AAP Finance

WTO sides with China against US tariffs

By AAP Newswire

The United States has been violating free trade rules by slapping hefty tariffs on imports from China as part of its trade spat with the Asian manufacturing giant, the World Trade Organisation says.

Officials in Beijing had filed a complaint at the Geneva-based body after the US imposed more than $US200 billion ($A273 billion) of duties on Chinese goods in 2018 as retaliation against alleged unfair government subsidies and theft of technological know-how by China.

The WTO dispute panel ruled that the measures discriminated against China and that the tariffs exceeded limits to which the US is bound.

It also concluded that the US failed to show how the Chinese imports that it targeted were linked to Chinese intellectual property theft.

The US government had claimed that there was no legal basis for a ruling, arguing that Chinese-US trade talks amounted to a decision to settle the matter outside the WTO system.

However, the WTO pointed out that the world's two largest economies had not come to an agreement and that China had not intended the talks to replace the WTO process.

WTO said the US should stick to international free trade rules, and it encouraged officials in Washington DC and Beijing to negotiate a solution.