WTO panel rules against US tariffs on China
A World Trade Organization panel on Tuesday ruled that the United States violated global trade rules when President Donald Trump unilaterally imposed tariffs on more than $350 billion worth of Chinese goods.
The United States had argued that China’s practices related to technology transfer, intellectual property, and innovation amounted to unfair and distortive policies of “state-sanctioned theft,” misappropriation of U.S. technology, intellectual property, and commercial secrets.
The United States said that these policies amounted to a violation of public morals.
Among other conclusions, the panel found that the United States had not provided an explanation demonstrating a genuine relationship of ends and means between the imposition of additional duties on these products and the public morals objective invoked by the United States.
The U.S. tariffs on Chinese products led the Chinese to impose tariffs on U.S. farm products, which ultimately led the Trump administration to compensate U.S. farmers for their losses on the grounds that China had singled out U.S. farm products.
Trade Representative Robert Lighthizer on Monday said, “This panel report confirms what the Trump administration has been saying for four years: The WTO is completely inadequate to stop China’s harmful technology practices. Although the panel did not dispute the extensive evidence submitted by the United States of intellectual property theft by China, its decision shows that the WTO provides no remedy for such misconduct. The United States must be allowed to defend itself against unfair trade practices, and the Trump administration will not let China use the WTO to take advantage of American workers, businesses, farmers, and ranchers. It is important to note that this report has no effect on the historic Phase One agreement between the United States and China, which includes new, enforceable commitments by China to prevent the theft of American technology.”
USTR said the agency “issued a Section 301 report in 2018 documenting how China had engaged in unfair forced technology transfer practices, such as exploiting its foreign ownership and administrative requirements to extort U.S. intellectual property rights or supporting commercial cyber theft from U.S. entities. The report cited hundreds of sources and thousands of pieces of evidence, including reports from governments, firms, business associations, think tanks and researchers, and others. These unfair trade practices and other actions by China have cost U.S. innovators, workers, and businesses billions of dollars every year.” ❖
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