Trade body rules U.S. tariffs on Chinaillegal

Trump has claimed World Trade Organization treats U.S. unfairly.

WTOrejects U.S. government’s argument thatChina haswrongly engagedinpractices harmful to U.S. interests onvariety of issues.

AWorld Trade Organization GENEVA— panel ruled Tuesday that Trump administration tariffs on $200 billionworth of Chinese goods are illegal, vindicating Beijing even if the United States has all but incapacitated theWTO’s ability to hand down a final, binding verdict.

The decision marks the first time that theGeneva-based trade body has ruled against a series of high-profile tariffs that President Donald Trump’s government has imposedonanumberof countries — allies and rivals alike. Trump has repeatedly claimed that the WTO treats the U.S. unfairly.

The ruling, in theory, would allow China to impose retaliatory tariffs on billions’ worth of U.S. goods. But it is unlikely to have much practical impact, at least in the short term, because the U.S. can appeal the decision and the WTO’s appeals court is currently no longer functioning— largely because ofWashington’s single-handed refusal to accept new members for it.

In its decision, theWTO’s dispute settlementbodyruled against the U.S. government’s argument that China has wrongly engaged in practices harmful toU.S. interests on issues including intellectual property theft and technology transfer— and it quickly drew criticism of U.S. trade representative Robert Lighthizer.

“This panel report confirms what the Trump administration has been saying for four years: The WTO is completely inadequate to stop China’s harmful technology practices,” Lighthizer said in a statement.

“The United States must be allowed to defend itself against unfair trade practices, and the Trump administration will not let China use the WTO to take advantage of Americanworkers, businesses, farmers and ranchers,” he added.

The Chinese ministry of commerce said the ruling was “objective and fair” and called on the U.S. to respect it.

The appeals court issues final rulings in trade cases and stopped functioning last year when the terms of two of its last three judges expired with no replacements.

The U.S. tariffs target two batches of Chinese products. Duties of 10% were imposed on some $200 billionworth of goods in September 2018, and were jacked up to 25% eight months later. An additional 25% duties were imposed in June 2018 against Chinese goods worth about $34 billion in annual trade, targeting industrial products and items like airplane propellers, water purifiers and motorcycles.