WTO rules against US in pre-trade war dispute with China
By Caoimhe Toman
Date: Wednesday 17 Jul 2019
(Sharecast News) - The World Trade Organization said some US tariffs on Chinese goods do not comply with its rules and that it will authorise retaliatory sanctions.
The ruling, which was made public on Tuesday, is linked to a case that predates the trade war between Washington and Beijing.
China lodged the case in 2012 after the US imposed tariffs in response for what it said were unfair subsidies on Chinese state-owned companies that were hurting American jobs.
Revealing his displeasure, the US Trade Representative said the ruling undermined its own rules "making them less effective to counteract Chinese SOE subsidies that are harming U.S. workers and businesses and distorting markets worldwide."
The USTR also said the US "is determined to take all necessary steps to ensure a level playing field" with China.
The decision by the WTO's appellate body didn't go wholly China's way. The body agreed with the US that China helps its component manufacturers in such a way that allows them to supply the country's industrial firms at an unfairly low cost.
But the US had miscalculated what the fair size of retaliatory measures to punish China for those subsidies should be. If the US did not recalculate them, then China would be allowed to retaliate with its own sanctions.
China's commerce ministry said the ruling proved the US "repeatedly abused trade remedy measures, which seriously damaged the fairness and impartiality of the international trade environment."
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