The Hong Kong Special Administrative Region (SAR) has taken a new step in its WTO labeling dispute with the U.S., with the WTO agreeing Monday to create a dispute resolution panel on the U.S. request to relabel Hong Kong products as "Made in China."
A second request from Hong Kong to set up a panel "to rule on U.S. origin-marking requirements for goods" was accepted by the WTO's Dispute Settlement Body (DSB), AFP reported, citing a Geneva trade official.
Hong Kong's request for the panel establishment regarding the U.S.' origin-marking requirements was among a list of items proposed for the DSB's meeting on Monday, according to a document posted on the website of the Geneva-based global trade body.
Hong Kong made a first arbitration request in late January, but its effort was blocked by the U.S.. A second request would virtually be automatically approved by the DSB.
Hong Kong's U.S.-bound exports would be re-stamped as "Made in China," U.S. customs announced in August last year, in a move to end the city's special treatment under the Hong Kong Policy Act of 1992. Items failing to comply will reportedly face a punitive 10 percent duty at U.S. ports.
The new rules, originally supposed to come into force in September last year, eventually came effect in November, due to an extension of 45 days.
Representatives of Hong Kong to the WTO issued a notice in late October to their U.S. counterparts, asking for negotiations over the U.S. requirements in accordance with the WTO dispute settlement mechanism.
"The U.S. is unilaterally and irresponsibly trying to weaken Hong Kong's status as a separate Customs territory," Hong Kong Secretary for Commerce and Economic Development Edward Yau Tang-wah said in a statement back then, reiterating the special status of Hong Kong has been widely recognized and respected by the international community, and Hong Kong's economic and trade status is on par with that of other WTO members.
Yau noted that such a move will confuse the market, and undermines the rules-based multilateral trading system, and the Hong Kong government will vigorously advance their arguments to defend Hong Kong's interests.