By Berta Gomez
Washington File staff writer

Washington -- U.S. Trade Representative Robert Zoellick is again urging Congress to pass legislation to bring the United States into compliance with World Trade Organization (WTO) rulings against corporate tax breaks for exporters.

In testimony February 26 before the House of Representatives Ways and Means Committee, Zoellick noted that a series of WTO rulings against the Foreign Sales Corporation (FSC) and its successor Extraterritorial Income (ETI) Act mean that the United States faces possible European Union (EU) sanctions on more than $4,000 million worth of U.S. exports a year.

Earlier that day, the EU released a list of potential U.S. products that would be subject to the retaliatory tariffs.

Asked to comment on publication of the list, Zoellick said he believed the EU was less interested in retaliation than in U.S. compliance and urged Congress to move quickly on the issue.

"Personally, I think the EU will hold off for a while, but I don't know for how long," Zoellick said. "We have got to get this fixed."

Some members of the committee expressed concern that certain U.S. exporters -- struggling amid a still-sluggish global economy -- would be further harmed by legislation that would effectively raise their taxes. While Zoellick did not respond directly, he did underline that U.S. businesses and consumers would certainly be affected by any retaliatory tariffs.

Moreover, he said, it is important for the United States to "live up to its obligations under WTO rules."

On another EU issue, Zoellick gave no further clue about whether the administration was preparing to file a WTO challenge to the EU's four-year moratorium on approvals of agriculture products produced by biotechnology for import into Europe.

"The administration, leaders of Congress and our agriculture community have made clear that we believe the EU should lift its moratorium on biotech products," Zoellick said in his prepared testimony. "We are working with others to determine the most expeditious way to get it to do so."

Zoellick also told committee members that the texts of two recently negotiated bilateral free trade agreements (FTAs) should be available for public release within weeks. The U.S.-Singapore FTA text should be ready by early March, and the U.S.-Chile FTA document by early April, he told legislators, some of whom expressed impatience with what they described as the Bush administration's unnecessary delays in making the agreements public.

The Chile and Singapore agreements were the first to be negotiated by the Bush administration under the Trade Promotion Authority (TPA) legislation passed by Congress in 2002.