IV

105TH CONGRESS

2D SESSION H. RES. 406

Expressing the sense of the House of Representatives that the canned fruit

subsidy regime of the European Union is a bilateral trade concern

of high priority, for which prompt corrective action is needed.

IN THE HOUSE OF REPRESENTATIVES

APRIL 1, 1998

Mr. CONDIT (for himself, Mr. RADANOVICH, Mr. HERGER, Mr. MATSUI, Mr.

FAZIO of California, Mr. DOOLITTLE, and Mr. POMBO) submitted the following resolution; which was referred to the Committee on Ways and

Means

RESOLUTION

Expressing the sense of the House of Representatives that

the canned fruit subsidy regime of the European Union

is a bilateral trade concern of high priority, for which

prompt corrective action is needed.

Whereas a dispute settlement panel established under the

General Agreement on Tariffs and Trade (GATT) has already found European Union canned fruit processing

subsidies to be inconsistent with the European Union’s

GATT obligations;

Whereas the United States, pursuant to an investigation of

European Union canned fruit subsidies under the authority of section 301 of the Trade Act of 1974, as amended,

has determined that the rights of the United States
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under the GATT have been denied by European Union

canned fruit processing subsidies;

Whereas under the authority of section 301 of the Trade Act

of 1974, the United States reached an agreement with

the European Union in 1985, under which the European

Union has committed to discontinue subsidies to European Union canned peach processors;

Whereas despite these legal and negotiated results, the European Union nevertheless continues to provide subsidies to

its canned peach sector in the amount of $160,000,000

to $200,000,000 annually, which amount exceeds the

total farm-gate value of United States cling peaches;

Whereas data recently provided by the European Union demonstrate that the European Union has violated the

United States/European Union canned fruit agreement in

each of the last five years for which data are available

by an aggregate amount in excess of $64,000,000;

Whereas because these canned fruit subsidies are contingent

on the use of European Union peaches and enable prices

more favorable than those the European Union processor

would actually have paid for the imported product, such

subsidies continue to be inconsistent with the European

Union’s obligations under the World Trade Organization;

Whereas numerous canned peach producing countries, including Mexico, Argentina, Australia, Brazil, and New Zealand, have taken formal trade remedy actions to protect

their industries from unfair European Union canned fruit

imports;

Whereas pervasive fraud and abuse under this subsidy regime

have also been documented;
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Whereas these subsidy excesses, violations, and abuses have

led to chronic European Union canned fruit surpluses

and escalating exports, which exports have severely undercut prices and displaced United States sales in all

global markets;

Whereas European Union subsidy excesses in this sector are

so extreme that between 300,000 and 600,000 metric

tons of Greek peaches are dumped every year in waste

pits, further depressing Greek and global canned fruit

prices;

Whereas the United States/European Union canned fruit

agreement has failed to prevent these trade-restrictive

and distortive consequences;

Whereas United States cling peach growers and processors

can no longer sustain the unfair competition and harm

being caused by unfairly subsidized European Union

canned peaches;

Whereas trade agreements such as the one now in place regarding European Union canned fruit are of no value if

they are inadequately enforced and deliver no relief to the

affected United States sector; and

Whereas the European Union for several years has resisted

efforts by the United States and most other non-European Union canned peach producing countries to correct

its canned fruit practices: Now, therefore, be it

1 Resolved, That it is the sense of the House of Rep2 resentatives that the United States Government should

3 promptly take all necessary corrective action against the

4 European Union canned peach subsidy regime in order to
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1 deliver tangible, meaningful relief to the United States in2 dustry and restore fair competition to this sector of trade.

Æ