[Federal Register Volume 73, Number 184 (Monday, September 22, 2008)]
[Notices]
[Pages 54640-54642]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-22101]


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OFFICE OF THE UNITED STATES TRADE REPRESENTATIVE

[Docket No. WTO/DS375]


WTO Dispute Settlement Proceeding Regarding European 
Communities--Tariff Treatment of Certain Information Technology 
Products

AGENCY: Office of the United States Trade Representative.

ACTION: Notice; request for comments.

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SUMMARY: The Office of the United States Trade Representative 
(``USTR'') is providing notice that on August 18, 2008, in accordance 
with the World Trade Organization (``WTO'') Understanding on Rules and 
Procedures Governing the Settlement of Disputes (``DSU''), the United 
States, jointly with Japan and the Separate Customs Territory of 
Taiwan, Penghu, Kinmen and Matsu, requested the establishment of a 
dispute settlement panel regarding the tariff treatment accorded by the 
European Communities (``EC'') and its member States to set-top boxes 
with a communication function, flat panel displays, and certain 
multifunctional digital machines. That request may be found at 
www.wto.org contained in a document designated as WT/DS375/8. USTR 
invites written comments from

[[Page 54641]]

the public concerning the issues raised in this dispute.

DATES: Although USTR will accept any comments received during the 
course of the dispute, comments should be submitted on or before 
October 24, 2008 to be assured of timely consideration by USTR.

ADDRESSES: Comments should be submitted (i) electronically, to 
[email protected], with ``EC Information Technology Products 
(DS375)'' in the subject line, or (ii) by fax, to Sandy McKinzy at 
(202) 395-3640, with a confirmation copy sent electronically to the 
electronic mail address above, in accordance with the requirements for 
submission set out below.

FOR FURTHER INFORMATION CONTACT: Elissa Alben, Assistant General 
Counsel, Office of the United States Trade Representative, 600 17th 
Street, NW., Washington, DC, (202) 395-3150.

SUPPLEMENTARY INFORMATION: Pursuant to section 127(b) of the Uruguay 
Round Agreements Act (URAA) (19 U.S.C. 3537(b)(1)), USTR is providing 
notice that the United States has requested the establishment of a WTO 
dispute settlement panel pursuant to the WTO Understanding on Rules and 
Procedures Governing the Settlement of Disputes (``DSU'') to review the 
issues identified below. Such panel, which would hold its meetings in 
Geneva, Switzerland, would be expected to issue a report on its 
findings and recommendations within nine months after it is 
established.

Major Issues Raised by the United States

    The EC and its member States impose duties on set-top boxes with a 
communication function, flat panel displays, and certain 
multifunctional digital machines.\1\
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    \1\ Machines which perform two or more of the functions of 
printing, copying, or facsimile transmission, capable of connecting 
to an automatic data processing machine or to a network (including 
devices commercially known as MFPs (multifunctional printers), other 
``input or output units'' of ``automatic data processing machines'', 
and facsimile machines).
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     Set-top boxes with a communication function. On May 7, 
2008, the EC published an amendment to the Explanatory Notes to the 
EC's Combined Nomenclature (CN), which provides that the duty-free 
heading CN 8528 71 13 (``set-top boxes with a communication function'') 
no longer includes set-top boxes with modems of certain types (e.g., 
Ethernet modems) or set-top boxes which ``incorporate a device 
performing a recording or reproducing function (for example, a hard 
disk or DVD drive).'' As a result of this exclusion, the EC and its 
member States impose a duty on these set-top boxes. In addition, the EC 
added an explanatory note to CN 8521 90 00 indicating that the 
subheading includes set-top boxes ``which incorporate a device 
performing a recording or reproducing function (for example, a hard 
disk or DVD drive).'' Products classified in CN 8521 90 00 are subject 
to an MFN duty of 13.9%.
     Flat panel displays (including LCD, electro luminescence, 
plasma and other technologies). On March 31, 2005, the EC published 
Council Regulation (EC) No 493/2005, stating that certain flat panel 
displays using LCD technology that are ``capable of reproducing video 
images from a source other than an automatic data-processing machine'' 
are not covered by the Information Technology Agreement (ITA) or by the 
Communication on its implementation (Council Decision 97/359/EC of 24 
March 1997). On April 26, 2005, the EC issued Commission Regulation 
(EC) No 634/2005, stating that flat panel displays with certain 
attributes, including DVI, would be classified in a dutiable tariff 
line. On December 29, 2005, the EC published Commission Regulation (EC) 
No 2171/2005, which also provided that certain flat panel displays 
would be classified in a dutiable tariff line if they had certain 
attributes, including DVI. On December 30, 2006, the EC published 
amendments to the Explanatory Notes to accompany CN 8471 60 80 and 8528 
21 90. Like the regulations, the Explanatory Notes provide that flat 
panel displays with certain attributes, such as DVI, may not be 
classified in the duty-free tariff line 8471 60 80 and would be 
classified in a dutiable tariff line. EC member States assess duties on 
flat panel displays. Furthermore, while the EC has temporarily 
suspended the collection of duties on some flat panel displays, it 
appears to fail to accord tariff treatment that is no less favorable 
than that provided for in its Schedule.
     Multifunctional digital machines. In 1999, the EC 
published Commission Regulation (EC) No 517/99, which provided that 
certain ``output units'' would be classified in a tariff line with a 6% 
MFN duty. On March 9, 2006, the EC published Commission Regulation (EC) 
No 400/2006, which classified certain ``output units'' or facsimile 
machines, under CN subheading 9009 12 00, as indirect process 
electrostatic photocopiers. The EC Customs Code Committee also issued a 
statement indicating that ``if a multifunctional device (fax, printer, 
scanner, copier) has the capability of photocopying in black and white 
12 or more pages per minute (A4 format) this indicates that the product 
is classifiable in heading 9009 as a photocopying apparatus.'' 
Consistent with that statement, on October 31, 2006, the EC published 
Commission Regulation (EC) No 1549/2006, which provides that certain 
``output units'' or facsimile machines capable of copying more than 12 
monochrome pages per minute are classified in a dutiable tariff line. 
EC member States assess duties on certain ``input or output units'' and 
facsimile machines.
    These measures appear to USTR to be inconsistent with the EC's 
obligations under Articles II:1(a) and II:1(b) of the General Agreement 
on Tariffs and Trade 1994 (``GATT 1994'') and its Schedule and with the 
member States' obligations under Articles II:1(a) and II:1(b) of the 
GATT 1994 and their Schedules, and they appear to nullify or impair 
benefits accruing to the United States under the GATT 1994.
    In addition, with respect to set-top boxes, the Tariff and 
Statistical Nomenclature Section of the Customs Code Committee 
delivered favorable opinions with respect to the proposed amendments to 
the Explanatory Notes contained in 2008/C 112/03 in October 2006 and 
May 2007, respectively. It did not publish the amended explanatory 
notes in the EC Official Journal until May 7, 2008. Furthermore, member 
States were applying duties to set-top boxes using the approach 
specified in 2008/C 112/03 prior to May 7, 2008. These actions appear 
to USTR to be inconsistent with the EC's obligations under GATT 1994 
Articles X:1 and X:2.

