European Union ministers appear to have taken a step toward defusing a steel trade spat with the United States by delaying a final decision on whether to retaliate against US tariffs.
The move gives the Bush administration more time to avoid EU sanctions on $300 million worth of US goods in response to hefty new US tariffs on steel imports.
EU foreign ministers voted today to delay a decision on retaliation until at least late July, and possibly October, to give the United States more time to address their concerns.
The EU had threatened to retaliate by as early as June 18 if the United States did not pay compensation for the tariffs by lowering duties on other European goods.
Brussels and other trading partners also have challenged the tariffs at the World Trade Organisation.
US President George W. Bush imposed the duties in March to help the US steel industry get back on its feet after a string of more than 30 bankruptcies since 1997.
US officials say tariffs are legal under the WTO Safeguards Agreement, which allows countries to take temporary measures to shield their producers from a surge in imports, and have so far ruled out paying compensation.
But the Bush administration has moved up its timetable for deciding whether to exempt certain foreign steel products from the tariffs, which range from eight to 30 percent.
On Friday, the Bush administration exempted 61 products representing about 136,000 metric tons of steel - or roughly 1 percent of the 13 million tons affected by the tariffs.
The US Commerce Department plans to announce several more batches of steel product exemptions by July 3, as it works its way through slightly more than 400 remaining requests. It will then begin considering another 800 exemption requests filed later in the process.
The plan approved by the EU ministers on Monday requires the European Commission - the executive body of the EU - to report by July 19 on the progress of talks with Washington. If there is no progress by then, EU ministers will decide by August 1 whether to go ahead with sanctions.