Chairman, Section 301 Committee
Attn: Implementation of WTO Recommendations
Room 100
600 17th Street, NW
Washington, DC 20508

Re: Dockets No. 301-62a and 301-100a

Dear Chairman of the Section 301 Committee:

The Food Marketing Institute (FMI) is pleased to respond to the Office of the U.S. Trade Representative’s (USTR’s) request for written comments regarding the possible modifications to actions taken by the United States as a result of the European Communities’ (EC) failure to implement the recommendations and rulings of the World Trade Organization (WTO) Dispute Settlement Body in the proceedings regarding the EC’s ban on imports of U.S. meat from animals treated with hormones and the EC’s regime for the importation, sale, and distribution of bananas. 65 Fed. Reg. 34786 (May 31, 2000).

For your information, FMI is a non-profit association that conducts programs in research, education, industry relations and public affairs on behalf of its 1,500 members and their subsidiaries. Our membership includes food retailers and wholesalers, as well as their customers, in the United States and around the world. FMI’s domestic member companies operate approximately 21,000 retail food stores with a combined annual sales volume of $300 billion, which accounts for more than half of all grocery sales in the United States. FMI’s retail membership is composed of large multi-store chains, small regional firms, and independent supermarkets. Our international membership includes 200 members from 60 countries.

FMI and its members remain very concerned about the current agricultural trade dispute with the EC and the potential for the escalation of retaliatory sanctions from both sides that may eventually threaten basic agricultural trade. We also remain concerned that the products selected for sanctions bear little or no relationship to the products in actual dispute. The lack of direct connection with the actual problem means that American consumers will not understand why popular products with no effective substitutes are no longer available to them for no apparent reason.

FMI continues to oppose the imposition of high tariffs on food and floral products. Increased duties will have an adverse impact on consumers because the additional tariffs are likely to result in fewer choices and/or higher prices on the products that are subject to the sanctions. Some retailers will be unable to provide the products; other may, but the increased costs will be passed on to consumers.

Given the broad list of products upon which the USTR proposes to impose further duties, the grocery, meat, floral and produce departments of supermarkets would be adversely affected, as well as the ethnic or “international” sections that many food retailers now offer. Our members have advised that the listed products that are likely to be of greatest significance to consumers and supermarkets are: Holland tomatoes, Roquefort cheese, Danish hams, chestnuts, onions, prepared mustards, mineral waters and aerated waters, canned soups and broths, chocolate and other cocoa preparations, prepared or preserved tomatoes (including paste and puree), cut flowers and flower bulbs, and foliage and branches. Furthermore, consumers who have traditions of using certain foods, such as chestnuts, lingonberry or raspberry jam, or Dijon mustard, to prepare authentic family meals, would be adversely impacted if the foods are not available from other suppliers.   

In sum, FMI requests that the above mentioned products be removed from the list of products that will be subject to the additional duties. We appreciate your consideration of our comments on this matter.

Sincerely,

Tim Hammonds
President and CEO