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Retaliatory Actions

U.S. and international trade law provide authority and mechanisms outlining the procedures used to enforce trade agreements and resolve trade disputes. In many trade disputes, countries are able to come to a mutually acceptable agreement on how to resolve the dispute. When agreement cannot be reached and an unfair trade practice continues to be applied, under the auspices of domestic or international law, countries may be allowed to retaliate or impose duties on the imports from the country promulgating the unfair trade practice.

The list of products on which a country raises import duties is called a "retaliation list." Industry and Analysis's Office of Trade Negotiations & Analysis is responsible for developing all U.S. retaliation lists implemented by the United States Trade Representative. In addition, OTNA analyzes the economic impact of retaliation lists implemented by foreign countries against the United States.

U.S. Retaliatory Actions:

Under various mechanisms of U.S. law and international trade law, the United States may impose trade sanctions on foreign countries that either violate trade agreements or otherwise maintain laws or practices that are unjustifiable and restrict U.S. commerce. Section 301 of the Trade Act of 1974 is the principal statutory authority under which the United States may impose these trade sanctions. When an investigation involves an alleged violation of a trade agreement (such as the WTO Agreement or the North American Free Trade Agreement), the United States Trade Representative (USTR) must follow the consultation and dispute settlement procedures set out in that agreement. If the United States finds it necessary to increase duties because of a violation of the WTO, USTR will seek authority from the WTO's Dispute Settlement Body to suspend trade concessions previously granted to the foreign country. Such actions typically include increasing import duties.

Foreign Retaliatory Actions:

Foreign countries that are members of the WTO (or other multilateral or bilateral agreements to which the United States is a party) are actively monitoring and challenging U.S. trade practices that they feel are not compliant with the obligations of the trade agreement.

When U.S. actions have been found to violate obligations under the WTO or other international trade agreements, affected foreign countries may impose trade restrictions on U.S. exports. These measures may remain in place until the United States is in compliance with its international obligations or otherwise resolves the dispute with the affected foreign country(ies).