U.S., EU, and Japan Ask for WTO Panel to Rule on China Rare Earths Export Restraints
The U.S. requested the establishment of a World Trade Organization dispute settlement panel to decide U.S. claims regarding China’s export restraints on rare earths, tungsten, and molybdenum, said the U.S. Trade Representative. Japan and the European Union also requested formation of the panel along with the U.S.
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
(On March 13, the U.S., EU, and Japan requested WTO consultations with China regarding this dispute. Despite these formal consultations, the EU said, there have been no signals from China that it would remove the restrictions. See ITT’s Online Archives 12031312 for summary of the U.S. request for consultations, and 12040330 for summary of the USTR’s request for comments on the matter.)
U.S., EU Say China’s Rare Earths Export Restraints Distort Global Supply, Prices
In its press release, the EU said China imposes a set of export restrictions, including export duties, export quotas and additional requirements that limit access to raw materials for companies outside China. Both the USTR and the EU said these measures significantly distort global supply and pricing and favor Chinese industry at the expense of companies and consumers in the U.S. and the EU, as well as the rest of the world. The USTR alleged these measures can also create substantial pressure on foreign producers to move their operations, jobs, and technologies to China.
Cite to Similar WTO Ruling Against China in January
According to the USTR, China committed as part of the terms of its WTO accession to eliminate export duties for all products other than those listed in a specific annex. The export duties the United States is challenging are imposed on products not listed in that annex, said the USTR. The WTO recently confirmed in the China -- Measures Related to the Exportation of Various Raw Materials (DS394) dispute that China cannot justify its imposition of such export duties under the exceptions provided in Article XX of the General Agreement on Tariffs and Trade 1994 (GATT 1994), it said.
(See ITT’s Online Archives 12013112 for summary of the WTO Appellate Body’s ruling against China in DS394, a U.S. challenge of China’s export restraints on several industrial raw materials used as key components in the steel, aluminum, and chemicals industries.)
USTR press release on the request for consultations available here. EU and Japan press releases available here and here, respectively.