The three-person panel found US-China tensions did not justify the adverse treatment of the financial centre.
The World Trade Organization has ruled that the United States is flouting international trade rules by labeling imports from Hong Kong as imports from China.
Wednesday’s WTO ruling refers to a decision by the administration of former US President Donald Trump to revoke special trade privileges for the Chinese-ruled city.
Trump made the decision – meaning goods made in the city no longer had the “Made in Hong Kong” stamp – after Beijing imposed the embargo. far-reaching security laws across the financial center in 2020 to quell dissent.
Until 2020, the United States treated Hong Kong, a semi-autonomous region and a separate WTO member, in the same way as before it was transferred from British control in July 1997.
A three-man WTO panel found that the United States had breached its obligations to Hong Kong by treating it less favorably than other WTO members with respect to marks of origin on its products. .
The United States says it has made an exception that allows measures to protect a country’s “essential security interests”.
The panel acknowledged that tensions had increased between the US and Hong Kong, but said it had not yet risen to the level of “international relations emergency”, the threshold needed to apply for an exception.
The panel concluded its 96-page report by saying that the United States should bring its measure into line with global trade rules.
The ruling drew fierce criticism from Washington on Wednesday, with US Trade Representative spokesman Adam Hodge saying the country “strongly opposes the erroneous interpretation and conclusions” of the report. council report.
Hodge said that the United States was responding to China’s “worrisome actions” that threatened US national security interests.
He added that the US has no plans to remove the marking requirement due to the latest report.
“National security issues cannot be considered in the WTO dispute settlement process and the WTO does not have the authority to make a second assessment of a WTO Member’s ability to respond,” Hodge said. what they see as a threat.”
Hong Kong’s economic development and trade minister praised the WTO ruling and urged Washington to reverse course.
“It is discriminatory, completely unreasonable and a serious violation of WTO rules,” Algernon Yau told reporters, adding that the change had “confounded customers.” “.