Recalling China'S First Defeat In &Nbsp In Six Years After Joining The WTO, And Levying Taxes On Imported Auto Parts

China has suffered the first defeat since its accession to the World Trade Organization (WTO) in 2001.

Geneva, Switzerland, 13 local time, composed of 3 members.

"Little chance of reversing the case".

According to the WTO rules, once the decision is issued, if China refuses to change the relevant policies, the appellate countries and regions will have the right to impose sanctions on China.

The preliminary findings of the WTO expert group will be the final result after a review and review of the parties for about 3 weeks, and the final result will be considered and passed by all the members of the WTO to become a formal decision.

In accordance with the dispute settlement procedure, the parties may also appeal against the outcome of the official verdict.

WTO's official report on this matter will be announced in March, and China has an opportunity to appeal.

But Song Hong, director of the International Trade Research Institute of the Institute of world economics and politics of the Chinese Academy of Social Sciences, believes that the chance of changing the verdict is negligible. "No dispute settlement team has made a final decision inconsistent with the preliminary ruling so far."

Case focus

In March 2006, the United States and the European Union brought suit against China's policy of imposing high tariffs on imported parts and components, which account for 60% or more of the price. Canada joined the same year in April.

They alleged that the policy made the imported parts lose competitiveness in the eyes of Chinese automakers. Foreign auto parts manufacturers were forced to pfer their production to China, resulting in the unemployment of workers in related industries in Europe and the United States.

In this regard, China insists that the move is intended to prevent the vehicle from being broken down into several large imports, allowing foreign companies to avoid high vehicle loads.

Song Hong believes that the focus of the case is "what constitutes the vehicle parts of the vehicle characteristics".

In developed countries, vehicle and spare parts are two completely independent concepts, but not in China. The two sides have always argued about the definition of the concept.

Zhou Shijian, executive director of the WTO Research Association, said in an interview that the ruling was unfair and a clear bias towards developed countries.

Zhou Shijian said that China imposed 25% tariffs on imported vehicles and 10% tariffs on auto parts.

Many auto manufacturers import large quantities of auto parts and assemble them into finished cars.

In this way, the imported cars are cheaper to import than the imported ones and avoid at least 15% customs duties in disguised form.