Tuesday, July 10, 2012
In yet another trade dispute between the US and China, China has blocked the formation of a WTO dispute resolution panel with respect to complaints by the United States, the European Union and Japan that China is engaging in unfair trade practices with respect to the exportation of rare earths, tungsten and molydenum. The United States requested consulatations with China in March of 2012. Subsequently, the EU, Japan and Canada all joined in the consultations. The United States reported to the WTO Dispute Settlement Body (DSB) today that those consulations have failed; therefore, it requested the establishment of a dispute resolution panel. Under WTO rules, China is allowed one opporunity to block the establishment of a panel, a right it exercised today. Accordingly, the WTO Dispute Settlement Body has deferred the establishment of the panel until its next meeting, at which time a panel will be established unless there is a reverse concensus of all the parties that no panel should be established. The matter is formally titled, China-Measures Relating to the Exportation of Rare Earths, Tungsten and Molydenum (DS431).