China is to ask the World Trade Organisation to rule on its latest commercial spat with the United States, the WTO said on Tuesday, hoping it will back Beijing's complaint that punitive US tariffs imposed on a raft of Chinese goods are illegal.
In a move that deepened the dispute, China will ask the WTO to set up a three-person dispute panel at a meeting on November 30. If China wins the case and any subsequent appeal Washington could be forced to drop the tariffs it levied on 31 Chinese products which it said were being traded unfairly. The US tariffs affected photovoltaic cells and modules used in solar power, various steel products, off-road tyres, aluminium goods as well as towers for windfarms.
Such capital-intensive and cyclical commodity products have frequently been at the centre of trade disputes as national industries have asked governments to step in and stop foreign competition from destroying profits and jobs. Steel products have frequently been involved, as more recently have solar power components, with the oversupplied global solar industry struggling to maintain its profit margins.
The United States has been a fierce critic of what it says are clandestine Chinese subsidy programmes, but Beijing says Washington's efforts to tackle suspected wrongdoing have gone beyond the rules. China's complaint targets Public Law 112-99, which was signed by President Barack Obama in March, as well as US steps taken against suspected export-distorting subsidies between November 20 2006 and the passage of the contested law. In a WTO filing, China said the US law had broken the rules because it applied retroactively to suspected Chinese subsidies as far back as 2006.