A dispute settlement panel of the World Trade Organization ruled against South Korea’s extended imposition of an antidumping tariff on Japan-made stainless steel bars and called on Seoul to take remedial measures in its report dated Monday.
The panel upheld Japan’s claim that its products are not being dumped as they are priced higher than those made by South Korean companies and cheaper Chinese products are already on the country’s market. It judged that South Korea’s move to protect its domestic industry was flawed and against WTO rules on antidumping duties.
South Korea can appeal the decision to the WTO’s Appellate Body within 60 days, though the process could be delayed as the United States is opposing the appointment of new judges to fill vacancies on the higher panel that has the final say in trade disagreements.
The latest ruling could add fuel to tensions between Japan and South Korea, which are at odds over wartime labor compensation and Tokyo’s imposition of tighter export controls.
South Korea started imposing a 15.39% tariff on Japan-made stainless steel bars in July 2004 and decided to extend the measure for the third time in June 2017, prompting Japan to lodge a complaint with the WTO in June 2018. The panel was set up four months later as bilateral consultations failed.
South Korea could decide on a fourth extension in January 2021, according to the Japanese Ministry of Economy, Trade and Industry.
South Korea’s antidumping duty on Japanese stainless steel bars, used to make bolts, nuts and valves for machinery and cars, totaled about ¥6.9 billion ($66 million) by the end of 2019, the ministry said.
Japan’s annual stainless steel bar exports to South Korea, which were at 9,269 tons in 2002 before the tariff was imposed, decreased by around 60% to 3,791 tons in 2019, it said.
A country is allowed to impose an antidumping tariff for five years when it judges that an imported product is priced at an artificially deflated level compared with its home market. Such a measure can be extended as an exception if it is feared that lifting it would hurt domestic industry.
Source : https://www.japantimes.co.jp/news