In November, the WTO gave Canada and the other co-complainants the authority to retaliate. The other countries involved include Mexico, Japan, India and Brazil.
Unless Congress repeals the law, the case may become the most damaging ever at the WTO when the U.S. begins distributing tariffs collected on Canadian lumber, worth $4 billion a year. Japan, the economy most affected by the Byrd Amendment, has the right to impose customs duties worth 125 billion yen ($116 million), the biggest sanctions awarded to Japan in a dispute.
President George W. Bush called for a repeal of the Byrd Amendment in his budget proposal to Congress on Feb. 7, saying that ending the law could save the U.S. Treasury $1.6 billion in the next fiscal year.
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So, unless the Byrd amendment is repealed, many nations, not just the EU, will be retaliating. It would be prudent not to irritate the Japanese, with their vast holdings of US Treasuries - which they can dump any time they please. The posted article states that President Bush is in favor of repeal. Sounds like prompt action is needed - unless he wants to get into a trade war against the whole world --- at the conclusion of which we are likely to be even more a beggar nation than we are now - and finally shocked into seeing it.
Is repeal legislation before Congress now?
My understanding is that the Senate will not repeal it. They need to redirect the money collected from the fines away from the companies to some other entity to get the WTO to approve it. A compromise bill was put up by Olympia Snowe but has little or no support.