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United States Prevails in WTO Dispute about Chinese Tire Imports

09/05/2011

WASHINGTON, D.C. – Today United States Trade Representative Ron Kirk announced that the World Trade Organization (WTO) Appellate Body found in favor of the United States in a dispute brought by China challenging the imposition of additional duties on imports of Chinese tires. A WTO panel had rejected all of China’s claims against the United States, finding that the United States acted consistently with its WTO obligations in imposing the additional duties. The Appellate Body, in turn, rejected all of China’s claims on appeal.

“This is a tremendous victory for the United States as well as for American workers and manufacturers. We have said all along that President Obama’s decision to impose duties on Chinese tires was fully consistent with our WTO obligations. A WTO panel agreed with us and now the Appellate Body has confirmed it,” said Ambassador Kirk. “The Obama Administration will continue to fight for U.S. jobs and businesses. We will use our trade laws to stand up for our workers and address harm to them.”

BACKGROUND

On September 11, 2009, the President imposed additional duties on imports of certain passenger vehicle and light truck tires from China for a period of three years in order to remedy the market disruption caused by those imports, as determined by the U.S. International Trade Commission (USITC). This safeguard measure was imposed in response to a petition filed by the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers Union under section 421 of the Trade Act of 1974, as amended (19 U.S.C. § 2451). Section 421 implements the transitional safeguard contained in Section 16 of China’s Protocol of Accession to the WTO.

China alleged that the USITC’s determination regarding market disruption and the level and duration of the additional duties were inconsistent with the Protocol of Accession and the GATT 1994. In addition, China alleged that the section 421 definition of “significant cause” was in and of itself inconsistent with the Protocol of Accession. A WTO panel sided with the United States and rejected all of China’s claims in a report circulated in December 2010. China appealed with respect to the panel’s findings regarding the USITC determination.

The Appellate Body’s report can be found here.