Burma Shield World Trade Giant Challenges Massachusetts Law

On July 4, the Japanese government and the European Commission (EC) unveiled plans to challenge US sovereignty before the World Trade Organization (WTO). At issue: a Massachusetts law that penalizes companies doing business with Burma.

Massachusetts, in an effort to put pressure on Burma's brutal military dictatorship, enacted a selective purchasing law on June 26, 1996 that imposed a pricing penalty on state procurements from firms that contract with Burma.

The EC claims that the purchasing law violates a WTO provision barring the use of "political" criteria in granting federal and state procurement contracts. EC spokesperson Ella Krucoff explained that, under WTO rules, the Massachusetts restriction is unfair "to the trade and investment community." Apparently, doing business with dictators is fair.

Disappointed with Washington's failure to crack down on Massachusetts, Japan and the EC have vowed to file a complaint against the law before the WTO, the Geneva-based international trade tribunal.

On June 19, the EC (the executive branch of the European Union) requested formal consultations with the US about the Massachusetts law under the WTO's dispute settlement procedures. These consultations are the final step before the dispute goes before a WTO tribunal. (Ironically, in June, the 626-member European Parliament called unanimously for the EC to abandon its attack on Massachusetts. The call went unheeded by EC Vice President Sir Leon Brittan.)

Modeled after earlier legislation boycotting trade with the apartheid government of South Africa, the Massachusetts law has encouraged several corporations to withdraw from Burma, including Apple Computer, Eastman Kodak, Hewlett-Packard, Obayishi of Japan and Philips Electronics of the Netherlands.

One Japanese official, apparently ignorant of the states' rights provisions of the US Constitution, told Japan Times that Japan would give the US government one week to "abolish" the Massachusetts law.

Under pressure from corporations affected by the law (including several European-based oil companies), the EC and Japan hope to use the WTO to defeat the Burma ban and a similar law enacted in New York.

Aung San Suu Kyi, leader of the Burmese democracy movement, supports the Massachusetts law and contends that such laws are an effective means of pressuring the Burmese military to restore democracy.

Multinational Monitor reports that the WTO threat parallels a new thrust by the National Association of Manufacturers, a US business lobby, to eliminate all laws that sanction trade for political, environmental or moral causes. In March, United Technologies testified against a Burma bill in Connecticut and UNOCAL has opposed a similar bill in Texas.

Washington-based Inside US Trade quotes US Commerce Secretary William Daley as saying the Clinton administration shares "the same concerns" on the Massachusetts law and has encouraged the business community "to make their views known."

This is the way the New World Order works. If Massachusetts buckles, the WTO may next set its sights on a new target - Burma sanctions passed by a number of US cities including, Berkeley, Santa Monica, San Francisco, Oakland, Boulder, Ann Arbor, Madison, Chapel Hill and Takoma Park.

What You Can Do: Write to US Trade Representative Charlene Barshefsky, 600 17th St. NW, Washington, DC 20508. Ask your elected representatives to urge Barshefsky to defend the Burma bans. For information on enacting selective purchasing laws in your home state, contact Simon Billenness at sbillenness@frdc.com, or the New England Burma Roundtable, c/o Franklin Research & Development, 711 Atlantic Ave., Boston, MA 02111, (617) 292-8026, ext. 225.