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US Targets Chinese And Indian Subsidy Programmes

by Leroy Baker, Tax-News.com, New York

10 October 2011


United States Trade Representative (USTR) Ron Kirk has announced that the US has submitted information to the World Trade Organization (WTO) identifying nearly 200 subsidy programmes that China has failed to notify, as well as 50 subsidy programmes India has not previously notified, as is required under its rules.

Through these actions at the WTO, the US is seeking the prompt provision of detailed information and data from China and India regarding the operation of these subsidy programmes.

Under WTO rules, every member country is obligated to submit information about all of its subsidy programmes on a regular basis. This information is required so that members may assess the nature and extent of the subsidy programmes of others. The USTR pointed out that the notification obligation is particularly significant for members like China, “where inadequate transparency in so many areas places a tremendous burden on other WTO members seeking to better understand China’s trade policy measures.”

“Every member of the WTO is required to come clean on its subsidy programmes on a regular basis,” said Kirk. “China has not notified its subsidy programmes in over five years. India only recently filed its first notification in almost ten years, and even then notified only three of the many subsidy programmes we know to exist.”

“Because China and India have failed to meet their respective obligations,” he added, “we had to act – as we are entitled to under the WTO rules – and provide the voluminous information we have developed regarding subsidy programmes in these two countries.”

It was confirmed that, previously, over the course of numerous meetings of the WTO Subsidies Committee, the US has requested that China and India make full notifications of all of their subsidy programs.

“The lack of transparency severely constrains the ability of WTO members to ensure that each government is playing by the rules,” Kirk concluded. “The US would have preferred to avoid today’s filings but we have done so to hold China and India accountable and to enforce the rules that all WTO members must follow. China and India are among the largest exporters in the WTO, and it is simply not acceptable that they continue to evade their transparency commitments.”

TAGS: tax | India | World Trade Organisation (WTO) | China | trade disputes | United States | trade

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