AP-The World Trade Organization ruled Friday in favor of China in its case alleging the European Union is illegally taxing steel fasteners of all sizes needed for everything from furniture to cars to bridges.
The WTO's appellate body said in its ruling that the EU isn't complying with international commerce rules by imposing anti-dumping duties on the Chinese-made fasteners.
It said the 27-nation bloc isn't calculating them fairly because it considers China to be a single exporter, rather than treating its companies individually.
It means the EU may have to adopt new regulations to lower its anti-dumping duties, but it will have broader impact still.
That is because the ruling says anti-dumping duties must now be set according to individual companies, not on country-wide basis, for China and other WTO-member nations such as Vietnam that are considered by the EU to lack free-market economies.
China and the European Union, its biggest trade partner, have been involved in their "fastener dispute" since 2009 when China asked the WTO to examine the EU's charges on imports of Chinese steel fasteners.
China brought the case on behalf of more than 1,700 producers who have been selling the steel fasteners at 30 percent to 50 percent below European prices.
The EU had slapped Chinese exporters with trade duties of up to 85 percent until 2014, arguing they were needed to keep China from dumping its cheaper products and harming EU industry's competitiveness.
The EU has more than 300 such producers, but the WTO said the EU had failed to show that a "major proportion" of that industry was harmed. Instead, it said, the EU had demonstrated that only 27 percent of its fastener production was affected.
Governments investigate dumping when they suspect foreign producers are exporting goods at artificially low prices — usually as a result of subsidies or in an attempt to corner a market.
The WTO cannot force countries to comply with its rulings, but it can authorize commercial sanctions against nations continuing to break the rules. Trade cases generally take years to reach that point.
China, too, has imposed anti-dumping duties on some European steel products and accused Europe of protectionism for extending curbs on imports of Chinese shoes.
China is the world's biggest steel producer and has faced complaints it is harming foreign producers by dumping steel in foreign markets. The United States has imposed anti-dumping duties on several types of Chinese steel products.
