GENEVA, Jan 21 (Reuters) – The United States and the European Union have downgraded their dispute at the World Trade Organization over the former president’s steel and aluminum tariffs US President Donald Trump in 2018 and subsequent EU retaliation, according to documents filed at the WTO.

The two sides agreed in October to suspend tariffs and work on a deal to tackle “dirty” production and overcapacity in the industry over the next two years, with China clearly at the center of their attention.

Each then agreed to suspend WTO panels deliberating on Trump’s tariffs and subsequent EU countermeasures, which have taken the form of tariffs on a range of US products, including whiskey, steamboats engine and Harley Davidson motorcycles.

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Documents filed with the WTO on Friday show that Washington and Brussels have now decided to end the panel process and move to a more informal and rarely used arbitration route.

The two sides aim to agree on arbitrators, who could include members of the existing WTO panel, and then immediately and indefinitely suspend their work. Either way, they wouldn’t start work until November 1.

The parties to arbitration may establish their own rules and procedures and define the issues in dispute, but they must agree that the arbitrators’ decision is final.

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Reporting by Philip Blenkinsop; edited by David Evans

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