WTO Dispute Settlement Is Flawed; China Violating WTO Obligations, Attorney Tells USTR
It’s too difficult to reverse flawed World Trade Organization dispute rulings, and China appears to be violating several obligations to the WTO, Stewart and Stewart attorney Terence Stewart said in comments to the Office of the U.S. Trade Representative. Stewart submitted his comments on July 28 to USTR on the performance of U.S. free trade agreements and trade relations with WTO members with whom the U.S. runs a significant trade deficit but holds no FTA (see 1706290011). While not required, almost all WTO decisions are made through consensus, meaning that winning litigators before WTO dispute panels and the appellate body haven’t been willing to see wins reversed despite the incorrectness of some decisions, Stewart wrote. In some areas of dispute settlement, such as trade remedies, countries have targeted the U.S., “seriously changing” agreements the U.S. negotiated during the Uruguay Round.
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China continues to violate its obligations to the WTO on export duties, agricultural subsidies and subsidy notifications, Stewart wrote. “Despite a series of WTO disputes on selected products on which China was imposing export duties that were not on the authorized list, China continues to violate its obligations to the WTO, with 125 products still facing export duties as of 2016 despite a very limited number permitted by the Protocol of Accession,” he said. It is also believed that China has “grossly exceeded” limits on domestic support for wheat, corn and rice agreed to in its WTO accession protocol, Stewart said. China fails to provide some notifications required by its WTO membership, especially on subsidies, he said. The U.S. has been forced three times to file WTO counter-notifications based on China’s failure to “submit any report for years or the clear inadequacy of the submission that was made.”