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EU eying legal action if US stimulus includes 'Buy American' provision

By Bernard Hibbitts (editor) and University of Pittsburgh School of Law students.

[JURIST] The European Union (EU) has concerns over the legality of a "Buy American" provision in a US economic stimulus package, according to a letter sent Monday to US officials by European Commission ambassador to Washington John Bruton Bruton also indicated that the EU would be prepared to take legal action if the provision were included and found to be in breach of World Trade Organization (WTO) rules. Bruton wrote:As you are aware, the United States and the European Communities are both party to the World Trade Organisation Agreement on Government Procurement (GPA). This provides U.S. goods and services access to substantial procurement opportunities in the European Communities and its Member States, in return for access to procurement opportunities in the United States for EC goods and services. I expect that you will ensure that U.S. obligations under the GPA will continue to be observed. I would note that the EC has strenuously avoided any efforts to restrict procurement opportunities for U.S. goods and services in its response to the global economic downturn.US President Barack Obama has already separated himself from the "Buy America" provisions, saying in a Tuesday interview: "That is a potential source of trade wars that we can't afford at a time when trade is sinking all across the globe." Canadian officials, who have also argued that such a provision would violate international trade law, have welcomed Obama's statement.

Full post as published by JURIST - The Paper Chase on February 04, 2009 (boomark / email).