394.31/12–2151: Telegram
The Chargé in Belgium (Millard) to the Secretary of State
confidential
Brussels, December
21, 1951—5 p. m.
854. Re Deptel 897 [899?], Dec. 19. Belg Govt preparing note recording its reaction to Art 19 action on Hatters furs. Preliminary draft of note shown to Emb rep. Highlights summarized below:
- 1.
- Belg Govt does not agree acts brought out in TC report justify Art 19 action.
- 2.
- Belg Govt has hoped strictest interpretation wld be applied to Art 19 to keep reversal of GATT concessions to minimum.
- 3.
- Belg Govt regrets conditions justifying modification under US TA extension act not same as under Art 19.
- 4.
- US Govt urged to reconsider decision and not invoke Art 19 in this case.
- 5.
- If US Govt finds it necessary to modify concession under Art 19 notwithstanding Belg representations, Belg Govt urges modification be made in manner strictly limiting applicability to duration of distress in industry and that concession be reinstated as soon as condition of industry permits.
- 6.
- Belg Govt reserves rights under Art 19 to seek compensation.
Emb comments on foregoing points:
- 1.
- Neither TC report data nor Emb arguments have persuaded Belg Govt that increased imports have significant share in causes for unfortunate condition of US industry. (Belg statistics reports to US for year 1950—123 tons $360,000 and for 10 months 1951—28 tons $100,000.) Belg assessment appears to be dominated by relative importance US production compared with imports and possibility industry wld be in poor condition irrespective of imports.
- 2.
- Belg officials attach great importance to strict interpretation Art 19 to discourage its use.
- 3.
- No comments.
- 4.
- So far as GATT arguments for deferring action or recommending no action on TC recommendation are concerned, Emb believes Belg reaction might be considered representative of CP reaction because based entirely on GATT principles.
- 5.
- Definite commitment of US to reinstate concession as soon as possible wld greatly influence Belg attitude toward action and reduce risk of them later asking compensation. Cassiers suggests quar[terly] renewable terms to assure periodic reconsideration, particularly in view his expectation that that body concession withdrawal will shortly benefit US Hatters fur industry. Emb wld appreciate prompt info whether eventual reinstatement wld be automatic or wld require hearings, etc.
- 6.
- Le Ghait indicates in general terms if compensation eventually sought it will probably be in form of withdrawal of Belg concession (of comparable value and affecting as few third parties as possible) for period limited to duration of US withdrawal.
Millard