2.1 billion worth of U.S. exports upon which retaliatory sanctions can be imposed, if the World Trade Organization rules against Washington’s steel tariff. A decision in this case, however, is not expected until at least mid-2003.

In an interview with the Financial Times, Pascal Lamy, the EU trade commissioner, lashed out at the U.S. steel tariffs. "There is no way it cannot be seen in Europe as ‘You can go to hell,’" he said.

On the top of the list for possible retaliatory duties is the $600 million worth of steel products exported to European Union countries by the United States. The EU has also set up trade barriers of its own, in the form of quotas and tariffs on steel imports that it says are needed to protect the European market from a rise in imports now barred from the U.S. market.

Washington for its part has condemned the EU-member nations for threatening to take prompt countermeasures to its steel tariff. "Legal disputes have to be resolved in the dispute settlement process in the WTO," opined an unnamed U.S. trade official quoted by the Financial Times. "The EU wants to be the judge and jury. This strikes at the heart of the multilateral process."

One U.S. official told the paper that the EU moves represent a "unilateral escalation by assuming the roles of contestant, judge, and jury," adding that if "countries start to go down the path of retaliating without waiting for a WTO decision, we will have that option too."

A number of other governments, including in Japan, south Korea, and China, have condemned the U.S. steel tariffs, and are considering joining the EU in filing a complaint before the WTO. Tokyo, like the EU, is seeking $160 million in compensation from Washington.  
 
 
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