FOR IMMEDIATE RELEASE	Contact:	Dara Klatt
October 26, 2005		The PBN Company
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		Paul Nathanson
		The PBN Company
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CITAC CONGRATULATES HOUSE WAYS & MEANS COMMITTEE
ON APPROVAL OF BYRD AMENDMENT REPEAL

Washington, DC — The House Ways and Means Committee today approved repeal of the Continued Dumping and Subsidy Offset Act, commonly known as the "Byrd Amendment" as part of a budget reconciliation package adopted by the Committee. The Reconciliation bill now heads to the House Budget Committee and the House floor.

"CITAC congratulates the House Ways & Means Committee for its courageous and important step toward repeal of the Byrd Amendment," said CITAC Executive Director Steve Alexander. "We also commend Ways & Means Committee Chairman Bill Thomas, and Subcommittee on Trade Chairman Clay Shaw and Rep. Jim Ramstad, who co-sponsored the legislation to repeal the Byrd Amendment, for their leadership on this important issue. They and their staff have exercised tremendous leadership in this effort."

"The Byrd Amendment is the ultimate combination of protectionism, corporate welfare and government waste," said Rep. Ramstad in a press release following the vote. "It costs taxpayers millions of dollars in subsidy payments and consumers millions in higher costs."

"CITAC has argued, and government studies support, that the Byrd Amendment is not only illegal under international trade rules, but it distorts competition here at home," said Lewis Leibowitz, CITAC Counsel and a partner at Hogan & Hartson LLP. "The Byrd Amendment does not compensate 'victims' of unfair trade, but puts large sums of money into the hands of a very small number of companies. The reconciliation vote in the Ways and Means Committee confirms that Congress has far more effective ways to spend public money."

On September 26, the Government Accountability Office (GAO) released the results of a comprehensive year-long review of the Byrd Amendment concluding that the law has benefited a handful of large companies (five companies received nearly 40 percent of the total distributions over four years) and that accountability for the accuracy of the almost $2 trillion in claims is virtually non-existent. The GAO concluded that the Byrd Amendment "undermines the effectiveness of trade remedies generally."

In the report, the GAO concludes that more than $1 billion of Byrd funds have been disbursed to a small number of U.S. companies with "mixed effects," with one company, the Timken Company and its subsidiaries (The Torrington Company and MPB Corporation), receiving 40% of total disbursements, or $395 million — nearly equivalent to the total amount received by 731 other companies during FY2001 — FY2004. Another top Byrd recipient is Candle-Lite ($56 million). In addition, the GAO report revealed that two-thirds of all Byrd payments went to only three industries, including bearings, candles, and steel.

The report concluded that accountability for the accuracy of claims for Byrd Amendment money is "virtually non-existent" and noted that companies making the largest claims generally receive the largest payments. An incentive is created for producers to claim as many expenses as possible as "qualified expenditures" relative to other producers so that their share of the funds available under a duty order is as large as possible. Only one company has been audited, showing that the expenses claimed by the company were substantially overstated.

In FY2004, qualifying expenditures were listed at almost $2 trillion and the program is facing a 10-fold increase in its claim processing, from 1,960 claims (FY2004) to almost 30,000 claims (FY2005). The $2 trillion in claims is equal to approximately 17% of the country’s total GDP.

The World Trade Organization (WTO) ruled in 2002 that the Byrd Amendment violates U.S. trade obligations. Congress’ failure to repeal the law has resulted in WTO-authorized retaliation against U.S. exports by Canada, the European Union, Japan and Mexico on products including baby formula, oysters, wine, dairy products, candy and chewing gum. Total retaliatory tariffs from these countries are approximately $114 million. However, approximately $3.7 billion is being held by U.S. customs in duties assessed against Canadian softwood lumber. Should these duties be distributed as Byrd payments, the level of Canada’s retaliation would skyrocket.

CITAC is a coalition of companies and organizations committed to promoting a trade arena where U.S. consuming industries and their workers have access to global markets for imports that enhance the international competitiveness of American firms.

For additional information, please contact Dara Klatt or Paul Nathanson at The PBN Company at .