U.S. Accuses China of Imposing Unfair Tariffs on American-Made Vehicles

July 5, 2012
The Obama administration has requested dispute-settlement consultations with China at the World Trade Organization 'in an attempt to eliminate these unfair duties, which appear to represent yet another abuse of trade remedies by China,' United States Trade Representative Ron Kirk said Thursday.

The United States is asking the World Trade Organization to intervene in a dispute with China over China's alleged imposition of antidumping and countervailing duties on more than $3 billion in exports of American-made vehicles.

The Obama administration has requested dispute-settlement consultations with China at the World Trade Organization "in an attempt to eliminate these unfair duties, which appear to represent yet another abuse of trade remedies by China," United States Trade Representative Ron Kirk said Thursday.

"As we have made clear, the Obama administration will continue to fight to ensure that China does not misuse its trade laws and violate its international trade commitments to block exports of American-made products," Kirk said in a news release. China's duties on imports of American-made vehicles "appear to be inconsistent with WTO rules," Kirk's agency said.

The action drew praise from the Alliance for American Manufacturing, which asserted that the Obama administration "has a stellar record on enforcing America's trade laws and has not hesitated to take action to defend American workers."

"The deck in China is stacked against American automakers and workers, and this case will help to level the playing field," said Scott Paul, executive director of the alliance.   

"Less than 1% of the estimated 18 million vehicles sold in China last year were made in America, despite the fact that the Detroit Three brands are growing more popular every day."

Meanwhile, the alliance noted that "Chinese auto parts are surging into America, aided by Chinese-government subsidies."

"Unless strong steps are taken now to also defend American auto-parts jobs, the efforts of the auto companies, unions and the administration to revitalize the American auto sector could be washed away in a matter of a few years," Paul said.

Third Complaint Against China

Kirk noted that the complaint marks the third time that the Obama administration has challenged China's use of trade remedies.

In two earlier WTO cases, the United States challenged duties that China had imposed to restrict imports of certain steel products and chicken products from the United States.

The United States also has taken China to task on its export restraints on several industrial raw materials -- including rare earths -- China's restrictions on electronic-payment services and subsidies to China's wind-power equipment sector.

"In each of these matters, the key principle at stake is that China must play by the rules to which it agreed when it joined the WTO," Kirk's office said in a news release.

"Those commitments include maintaining open markets on a non-discriminatory basis, and following internationally agreed procedures in a transparent way." U.S. Sen. Sherrod Brown, D-Ohio, applauded the administration for its most recent action against China.
 
"The auto industry is helping turn our economy around by reviving manufacturing facilities across the nation," Brown said. "But we're at risk of this progress being undercut if we allow China to continue to cheat and break trade laws. "Today's announcement is the type of aggressive approach we need to address the unlevel playing field American automakers are facing."

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