Japan will take its case to the General Agreement on Tariffs and Trade if U.S. automakers seek punitive duties on foreign car imports, a high-level Japanese trade official warned Wednesday.
Meanwhile, plans by the Clinton administration to raise tariffs on Japanese minivans may be complicated by a highly classified memo prepared by career lawyers at the U.S. Trade Representative's office.In 1989, the U.S. Treasury Department overturned a Customs Department decision and classified the minivans as cars, making them subject to the 2.5 percent automobile tariff rate.
The classified memo argues strongly that raising the import duties through reclassification would violate rules laid down by GATT, the Geneva-based body that oversees most of the world's merchandise trade.
Administration officials will not even admit the memo exists, and only a few high-level officials have read it. It was prepared last year, at a time when the Bush administration was staunchly defending the lower tariff rate under pressure from Democrats who want it raised.
The senior Ministry of International Trade and Industry official, who declined to be identified, told reporters Japanese authorities are concerned that the United States appears to be on a collision course with Japan and Western Europe over this sensitive issue.
The action by the U.S. auto manufacturers would involve an anti-dumping petition that foreign automakers are violating U.S. trade laws by selling cars for less in the United States than they charge for the same cars in their home markets.
The official denied that Japan's automakers have been dumping their cars in the U.S. market, pointing out that Japanese companies repeatedly have raised their export prices in response to fluctuations in the dollar-yen exchange rate.
He said he suspected the U.S. automakers were attempting to test the policy position of the new U.S. administration by suggesting they are considering such legal action.
Application of U.S. dumping charges would be completely unacceptable to Japan, he said, because Japanese automakers have complied with a ministry request not to raise "voluntary" quotas on car shipments to the United States in fiscal 1993, which begins April 1, despite signs of a recovery in the U.S. automobile market.
The quotas were set at the current fiscal 1992 level of 1.65 million units.
The official warned legal action against imports would be particularly harmful to U.S. consumers. Motorcars exported from Japan accounted for 30 percent of all autos sold in the U.S. market last year, he noted.
An executive of one of Japan's largest automobile companies suggested the U.S. carmakers made their threat in hopes of winning concessions on prices
from their counterparts in Japan and Europe.
"It is doubtful that they will really take action," he said. "We have not committed any wrongdoing in the U.S. market and I don't think their criticism is reasonable."
He said the American Automobile Manufacturers' Association likely hopes to profit from some sort of protectionist action by the Clinton administration while applying pressure to automakers in Japan and Europe to raise the retail prices on cars they sell in the United States.