US, EU and Japan filed WTO complaint against China

The U.S., EU and Japan have joined together Tuesday to file a WTO complaint against China when Beijing imposes new restrictions on exports of rare earths used in high technology.

“Alongside the U.S. and Japan, the European Union formally brought its dispute with China to the World Trade Organization”, the European Commission said in a statement on Tuesday.

This action follows a previous standoff between China and the EU on the export of raw materials, which was concluded in favor of Europeans.

“The restrictions imposed by China on rare earths and other products violate international trade rules and should be removed. These measures affect our producers and consumers within the European Union and worldwide,” said the EU Trade Commissioner, Karel De Gucht in the statement.

The filing of the complaint was not immediately confirmed by the WTO headquarters in Geneva.

Beijing is the largest producer of rare earths, these 17 metals are essential to the manufacture of high technology products ranging from missiles, mobile phones to electric cars and wind turbines.

The willingness of Beijing to control exports of rare earth raised a wave of public outcry when 97% of the production of these metals come from China, where mining activities cause great damage to the environment.

The first dispute with China had been brought before the WTO on commodity exports. The WTO, hearing an appeal from EU, U.S. and Mexico, ruled in the summer of 2011 that a series of restrictions imposed by China on exports of nine key commodities for European industry were illegal.

Despite this precedent, “China has made no effort to lift its other export restrictions. This leaves us no choice”, said Mr De Gucht.

Even before the formal filing of the complaint, Beijing has reacted. “The quotas imposed by China on its exports of rare earths are consistent with WTO rules”, said Tuesday the the spokesman of Chinese Foreign Ministry, stressing that quotas were established “to protect the environment and achieve sustainable development.”