On 18 April 2019 the WTO circulated the panel report in the case brought by the United States in “China - Tariff Rate Quotas for Certain Agricultural Products” (DS517).

The U.S. complaint about Chinese tariff-rate quotas (TRQs) on certain grain products helps illustrate several key issues in U.S. - China trade relations and the effectiveness of WTO disputes. First, do international obligations based on transparency and fairness work in relation to an authoritarian country not known for the rule of law domestically? Second, can there be a disconnect between the legal aspects of a dispute and the underlying economic interests, with a DSB ruling sometimes not leading to improved trade flows? And third, given the bilateral trade war and "phase one" trade deal between the United States and China, has the WTO been superseded in this trade relationship? This paper summarizes the facts and law of the China - TRQs dispute, and examines each of these questions in that context.

The prospect of future growth in demand for agricultural products makes China's accession to the World Trade Organization (WTO) an important issue for the U.S. agricultural sector. Most agricultural interest groups strongly support China's entry into the WTO, because they think it will increase U.S. agricultural exports and enhance farm income. In a November 15, 1999 agreement with the United States, China agreed, upon its accession to the WTO, to substantial reductions in tariffs on agricultural products and to the establishment of tariff rate quotas which expand market access for several agricultural products of interest to the United States. P.L. 106-286, which grants China permanent normal trade relations status (PNTR) contingent upon its accession to the WTO, should help ensure that the United States benefits from China's market opening in agriculture and other sectors. In the 107th Congress, attention is focused on China's final WTO accession negotiations where differences over agriculture have become an issue. This report will be updated as developments warrant.