South Korea launches WTO trade challenge against U.S. duties

By Tom Miles

GENEVA (Reuters) – South Korea has launched a wide-ranging complaint at the World Trade Organization to challenge the U.S. use of anti-subsidy and anti-dumping duties, citing their use on steel and transformers, a WTO filing showed on Tuesday.

The United States has 60 days to settle the issue, after which time South Korea could ask the WTO to adjudicate.

The complaint targets U.S. trade laws that pre-date the administration of President Donald Trump, but it adds to the friction already stoked by Trump’s policy of putting “America first”, which is widely seen as protectionist.

Washington is already wrestling with a WTO case brought by Canada that challenges the foundations of U.S. trade law, and is fighting China’s claim to be treated as a “market economy”, a designation that could stymie U.S. defenses against Beijing.

Meanwhile Trump has thrown the whole WTO dispute settlement process into crisis by blocking the appointment of new appeals judges, threatening to halt the workings of a system that has refereed global commerce for almost quarter of a century.

South Korea filed its complaint on Feb. 14, challenging anti-dumping duties of up to 60.81 percent that were slapped on South Korean steel products and transformers in May 2016.

Its Trade Ministry said last week that applying “Adverse Facts Available” (AFA) rules allowed the United States to unfairly levy high anti-dumping duties without thoroughly verifying data available to it.

Last May, in a dispute with China, the WTO appeals judges ruled that the use of AFA could be challenged in a dispute, although there was not enough evidence to challenge them in the Chinese case.

The South Korean complaint made no mention of recent trade friction over the U.S. imposition of “safeguard” duties on solar panels and washing machines. Seoul has asked Washington for compensation in that case, a demand that could potentially be undermined if it became the subject of a dispute.

The European Union, China, Taiwan and Japan have also demanded compensation for those U.S. safeguard duties.

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