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2. Public notice and notification. To make the whole procedure fair and transparent, the importing Member would publish notice of the commencement of any investigation, any measure proposed to be taken, the decision to apply a measure, commencement of any procession to consider the duration of the action. Any such action by China against the applying member or by the WTO member against China shall be notified immediately to the Committee on Safeguards.
3. Consultations. 1) Initiation of consultations. When products of Chinese origin are being imported into any WTO Member in such increased quantities or under such conditions as to cause or threaten to cause market disruption to the domestic producers of like or directly competitive products, the WTO Member so affected may request consultations with China. The affected WTO Member should pursue application of a measure under the Agreement on Safeguards. 2) An agreement is reached. If these bilateral consultations led to an agreement that imports of Chinese origin are a cause of market disruption and where necessary, China shall take an action to prevent or remedy the market disruption.3) If consultations do not lead to an agreement between China and the WTO Member concerned within 60 days of the receipt of a request for consultations, the WTO Member affected has the right, in respect of such products, to withdraw concessions or otherwise to limit imports, but only to the extent necessary to prevent or remedy such market disruption.
4. Provisional safeguard measures. In case that delay would cause a damage that would be difficult to repair, the WTO Member may take a provisional safeguard measure pursuant to a preliminary determination that imports have caused or threatened to cause market disruption.In this case, notification of the measures taken to the Committee on Safeguards and a request for bilateral consultations shall be effected immediately thereafter.The duration of the provisional measure shall not exceed 200 days and it shall be counted in the duration of the safeguard measures if the final determination is and affirmative and safeguard measures are necessary.
5. Retaliation. A WTO Member shall apply a measure only for such period of time as may be necessary to prevent or remedy the market disruption. China cannot retaliate in response to the application of PSSMs unless a measure is taken based on a relative increase in imports for more than two years or an absolute increase in imports for more than three years.
IV. Effects of PSSMs on China
In general, Chinese scholars have criticized the PSSMs and considered them as one of the four unfair provisions that China agreed to upon its accession to the WTO. (Han Xiuli, 2004b) Undoubtedly, the provision of PSSMs has rendered higher possibility and more conveniences for other WTO members to apply or even abuse safeguard measures against China and forced Chinese enterprises into unfavorable conditions facing more challenges. However, a careful study of the trade development after China’s accession indicates that the PSSMs have not “extraordinarily enhanced their unfavorable effect upon China”. Therefore, it is necessary to look at the issue from different perspectives.
The PSSMs distort the principle of free and fair trade and exert huge and far-reaching influence upon China. So far as the reach of the influence, the effect of PSSMs must be reviewed from microscopic and macroscopic perspectives. In terms of macroscopic consideration, China’s trade policy and trade regime will be affected while the microscopic effect is reflected in the operation of enterprises and the development of domestic industry.
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