The World Trade Organization on Wednesday said China could slap duties on $645 million worth of US imports per year, in a long-running anti-dumping dispute with Washington.
The US, which is unable to appeal against the decision, branded it “deeply disappointing” and said it reinforced the need to reform the WTO’s rules, saying they were being used to “shield” China.
“In light of the parties’ arguments and evidence in these proceedings, we have determined that the appropriate level… is $645.12 million per annum,” a WTO arbitrator ruled.
The WTO green light does not mean China will automatically impose the tariffs.
The figure was revealed in an 87-page decision by a WTO arbitrator on the level of countermeasures Beijing could request in its dispute with Washington.
The issue is US countervailing duties on certain Chinese products.
The dispute stretches all the way back to 2012, when the WTO set up a panel of experts to try to settle a complaint filed by China over what it said were unfair duties imposed by the US.
Washington had justified the additional tariffs on products ranging from paper to tyres and solar panels, arguing they were being dumped on the market to help Chinese companies grab business.
The WTO Dispute Settlement Body ruled in China’s favour and the ruling was upheld by its appeals judges in 2014, paving the way for China to retaliate.
Beijing initially asked to be permitted to slap tariffs on $2.4 billion of US products each year, but then scaled back its demand to $788.75 million.
Washington had argued that the appropriate level should not exceed $106 million per year.
The use of anti-dumping duties are permitted under international trade rules as long as they adhere to strict conditions, and disputes over their use are often brought before the WTO’s Dispute Settlement Body.
Adam Hodge, a spokesman for the US Trade Representative, lashed out at Wednesday’s ruling.
“The deeply disappointing decision today by the WTO arbitrator reflects erroneous Appellate Body interpretations that damage the ability of WTO members to defend our workers and businesses from China’s trade-distorting subsidies,” he said.
- AFP, with additional editing by George Russell