|
||
|
TWN
Info Service on WTO and Trade Issues (Aug24/02) Geneva, 12 Aug (D. Ravi Kanth) — China on 9 August initiated dispute proceedings against the European Union at the World Trade Organization over Brussels’ proposed countervailing duties of up to 37.6 percent on electric vehicles from China, a move that signals a worsening trade war between China on the one side and the EU and the United States on the other, said people familiar with the development. The proposed countervailing duties on Chinese electric vehicles could come into effect in October if the EU member states approve the measures. As a first step, China has requested consultations with the EU at the WTO pursuant to Article 4 of the Dispute Settlement Understanding (DSU) to amicably resolve the dispute “within 60 days after the date of receipt of the request for consultations.” If the two sides are unable to reach an amicable agreement within this period, China can request the establishment of a dispute panel at the WTO to rule on the EU’s duties on Chinese electric vehicles. China’s Ministry of Commerce on 9 August stated: “To safeguard the legitimate interests of electric vehicle industry and to support global cooperation in green transition, China filed the consultations request and initiated WTO dispute settlement proceedings against the EU on 9 August.” China said: “The EU’s provisional findings lack factual and legal support, are contrary to WTO rules, and impede global cooperation to respond to climate change.” “We urge the EU to immediately correct its measures, maintain economic cooperation between China and the EU, and preserve the stability of the global electric vehicle industrial and supply chain,” it said, according to an email sent by a Chinese official. Coming close on the heels of China’s request for the establishment of a dispute panel against the US at the WTO over several provisions of the US Inflation Reduction Act (IRA), Beijing appears to be stepping up its fight against the unilateral and allegedly WTO-inconsistent measures being implemented against it on a rising scale, said people familiar with the development. However, at a time when the WTO’s enforcement function has been stymied by the US through making the Appellate Body dysfunctional for the past five years, it is not clear whether China would be able to secure an early ruling on the measures being put in place against it by the two trans-Atlantic trade giants, said people, who asked not to be identified. CONTEXT The EU trade commissioner, Mr Valdis Dombrovskis, had recently said that “it’s clear that member states realize the need to protect the EU’s car industry because this risk of injury is there.” “Chinese battery electric vehicle market share is growing very rapidly,” said Mr Dombrovskis, adding that “subsidization is there”, according to a report in the Financial Times on 5 August. The EU trade commissioner went on to say: “So it’s certainly an issue that needs to be addressed.” The EU is expected to impose countervailing duties of up to 37.6 percent on imports of Chinese electric vehicles, according to news reports. The EU’s proposed decision must be formally voted on by its members in October, with Germany having already signaled its opposition to the proposed tariffs. In a seemingly related development, China has launched an anti-dumping probe into cognac imported from the EU, a move that is seen as punishing France for championing the proposed duties on Chinese electric vehicles, according to an FT report. Once the EU said it would impose countervailing duties on Chinese electric vehicles, Beijing appears to have responded by opening an anti-dumping investigation into imports of brandy from the EU that could hit farmers in France, Spain, the Netherlands, Denmark, Germany, and Belgium. According to the FT report, “this year, Brussels has also launched trade probes into wind turbines and solar manufacturers and announced anti-dumping measures against imports of Chinese bio-fuels, which will come into effect next week.” All these “tit-for-tat” trade measures between China on the one side, and the US and the EU, on the other seem to signal the intensification of a trade war that has already undermined global supply chains, said several analysts, who preferred not to be identified. DSU ARTICLE 4 CONSULTATIONS Under paragraph 3 of Article 4 of the DSU, it is unambiguously stated that: “If a request for consultations is made pursuant to a covered agreement, the Member to which the request is made shall, unless otherwise mutually agreed, reply to the request within 10 days after the date of its receipt and shall enter into consultations in good faith within a period of no more than 30 days after the date of receipt of the request, with a view to reaching a mutually satisfactory solution. If the Member does not respond within 10 days after the date of receipt of the request, or does not enter into consultations within a period of no more than 30 days, or a period otherwise mutually agreed, after the date of receipt of the request, then the Member that requested the holding of consultations may proceed directly to request the establishment of a panel.” Further, according to paragraph seven of Article 4 of the DSU, “If the consultations fail to settle a dispute within 60 days after the date of receipt of the request for consultations, the complaining party may request the establishment of a panel. The complaining party may request a panel during the 60-day period if the consulting parties jointly consider that consultations have failed to settle the dispute.” +
|
||
