China Complains at WTO Over U.S. Anti-Subsidy Measures

China said it lodged a complaint at the World Trade Organization over U.S. anti-subsidy duties affecting $7.3 billion of Chinese products such as solar panels, thermal paper and steel sinks.

During probes to determine whether Chinese companies received illegal government aid, the U.S. acted “inconsistently with WTO rules and rulings in many aspects,” China’s mission to the WTO in Geneva said in an e-mailed statement today. The U.S. “repeated its wrongful practice” during its recent anti-subsidy investigation on Chinese solar cells.

The complaint comes just eight days after the U.S. Commerce Department imposed duties of as much as 250 percent on Chinese solar imports, siding with companies including SolarWorld AG (SWVK) that said the goods were sold below the cost of production. China said the following day it was “seriously concerned” by the U.S. move, which it labeled an unfair trade practice.

While the U.S. decision was meant to provide a boost to the U.S. solar-manufacturing industry, where four companies filed for bankruptcy in the past year, it may further inflame trade tensions, Shyam Mehta, an analyst with GTM Research in Boston, said last week.

Commerce Finding

The Commerce Department also made a preliminary finding in March that China gives illegal subsidies to exporters of crystalline silicon photovoltaic cells and solar panels. The U.S. applied tariffs of 2.9 percent on Suntech Power Holdings Co. and 4.73 percent on Trina Solar Ltd. (TSL), while all other Chinese producers and exporters must pay a levy of 3.61 percent.

China’s complaint is its seventh against the U.S., which has lodged 13 cases against the Asian nation -- half the number of all WTO complaints against the Chinese government.

Today’s request for consultations is the first step in the case and means the two governments must now hold talks for at least 60 days in a bid to resolve the dispute. After that, China can ask WTO judges to investigate the complaint. Rulings are typically made within six months, after which either side can appeal.

“We are studying the request for consultations,” Nkenge Harmon, a spokeswoman for the U.S. Trade Representative’s office, said today in an e-mail. “The Obama administration strongly supports the trade remedy laws, and was the first administration ever to apply” a China-specific safeguard on imports of tires from that country, she said.

To contact the reporter on this story: Jennifer M. Freedman in Geneva at jfreedman@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

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