WTO to set up panels to rule on US tariff disputes

The World Trade Organization (WTO) agreed to hear grievances from a number of countries over new US steel and aluminium tariffs, as well as complaints from Washington over retaliatory duties.

The Dispute Settlement Body (DSB) of WTO approved the constitution of panels to review US decision to hit a long line of countries with tariffs of 25% on steel and 10% on aluminium.

Earlier, the European Union, China, Canada, Norway, Mexico, and Russia all confirmed they would escalate their disputes by starting adjudication proceedings, while the US wants dispute panels against Canada, China and the EU.

The Dispute Settlement Body will create separate panels for the complaints by the European Union, China, Canada, Mexico, Norway and Russia, after the US said it would not agree to a single panel to hear all of them. A seventh request from Turkey for a panel will be discussed during a meeting later.

The DSB also agreed for a panel which will review "certain Chinese measures pertaining to the protection of intellectual property rights” as demanded by US.

Background

Earlier, US President Trump imposed the tariffs levying 25 percent on steel and 10 percent on aluminium import. While imposing the tariffs, US President Donald trump justified it and said ‘it’s a matter of national security’ and hence it is the ‘safeguard’ under WTO rule and out of purview the WTO’s remit.

US departure from a decades-long strive for free trade, the exporter countries knocked the WTO door. They say the United States should compensate them for the damage, and have imposed their own tariffs in response.

The tariff spat has escalated into an all-out trade war between the US and China and growing trade tensions between Washington and many of its traditional allies.

Now, what?

The WTO decision to set up the panels follows rounds of failed consultations or discussions between the aggrieved parties and mark an escalation in an ongoing showdown at the WTO around Trump's controversial trade policies.

Under WTO regulations, parties in a dispute can block a first request for the creation of an arbitration panel, but if the parties make a second request, it is all but guaranteed to go through.

The creation of a DSB panel usually triggers a long and often costly legal battle that sometimes takes years to resolve.

India asks WTO to set up panel against US for high import duty on steel, aluminium