China to hear evidence in Geneva over auto parts

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Shanghai, October 15, 2008: ( Representatives from China's Ministry of Commerce will arrive at WTO headquarters in Geneva to hear the evidence and wait for the final rulings over the auto parts issue, reported the 21st. Century Economic Herald today.

"After careful investigation, China cannot completely agree with the Dispute Settlement Body (DSB)'s report and ruling, and we have already made that clear before," a ministry official under condition of anonymity said in an interview with the newspaper.

"Every country is entitled to make laws to prevent tax evasion and in light of this principle, we decided to appeal," he said, repeating that the taxes were needed to stop whole cars being imported in large chunks, allowing companies to avoid the higher tariff rates for finished cars.

China on September 15 appealed the World Trade Organization ruling which claimed that Beijing was breaking trade rules by taxing imports of auto par

ts at the same rate as foreign-made finished cars. Under Chinese rules, cars made in China must contain at least 40 percent Chinese-made parts or they are taxed at the rate of imported finished cars.

DSB has between 60 and 90 days to come up with a new report following China's appeal, but EU trade commission spokesman Peter Power said at the time that while China had this final right to appeal, he was confident the original verdict would stick.

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