Exclusive: U.S. asks for WTO panel over metals tariff retaliation

[October 19, 2018]  By Trevor Hunnicutt and Nerijus Adomaitis

WASHINGTON/OSLO (Reuters) - The United States is requesting that a World Trade Organization dispute resolution panel get involved in a clash over international retaliation over U.S. tariffs on steel and aluminum, according to a U.S. official familiar with the matter.

The requests, filed on Thursday, cover tariffs by China, the European Union, Canada and Mexico, which followed the United States imposing a 25 percent duty on steel imports and a 10 percent tariff on aluminum imports, which it justified on national security grounds.

Canada, Mexico and China had also planned to ask for a WTO panel examining those tariffs, according to another government official familiar with the matter. Earlier on Thursday, Norway said that it, the EU and other countries would seek the WTO dispute group's help.
 

China has filed a request with the WTO to establish an expert group to determine the legality of the tariffs, its commerce ministry said late on Thursday.

In a statement posted on its website, the ministry said the U.S. decision to adjust the tariffs was an act of protectionism that seriously undermined multinational trade rules.

It said consultations with the United States under the WTO dispute settlement mechanism had failed to resolve China's concerns, prompting it to ask for the expert group to be established.

Officials representing the other countries' trade delegations could not immediately be reached after normal business hours. The WTO did not immediately respond to requests for comment.

The dispute marks a new dimension to the ongoing skirmish between the United States and a number of its trading partners as well as the WTO itself, where it has blocked appointments of new judges. The WTO is presiding over a record number of disputes, many of them triggered by Trump's tariffs on steel and aluminum and his trade war with China.

Norway earlier said initial consultations with the United States had not led to an agreeable solution, and therefore the Nordic country had joined others in asking the WTO to set up the panel to obtain an independent assessment of the matter.

A overhead crane places a steel slab for storage at the Novolipetsk Steel PAO steel mill in Farrell, Pennsylvania, U.S., March 9, 2018. REUTERS/Aaron Josefczyk

"We believe that additional U.S. duty on steel and aluminum is contrary to WTO rules," Norwegian Foreign Minister Ine Eriksen Soereide said in a statement.

"Therefore, together with the EU and several others, we asked today the WTO to establish a dispute resolution panel on the U.S. additional duty," she said.

In Brussels, meanwhile, the EU, Norway and Switzerland sought Asian support for free trade, the Iran nuclear deal and fighting global warming at a regional summit that included China, Japan and Russia as a counterbalance to a more protectionist United States.

U.S. Commerce Secretary Wilbur Ross told CNBC on Wednesday that trade negotiations with China appear to have taken a brief pause, and he tamped down expectations that the countries would make substantial progress toward an agreement at an upcoming G20 meeting.

Despite striking a deal with Washington to overhaul the North American Free Trade Agreement (NAFTA), Mexico and Canada remain subject to the metals tariffs.

On Tuesday, EU trade chief Cecilia Malmstrom held talks with Ross in Brussels on improving trade relations, though Washington accused the bloc of moving too slowly in negotiations.

(Reporting by Trevor Hunnicutt in Washington and Nerijus Adomaitis in Oslo; Additional reporting by David Stanway in SHANGHAI; Editing by Mark Heinrich and Tomasz Janowski)

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