WTO Launches Second Probe Into U.S. Steel Tariffs
The European Union has already been granted a special WTO panel to investigate the U.S. decision to levy duties of up to 30 percent on a range of steel products and a number of other states are lining up to take similar action.
The steel tariffs, along with Washington's recent decision to boost massively its aid to farmers, have stoked international trade tensions, threatening the plans of the 144-state WTO for global negotiations to further liberalize world trade.
The United States says that the tariffs are needed to give its struggling steel industry time to restructure and that it is acting in accordance with the WTO's so-called safeguard rules.
But the EU and the others reject the U.S. argument and have demanded a ruling from the WTO's Dispute Settlement Body (DSB).
Trade officials said that the two WTO panels agreed to so far would merge into one and that a similar approach would probably be taken with pending requests for panels from China, Switzerland and Norway.
It is China's first use of the WTO's disputes machinery since it joined the trade body at the start of the year.
As WTO dispute decisions can take months, the EU has threatened to retaliate with $300 million sanctions of its own unless Washington agrees to concessions, Reuters reported.
Washington has granted EU firms some exemptions from the import duties, but Brussels says more are needed.
However, Japan, which had also been planning sanctions, has put its plans for retaliation on hold while negotiations on exemptions continue.
It is not only the threat of retaliation that has prompted the United States into giving some ground on the tariff issue.
With the U.S. economy picking up, steel users complained that the duties were leading to a surge in domestic prices.