US wins at WTO over China raw materials

Jul 05, 2011 | 06:08 PM | Catherine Ngai

Tags  WTO, raw materials, China, Kevin Dempsey, Alan Price, export restrictions, Catherine Ngai

NEW YORK — The World Trade Organization (WTO) has ruled against China in a dispute over export restraints on a group of nine raw materials and, in the process, paved a new path for U.S. mills to combat growing scarcity—and skyrocketing prices—for materials essential to steel and metal production.

In response to complaints filed by the United States, Mexico and the European Union in 2009, the WTO panel ruled that the export of certain forms of bauxite, coke, fluorspar, magnesium, manganese, silicon carbide, silicon metal, yellow phosphorus and zinc were inconsistent with China’s accession to the organization, which included clauses to eliminate all export duties and quotas except for several products, including ferrous waste and scrap, aluminum waste and scrap, and wire of copper-zinc base alloys.

"This is the first case in which these issues have been challenged at the WTO," said Alan Price, head of the international trade practice at Washington-based Wiley Rein LLP. "It sets a significant number of precedents, subject to the fact that the Chinese may appeal it to the appellate body. The key issue is not whether China acted inconsistently with its commitment, but whether any of its defenses, such as the environmental defense under Article XX, were valid."....

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