The World Trade Organisation's top court upheld on Friday some Chinese objections to a ruling that had backed the right of the United States to impose extra duties on Chinese goods that Washington said unfairly priced and subsidised. In particular the appellate body supported China's argument - rejected by the original dispute panel - that the imposition of such a double penalty broke WTO trade rules.
The case turned on the treatment of goods from a country that is not a market economy and where the state influences prices. China hailed the ruling and called on the United States to end the way it calculated anti-dumping duties on unfairly priced goods and countervailing duties on subsidised products.
"The WTO has conclusively established that the United States acts unlawfully in the methods by which it calculates and imposes countervailing duties on imports from China," a Chinese government statement said. It said the ruling confirmed its argument that the use of a non-market economy method to calculate anti-dumping duties resulted in an illegal double penalty when applied together with countervailing duties on subsidies.
US Trade Representative Ron Kirk said he was disappointed with the appeal court's verdict. "I am deeply troubled by this report," Kirk said in a statement. "It appears to be a clear case of overreaching by the Appellate Body. We are reviewing the findings closely in order to understand fully their implications." The original ruling published on October 22 had backed the right of an importer to set duties on goods from non-market economies to compensate for unfair pricing and subsidies - something previously struck down by a US court.