U.S. and China Reach Agreement in China "Famous Brand" Exports Case
The Office of the U.S. Trade Representative has announced the signing of an agreement between the U.S. and China confirming China's full elimination of numerous subsidies that had been supporting the export of "famous brands" of Chinese merchandise and other Chinese products.
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U.S. Requested Consultations with China Over Its Export Subsidy Initiatives
In December 2008, the U.S. requested World Trade Organization consultations with China regarding three central government initiatives1 promoting famous Chinese brands of merchandise, and numerous sub-central government measures implementing these initiatives.
All of the challenged initiatives appeared to qualify as export subsidies, because they are granted on the condition that the recipients meet certain export performance criteria. Export subsidies on all products are generally prohibited under the WTO Agreement on Subsidies and Countervailing Measures.
Challenged Subsidies Include Textiles, Agricultural/Food Products, Medicines
The challenged subsidies relate to a wide range of manufacturing and export sectors, including household electronic appliances, textiles and apparel, light manufacturing industries, agricultural and food products, metal and chemical products, medicines, and health products.
China Confirms It Has Taken Steps to Eliminate, Remove Provisions of Subsidies
Under the agreement, China confirms that it has taken steps either to eliminate the measures of concern or to modify them to remove any provisions related to export-contingent brand designations and financial benefits.
1The "Famous Export Brand" initiative, the "China World Top Brand" initiative, and the "China Name Brand Products" initiative.
(See ITT's Online Archives or 02/18/09 news, 09021830, for BP summary of the USTR seeking comments on its request for WTO consultations with China.
See ITT's Online Archives or 12/29/08 news, 08122920, for BP summary of USTR announcing the December 2008 U.S. request for WTO consultations with China.)
USTR press release (dated 12/18/09) available at http://www.ustr.gov/about-us/press-office/press-releases/2009/december/united-states-wins-end-china's-"famous-brand"-sub