The World Trade Organization has rejected China's challenge to U.S. restrictions on 12v solar panel imports. Why?

The World Trade Organization (WTO) ruled Tuesday that the United States did not violate world trade rules, rejecting China's complaint against the United States over its restrictions on solar panel imports in a victory for the United States.

The WTO's three-member dispute settlement panel rejected all four of China's claims, saying in a report released on Tuesday that China had failed to prove that U.S. protective measures against imports of certain crystalline silicon solar cells were inconsistent with WTO rules.

In January 2018, former US President Donald Trump announced a four-year tariff quota on solar panels, limiting the number of imports, and imposing tariffs on parts exceeding the number, with a tax rate of up to 30%.

The measure stems from a trade lawsuit filed in April 2017 by a bankrupt U.S. solar manufacturer, which announced it had been hurt by cheap imports, mostly from Asia. The U.S. International Trade Commission endorsed that claim in October, contributing to Trump's final decision.

According to Bloomberg data, Chinese solar panel suppliers flooded the United States at the end of 2017 to avoid the 30 percent import tariff imposed by American customers.

China has since disputed the American restrictions, saying, for example, that the United States has not proven a causal link between the increase in imports and the damage to its industry. China said earlier that the 30 percent tariff imposed by the United States can not only be regarded as a violation of the WTO agreement on safeguard measures, but also as a violation of China's legitimate rights and interests, and also have a serious impact on the credibility and rigor of WTO rules and principles.

However, such a complaint has been rejected by the WTO, and US Trade Representative Katherine Tai welcomed the WTO's ruling, saying in a statement in response: "I welcome the WTO panel's finding that China's challenge to US solar defense measures is without merit and has been rejected."

"We must make epoch-making infrastructure investments that allow the solar industry to realize its full potential and create good-paying jobs in areas that are innovative and climate-resilient," she added.

Unless the United States or China appeal, the WTO dispute settlement body will adopt the panel's report within 60 days.