GENEVA - The United States launched an appeal Wednesday in a dispute with Japan at the World Trade Organization over its treatment of unfairly-priced imports.

The appeal marks another attempt by the United States to defend zeroing, its controversial method of dealing with imports it says are dumped -- sold for less than they cost at home.

The United States is the only one of the WTO's 153 members still to support the method, which has been repeatedly condemned by the WTO's highest court.

Only last Thursday the court, the Appellate Body, told the United States it must comply with previous rulings in another case involving zeroing that Washington was contesting with the European Union.

The WTO's Dispute Settlement Body had been due to discuss an April 24 report that found the United States failed to comply with an earlier ruling in the case, originally involving imports of Japanese bearings, which the United States had argued were dumped.

But the chairman of the body, Canada's WTO ambassador John Gero, told the meeting the item was being removed from the agenda because the United States was appealing.

April's finding by a WTO compliance panel had cleared the way for Japan to seek up to $250 million a year in retaliation against U.S. imports.

Japan has said it reserves the right to seek sanctions against the whole range of U.S. goods, not just bearings.

Washington had objected to the amount of retaliation sought by Japan and the matter had gone to arbitration, though this was suspended pending resolution of the compliance case.

WTO rules allow members to impose compensatory levies, known as anti-dumping duties, on goods that are dumped, provided they are also shown to injure businesses in the importing country.

Critics say zeroing artificially inflates these duties by ignoring in the calculation cases where the imported goods actually cost more than they do at home.

In another dispute, involving zeroing in U.S. anti-dumping duties on imports of Mexican stainless steel, the two countries told the dispute body they had reached an agreement to negotiate further, following the expiry of a WTO deadline at the end of April for the United States to comply with rulings in the case.

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