An agreement between Washington and the European Union in April gave negotiators until Oct. 15 to hammer out rules to deter foreign investments in properties nationalized by third countries without due compensation.
Under the accord, the EU agreed to halt its World Trade Organization challenge to the Helms-Burton Act, designed to punish foreigners who invest in properties seized by Cuba from U.S. citizens.
In return, the Clinton administration pledged to continue suspending
parts of Helms-Burton for six-month periods, and seek their revocation in
Congress if the EU agrees to rules that would make the law redundant. `We have problems'
Key among the snags is the U.S. insistence that the rules apply to past and future investments, while the EU favors hitting only future investments, the U.S. official said .
EU officials also want to require an international process to judge whether the nationalizations were improper before the rules can be applied. Washington opposes such complex and potentially dilatory procedures.
``We insist on having regimes that are effective and enforceable,'' the U.S. official added. ``There's obviously something wrong when Cuba can refuse to take part in this international process, and in that way evade the rules.''
Washington negotiators are also insisting on a much tougher level of rules and sanctions for countries that, like Cuba, ``show a pattern of lack of respect for property rights,'' said the U.S. official.
``For a country that has expropriated lots of property, where they did so in a manner clearly discriminatory against a people or a particular nation, or didn't offer any type of [legal] settlement procedures, we feel there should be enhanced and stronger disciplines,'' he added.
Also disturbing the talks, the U.S. official added, is the insistence by the 15 members of the European Union on having their own envoys at the talks held so far.
``It's three of us and 27 Europeans,'' the U.S. official said.
France has taken the most uncompromising positions so far, EU
officials said, but only partly because of the pro-Cuba policies of the
new French Socialist government headed by Prime Minister Lionel
Jospin. Many Europeans won't budge
Europe's trade with Tehran and Tripoli, where it buys the lion's share of its petroleum imports, amounts to hundreds of billions of dollars and far overshadows the continent's meager economic interests in Cuba.
EU officials have been arguing for months that recent steps taken by Europe to press Iran and Libya on terrorism merit a waiver of the sanctions threatened by the so-called D'Amato legislation.
And if Washington waives sanctions, EU officials said, Europe would find it easier to cooperate on the Helms-Burton talks. But the Clinton administration has made it clear that's not in the cards.
``What they have done on Iran and Libya is not enough,'' said the U.S. official participating in the negotiations. ``The Europeans should not be surprised that they will not get a waiver.''
Facing such bottlenecks, both U.S. and European negotiators said it will be tough to complete the negotiations by the mid-October deadline.
A deadlock might spur the EU to reactivate its challenge to Helms-Burton before the World Trade Organization, a fledgling group whose authority to set world trade policy could be crippled by the fight between the two economic titans.
Copyright © 1997 The Miami Herald