China loses WTO appeal against U.S. tire tariffs

(Reuters) - The United States was entitled to impose extra safeguard duties on imports of Chinese tires, the World Trade Organization's top court said on Monday, upholding a ruling made in December 2010.

The United States imposed the 35 percent duties in September 2009 after the United Steelworkers union complained that surging Chinese imports were hurting U.S. producers.

WTO rules allow members to impose temporary extra tariffs on goods to counter a destabilizing flood of imports.

"This is a tremendous victory for the United States as well as for American workers and manufacturers," U.S. Trade Representative Ron Kirk said in a statement. "We have said all along that President Obama's decision to impose duties on Chinese tires was fully consistent with our WTO obligations.

"The Obama Administration will continue to fight for U.S. jobs and businesses. We will use our trade laws to stand up for our workers and address harm to them."

China said it regretted the decision and urged the United States to scrap the tariff to ensure fair competition. It said the measure had not helped to reduce U.S. imports of tires, but had merely pushed China out of the market.

U.S. imports of Chinese tires fell by 23.6 percent in 2010 and by a further 6 percent in the first half of 2011, while U.S. tire imports overall grew by 20.2 percent and 9 percent respectively.

"It was a protectionist measure and unsupported by the U.S. tire industry. The safeguard measure does not help reducing U.S. tire imports, but injures China's legitimate trading interests," China's trade mission in Geneva said in a statement.

September 5, 2011

Source: Reuters