China, India win WTO ruling against US

GENEVA — The United States broke global trade rules by slapping import duties on Indian steel products, a World Trade Organisation (WTO) panel ruled on Monday, calling on Washington to fall into line.

A WTO dispute settlement panel, said Washington had “acted inconsistently” with  regulations set down for the international body’s 160 member economies.

“We conclude that the United States has nullified or impaired benefits accruing to India,” said the panel, which is made up of independent trade and legal experts. “We recommend the United States bring its measures into conformity with its obligations.” 

India filed its complaint at the WTO in 2012, after Washington imposed duties of nearly 300 per cent on imports of products including steel pipes.

The United States applied the duties because it felt Indian steel manufacturers were benefitting from unfair subsidies.

WTO members are allowed to impose so-called countervailing duties — a special import tax — if they believe that their domestic manufacturers are being hurt by subsidies granted by a trade partner to its companies.

The WTO regulations require the importing country to first conduct a detailed investigation that shows properly that domestic industry is hurt.

Legal sparring over the scope and depth of such investigations, and the legitimacy of subsidies and countervailing duties is commonplace at the WTO.

The WTO polices global trade accords in an effort to offer its member economies a level playing field.

Its panels can authorise retaliatory trade measures by the wronged party if its rival fails to fall into line.

It disputes process can last for years however, owing to appeals, counter-appeals and compliance assessments.

Monday’s ruling was the first by the WTO panel in the steel case and Washington has the right to appeal.

Also on Monday, Beijing won a key victory in a trade dispute with Washington, as a WTO panel said the United States was wrong to slap punitive duties on a host of Chinese goods.

The battle covered an array of products including paper, steel, tyres, magnets, chemicals, kitchen fittings, flooring and wind turbines.

The United States had hit them with extra import duties because it argued that they were being dumped on its market to help Chinese companies grab business.

China filed a complaint over the measures at the WTO in 2012.

A WTO dispute settlement panel on Monday said that the US duties were “inconsistent” with global rules.

“They have nullified or impaired benefits accruing to China,” said the panel, which is made up of independent trade and legal experts. “We recommend that the United States bring its measures into conformity with its obligations.” 

In a statement issued by its diplomats at the WTO, China’s ministry of commerce hailed the decision, noting that the annual export value of the affected products was around $7.2 billion.

“China urges the United States to respect the WTO rulings and correct its wrong doings of abusively using trade remedy measures, and to ensure an environment of fair competition for the Chinese enterprises,” it said.

Washington has the right to appeal against the ruling, which was the first in the case.