US faces China sanctions after WTO ruling 
2019-07-18
THE United States did not comply with a World Trade Organization ruling and could face Chinese sanctions if it does not remove certain tariffs that break WTO rules, the WTO’s appeals judges said in a ruling on Tuesday.
China went to the WTO in 2012 to challenge US anti-subsidy tariffs on Chinese exports including solar panels, wind towers, steel cylinders and aluminium extrusions, exports that valued at US$7.3 billion at the time.
The ruling said the United States must accept Chinese prices to measure subsidies.
China’s commerce ministry said the WTO appellate report proves the US “repeatedly abused trade remedy measures, which seriously damaged the fairness and impartiality of the international trade environment.”
The comments were posted late on Tuesday on the official website of the Ministry of Commerce.
Among the findings, the Appellate Body found that the US Department of Commerce had failed to explain, in several of the countervailing proceedings, “how government intervention in the market resulted in domestic prices for the inputs at issue deviating from a market-determined price,” underlining that “an investigator’s determination of how prices in markets are in fact distorted as a result of government intervention must be based on positive evidence.”
“China has always respected multilateral trade rules and opposed the abuses of trade remedy measures,” the statement said.
Bringing the case to the WTO was aimed at protecting China’s legitimate interests while maintaining the authority of the multilateral trade system and seriousness of rules, it added.
In recent years, the US abuse of anti-subsidy measures has severely hampered normal exports of Chinese products, the ministry said, urging the United States to take actions to create a fair and stable trade environment for businesses in both countries.
Under President Donald Trump, the United States has been blocking the process to appoint or reappoint members of the WTO’s Appellate Body, which is effectively the top court for world trade.
The Appellate Body normally has seven members and needs three to consider each case, but from December 11 it will have only one judge left, causing at least a temporary collapse, the European Union’s trade chief Cecilia Malmstrom has said.
If China seeks to bring sanctions in the dispute, it would need to enter a new round of legal argument over the value of any damage to its trade.
The dispute centered on 17 investigations carried out by the US Department of Commerce between 2007 and 2012.
The products concerned were solar panels, wind towers, thermal and coated paper, tow-behind lawn groomers, kitchen shelving, steel sinks, citric acid, magnesia carbon bricks, pressure pipe, line pipe, seamless pipe, steel cylinders, drill pipe, oil country tubular goods, wire strand and aluminium extrusions.
Shortly after the WTO ruling was released, US President Donald Trump said Washington could impose tariffs on an additional US$325 billion worth of Chinese goods if it needed to do so.
