China violated the most-favored nation treatment in China's integrated circuit case as it tried to protect the domestic industry.It has followed discriminate tax policy in which it imposed 17 % value added tax on foreign imports (majorly American imports) and had given refund of VAT to the domestic products costing them only 3 %. This is in violation of WTO rules as the country cannot discriminate against foreign products. Hence U.S.A filed a case against China in WTO in 2004.According to the U.S.A and European Union, China had violated the national treatment in the China's Auto parts case as it followed protectionist policy for its domestic auto-industry. United States of America and European Union have filed a case in WTO under dispute settlement mechanism alleging the unfair treatment of China towards foreign auto parts. China's complex tariff system is the main reason for favoring domestic industry and damaging the interests of foreign auto companies. However it may not be true completely as some analysts find political reasons behind this complaint. Majority car making companies in China are having collaboration or joint venture with foreign firms and hence will get the benefit of low cost domestic spare parts that result in lower manufacturing costs. Hence they will not prefer purchasing higher cost imported spare parts from foreign companies.The term "like product" means the product that is identical to the dumped import, or in the absence of such a product, another product that has characteristics closely resembling the dumped import (Article 12 of the Anti dumping regulations of PRC, 2004) .
4. What is "dumping" in the WTO system, do the Antidumping Regulations of the PRC 2004 use the term in the same meaning
Dumping is defined by World Trade Organization
as the action of bringing a product in to the market of another country at a price less than the normal value of the product. Dumping is condemned but not prohibited in WTO law (FN1).
According to Article 3 of the Anti dumping regulations, 2004 of PRC, The term "dumping" means that an import is introduced, in the ordinary course of trade, into the market of the People's Republic of China at an export price less than its normal value. Hence its meaning is almost similar to that of WTO definition.
The margin of dumping is the amount by which the export price of an import is less than its normal value (Article 6). The margin of dumping shall be established on the basis of a comparison of a weighted average normal value with a weighted average of prices of all comparable export transactions or by a comparison of the normal value and export price on a transaction-to-transaction basis.
5. In the Antidumping Regulations or the Subsidy and Countervailing Measure Regulations of the PRC 2004, what does "injury" mean
According to the Anti dumping regulations of PRC, 2004, The term "injury" means material injury or threat of material injury caused by dumping to an established domestic industry or material retardation of the establishment of such a domestic industr