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The Bush administration on Tuesday bowed to a World Trade Organisation ruling and agreed to eliminate anti-dumping duties on imports from eight European steelmakers, including Mittal and Corus.

The decision is a significant victory for the European steel industry and for diplomats in Brussels who successfully challenged Washington’s anti-dumping rules in a range of cases involving products from chemicals to steel.

The move will severely limit Washington’s ability to protect politically sensitive industries and make it harder for US companies to seek anti-dumping duties against rivals. The announcement follows a WTO ruling that banned contentious methods used by the US to determine whether a company is dumping its goods on the US market.

The disallowed system – known as “zeroing” – allowed Washington to claim foreign companies were dumping goods on the US market even when they were being sold at a higher price than in their domestic market.

The decision was expected to clear the way for European companies to ramp up their imports of targeted goods into the US, trade lawyers said.

Lyle Vander Schaaf, an international trade lawyer at Brian Cave, said: “The ruling means that companies accused of dumping were in fact not guilty and in some cases will no longer have to pay punitive duties.”

But Mr Vander Schaaf said the decision issued by the Commerce Department appeared quite narrow in its interpretation of the WTO ruling and meant many steel companies would not get relief.

“Steel is a politically sensitive industry – and so while the Commerce Department has been forced to concede, it might begin looking for other ways to thwart imports,” he added.

Richard Cunningham, senior international trade partner at Steptoe & Johnson, said it was unclear if European companies would be able to reclaim the duties they had already paid out.

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