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U.S. Challenges Mainland China’s Compliance with WTO Ruling on AD/CV Duties on Chicken Products

USTR announced on 10 May a challenge at the World Trade Organisation against the mainland Chinese government’s failure to bring its antidumping and countervailing duties on U.S. chicken broiler products into compliance with WTO rules. This trade enforcement action is the 12th WTO complaint brought by the Obama administration against mainland China, which showcases the firm commitment of the United States to ensure that Beijing lives up to its multi-lateral obligations and that U.S. farmers and workers can compete on a level playing field in the global economy.

In 2010 mainland China imposed AD duties of 50.3 percent to 105.4 percent and CV duties of 4 percent to 30.3 percent on imports of chicken broiler products from the United States. The United States challenged those duties at the WTO, which found that mainland China had breached several procedural and substantive obligations in conducting its AD and CV investigations and that there were numerous defects in mainland China’s determination that imports from the United States caused adverse price effects in the mainland Chinese market. Beijing subsequently issued a redetermination advancing additional rationales for the duties, some of which were lowered and some of which were increased, and asserted that it had complied with the WTO’s findings.

After an intensive review USTR has concluded otherwise and is therefore challenging mainland China’s redetermination on various grounds. These include mainland China’s failure to properly calculate costs of production for a U.S. producer, failure to conduct a transparent reinvestigation, and various failures with respect to the finding that the mainland Chinese industry has been injured on account of U.S. exports.

The United States is the only WTO member that has challenged a claim of compliance by mainland China following a WTO finding that Beijing had breached its multi-lateral obligations. In the only other instance, Washington prevailed in its claim that mainland China’s continued imposition of extra duties on specialty steel products was inconsistent with WTO rules. Following that challenge, mainland China terminated the extra duties.

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