Special author of Xu Tianmin Studio: Wen Tao
On January 27, China's Ministry of Commerce issued an announcement that on January 26, 2022, the WTO Arbitral Tribunal issued a ruling in the WTO dispute between China v. the United States on countervailing measures, finding that due to the United States' failure to comply with the WTO ruling in force, China can carry out US$645 million in trade in trade in goods annually. The successful results of this case are of great significance to correcting the illegal countervailing practices of the United States, safeguarding the legitimate trade interests of mainland enterprises, and safeguarding the multilateral trading system.
The ruling is a long time ago, dating back more than a decade. Since 2007, the United States believes that there are subsidies for China's solar panels, pressure tubes, etc., which have a greater impact on domestic products in the United States, so the US government has imposed countervailing duties on the above products. In 2012, China filed a lawsuit with the WTO, and after an investigation by the WTO, in 2015 it found that the reasons for the US countervailing measures were not valid, and demanded that the US side immediately stop and correct them.
Screenshot of the report on the official website of the World Trade Organization (WTO).
However, the United States has been in violation of this ruling, and even maintained the previous countervailing measures for some products, on April 29, 2016, China sued again again again for the IMPLEMENTATION measures of the United States, the WTO determined that the implementation of the United States still violates WTO rules, the United States has not implemented the WTO ruling, the Chinese side in order to counteract, on October 17, 2019, applied for trade retaliation authorization application, and finally won the lawsuit in 2022, China could retaliate against the U.S. side for $645 million a year in trade in goods.
This case lasted 10 years, the reason why the time is so long, first, because when this case just happened or around 2010, China's national strength is not strong enough, the WTO is completely dominated by the United States, the United States pointed out that China has "subsidy" behavior, then most countries naturally do not think that the United States is lying, at that time the United States was not only the world's largest economy, but also a beacon of democracy, how could it do things to slander others? It must have been China that violated WTO rules before it led to US sanctions.
On the other hand, there is the problem of the WTO itself, the WTO's Appellate Body is an important part of the WTO's dispute resolution department, but since Trump took office in 2017, the US government has repeatedly blocked new judges on the grounds that there are "institutional problems" in the Appellate Body.
On 9 December 2019, at the meeting of the General Council of the WTO Appellate Body, David Walker, then Chairman of the Dispute Settlement Body and Ambassador of New Zealand to the WTO, submitted a draft reform, which was again rejected by the United States, leaving only one Appellate Body judge for the next year, and the last judge officially left office on November 30, 2020. The WTO Appellate Body has been completely shut down in this regard.
New Zealand Ambassador to the WTO David Walker (center)
Judges are delayed in taking office, and the case is naturally delayed again and again, although China and the European Union continue to demand the selection of judges, but it is still to no avail. On August 4, 2020, in order to reasonably resolve the trade dispute, China and the European Union took the lead and the World Trade Organization's "Multi-Party Provisional Appellate Arbitration Arrangement" arbitrator pool was officially and successfully established, authorizing China to carry out US$645 million in trade retaliation after conducting a detailed investigation of the case.
This judgment is of great significance not only to China, but also to the world. For China, it has washed away its innocence and no longer has to carry the black cauldron of violating WTO rules. At the same time, it also reflects China's willingness to abide by WTO rules and safeguard its rights and interests under the rules-based international order, rather than using violence, demonstrating the style of a big country.
In the light of China's approach, the EU has filed a lawsuit against China in an attempt to resolve the Lithuanian issue within the framework of the WTO. As the world's second largest economy, and as a country that firmly upholds multilateralism, China has played an exemplary role this time, and the EU is willing to solve the problem through the WTO, which Of course China welcomes. The EU may be holding the idea of "taking the other way and giving the other body", but China is not afraid of the shadow oblique, believes that the WTO will make a reasonable ruling, is willing to uphold the ruling, and continues to support the trade rules with the WTO as the core.