Article 25 requires wto members using this mechanism

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means of dispute settlement…that concern issues that are clearly defined by both parties.” Article 25 requires WTO members using this mechanism to provide all WTO members with notice and, with a favorable arbitral award, would allow the U.S. access to retaliation through the WTO DSU (including with tariffs or suspending other market access the U.S. gave China through the WTO), were China to not comply with commitments. 67 An arbitration mechanism could also be used for any WTO plus commitments to which China agrees. In addition to raising tariffs in the event of non-compliance, the U.S. should consider Office of Foreign Assets Control (OFAC) financial sanctions or travel bans against Chinese persons and companies who steal U.S. technology. 68 Given that the tariffs which have been imposed to date by the U.S. and China are not WTO consistent, such any U.S.-China bilateral deal should aim to bring tariffs back to their WTO bound levels when specific benchmarks are met, but with scope for tariff snap-backs in the event of non-compliance. The U.S. and China should seek to make such a deal WTO consistent by seeking a WTO waiver. Such an approach is a pragmatic compromise that recognizes that the U.S. and China will likely focus on bilateral negotiations to address their trade issues, while minimizing the harm to the WTO as an institution. 65 Ibid. 66 Ibid. 67 Pohl, Jens Hillebrand. “Blueprint for a Plurilateral WTO Arbitration Agreement under Article 25 of the Dispute Settlement Understanding.” In R estoring Trust in Trade: Liber Amicorum in Honour of Peter Van den Bossche. 2018. 68 Branstetter, Lee G. China’s Forced Technology Transfer Problem – And What to Do About It. PIIE Policy Brief. 2018. policy-briefs/chinas-forced-technology-transfer-problem-and-what-do-about-it.
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The US-China economic relationship: A comprehensive approach 18 Negotiate a BIT The U.S. and China should reinvigorate BIT negotiations, as has recently been suggested by the U.S. Chamber of Commerce and Am Cham China. 69 The countries began negotiating a BIT in 2008 with limited progress. The U.S. and China should revisit this effort and set an aggressive timeline of nine months to complete the agreement. Pursuing a high quality BIT would serve several core U.S. interests. First, it would provide the U.S. with an opportunity to shape rules that could address China’s key trade and investment practices the U.S. finds so objectionable. Second, a BIT would further a rules-based approach to dealing with China. Third, it would develop another mechanism for the U.S. to hold China accountable through enforcement measures, as a BIT could include a state-to-state as well as an investor-state dispute settle- ment mechanism What should NOT be a focus for the U.S. in bilateral negotiations It is also worth noting what should not guide the negotiations or determine success: namely commitments by China to increase purchases of U.S. exports and a reduction in the bilateral trade deficit.
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