COPY.
Our ref: CRE 17493/2/G Your ref: EG 3/103/1
EG 2/21
CONFIDENTIAL
Dear Mellor,
BOARD OF TRADE,
Commercial Relations & Exports Dept.,
1, Victoria Street, London, S.W.1.
7th November, 1967.
Your letter of 27th October about the Hong Kong Government's reactions to the new Austrian anti-dumping legislation.
We had already noted that this legislation, like its predecessor, contained features which were prima facie incompatible with Article VI of the G. A.T.T. and have registered our dislike of it with the Austrian Government. In reply, the Austrians said that the new law was primarily intended to cope with low-priced rather than dumped imports; it would be sparingly applied and not used against properly priced exports from countries such as the United Kingdom. The desirability of extracting a firm assurance from the Austrian Minister concerned that the law will not be applied against British exports in a manner inconsistent with Austria's international obligations is now being considered, and if it is decided to proceed in this way it could be explained that British exports mean those of all territories for which the United Kingdom has responsibility in the G. A.T. T.
Strictly for your own information, we have preferred to pursue this matter on a bilateral plane with the Austrians, rather than multi- laterally through EFTA or G.A. T. T., because we suspect that a main obj- ective of the new Austrian law is protection against low-priced imports of textiles from Portugal. The United Kingdom has also suffered from Portuguese textile exports but we have been able to persuade the Portuguese voluntarily to restrain the extend of these exports to us. The terms of this bargain are not strictly in accordance with the Stockholm Convention and its existence has not been acknowledged by either side. The Austrians, however, are aware of it and any initiative on our part to take them to task publicly on their new anti-dumping law could provoke them into raising the whole question of protection against low cost imports from Portugal in a form embarrassing to us. We should therefore be reluctant to take the initiative in drawing attention to the Austrian law in the G.A.T.T.
For the reasons indicated, we should prefer not to discuss the Portuguese complication with representatives of the Government of Hong Kong. We could tell them however that we have already protested informally to the Austrian Government and are considering a more formal approach. The Hong Kong interest will be borne in mind in that connection. Some of the un-G.A. T. T. worthy features of the new law have simply been carried over from the previous legislation which was in force some years but not criticised in the G. A. T. T. We should not therefore feel justified in directing attention to the new measure in the G. A.T.T.; nor would we wish to take the initiative in pillorying an EFTA partner in the G. A. T.T. Nevertheless if other countries criticise the new law we shall be willing to associate ourselves with any general expressions of disapproval. If an actual case occurs of the new
Austrian law being applied to Hong Kong's exports in a manner contrary to Article VI, we shall naturally be very willing to consider with the Hong Kong authorities the appropriate form of counter action.
The other question raised in your letter, namely Italian requirements for Certificates of Origin, is not one for me but I have arranged for it to be looked into and will let you know the result in due course.
Yours sincerely,
D. Mellor, Esq.,
Commonwealth Trade Department,
Commonwealth Office,
Downing Street,
LONDON, S. W. 1.
(Sgd.)
M. G. Petter.
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