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Section 301 of the Trade Act of 1974 provides the United States with the authority to enforce trade agreements, resolve trade disputes and open foreign markets to U.S. goods and services. Section 301 is the principal statutory authority under which the United States may impose trade sanctions on foreign countries that either violate trade agreements or otherwise maintain laws or practices that are unjustifiable and restrict U.S. commerce. When an investigation involves an alleged violation of a trade agreement (such as the World Trade Organization (WTO) Agreement or the North American Free Trade Agreement (NAFTA)), United States Trade Representative (USTR) must follow the consultation and dispute settlement procedures set out in that agreement. If the United States finds it necessary to increase duties because of a violation of the WTO, USTR will seek authority from the WTO's Dispute Settlement Body to suspend trade concessions previously granted to the foreign country. Such actions include increasing import duties.
EUROPEAN COMMUNITY BEEF HORMONES (1999 to present)
The EU ban of imports of meat and meat products derived from cattle to which any of six hormones have been administered for growth promotional purposes has effectively blocked U.S. beef from entering the European Community market since 1989. Both a WTO panel and the Appellate Body ruled that the ban was inconsistent with the EU's WTO obligations under the Sanitary and Phytosanitary Measures agreement. The EU was given until May 13, 1999 to come into compliance with the WTO rulings. The EU did not lift the ban on hormone-treated beef by the WTO deadline. In response, the United States requested and received authorization from the WTO to retaliate against the EU. The United States began to impose prohibitive duties in the order of 100 percent ad valorem tariffs on 34 products from across the EU in July 1999. That list remained unchanged until modifications were announced January 15, 2009.
In May 2009, the United States and the EU signed an MOU under which the EU agreed to create a new duty-free quota for imports of specially-produced beef. Since 2009, in exchange for the elimination of increased U.S. tariffs on EU imports, the MOU has provided an opportunity for U.S. producers to export additional beef to the EU market, as intended by the parties. However, in recent years the U.S. beef industry has been prevented from gaining the intended benefits from the MOU because of increased imports under the duty-free quota from non-U.S. suppliers.
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