For the first time since China gained membership in 2001, the World Trade Organization (WTO) on November 1, 2019 authorized China to impose $3.6 billion worth of punitive and retaliatory tariffs on American imports. The WTO ruled that U.S. antidumping duties on imports of Chinese steel were overinflated because the methodologies used by the U.S. in antidumping proceedings were inconsistent with WTO rules. WTO Arbitrators suggested that China could impose the countermeasures as early as this month.

The WTO decision was announced as U.S. President Trump and Chinese President Xi Jinping plan to sign “phase one” of an interim truce in the trade war later in November at a venue that has yet to be determined, as the meetings scheduled for the Chile APEC summit were cancelled because of unrest. Though the $3.6 billion figure is a small fraction of the $75 billion in retaliatory tariffs China has already implemented, imposing these WTO-authorized countermeasures could be seen as an escalation of the trade war by the U.S. and could possibly delay progress on an interim deal.

According to the Financial Times, however, U.S. government officials in Washington, while disappointed by the WTO’s decision, believed that the ruling would not have an impact on the trade negotiations between the American and Chinese governments. The origins of this particular WTO case dates back to a Chinese complaint filed nearly six years ago to December 2013, long before the current trade dispute. The case is concerned with the methodology the U.S. used to calculate the antidumping duties, not the general trade policies the current administration has chosen.