The World Trade Organization ruled on Friday that US tariffs on steel and aluminium imports imposed by then-President Donald Trump violated global trade rules, in a decision that was immediately criticised by Washington.
The three-person adjudicating panel said the US measures were inconsistent with WTO rules and recommended that the US bring them into compliance in one of the most high-profile and potentially explosive cases to come before the WTO.
The US said it strongly disagreed with the panel’s “flawed” interpretation and conclusions.
It could challenge the ruling, but that would leave it in a legal limbo because Washington has blocked appointments to the WTO Appellate Body, rendering it unable to render a decision.
China expressed hope that the US would follow the panel’s decision and “correct its wrongful conduct as soon as possible.”
The US Trade Representative’s office stated in a statement that the US would not “stand idly by” as Chinese overcapacity threatened its steel and aluminium sectors, as well as its national security.
“As a result of these disputes, we do not intend to remove Section 232 duties,” it said, adding that the panel report reinforced the need for WTO reform.
The US steel industry also blasted the WTO panel, with the Steel Manufacturers Association stating that it supported the government’s refusal to accept its findings.
In 2018, Trump imposed 25% tariffs on steel imports and 10% tariffs on aluminium imports, citing Section 232 of the 1962 Tariff Act, which allows the president to restrict imports if they threaten national security. Later, free trade partners Canada and Mexico were exempted.
The tariffs prompted several WTO members, including China, to challenge the measure, and a three-member WTO panel issued its findings in cases brought by China, Norway, Switzerland, and Turkey on Friday. Indian and Russian cases are still pending.
Last year, Washington agreed to remove tariffs on EU imports, prompting Brussels to halt the EU case.
Otherwise, President Joe Biden’s administration has maintained the metals tariffs that were a centrepiece of Trump’s America First strategy.
The case hinged on the WTO’s exemption from global trade rules in cases of national security.
The central US argument was that national security should be judged by countries themselves, not by three WTO adjudicators sitting in Geneva.
Complainant Switzerland stated that the ruling did not call into question WTO members’ right to take broad discretionary security measures, but they did have to meet certain minimum requirements that could be scrutinised at the WTO.
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The central US argument was that national security is a matter for countries to decide, not three WTO adjudicators sitting in Geneva.
Complainant Switzerland stated that the decision did not call into question WTO members’ right to take broad discretionary security measures, but they did have to meet certain minimum requirements that could be scrutinised at the WTO.