
Geneva: China has initiated World Trade Organization (WTO) dispute consultations with the United States over the recent tariff measures placed on goods from China. The request was distributed to WTO members today.
China contends that the 10 per cent extra ad valorem duties imposed on all goods from China, along with regulations regarding drawback availability and duty-free de minimis treatment for Chinese products, violate the US’s most favoured nation commitments under Article I:1 of the General Agreement on Tariffs and Trade (GATT) 1994, as well as US tariff obligations under Article II:1(a) of GATT 1994.
A request for consultations officially starts a dispute within the WTO. These consultations allow the involved parties to discuss the issue and seek a satisfactory resolution without escalating to litigation. If the dispute remains unresolved after 60 days, the complainant can then ask for a panel to adjudicate the matter.
On February 1, 2025, the United States issued a fact sheet and Executive Order implementing a 10% additional tariff on goods originating in China. The 10% additional tariff measures are imposed under section 1702(a)(1)(B) of the International Emergency Economic Powers Act (IEEPA), as part of an alleged attempt to address the “national emergency” for the alleged influx of synthetic opioids into the United States. Consequently, all products of China, as defined by the Federal Register notice, were subjected to an additional 10% ad valorem rate of duty, effective on February 4, 2025.
The measures at issue, including the 10% additional tariffs, as well as the measures concerning the availability of drawback and duty-free de minimis treatment, as provided in Section 2(f) and 2(g) of the Executive Order, respectively, which China claimed are imposed based on unfounded and false allegations concerning China, apply only to all products of Chinese origin. Furthermore, the 10% additional tariffs imposed are in excess of the United States bound rates in its Schedule of Concessions and Commitments annexed to the GATT 1994. The measures at issue not only violate WTO rules but are discriminatory and protectionist in nature, China claimed. It further claimed that the measures at issue were inconsistent with the United States’ obligations under the following provisions of the GATT 1994.
While imposing tariffs on imports from China, Canada and Mexico on February 1, 2025, US President Donald Trump attributed them to ” the extraordinary threat posed by illegal aliens and drugs, including deadly fentanyl, which he claimed constituted a national emergency under the International Emergency Economic Powers Act (IEEPA).
The White House claimed President Trump was taking “bold action” to hold Mexico, Canada, and China accountable for their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country. “Chinese officials have failed to take the actions necessary to stem the flow of precursor chemicals to known criminal cartels and shut down money laundering by transnational criminal organizations,” the White House stated and added that tariffs are a powerful, proven source of leverage for protecting the national interest. “President Trump is using the tools at hand and taking decisive action that puts Americans’ safety and our national security first.”
Responding to the US tariff measures, Beijing, on February 2, 2025, deplored and opposed it and warned it would take necessary countermeasures to defend its “legitimate rights and interests”.
“China’s position is firm and consistent. Trade and tariff wars have no winners. The USA’s unilateral tariff hikes severely violate WTO rules. This move cannot solve the U.S.’s problems at home and more importantly, does not benefit either side, still less the world,” the Chinese foreign office stated, asking the US to view and solve its own fentanyl issue objectively and rationally instead of threatening other countries with arbitrary tariff hikes. “Additional tariffs are not constructive and bound to affect and harm the counternarcotics cooperation between the two sides in the future,” it claimed and asked the US “to correct its wrongdoings, maintain the hard-won positive dynamics in the counternarcotics cooperation, and promote the steady, sound and sustainable development of China-U.S. relationship”.
China retaliated on February 4, 2024, against President Trump’s 10 per cent tariffs on all Chinese imports by implementing its own tariffs on U.S. coal and gas, as well as placing restrictions on the export of certain minerals. According to the Chinese government, these tariffs will not be enforced until February 10, 2025, providing a window for negotiations. The White House press secretary announced that a conversation between Trump and Xi Jinping was in the works and would take place shortly. Economists have estimated that China’s tariffs would cover around $20 billion of U.S. exports, while Trump’s tariffs target more than $450 billion of Chinese goods.
– global bihari bureau