China Export Limits Fly in Face of WTO Order

(CN) - China's export restrictions on rare earths and other raw materials are distorting the world market and hurting manufacturers and consumers alike, the European Union said Tuesday.

The statement calls on the World Trade Organization to settle claims that the EU, the United States and Japan have leveled against China, which supplies some 97 percent of the world's rare earths.

Such rare earths include 17 materials with magnetic, heat-resistant and phosphorescent properties that make them technological components.

But the EU says export quotas, duties and other limitations on high-demand Chinese materials gives its own industry an unfair advantage.

"China's restrictions on rare earths and other products violate international trade rules and must be removed," EU Trade Commissioner Karel De Gucht said in a statement. "These measures hurt our producers and consumers in the EU and across the world, including manufacturers of pioneering hi-tech and 'green' business applications."

This is the EU's second challenge this year to China's export restrictions on raw materials.

In January, the WTO's appellate body confirmed a previous ruling that China could not use environmental protection or conservation policy to justify export restrictions on various forms bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorus and zinc.

"Despite the clear ruling of the WTO in our first dispute on raw materials, China has made no attempt to remove the other export restrictions," De Gucht said. "This leaves us no choice but to challenge China's export regime again to ensure fair access for our businesses to these materials."

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