Chinese Government Responds to US Countervailing Determination

China’s Ministry of Commerce has published its official response to the countervailing determination set out by the US Department of Commerce on December 10, expressing “strong dissatisfaction over and firm opposition to such a decision.”

The Ministry claims the Department of Commerce has turned a “deaf ear to the US law as well as its own consistent practice” through its decision to break with its practice, maintained since 1984, of not imposing countervailing duties on what it classes as ‘non-market economies’. This non-imposition, says the Ministry, had “already been established as a legal precedent in the US judicial lawsuits” prior to the Department of Commerce’s commencement of a series of five countervailing investigations, which led to US based companies lodging a number of countervailing appeals against products originating in China. Referring to these recent investigations, the Chinese Ministry of Commerce states that “such practices are by no means conducive to the normal development of the bilateral trade and economic ties.”

In the wake of the December 10 ruling, Chinese authorities claim the Department of Commerce has “demanded” they supply a large amount of information – information they say must be given purely on the basis of the Department’s “groundless fabrications.” The Ministry of Commerce further comments that its US counterpart has “arbitrarily expanded” the scope of the information sought, a measure it believes to be contrary to WTO requirements for countervailing investigations. Part of the Ministry of Commerce’s official statement reads: “Despite the active cooperation of the Chinese side with the US investigation, the US Department of Commerce, unfortunately, refused to adopt or believe in the authentic and effective data provided by the former and thus a miscalculation of the extent of subsidies [exists].”

The US determination, a decision the Chinese Ministry of Commerce has labelled as “unjust”, has furthermore drawn the accusation that it not only violates US law, but is “also self-evident of its discrimination against the Chinese enterprises as well as its prejudice against the development pattern of [the] Chinese economy.” This is an attitude the Chinese body believes incites US trade protectionism, thereby impairing the interests of Chinese industry. The Ministry concluded by saying that China “shall reserve its rights of taking further measures to safeguard the well-being of its enterprises.”