WTO body rules against China's tariffs on car parts
A ruling body of the World Trade Organization has issued a recommendation Monday that China change its tariffs on importing car parts into the country, so that policy falls more in the line with free trade principles, dpa reported.
The United States, European Union and Canada had appealed against China's laws, saying they were unfair according to WTO rules since they taxed imported parts by 25 per cent in certain cases.
The US said the practice ended up deterring automobile manufacturers in China from using imported auto parts in the assembly of vehicles
The ruling is likely to be upheld by member-states and a negotiation process will follow in which the terms of China's compliance will be determined.
China joined the WTO in 2001 and this was the first dispute to be litigated against its policies.
US Trade Representative Susan Schwab said that especially in light of the problems the auto industry faced "I expect China to comply promptly with its WTO obligations by removing an unlawful and unfair trade barrier that is harming US workers and manufacturers."
Concern has mounted in the US over the fate of a bailout for auto makers and the affect their failure might have on the rest of the economy, including on companies that produce parts.