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U.S. Files Second WTO Complaint on Access to China’s Market for Rice, Wheat, and Corn

Friday, December 16, 2016
Sandler, Travis & Rosenberg Trade Report

The Office of the U.S. Trade Representative announced Dec. 15 that it has launched a new trade enforcement action at the World Trade Organization against China’s administration of tariff-rate quotas for rice, wheat, and corn. USTR also said that in a separate but related case it has requested the establishment of a WTO dispute settlement panel to examine China’s level of domestic support for domestic producers of rice, wheat, and corn. 

According to USTR’s analysis, China appears to administer its TRQs – which are necessary to import medium- or short-grain rice, long-grain rice, wheat, and corn at lower duty rates – in a manner inconsistent with the commitments in its WTO accession protocol and the GATT 1994. USTR states that China announces the opening of TRQs on an annual basis but that its application criteria and procedures are unclear and it does not provide meaningful information on how it actually administers the TRQs. USTR also contends that China appears to be maintaining impermissible restrictions on importation and failing to provide notice of the total quantities permitted to be imported as well as changes to that quantity. 

As a result, USTR states, traders are not able to enjoy full access to these TRQs, which persistently do not fill. The Department of Agriculture estimated that these TRQs were worth more than $7 billion in 2015 and that if they had had been fully used China would have imported as much as $3.5 billion worth of additional crops.

USTR is also advancing a WTO case examining allegations that China’s market price support for rice, wheat, and corn was nearly $100 billion in excess of its domestic support commitments in 2015. The two sides held consultations in October but no resolution was reached.

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