US Appeals WTO Compliance Panel Findings on CV Duties Against China

The U.S. appealed the World Trade Organization's compliance panel decision that said the U.S. had to change its countervailing duties on oil country tubular goods, solar panels, pressure pipe and line pipe. The CVD cases were brought between 2007 and 2012. The core issue in the case is whether the Commerce Department properly described the government's intervention in Chinese firms that made those products when it targeted them for trade remedies. The appeal was published at the WTO on April 30.

China alleged that Commerce was wrong to propose "that majority government ownership is sufficient to treat an enterprise as a 'public body,'" and the first panel agreed that there was not sufficient evidence to draw that conclusion. An appellate panel overturned the original judgment that the Chinese were right to say that the U.S. should not have dismissed domestic Chinese prices as an accurate dumping benchmark. The appellate body said there is enough market distortion in China that its internal prices are not a good measure of costs.

However, for four specific products -- the OCTG, solar panels, pressure pipe and line pipe -- the compliance panel said there was not evidence that the price of inputs in China was distorted, so the CVD should have been based on domestic prices. After its partial loss at the WTO, Commerce revised some CVD determinations, but the compliance panel said its actions were not enough to comply with WTO rules.