US urges WTO consultation on China auto duties

WASHINGTON -- The US government requested dispute settlement consultations with China at the World Trade Organization on automobiles duties, a senior trade official announced on Thursday.

US Trade Representative Ron Kirk said the federal government was challenging China's imposition of antidumping and countervailing duties on more than $3 billion in exports of automobiles.

Consultations are the first step in a WTO dispute. Under WTO rules, if parties do not resolve a matter through consultations within 60 days, complaints may request the establishment of a WTO dispute settlement panel.

In December 2011, China imposed antidumping and countervailing duties on imports of US cars and SUVs with an engine capacity of 2.5 liters or larger. Then Chinese Commerce Minister Chen Deming said the measures were taken after China conducted open investigations in accordance with the WTO rules and upon petitions from domestic enterprises.

The US latest move was the third time that the Obama administration had challenged China's trade remedies, said Ron Kirk. In two earlier cases, the US challenged duties that China had imposed to restrict imports of certain steel products and chicken products. It also brought actions against China's restrictions on electronic payment services and subsidies to China's wind power equipment sector. In addition, the US invoked a China-specific safeguard to impose punitive duties on imports of Chinese passenger and light truck tires.

US President Barack Obama claimed that the initiative on Chinese tires had saved 1,200 manufacturing jobs. But the total cost to American consumers from higher prices resulting from the tire safeguard tariffs was $1.1 billion in 2011, said Gary Clyde Hufbauer and Martin Vieiro in a report, experts from Peterson Institute for International Economics.

Most recently, the Obama Administration also asked the WTO to establish a dispute settlement panel on June 27 to decide US claims regarding China's export restraints on several industrial raw materials, including rare earths.