The World Trade Organisation (WTO) ruled on Wednesday (December 21) that the United States was flouting international trade rules by labelling imports from Hong Kong as those from China. USA has rejected this ruling. The WTO ruling addressed a decision under former president Donald Trump’s administration after Beijing imposed a sweeping security law on the financial hub in 2020 to stamp out dissent.
Trump retaliated by removing special trading privileges for the city and US customs authorities later said goods produced there could no longer be stamped “Made in Hong Kong”, sparking the complaint.
Hong Kong argues that this move by the US ignored its status as a separate member of the WTO. This, says Hong Kong, violates trade rules.
On Wednesday, a panel set up by the WTO’s dispute settlement body said that the origin marking requirement was “not justified” under global trade rules.
It added that the US “has not demonstrated that the situation at issue constitutes an emergency in international relations”.
The US’s labeling requirement also gives Hong Kong products “less favorable” treatment than others, the panel said, adding that goods of other countries bear their own name rather than that of another WTO member.
The ruling drew sharp reaction from the US.
“Issues of national security cannot be reviewed in WTO dispute settlement, and the WTO has no authority to second-guess the ability of a WTO member to respond to what it considers a threat,” said US Trade Representative spokesperson Adam Hodge.
(With inputs from agencies)
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