Hong Kong companies that have moved manufacturing centres to the mainland could become victims in escalating trade wars between China and the United States, following the mainland's entry to the World Trade Organisation. Hong Kong-invested Xinyi Automobile Glass in Shenzhen vowed to appeal to the US International Trade Commission after it was charged a 3.71 per cent tariff on the windshield glass it exports to the country. The tariff was the lowest imposed on products from Xinyi and 13 other Chinese windshield glassmakers, but still made Xinyi vulnerable. Gerry Tung, managing director and general manager of Xinyi, said: 'What worried us most is not the 3.71 per cent, but the prospect that we will be put under scrutiny every year for the next five years and could be charged much higher. This puts us and our investors into great uncertainty.' Mr Tung said that, under US regulations, if the tariff was set at more than 2 per cent, the company was deemed to have exported at prices lower than cost, or dumping. US glass producers PPG Industries, Apogee Enterprises and Safelite Glass petitioned the International Trade Commission last year to press dumping charges against 14 Chinese glassmakers, including Xinyi. At the verdict on March 30, the companies were charged from 3.71 per cent to more than 100 per cent. Xinyi said the verdict was not fair, because, as a private company, Xinyi could not export goods below cost. The argument was supported by a preliminary verdict of zero tariff by the commission. China said it had become more of a target by countries wanting to protect their markets, faced with the mainland's low-cost labour force. Chai Xuesong, executive assistant at Xinyi, said the company was reviewing its price structure for all its export markets to avoid lawsuit risks. The US lawsuit, which lasted more than 13 months, had cost the company at least US$400,000. Xinyi's products now cost about 30 per cent less than those of US producers. Mr Chai suggested companies entering China's market should price their products strategically if they were to export to the West. Mr Tung said Xinyi was a victim of what the Chinese Government called a 'new tidal wave of trade protectionism'. China exported two million pieces of windshield glass for the car maintenance market last year, accounting for more than 14 per cent of the sector, against a share of less than 10 per cent in 2000, he said.