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Foreign parties believe that China’s levying the same tariff as a complete vehicle on components that equal or exceed 60% of the vehicle’s value is equivalent to disguising the “localization rate†of parts and components, thus violating WTO regulations.
The Chinese side believes that China is in order to prevent the use of tax differences between vehicles and parts to avoid customs supervision and evasion of customs duties, and it is also a need to protect the interests of consumers. The relevant regulations are in line with China’s commitment to accede to the WTO and also comply with the relevant WTO rules.
The legal network reporter Chen Jingjing continued to fluctuate for more than six months after the dispute over the import of auto parts. On October 26, the WTO Dispute Settlement Body, on the request of the European Union, the United States, and Canada, decided to set up an expert group to hear the disputes raised by the above-mentioned three parties on China's imported automotive parts and regulations. Assistant Minister of Commerce and Press Spokesman Chong Quan said on October 27 that China regrets that the EU, the United States, and Canada have once again asked for the establishment of an expert group.
The core reason for the disagreement between China and the European Union, the United States, and Canada on the import of auto parts is the “Administrative Measures for the Import of Auto Parts that Constitute the Characteristics of the Vehicle†formally implemented by China on April 1, 2005. The regulations stipulate that imported parts with the characteristics of a complete vehicle will be taxed on the entire vehicle to prevent the car manufacturer from importing the entire vehicle in the form of parts and components, thereby evading the tariff imposed on imported vehicles.
However, the foreign party believes that China imposes the same tariffs on vehicles with parts equal to or exceeding 60% of the total vehicle value, which is equivalent to disguising the ratio of localization of parts and components, thus violating WTO regulations. From March to April of this year, the United States, the European Union, and Canada respectively proposed to China that they would like to negotiate on the taxation measures for imported auto parts and components that constitute the characteristics of the vehicle. The relevant Chinese authorities discussed the case with the above three parties; in September, The tripartite party, on the ground that China failed to meet the requirements put forward during the consultation, turned to the WTO dispute settlement body to set up an expert group and the expert group examined the case. The Chinese side expressed regret.
Chong Quan stated that China's relevant administrative regulations on the import of auto parts and components are designed to prevent the use of tax differences between vehicles and parts to avoid customs supervision and evasion of customs duties, and also to protect the interests of consumers. The relevant regulations are in line with China's commitment to China's accession to the WTO and also comply with the WTO rules. The Chinese side has clarified this in previous consultations with the European Union, the United States, and Canada and has shown great sincerity in resolving issues through negotiations.
In the five years since joining the WTO, the average tariff on China's auto vehicles has been reduced from 80% at the time of accession to the current 25%, the average tariff on auto parts has been reduced from 30% to 10%, and the quota and permit system have been abolished. . Chong Quan emphasized that these facts all indicate that the Chinese government is serious and serious in fulfilling its commitment to join and complying with the WTO rules. According to China's accession to the WTO, China has the right to impose higher tariffs on auto vehicles than parts and components, and also has the right to crack down on circumvention in accordance with the law.
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