The World Trade Organization confirms the U.S. is requesting consultations with China under the group’s dispute-settlement system regarding antidumping duties imposed by the Chinese on some American-built vehicles.
The request for consultations is the filing of a complaint that initiates a dispute within the WTO. Consultations give the parties an opportunity to discuss the matter and to find a satisfactory solution without proceeding further with litigation.
The antidumping duties come as General Motors, Ford and Chrysler, as well as other foreign auto makers, accelerate exports to the world’s largest vehicle market.
The WTO says in a statement that after 60 days, if consultations fail, the complainant may request adjudication by a panel.
U.S. Trade Representative Ron Kirk says the U.S. challenge is against China’s slapping of duties on more than $3 billion worth of U.S.-produced cars and SUVs with an engine capacity of 2.5L or larger.
Kirk calls the duties on the 92,000 vehicles, or 80% of U.S. vehicle exports to China, unfair and says they appear to represent yet another abuse of trade remedies by the Chinese government.
“As we have made clear, the Obama Admin. will continue to fight to ensure that China does not misuse its trade laws and violate its international trade commitments to block exports of American-made products,” Kirk says in a statement.
“American auto workers and manufacturers deserve a level playing field, and we are taking every step necessary to stand up for them.”
The U.S. suggests the Chinese move is in retaliation after President Obama in September 2009 imposed a safeguard measure against China’s tire imports.
The China Ministry of Commerce then announced it would initiate antidumping- and countervailing-duty investigations of imports of American-made cars and SUVs.
The ministry issued a decision in May of last year finding that imports of such vehicles had been sold at less than fair value on the Chinese market and also had benefited from local subsidies, referring to the U.S. government bailouts of GM and Chrysler.
China initially suspended imposing duties. But last December, the government announced both antidumping and countervailing duties on the vehicle imports.
The antidumping duties range from 2.0% to 8.9%, with an “all others” rate of 21.5%. The countervailing duties range from 6.2% to 12.9%, with an “all others” rate of 12.9%.
A statement from the Office of the U.S. Trade Representative says the U.S. believes China initiated the investigations without sufficient evidence, failed to objectively examine the evidence and made unsupported findings of injury to its domestic industry.
“In addition, China failed to disclose essential facts underlying its conclusions, failed to provide an adequate explanation of its conclusions, improperly used investigative procedures and failed to require non-confidential summaries of Chinese company submissions.”