Public Comment: Requirements for Submissions

    Interested persons are invited to submit written comments 
concerning the issues raised in the dispute. Comments should be 
submitted (i) electronically, to [email protected], with ``EC 
Information Technology Products (DS375)'' in the subject line, or (ii) 
by fax, to Sandy McKinzy at (202) 395-3640, with a confirmation copy 
sent electronically to the electronic mail address above.
    USTR encourages the submission of documents in Adobe PDF format as 
attachments to an electronic mail. Interested persons who make 
submissions by electronic mail should not provide separate cover 
letters; information that might appear in a cover letter should be 
included in the submission itself. Similarly, to the extent possible, 
any attachments to the submission should be included in the

[[Page 54642]]

same file as the submission itself, and not as separate files.
    Comments must be in English. A person requesting that information 
contained in a comment submitted by that person be treated as 
confidential business information must certify that such information is 
business confidential and would not customarily be released to the 
public by the commenter. Confidential business information must be 
clearly designated as such and ``BUSINESS CONFIDENTIAL'' must be marked 
at the top and bottom of the cover page and each succeeding page. 
Persons who submit confidential business information are encouraged 
also to provide a non-confidential summary of the information.
    Information or advice contained in a comment submitted, other than 
business confidential information, may be determined by USTR to be 
confidential in accordance with section 135(g)(2) of the Trade Act of 
1974 (19 U.S.C. 2155(g)(2)). If the submitter believes that information 
or advice may qualify as such, the submitter--
    (1) Must clearly so designate the information or advice;
    (2) Must clearly mark the material as ``SUBMITTED IN CONFIDENCE'' 
at the top and bottom of the cover page and each succeeding page; and
    (3) Is encouraged to provide a non-confidential summary of the 
information or advice.
    USTR will maintain a file on this dispute settlement proceeding, 
accessible to the public, in the USTR Reading Room, which is located at 
1724 F Street, NW., Washington, DC 20508. The public file will include 
non-confidential comments received by USTR from the public with respect 
to the dispute; if a dispute settlement panel is convened or in the 
event of an appeal from such a panel, the U.S. submissions, any non-
confidential submissions, or non-confidential summaries of submissions, 
received from other participants in the dispute; the report of the 
panel; and, if applicable, the report of the Appellate Body. The USTR 
Reading Room is open to the public, by appointment only, from 10 a.m. 
to noon and 1 p.m. to 4 p.m., Monday through Friday. An appointment to 
review the public file (Docket WTO/DS-375, EC Information Technology 
Products Dispute) may be made by calling the USTR Reading Room at (202) 
395-6186.

Daniel Brinza,
Assistant United States Trade Representative for Monitoring and 
Enforcement.
[FR Doc. E8-22101 Filed 9-19-08; 8:45 am]
BILLING CODE 3190-W8-P