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China – Measures Affecting Imports of Automobile Parts

Published online by Cambridge University Press:  07 September 2011

Jasper-Martijn Wauters
Affiliation:
White and Case, LLP
Hylke Vandenbussche
Affiliation:
Université Catholique de Louvain
Henrik Horn
Affiliation:
Research Institute of Industrial Economics, Stockholm
Petros C. Mavroidis
Affiliation:
Columbia Law School, New York
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Summary

Abstract: This paper reviews the WTO Appellate Body Report on China – Measures Affecting Imports of Automobile Parts (WT/DS342/AB/R, 15 December 2008). This dispute concerns a set of regulatory measures imposing a 25% ‘charge’ on imported automobile parts used in the manufacture of motor vehicles in China. The main legal question in this case consisted of the nature of this charge as either a border charge subject to China's tariff concessions or an internal charge, subject to the basic nondiscrimination requirement of GATT Article III. In our report, we examine the reasoning of the Appellate Body relating to the difference between these two types of charges. We discuss the role and relevance of this distinction in the GATT/WTO legal system in general, and for the purposes of resolving this dispute in particular. We also address the important systemic question relating to the review of a Member's domestic laws for purposes of determining their GATT/WTO consistency. This was an important issue in this case, as China claimed that the Panel misunderstood the meaning of the relevant Decree and requested the Appellate Body to review the Panel's erroneous reading of this Decree. We discuss the Appellate Body's reasoning relating to the review of domestic laws by Panels and the Appellate Body and express concern over the distinction drawn by the Appellate Body between legal and factual elements of relevance in the interpretation of such laws.

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Publisher: Cambridge University Press
Print publication year: 2010

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