U.S. Said to Win WTO Trade Dispute With China Over Automobiles

May 22, 2014 8:43 pm ET

May 23 (Bloomberg) -- The World Trade Organization has ruled in favor of the U.S. in a dispute with China involving automobiles, two years after filing complaints against the Asian nation, according to a person familiar with the matter.

The U.S. is set to announce the victory in Washington today, according to the person, who requested anonymity in order to speak freely. Officials from the Chinese Embassy in Washington didn’t immediately respond to a request for comment.

President Barack Obama’s administration in 2012 lodged a complaint with the Geneva-based WTO challenging Chinese duties on auto imports from the U.S. A separate U.S. complaint that year said China, the world’s second-largest economy, unfairly subsidized its auto and auto parts manufacturers.

The U.S. this week dramatically escalated the trade battle with China, accusing five military leaders of stealing corporate secrets. The indictments are on top of complaints over issues such as tires, chicken parts, clean-energy products and credit- card payment services.

Since 2009, the U.S. has filed 17 cases at the WTO against China and other nations, including Indonesia and India, according to the U.S Trade Representative’s office. The U.S. doubled the rate of filings against China over that time.

In March the WTO backed the U.S. in one of those cases, agreeing that China’s limits on exports of rare-earth elements used in hybrid-car batteries and wind turbines violate trade rules.

The automobile issue has drawn recent attention. The U.S. in July 2012 filed a WTO complaint seeking to offset Chinese duties on more than $3 billion worth of auto imports from the U.S. The Beijing government had alleged that the U.S. industry gained an unfair edge in trade by using government subsidies and selling the goods in China below their value, a practice known as dumping.

Two months later, the U.S. filed the second WTO case against China alleging the Beijing government subsidized its own auto and auto-parts makers in violation of global trade rules.