United States wins WTO car import ruling against China

PUBLISHED : Saturday, 24 May, 2014, 1:52am
UPDATED : Saturday, 24 May, 2014, 2:21am

The World Trade Organisation (WTO) has ruled in favour of the United States in a dispute with China involving cars, two years after America filed complaints against it, according to a person familiar with the matter.

The US was set to announce the victory in Washington yesterday, according to the source, who requested anonymity. Officials from the Chinese Embassy in Washington did not immediately respond to a request for comment.

President Barack Obama's administration in 2012 lodged a complaint with the Geneva-based WTO challenging Chinese duties on car imports from the US. A separate US complaint that year said China unfairly subsidised its car and car parts manufacturers.

The US this week dramatically escalated the trade battle with China, accusing five military leaders of stealing corporate secrets. The indictments are on top of complaints over issues such as tyres, chicken parts, clean-energy products and credit-card payment services.

Since 2009, the US has filed 17 WTO cases against China and other nations, including Indonesia and India, according to the US Trade Representative's office. The US doubled the rate of filings against China over that time.

In March the WTO backed the US in one of those cases, agreeing that China's limits on exports of rare-earth elements used in hybrid-car batteries and wind turbines violate trade rules.

The car issue has drawn recent attention. The US in July 2012 filed a WTO complaint seeking to offset Chinese duties on more than US$3 billion worth of car imports from the US. The Beijing government had alleged that the US industry gained an unfair edge in trade by using government subsidies and selling the goods in China below their value, a practice known as dumping.

Two months later, the US filed the second WTO case against China alleging the Beijing government subsidised its own car and car-parts makers in violation of global trade rules.