Jan. 11 (Bloomberg) -- Japan wants the World Trade Organization to authorize retaliatory measures against the U.S. over a calculation that inflates import duties, saying the Bush administration is ignoring global trade rules.

Japan will ask WTO judges on Jan. 21 to permit sanctions of up to $250 million in the first year to punish the U.S. for not complying with an earlier ruling saying ``zeroing,'' a method of calculating foreign exporters' dumping margins, is illegal. The U.S., which announced in December 2006 that it would eliminate zeroing, was to have complied with the WTO's decision on the Japanese case by Dec. 24.

``Given the status of implementation of the recommendation and rulings, which found that the zeroing measures are inconsistent with the WTO agreement, we have to reserve our right to retaliate,'' Koji Saito, a Japanese diplomat in Geneva, said by telephone today.

Had the U.S. not used zeroing, duties imposed on products made by Kawasaki Steel Corp., now known as JFE Steel Corp.; Koyo Seiko Co., now JTEKT Corp.; NTN Corp.; NSK Ltd., and Asahi Seiko Co. would have been lower or non-existent, Japan has said.

Zeroing considers the difference between the price of a product in its home country and in the U.S., except when the item is sold at a higher price in the U.S. The result is higher anti- dumping duties on products such as steel, paper and textiles.

Value of Sanctions

Such duties aim to protect domestic manufacturers from competition from goods sold more cheaply in their country than in the country of origin.

The value of the sanctions ``will go up or down, depending on the degree of application of the U.S. of the zeroing measures,'' Saito said. Japan hasn't decided which products will be targeted but retaliation will be limited to goods, he added.

In a series of WTO cases, judges have sided with Canada, Thailand, the European Union and India in their complaints against zeroing.

In November, the Bush administration said it would ask other WTO governments to allow it to use zeroing, saying any agreement in global trade talks must permit the methodology.

To contact the reporter on this story: Jennifer M. Freedman in Geneva at jfreedman@bloomberg.net .