WTO Grants China Request for Panel on US Tariffs

U.S. Section 301 tariffs on Chinese goods, retaliation over U.S. Section 232 metals duties and continued disagreements over Appellate Body appointments highlighted a Jan. 28 meeting of the World Trade Organization's (WTO) Dispute Settlement Body (DSB). China's second request for a dispute panel to rule on U.S. Section 301 duties imposed on Chinese imports was granted. The issue gets at the heart of the ongoing U.S.-China trade war as the U.S. Section 301 report faulting Chinese practices on intellectual property and technology transfer kicked off the now heated dispute between the two nations. The U.S. "unilateral determination" under Section 301 of the Trade Act of 1974 to collect "25% additional duties on approximately $34 billion of Chinese imports" and "10% additional duties on approximately $200 billion of Chinese imports" is "a blatant breach" of its WTO obligations, China said. The U.S. move "is posing a systemic challenge to the multilateral trading system," it added. China stressed the "urgency" of addressing the dispute, saying the U.S. actions continue "to damage China's legitimate economic and trade interests." China rejected U.S. allegations it routinely flaunts international trade rules. "China's action Monday by resorting this dispute to the WTO dispute settlement system reaffirms our strong support to the rules-based international trading system and is helping to strengthen the viability of the system," China remarked. The U.S. slammed China's move and alleged "China intends to do, and is doing, great damage to the international trading system" through its use of "grossly unfair and trade-distorting forced technology transfer policies and practices and through this unfounded" dispute panel request. "China seeks to use the WTO dispute settlement system as a shield for a broad range" of its policies and practices "not covered by WTO rules," and in doing so "is threatening the overall viability of the WTO system," the U.S. said. Meanwhile, the U.S. dismissed China's argument that the U.S. tariffs were "unilateral" and "WTO-inconsistent," noting China responded in kind with "discriminatory duties on over $100 billion in U.S. exports." China's actions and self-contradictory arguments suggest it "is not serious about addressing the legitimate concerns of its trading partners over Chinese technology transfer practices that no one could describe or defend as fair," the U.S. concluded.