The U.S., the E.U. and Japan Launch WTO Challenge to China's Rare Earth Export Restraints

March 20, 2012

On March 13, 2012, the United States, the European Union and Japan, requested World Trade Organization (WTO) consultations regarding China’s export restrictions on various forms of rare earths, as well as tungsten and molybdenum. These materials are used as inputs in a variety of products and manufacturing sectors, including hybrid car batteries, wind turbines, energy-efficient lighting, steel, advanced electronics, automobiles, petroleum, and chemicals. According to the Office of the United States Trade Representative, China imposes several different types of export restraints on these materials, including export duties, export quotas, export pricing requirements and related export procedures and requirements.

The request for consultations formally initiates the dispute resolution process at the WTO. Under WTO rules, if the matter is not resolved through consultations within 60 days, the United States, the European Union and Japan may request the establishment of a WTO Dispute Settlement Panel. In January, the United States won a case challenging China’s export restraints on nine other industrial inputs.

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