tariff Photo:VCG

The US Court of International Trade (CIT) announced on Tuesday US time to grant a preliminary injunction suspending the liquidation of some Chinese imports subject to additional tariffs, a move described by trade experts as a small sign of possible and more notable progress in China-US trade talks.

Highlighting the damage of the US' tariffs on US businesses' earnings, a lawsuit led by US flooring importer HMTX Industries commenced in September 2020, the first of about 3,600 cases challenging the US imposition of a third and fourth round of additional tariffs on  Chinese products.

The court granted the plaintiffs' motion for a preliminary injunction, according to a slip opinion posted on the CIT's website. It said that the court "will temporarily restrain liquidation of any unliquidated entries of merchandise imported from China" by the plaintiffs that were subject to the last two rounds of tariffs.

Import tariffs, after initially being imposed, would still take a while before being ultimately liquidated. The temporary suspension of liquidation means the tariffs would be frozen for the time being, He Weiwen, a former senior trade official and an executive council member of the China Society for World Trade Organization Studies, told the Global Times on Wednesday.

The latest ruling, part of the normal court procedure in the US, could indicate that the levying of additional tariffs was ill-grounded, He said, adding that "it might be an early sign, albeit far from being convincing, that the US is moving toward eventually removing the additional tariffs."

Under US law, a court's decision on a case sets a precedent for other suits. If the final verdict of the tariff lawsuit is in favor of the US importers, there would be a chance of kindling a tariff rollback, according to He.

The tariff revocation is the prerequisite for the two economies to truly re-engage with each other in the trade arena, experts said.

As part of a tariff war that started in 2018, the US initially sought 25 percent tariffs on about $250 billion of imports of Chinese goods in three tranches. A fourth round on $300 billion worth of Chinese imports was partially delivered in 2019 with a 15 percent tariff rate. The rate was halved to 7.5 percent beginning in February 2020.

Although the ruling itself isn't proof of a tariff cancellation, the CIT's preliminary decision still indicates that US trade policy under the Joe Biden administration seems more pragmatic, Gao Lingyun, a trade expert at the Chinese Academy of Social Sciences in Beijing, told the Global Times on Wednesday.

In a sign that the two countries are continuing to push for pragmatic trade cooperation despite lingering tensions, Chinese Commerce Minister Wang Wentao and his US counterpart Gina Raimondo had a "candid and pragmatic" exchange of views on relevant issues of mutual concern in the business sector, Gao Feng, a spokesperson for the Ministry of Commerce, told reporters in June.

Both sides agreed to promote pragmatic cooperation in trade and investment and properly handle differences, while maintaining work communication, according to Gao, speaking of the June phone call.

This was the third discussion between top Chinese and US economic and trade officials since Biden took over the US' presidency. 

Chinese Vice Premier Liu He held a virtual meeting with US Treasury Secretary Janet Yellen on June 2. Liu held a phone call with US Trade Representative Katherine Tai on May 27.