Trade Cases

WTO panel rules in favor of US in 232 tariff quarrel with Turkey

Written by Laura Miller

A World Trade Organization (WTO) dispute panel has ruled in favor of the US in a case regarding retaliatory tariffs imposed by Turkey in response to Section 232 tariffs on steel and aluminum.

In 2018, the Trump Administration placed Section 232 tariffs of 25% on steel and 10% on aluminum imports for national security reasons. In response, Turkey put retaliatory tariffs on coal, paper, walnuts/almonds, tobacco, unprocessed rice, whiskey, automobiles, cosmetics, machinery equipment, and petrochemical products from the US, according to Reuters.

The WTO panel’s Dec. 19 ruling recognized the Section 232 levies are a security measure enacted by the US and that Turkey is violating WTO rules by imposing “retaliatory tariffs disguised as safeguard measures,” Sam Michel, spokesperson for the office of US Trade Representative Katherine Tai, said in a statement.

“The WTO does not have the authority to second-guess a WTO member’s response to threats to its security, and WTO reform must ensure that issues of national security cannot be reviewed in WTO dispute settlement,” Michel said.

The panel has recommended that Turkey “bring its WTO-inconsistent measure into conformity with its obligations under” the General Agreement on Tariffs and Trade 1994.

Additionally, non-market excess capacity from China, Turkey, and others “is an existential threat to market-oriented steel and aluminum sectors and, through the effects on imports, a threat to US national security, including by eroding US steel and aluminum manufacturing capacity,” Michel said.

He added that the WTO has been ineffective at dealing with non-market excess capacity.

Laura Miller

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