US wins trade case with China over auto import duties

The United States has won a trade case with China over tariffs imposed on U.S. auto imports, a major boost for the Obama administration’s enforcement efforts, a top official said Friday.

U.S. Trade Representative Michael Froman said the World Trade Organization’s (WTO) decision makes it clear that the White House will take aggressive steps to ensure American businesses get fair global trading treatment.  

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“It is time for China to change the practices that have led the United States and our trading partners to bring these kinds of cases,” he said.

Froman pointed out that the U.S. has won all three cases it has filed against China over tariffs.

Beijing’s government had argued the duties were needed because U.S. auto imports were receiving incentives that were allowing them to be sold in their market at a lower cost, or dumped, a point the WTO rejected.

“We must continue to enforce our trade rights in the WTO to ensure that countries like China do not unfairly discriminate and retaliate against U.S. products,” said House Ways and Means Committee Chairman Dave Camp (R-Mich.).

U.S. trade officials argued, though, that China's actions were in retaliation for tariffs imposed on Chinese tires coming into the United States in in 2009. That decision was upheld by the WTO in 2011.

"Today's outcome is a significant victory in the fight against China's practice of retaliating and intimidating those who dare to stand up to it,” said Ways and Means ranking member Rep. Sandy Levin (D-Mich.).

“The United States will not shy away from enforcing U.S. trade laws, and we certainly won't tolerate the intimidation that China demonstrated in starting the investigation challenged in this dispute."

In December 2011, China imposed duties ranging from 2 to 21.5 percent on U.S. cars and SUVs, effectively a tax of more the 20 percent on cars and SUVs sold to China.

“I am pleased that USTR stood up for U.S. autoworkers and their families and I hope this case makes clear that the United States will not back down on trade enforcement in the face of retaliation,” Senate Finance Committee Chairman Ron Wyden (D-Ore.).

Wyden suggested that the United States should exercise all available options to enforce U.S. rights if China chooses to retaliate again, as it has promised for Justice Department indictments issued earlier this week on five Chinese military officers involved in criminal hacking.

In 2013, the United States exported $64.9 billion of autos, $8.5 billion of which went to China, the second-largest export market for U.S. autos.

The duties last year affected an estimated $5.1 billion of those exports, officials said.

China had removed the duties last year as the U.S. moved forward at the WTO.

“However, while we welcome China’s decision to lift the duties, we remain deeply concerned by the troubling pattern of China’s misuse of antidumping and countervailing duty measures," Froman said.

Congressional lawmakers hailed the ruling of a violation of international trade rules as a major victory for U.S. automakers.

“Today’s WTO decision is a significant step towards protecting our automakers from discriminatory trade practices,” said Sen. Sherrod Brown (D-Ohio), vice chairman of the Senate Auto Caucus.