Japan has notified the World Trade Organization that it will continue to apply punitive tariffs on ball and roller bearings from the United States, at least through September 2010.

Japan's Ministry of Finance issued a statement saying the U.S. has failed to live up to its obligations under WTO rulings against the Continued Dumping and Subsidy Offset Act of 2000 (CDSOA), otherwise known as the Byrd Amendment.

The CDSOA instructed Customs to collect antidumping duties, and then award them back out to domestic U.S. producers of those items. U.S. ball and roller bearing manufacturers have been by far the largest beneficiaries of CDSOA payouts, running into the hundreds of millions of dollars in several cases.

Controversial from the beginning, the WTO repeatedly ruled the CDSOA 5251R9N7 violated various trade rules and laws -- but it took a recalcitrant U.S. Congress until 2006 to repeal the law.

Because the CDSOA and its implementation became wildly and unpredictably complex, and because billions of dollars are at stake for those who can get in line to benefit, the actual death of the CDSOA program will be many years from now. Disputes among many thousands of claimants remain mired in the U.S. Court of International Trade, ping-ponged back to the International Trade Commission. The key distribution qualification has been ruled unconstitutional, and meanwhile older (pre-2007) tariffs and duties are still being collected and distributed.

Since the U.S. did not repeal the CDSOA on the WTO's timetable, the WTO allowed the various complainant countries to establish punitive tariffs on products from the United States; the allowable punitive tariff is based on the previous year's calculated benefit.

As CDSOA program payouts have naturally been winding down since its repeal, Japan's recalculation for 2009-2010 puts the punitive tariff slightly lower. For 2008-2009, the rate had been 10.6%.

Japan's new 2009-2010 WTO-approved punitive tariff on ball and roller bearings from the U.S. is 9.6%.

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