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China has requested dispute settlement consultations on anti-dumping and countervailing duties imposed by the United States on its exports of several types of steel products, off-road tyres and woven sacks. One of the aspects challenged by China was that US authorities had used the controversial method of ‘zeroing’ in the calculation subsidy benefits and had failed to ensure a fair comparison between the export price and normal value when determining dumping margins. It also said the US had failed to make a determination that China ‘entrusts or directs’ state-owned enterprises to provide WTO-illegal subsidies to producers of these goods. If the case cannot be resolved through consultations, China will have the right to request a dispute settlement panel in the latter half of November.
According to the WTO, Members initiated 37 new anti-dumping investigations on Chinese exports in the first six months of 2008. In the same period, thirteen new anti-dumping measures were imposed on Chinese goods. The figures represent about half of all anti-dumping actions taken by WTO Members between January and June 2008.
As expected, China has appealed the 18 July panel ruling, which found that the application of higher import duties (25 instead of 10 percent) on auto parts if they account for more than 60 percent of a vehicle assembled in China was inconsistent with the country’s scheduled tariff commitments. Complainants EU and US had charged that the differentiated tariff was designed to bolster the defendant’s domestic auto part industry and to encourage foreign manufacturers to relocate production in China. Chinese authorities, however, claimed the measure was aimed at preventing tax avoidance by auto dealers who import cars in parts rather than fully assembled in order to pay a lower import duty. The Appellate Body should issue its verdict within three months of appointing the three judges who will hear the case.
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