The Research On Sino-US Subsidy And Countervailing Measures Under The Framework Of WTO

China has gained extraordinary economic prosperity since being accepted as a member of the World Trade Organization (WTO) and the national enterprises has seen impressive improvement of their competence. Subsequently, on one hand, the impact of Chinese government as well as its enterprises is much more valued and the living standard is arising rapidly. On the other hand, plenty enterprises are suffering from both countervailing investigations and anti-dumping investigations initiated by United States, European Union, Canada, Japan and other related countries. Unlike anti-dumping investigations, countervailing investigations were not used against Chinese enterprises until the last decade since most of the developed countries used to hold the policy which stated countervailing investigations should not be used against non-market economies. Therefore, lots should be investigated and understood to make use of the WTO Disputes Settlement Body (DSB) and show a voice in the discussion of those controversial arguments among WTO members.It is necessary to improve the anti-subsidy laws and the anti-subsidy investigation system, as well as to organize our subsidy policies to be in accordance with the Agreement of Subsidy and Countervailing Measures (SCM). If not, the investigated enterprises will have to deal with unbearable duties, or even confront the crisis of bankrupt. At the same time, China will fail to initiate such investigations against foreign companies and the subsidies provided by foreign governments. This thesis aims to carry a thorough research of the countervailing system of the United States and controversial issues in DS437therefore to improve our countervailing measures and subsidy policies. The following states the overall structure research method and content summary of this paper.The first part of the thesis introduces the history as well as the contemporary countervailing rules of the United States and discusses the reasons and purpose of them both theoretically and practically. As the most important trade partner of China, the United States is also the first to make and use countervailing rules, a thorough understanding of which will be helpful for China to better deal with countervailing investigations. The second part is about the introduction and analysis of DS437according to the materials published by US Department of Commerce (DOC) and International Trade Commission (ITC) and WTO. The main issues include market status, public body and specialty of subsidies. The main substance of the third part is the key to the paper which includes comprehensive research and discussion of the following three issues theoretically and practically, their impacts on Sino-US anti-subsidy disputes, and comes to the conclusion that it is illegal to decide ordinary Chinese national enterprises as public body without demonstration, to deny China’s market status, or make a judgment of whether the subsidy granted by the government is specialized without ground of proof.The last part provides the methods to deal with countervailing disputes especially those with United States and to perfect the relative rules and systems in China. After ten years of practice and research, China has improved dramatically to cope with countervailing disputes and has made a difference in legalizing the subsidy policies according to the requirements of WTO rules. There is still a long way to go by cutting down special subsidies, adjusting the relations between government and national enterprises, improving the salary and training system for employees to eventually confront countervailing disputes better, strengthen the competence of the enterprises and realize national economic prosperity.