China Anti-dumping Duties on Steel WTO - Illegal, Japan says

On 20 December, Japan notified the global trade arbiter that it would be seeking consultations with China over Beijing’s anti-dumping duties on a specific type of steel tubes used in industrial boilers - formally known as high-performance stainless steel seamless tubes, or HP-SSST (DS454). Dumping, in trade parlance, involves the practice of companies selling their products abroad at prices below normal market values, causing harm to the domestic industry of the importing country.

The duties at issue, which also affected imports of the same product from the EU, have been in place since last November, following the results of an anti-dumping investigation that China launched in September 2011. The duties applied to Japan’s imports, according to the country’s Ministry of Economy, Trade, and Industry, ranged from 9.2 to 14.4 percent.

According to Tokyo, the duties are in violation of the WTO’s General Agreement on Tariffs and Trade, along with provisions of the global trade body’s Anti-Dumping (AD) Agreement. The consultations request raises questions regarding various procedural elements of the investigation, such as whether there had been sufficient evidence to launch the investigation in the first place.

China, in a brief response on its Ministry of Commerce website, has said that it will “properly handle [the consultation request] according to dispute settlement procedures under the World Trade Organization,” without going into further detail.

China’s increased use of trade remedy investigations has drawn the attention of its trading partners in recent years, with this case marking the fourth on the matter since Beijing acceded to the global trade body in 2001.

The two regional economic powerhouses - who have lately been publicly at odds due to a separate disagreement regarding sovereignty over a group of islands - have rarely sparred at the WTO dispute level, with just one other row making it to the global trade arbiter. Japan lodged a challenge late last year, together with the EU and US, over China’s export restrictions on rare earths (DS433, DS432, and DS431, respectively); a panel to hear that case was composed in September.