China-US Tensions on Display at WTO
China disputed the legality of the Section 232 tariffs on steel and aluminum at the World Trade Organization (see 1803260025), and now the U.S. is disputing both the characterization of those tariffs and how China has responded to them. The tariffs were for national security, and not to protect domestic industry from rising imports, asserted Deputy U.S. Trade Representative Dennis Shea, ambassador to the WTO. China's decision on April 2 to implement tariffs on pork, aluminum scrap and other U.S. exports were not justified, Shea wrote in a letter to China's WTO ambassador, since China can only use the safeguards to respond to safeguards, and the U.S. measures were not safeguards. "China has asserted no other justification for the measures, and the United States is aware of none," he wrote. "Therefore, it appears that China's actions have no basis under WTO rules."
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However, the U.S. is isolated in making this argument, as the European Union has already said that it views the 232 tariffs as safeguards masquerading as a national security tariff. On April 4, China requested consultations on the much larger Section 301 tariff action planned by the U.S. It says that the U.S. is breaking the rules because it independently made a determination of injury without using the WTO's dispute settlement system.