The New Challenge To The Trade Remedy Measures Against China

It has been10years since China became a member of WTO in2001.Duringthese10years, China, as an important role in the international world, has enjoyed theconvince advanced by the WTO in tariff and free trade but at the same time hassuffered great losses from the updating protectionist. In the anti-dumpinginvestigations, countries like US and EU tend to exclude the price in China’s marketand use the price from a third country to calculate the normal price which had lead toa high amount of anti-dumping tax.As the economic status of China will be acknowledged in the WTO by2016, wenoticed that the western countries began to initiate anti-dumping and anti-subsidyinvestigations altogether from2004and at the same time the “external benchmark”to calculate the “benefits” of subsidy has become a new concerns after the applicableof “substitute valance”.This paper analyzes this tendency from six parts: at first, it discloses thetendency in the context of the trade remedy history of China. In the second part, itgives the concept and background of the two methods; and then it focuses on theconnection between these two systems. Although “external benchmark” and“substitute valance” are two different concepts, they do share a lot of same characters in nature. Besides, with the coming of2016,“external benchmark” is beginning togradually replace the “substitute valance” and may impose a great threat to Chineseenterprises and economics in the near future. With reference to this status, the fourthpart studies the “external benchmark” from both the WTO agreement and the WTOcase law. In the fifth part, the author turns to the “external benchmark” practice inChina and to remind the risk we may face with the abuse of this concept. In the end,the author gives some recommendations on dealing with this new tendency andexpects the government and enterprises in China will pay attention to the practice ofexternal benchmark and make preparation to counter it.