U.S. postpones sanctions on European Community

March 20, 1993|By New York Times News Service

WASHINGTON -- Fending off a trade battle at least temporarily, the United States yesterday postponed plans to impose trade sanctions Monday on the European Community over rules that let public utilities favor European companies in making purchasing decisions.

In an unexpected about-face, Mickey Kantor, the U.S. trade representative, announced that he would delay the sanctions for at least eight days so that he could meet with EC trade officials in Brussels on March 29 to see whether the two sides could settle the dispute.

Mr. Kantor made the announcement after a morning meeting with Jacques Delors, the president of the EC's executive commission, who told President Clinton in a meeting Thursday that he was dismayed by the threatened sanctions.

At a news briefing yesterday, Mr. Kantor said, "President Delors made it clear to me that the EC will address constructively our concerns" at the meeting, at which Mr. Kantor will meet with Sir Leon Brittan, the community's commissioner for external economic affairs.

One U.S. official expressed satisfaction with Mr. Delors' willingness to address the administration's concerns. "That puts fair amount of burden on them to come forward" with further proposals, the official said.

Sen. John C. Danforth, a Missouri Republican, said he was disappointed that Mr. Kantor had backed down from pushing through sanctions Monday. "After this sort of retreat, what little credibility the U.S. might have enjoyed with the EC has been destroyed, or nearly destroyed," Mr. Danforth said.

On Feb. 1, Mr. Kantor announced Washington's plans to retaliate by banning companies from the 12 community nations from bidding on almost $50 billion a year in contracts with Washington.

The abrupt postponement was a surprise. It came three hours after Mr. Kantor's office scheduled a Monday morning news conference to announce the sanctions.

In a speech in Washington to the European Institute, Mr. Delors said the threatened retaliation would have "bad consequences in Europe" and "would reinforce the protectionist camp" within the community.

European officials said that at the March 29 meeting, they would seek to get the two sides to agree to analyze both sides' procurement rules to see where they were discriminatory and then seek a settlement.

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