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China challenges U.S. and EU over anti-dumping duties

China said on Monday it would challenge the U.S. and EU over how they calculate anti-dumping duties on Chinese exports. The Ministry of Commerce (MOFCOM) said on its website that the nation has launched dispute resolution procedures against the two trading partners under World Trade Organization (WTO) rules, and that the U.S. and EU “have not fulfilled their obligations” under the terms of China's WTO accession in 2001, which permitted member states to calculate anti-dumping duty rates based on different methodologies than against other “market economy” nations for a 15-year period. The deadline expired on Sunday, and the U.S. and EU have opted not to embrace the change, arguing that China is still not a market economy. A PRC trade lawyer told China Law & Practice earlier that “any argument from the U.S. or EU is unlikely to prevail at the WTO level”, while a Washington, DC-based partner said that the two jurisdictions' failure to honor Section 15 is “an obvious violation” and a “blatant act of non-compliance”. Whether China qualifies as a market economy status is a separate matter, as the dispute relates specifically to the validity of the WTO Accession Protocol clause. The Obama administration decided it won't grant China market economy status last week, with President-elect Donald Trump also announcing at a rally that “China is not a market economy.” Meanwhile EU governments reached an agreement on Tuesday to permit higher tariffs on cheap raw material imports to defend themselves against unfair trade practices, after the bloc launched a new investigation into Chinese steel. The WTO dispute proceeding—with all the negotiations, appeals and sanctions involved—will most likely span years. This story has more on the issue.  

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