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China revives WTO nuts and bolts dispute with EU

30 October 2013, 18:07 CET
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(GENEVA) - China on Wednesday revived a WTO dispute with the EU over import duties on nuts and bolts, claiming Brussels failed to respect a 2011 ruling, the global body said.

The World Trade Organization said that Beijing had made a formal request for consultations with the European Union on the latter's compliance with an order it to fall into line.

Under the rules of the 159-nation WTO, requesting consultations is the first step towards seeking the creation of an independent panel of trade experts to rule on a complaint.

The issue at stake is the EU's anti-dumping duties on iron and steel fasteners -- a category of products epitomised by nuts and bolts.

Such duties can be imposed when WTO members believe that their domestic industries are being harmed by dumping, which is the sale of cut-price products in order to grab market share.

Arguing that dumping was taking place, the EU had in January 2009 levied tariffs ranging from 26.5 percent to 85 percent on Chinese fasteners.

In 2010, however, a WTO panel created at China's behest ruled that Brussels acted inconsistently in its anti-dumping calculations. That decision was upheld on appeal in 2011.

In the wake of such WTO rulings, member states found at fault are allowed time to bring their rules into line, in agreement with the plaintiff.

In January 2012, China and the EU agreed that Brussels would put its house in order by October that year -- when the EU announced it had respected the ruling, a stance that China rejects.

Brussels has 15 days to respond to Beijing's request for consultations, after which China can request the establishment of a panel to assess the EU's compliance.

China is the world's biggest producer of screws, nuts, bolts and washers, while the European Union is its biggest market.

EU-China trade has exploded in recent years, making the EU the top destination for Chinese exports while China is Europe's biggest trade partner after the United States.

Beijing and Brussels have locked horns over a string of trade issues at the WTO, which seeks to set a level playing field for commerce between its members.

In the event that the WTO's disputes settlement body finds in favour of a plaintiff, it can authorise retaliatory trade measures against a country until its falls into line.

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