EU takes legal action against export restrictions on Chinese raw materials

The European Union launched today a third case against China’s restrictions on exports of raw materials essential for European industries. Following the successful legal actions in 2012 and 2014 on similar measures, this time the EU is focusing on restrictions concerning graphite, cobalt, copper, lead, chromium, magnesia, talcum, tantalum, tin, antimony and indium. “We cannot sit on our hands seeing our producers and consumers being hit by unfair trading practices. The past two WTO rulings on Chinese export restrictions have been crystal clear – these measures are against international trade rules. As we do not see China advancing to remove them all, we must take legal action,” said EU Trade Commissioner Cecilia Malmström. China currently imposes a set of export restrictions, including export duties and export quotas that limit access to these products for companies outside China. These measures have distorted the market and favoured Chinese industry at the expense of companies and consumers in the EU, in violation of general WTO rules and also of China’s specific commitments from the time of its accession to the WTO. Also, their alleged aim to support an environmentally friendly and sustainable production of raw materials could be achieved more effectively with other measures, without negative impact on trade. The formal consultations between the EU and China – the first step in the WTO dispute settlement – will be conducted in parallel to a similar procedure initiated by the US. In absence of a satisfactory solution within 60 days, the EU may request the WTO to set up a panel to rule on the compatibility of China’s measures with WTO rules.