WTO to adjudicate China auto parts case by Jan 2008

The World Trade Organization (WTO) will adjudicate China's auto parts imports tariff case in January 2008, a senior official from Ministry of Commerce said yesterday.  

In March 2006, the United States, Canada and the European Union filed a complaint against China with the WTO regarding China’s tariff policies which has meant to encourage the use of home-made auto parts.

According to a Chinese government mandate, locally purchased spare parts should account for no less than 40% of a vehicle’s total value, otherwise vehicles will be charged higher import tariffs.

Chong Quan, spokesman of China's Ministry of Commerce said in a statement that China's rules on auto parts were to prevent customs duties evasion and "protect the rights and interests of consumers".

China's average import duties on whole vehicles had fallen from 80 percent to 25 percent since its accession to WTO, and duties on auto parts have fallen from 30 percent to 10 percent, Chong said.

"In terms of market access, China has given other WTO members unprecedented accession opportunities," he added.

China's auto part trade frictions with other countries intensified in recent years.  In February this year, the U.S. and Mexico brought China's auto parts imports policies to the WTO, alleging that Chinese policies on auto parts imports favor China's domestic suppliers against foreign suppliers. Another example is a US-initiated case dispute this April, involving China's intellectual property rights. Currently the cases are still under negotiations among related parties.