WTO Closes Disputes by Canada and Mexico on Section 232 Tariffs

SEATTLE (Scrap Monster): The World Trade Organization (WTO) announced its decision to drop complaints raised by Canada and Mexico against imposition of Section 232 tariffs on steel and aluminum by the U.S. It must be noted the U.S. had exempted Canada and Mexico from tariffs in May this year. Meantime, similar complaints filed by China, the EU, Norway, Russia and Turkey in WTO are still under process.

In complaints filed before the WTO, Canada and Mexico had claimed that steel and aluminum import duties of 25% and 10% respectively were against the provisions of the WTO's General Agreement of Tariffs and Trade. Also, the tariffs were inconsistent with WTO’s agreements on safeguards.

In May this year, the U.S. agreed to abolish tariffs on imports from the neighboring countries of Canada and Mexico. Accordingly, the countries agreed not to ship steel and aluminum that are unfairly subsidized or sold at dumped prices. Also, the countries also agreed on measures to prevent tansshipment of such steel and aluminum between the countries.

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Following the removal of Section 232 tariffs, the imports of steel and aluminum from Mexico and Canada to the U.S. has witnessed considerable surge. This in turn has led to reduced U.S. imports from other foreign countries.

Recently, Russia had initiated a dispute in the WTO against U.S. dumping duties on carbon-quality steel, claiming that the application of duties on imports of carbon-quality steel from Russia is inconsistent with various provisions of the WTO’s Anti-Dumping Agreement.