China expresses regret over WTO ruling on rare-earth materials

China today expressed regret over the World Trade Organisation's ruling that the country has not followed rules of tariff and quotas in restricting exports of rare earth materials as alleged by the US, Japan and the EU.
China's Commerce Ministry reacted with regret to a report released by the WTO stating that some Chinese raw materials' exports haven't followed rules on export tariffs and quotas.
The WTO report was a response to accusations made in March of 2012 by the US, European Union and Japan that China had broken rules by limiting exports of materials including rare earth, tungsten and molybdenum.

The MOC's legal department said that the ministry is evaluating yesterday's WTO ruling and the measures needed to be taken in accordance with WTO dispute settlement protocols.
Rare earths, a class of 17 mineral elements, are one of the most sought-after resources for their vital roles in green technologies like wind turbines and electric car batteries, and of particular concern, in military sectors.
China, which has reserves totalling 23 per cent of the global total of rare earths supplies over 90 per cent of the world's market.

China defends the restrictions on rare earths stating that it faced severe resource and environment pressure as these materials are high-polluting and high-energy consuming.

"This meets the requirement of protecting such resources that can be exhausted and environment in China, and also contributes to the global sustainable development," state-run Xinhua news agency quoted an official as saying.
The Chinese side considers these measures tally with goals of sustainable development advocated by the WTO and are conducive to the coordinated development of resources, environment and human beings, the official said.
China will keep enhancing its management of resource products under WTO rules to preserve fair competition,he said.
The WTO ruling said China acted inconsistently with rules regarding to the export measures imposed on rare earth materials and upheld the allegations by US, EU and Japan.

In its ruling over the dispute brought up against China by the EU, Japan and the US in 2012, a WTO panel report, said that China's export duty, export quota, and export quota administration and allocation measures imposed on rare earths, products were inconsistent with the WTO rules and China's Accession Protocol.
The EU, Japan and the US teamed up to bring a joint case in March 2012 to the WTO over China's measures related to the exportation of rare earths, tungsten and molybdenum, having claimed that the restriction has limited other countries' access to those minerals and gave China a competitive advantage while hurting producers and consumers in other parts of the world.

The three trading powers required to establish a panel to probe into this dispute in June 2012, which was established a month later by WTO's Dispute Settlement Body (DSB).
The WTO panel however recognised China's comprehensive resource and environment conservation measures taken for the products at issue, and rejected EU's claim that the "export performance" requirement imposed by Chinese government on enterprises applying for molybdenum export quotas discriminated foreign enterprises.