The European Union has asked the World Trade Organization (WTO) to arbitrate in a dispute about China’s restrictions on rare earth minerals such as lutetium and scandium which are important in the manufacturing of products such as mobile phones.
China has recently increases its restrictions on rare earth metals and other products by increasing export duties and reducing export quotas, measures that the EU, the US and Japan companies find unfair, as they only benefit China’s own companies.
“China’s restrictions on rare earths and other products are a violation of China’s WTO commitments and continue to significantly distort global markets, creating a disadvantage for our companies,” said EU trade commissioner Karel De Gucht.
Beijing says that its restrictions are needed to protect the environment, conserve supplies and meet domestic demand.
“We regret that we are left with no other choice but to solve this through litigation.”
The first stage in the dispute process was to hold formal talks at the WTO in Geneva.
Since those failed, the next stage will be for the WTO to set up a dispute settlement panel.