In Feb 2021, Company X decided to open a branch based in State A to produce cars, which are largely destined for export to State C. In July 2021, State C adopted a stringent climate policy; it imposed a cap on greenhouse gas emissions and consequently established for car manufacturers within State C a duty to surrender GHG emission allowances. Considering that State A and B do not have a similar climate policy in place, State C decided to impose a tariff on cars imported from both State A and B; however, in September 2021 State C withdrew the tariff on cars imported from State B only.

Please advise the issue and solution in relation to international trade law.

Thank you