Geneva: The World Trade Organisation today issued its first official condemnation of Chinese commercial practices, siding with the United States, the European Union and Canada in a dispute over car parts.

The WTO found that China was breaking trade rules by taxing imports of auto parts at the same rate as foreign-made finished cars, according to a copy of the ruling's conclusions obtained by The Associated Press.

In the sweeping decision, the three-member WTO panel found against China on nearly every point of contention with the US, the 27-nation EU and Canada. The panel found that Chinese measures "accord imported auto parts less favourable treatment than like domestic auto parts" or "subject imported auto parts to an internal charge in excess of that applied to like domestic auto parts".

Its final message to Beijing, "The dispute settlement body requests China to bring these inconsistent measures as listed above into conformity with its obligations."

The three trade powers argued that the tariff was discouraging automakers from using imported car parts for the vehicles they assemble in China. As a result, car parts companies had an incentive to shift production to China, costing Americans, Canadians and Europeans their jobs, they said.

The ruling, to be officially released in March, will be closely watched by makers of everything from batteries and brakes to seats and spark plugs on both sides of the Atlantic, including US-based Delphi Corp, General Motors former parts supplier, and Robert Bosch GmbH in Germany.
Source : PTI