China Wins in WTO Section 301 Tariff Case

A new World Trade Organization dispute settlement panel report said that the U.S. improperly applied Section 301 tariffs on goods from China. “It remains to be seen whether the US decides to appeal the ruling,” former WTO official Peter Ungphakorn said in a tweet. “Since the Appellate Body cannot function, this would be an 'appeal into the void.'” The WTO appeals court is mostly inoperable due to a U.S. hold on adding new members.

U.S. Trade Representative Robert Lighthizer said the ruling highlights what is wrong with the WTO. “This panel report confirms what the Trump Administration has been saying for four years: The WTO is completely inadequate to stop China’s harmful technology practices,” he said. “Although the panel did not dispute the extensive evidence submitted by the United States of intellectual property theft by China, its decision shows that the WTO provides no remedy for such misconduct.” The finding also has “no effect on the historic Phase One Agreement between the United States and China, which includes new, enforceable commitments by China to prevent the theft of American technology,” he said.

China's Ministry of Commerce said the decision was “objective and fair,” according to an unofficial translation of a press release. “The multilateral trading system with the WTO at its core is the cornerstone of international trade. China has always firmly supported and maintained this cornerstone and respected WTO rules and rulings,” it said.