BEIJING, Jan. 30 (Xinhua) -- The World Trade Organization (WTO) decided earlier this week that China has won a decade-old trade dispute case over U.S. anti-subsidy duties on Chinese goods.
China could impose tariffs on imports from the United States totaling up to 645 million U.S. dollars a year, the sixth-highest amount in the history of the WTO Dispute Settlement Body, as Washington has failed to implement previous WTO recommendations and rulings, according to the global trade body on Wednesday.
Following are some key takeaways and implications of the WTO ruling:
THE MOST EXTENSIVE CASE
The case dates back to May 2012, when China filed a complaint with the WTO over U.S. anti-subsidy measures on Chinese oil-well pipes and other products, claiming that such steps were against regulations of the world trade body.
The WTO has ruled in favor of China on the core issue, but the United States did not fully implement the WTO ruling and continued to impose anti-subsidy measures on some products.
"This is the most comprehensive case among all WTO disputes involving China, as it has gone through multiple stages in the WTO dispute settlement process," said Ji Wenhua, a law professor with the University of International Business and Economics.
The ruling is of great significance for rectifying U.S. countervailing duties on imported Chinese goods, protecting the legitimate trade interests of Chinese companies and safeguarding multilateral trading systems, said a statement by the commerce ministry.
Ji said the success gives China more experience in defending sovereignty and interests with international legal proceedings, and is an important example of the country's continuous engagement in the international rule of law.
"The key to winning the case is the spirit of the rule of law, which is reflected in challenging U.S. violations of WTO rules with WTO rules," said Zhang Yuejiao, former chair and judge of the WTO Appellate Body.
China's victory has dealt a heavy blow to the abuse of trade remedies by certain importing countries, defended the legitimacy and impartiality of WTO rules, and protected the authority and effectiveness of the multilateral trading system, Zhang said.
BARGAINING CHIP
Wednesday's ruling marks the second time that the WTO authorized China to impose retaliatory tariffs on the United States. In 2019, the WTO allowed China to seek approximately 3.579 billion U.S. dollars in countermeasures against the United States in a dispute over anti-dumping measures.
"Trade retaliation is not the ultimate goal. Rather, the ruling can be used to urge the losing party to correct its wrongdoings," Ji told Xinhua.
With the right to retaliate as "a bargaining chip" in hand, China has won the initiative in the matter, he said.
Zhang said that the WTO Dispute Settlement Body works as an effective deterrent to rule-breaking practices, which is why people say the body has "teeth."
The ruling is legally binding on the parties involved, said Zhang, explaining that the complaining party can initiate review procedures and impose retaliatory tariffs under WTO authorization if the losing party fails to implement the decision within the set timeframe.
"We will pay close attention to the follow-up enforcement actions that the United States will take, and reserve the right to take further actions for safeguarding the multilateral trading regime," Gao Feng, a spokesperson with the commerce ministry, told a press briefing following the issuance of the decision.
U.S. NOT A ROLE MODEL
For Ji, the case is another evidence that there are long-standing, persistent and massive practices on the U.S. part that run counter to WTO rules.
"The United States is not a model to follow in terms of implementing WTO rulings or fulfilling international obligations," Ji noted, adding that Washington should honor its WTO commitments and observe rules before finger-pointing.
From 2010 to 2020, there were 759 anti-dumping and 159 countervailing investigations launched against China, data showed. Among them, 87 anti-dumping and 81 countervailing investigations were filed by the United States.
Commenting on China's application of rules in the case, Li Zhenghao, partner at law firm King & Wood Mallesons, said the use of rules is a demonstration of respect for and trust in the multilateral trading regime.
In addition to safeguarding its own rights and interests, China has, with its concrete actions, supported the multilateral trading system and opposed the practice of turning a blind eye to multilateral rules, showing its sense of responsibility as a major country, Li said.
Despite COVID-triggered shocks, China-U.S. trade volume hit a record high in 2021, highlighting the deep economic interdependence and trade dependability between the two sides. But additional tariffs imposed on Chinese products would translate to higher costs for U.S. consumers and further fuel domestic inflation.
While urging the United States to immediately stop unfair practices and discard unilateralism and trade protectionism measures, experts suggested that the country should seek win-win solutions through equal and mutually beneficial consultations with China. ■
