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Monday, October 21, 2019

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March 24, 2018

WTO: Concern Over US Tariffs

WTO members expressed concern over the United States’ imposition of higher tariffs on steel and aluminium imports and the impact they may have on the global trading system at a meeting of the Council on Trade in Goods on 23 March, the same day the new US measure came into effect. The US responded by saying that the tariffs are necessary to address the threat these imports pose to national security.

Over 40 members - including the 28 members of the European Union - took the floor to warn against measures that have repercussions not only on traders' commercial interests but also on the predictability and stability of the rules-based multilateral trading system following the entry into force of the "Presidential Proclamation on Adjusting Imports of Steel into the United States". The proclamation imposes a 25% ad valorem tariff on imported steel and a 10% tariff on aluminium articles as of 23 March.
The US measure is inconsistent with the General Agreement on Tariffs and Trade (GATT) and the WTO Agreement on Safeguards, said China, which, along with Russia, had requested for this issue to be taken up at the meeting. China was of the view that the US measure did not take into account information demonstrating how steel and aluminium imports would not affect national security. China called on the United States to refrain from taking unilateral measures, follow WTO rules and uphold the multilateral trading system.
The Russian Federation said the new tariffs exceed the bound rates the United States had committed to under WTO rules. It further noted that several WTO members would be exempted from the new US measure and sought further clarification on this exemption and how the measure can be justified under WTO rules. The Russian Federation said it was looking forward to constructive dialogue with the US.
The other members who took the floor to raise issue with the new US measure and call for the upholding of the multilateral trading system were Japan; Venezuela; Brazil; New Zealand; Turkey; Korea; Hong Kong, China; Singapore; Thailand; Pakistan; Norway; Australia; India; El Salvador; Switzerland; Paraguay; Guatemala; and Kazakhstan.
In response, the United States said that its Secretary of Commerce, in its investigations pursuant to Section 232 of the Trade Expansion Act of 1962, had found that quantities of imports and circumstances of global excess capacity for producing steel and aluminium "threaten to impair the national security". Tariffs, as noted in the US President's proclamations, are necessary to address the threat.
The US further noted that the President's proclamations authorized the provision of relief from the new duties on steel or aluminium articles determined not to be produced in the United States in sufficient amounts or of satisfactory quality. The Department of Commerce published requirements and procedures on 19 March for requesting such exclusions and submitting objections to exclusion requests. Moreover, on 22 March, the President issued proclamations removing, for a period of time, the application of additional tariffs with respect to certain countries with which the US has a "security relationship", the US said.
AustraliaBrazilDepartment of Commerce