TWN Info Service on WTO and Trade Issues (Oct19/25)
31 October 2019
Third World Network

US double standards in several trade disputes
Published in SUNS #9008 dated 30 October 2019

Geneva, 29 Oct (D. Ravi Kanth) -- The United States on Monday stood exposed at the World Trade Organization on the double-standards that it has adopted over several trade disputes.

Washington slapped additional tariffs last year on steel and aluminium imports and had sought to legitimise it by citing Section 232 of its tariff law (national security provisions), but has charged other members for taking recourse to "unilateral retaliation against the United States," participants told the SUNS.

At the Dispute Settlement Body (DSB) meeting on 28 October, the US made a second request for the establishment of a panel against India over New Delhi's retaliatory duties on American products in response to Washington's additional duties imposed on steel and aluminum last year.

The US justified the additional duties imposed on steel and aluminum on grounds that "every sovereign has the right to take action it considers necessary for the protection of its essential security" under Article XXI of the GATT 1994.

"What remains inconsistent with the WTO Agreement is the unilateral retaliation against the United States by various WTO Members including India," the US said.

"These members pretend that the US actions under Section 232 are so-called "safeguards", and claim that their retaliatory duties constitute suspension of substantially equivalent concessions under the WTO Agreement on Safeguards," the US argued.

"Just as these members appear to be ready to undermine the dispute settlement system by ignoring the plain meaning of Article XXI and 70 years of practice, so too are they ready to undermine the WTO pretending to follow its rules while imposing measures that blatantly disregard them," the US argued, calling for a panel to adjudicate against India's retaliatory duties.

In a measured response to the US criticisms, India said while it is disappointed with the second request made by the US, the "Section 232 measures on steel and aluminum products imposed by the United States are nothing but disguised safeguard measures to protect the United States' domestic industry in the garb of national security."

"As a result, India was constrained to impose additional duties to suspend concessions and other obligations referred in Article 8.2 of the Agreement on Safeguards," India said.

"India's rebalancing measures are in direct response to the unwarranted restrictions imposed by the United States and against Indian steel and aluminum products," New Delhi emphasized.

India said "its rebalancing measures are in direct response to the unwarranted restrictions imposed by the United States against Indian steel and aluminum exports."

Therefore, "India is committed to remove its rebalancing measures as soon as the United States removes its illegal tariffs against Indian steel and aluminum products," the Indian official said.

Several other countries have also imposed retaliatory tariffs on the US products in response to Washington's unilateral duties imposed under its Section 232 national security provisions.

The US also faced severe criticism from China over Washington's continued failure to implement the DSB recommendations against the US Section 110(5) of the US Copyright Act (the panel report was adopted on 27 July 2000).

"We note that the United States has provided 176 status reports in this dispute," China said.

"However, these reports [submitted by the US] are not materially different from one another and none of them could indicate any substantive progress in implementation [by the US]," China argued.

"Nearly two decades after the DSB adopted the Panel [and the AB] Report[s], the United States continues to fail to bring its WTO-inconsistent measures into conformity as prescribed by Article 21.1 of the DSU," China said.

China mocked the US by saying "when the United States, the most frequent user and the major beneficiary of the system, chose to disregard its implementation obligation for so long, the capacity and the effectiveness of the dispute settlement system to rein in trade distortions would inevitably be compromised."

The US has also failed to implement several other rulings in various trade disputes for more than 18 years.

On a separate dispute, the US objected to China's request to impose retaliatory tariffs on $2.4 billion worth of American goods due to Washington's failure to comply with the WTO's rulings and recommendations against the US countervailing duties on Chinese products.

The US challenged China's estimate of retaliatory duties on American products.

Consequently, China's request for imposing retaliatory tariffs on American goods because of Washington's failure to comply with the Dispute Settlement Body recommendations will now be decided by an arbitrator.

Meanwhile, at the meeting, 116 countries urged the US for the umpteenth time to allow the expeditious selection to fill the six vacancies at the Appellate Body.

But the US said that "the systemic concerns [about the AB's functioning] that we have identified remain unaddressed."

The US also added one more charge to its litany of AB's alleged failings by arguing that the Appellate Body adopted "the incorrect legal interpretation of Article 6.2 of the Dispute Settlement Understanding." +