WTO: China rare earth quota system challenges

October 28, 2013 , the Commerce Department announced the 2014 rare earth export quota reporting conditions and reporting procedures . If launched from 1998 rare earth export quota license system date, this model has more than 15 years.


Now, the earth is facing a change in the quota system . Foreign media recently reported that Chinese exports of rare earths regulation triggered America, Europe and China trade litigation, WTO WTO has basically endorsed the idea of ​​America, Europe , and has issued a tentative judgment relevant national notice , finds a violation of China 2001 WTO accession agreement commitments.

October 30 , learned from authoritative sources , at present, government departments have already commenced discussions on the news , "message should be true ." The official said China is very difficult to restore the situation .

Chinese Ministry of Commerce and Ministry of Industry and so had repeatedly stressed that China adopt a quota system for rare earth and make industry consolidation , the purpose is to protect resources and the environment and achieve sustainable development , in line with WTO rules . The Chinese government has no intention of trade-distorting way to protect domestic industries .

Preliminary ruling unfavorable to China

Last March , the United States on China for rare earths , tungsten and molybdenum export controls imposed questioned that these restrictive measures on these raw materials in the international market on the supply chain caused huge distortions and harmful interference. EU and Japan also made the request for consultations with China .

China has about 23% of the world 's rare earth reserves , but long-term supply more than 90 percent of global rare earth production. Previously few years, China has been in the export of rare earth export quota system perform , that is clearly a year of domestic manufacturing enterprises meet the relevant conditions of export volume and distribution companies , in order to protect resources and the environment and realize sustainable development.

Commerce Department released data show that China's rare earth export quota year 2010 a total of 30,258 tons , compared to 2009 decreased by almost 40% , while in 2004-2009 , rare earth export quotas of 66,000 tons , 66,000 tons , 62,000 tons , 60,000 tons , 47,000 tons , 50,000 tons , the annual amount did not exceed the 10% decrease .

"Foreign mainly aimed at China's quota system , which is not enough to use the problem is for this thing is reasonable . " Baotou a rare corporate executives , said rare earth is just " the beginning , "the lawsuit defeated, will involve numerous resources sector .

The parties, of rare earth quotas actually originated in the year of entry agreement , some of the rare element was not added attention and was not included in the scope of protection included in the negotiations , the Chinese did not realize at that time , and later found out, to come up with a quotas.

In fact, in some specific cases, WTO rules allow members to conduct export control , in which one out of non-renewable natural resources protection. But Europe and the United States put forward , if indeed out of this consideration , China 's restrictive measures should also be applied to China 's domestic production.

Multi- channel display , WTO has basically endorsed the idea of ​​America, Europe , and to notify the relevant national judge issued a tentative , finds a violation of 2001 China joined the WTO agreement commitments.

In the eyes of domestic rare earth enterprises , so that the results may not be an accident. "Even if you can appeal , but also a formality , there is not much practical significance. "These rare earth business people said.

Foregoing authorities also revealed that at present , government departments have already started discussions , but " even if unsuccessful , would not immediately abolish the quota ."

It is reported that the equivalent of first instance verdict WTO panel report will be released in mid- November , if the country refuses to accept the award may be related to the WTO High Commission of Appeal.

RE quota dispute

In the rare case before , someone on the reasonableness of rare earth export quota discussion . Which criticized the quota into a commodity reselling , corruption.

Rare earth prices have soared once around 2010 , engaged in rare earth become one of the shortcut to get rich , but slashed rare earth export quota year , a large number of rare earth production plans to export -oriented enterprises due to lack of quotas , eager to have export quota system trading company purchase , prompting index prices have soared .

China Industry Insight Network research and analysis , rare earth export quota system market, " guidance " has reached 120,000 to 170,000 yuan per ton , and even in some months , rare earth export quotas pushed up to 400,000 to 500,000 yuan per ton .

This year, the rare earth export quota of about 30,000 tons per year , but also create new problems . " quota policy enforcement for many years, but this year , every year remaining , but become a burden . " The authorities said .

The source said that the quota of rare earth has existed in name only , not in line with market rules, after fully liberalized influence is there, "Which products have a market on which products impact ."

Noteworthy that the overall supply of rare earth pattern has been the emergence of new changes , the United States , Australia and other countries were launched, some mining plan , there are currently 30,000 tons of production capacity , the future international market in China will also reduce dependence on light rare earths . " If you lose, China's rare earth industry will be more rudderless , rare earth enterprises with foreign direct shopping prices . " preceding business people said.

China is not without preparation.

May 10, 2011 , the State Council issued " on the promotion of the rare earth industry healthy development of a number of opinions ", the Chinese around the rare earth resource development, smelting separation and circulation market order expand regulation by the Ministry of Industry and the formation of large rare earth industry group programs , now the industry has formed a number of sets resource extraction, smelting separation processing and application technology research and development of rare earth industry in one large group .

However, in view of the business people , the rare earth still not completed the integration of clear pattern. "The government will make use of the time for appeal previously thought to achieve integration purposes to play on the international market picked up a fist fight out effect, but did not expect to be so hard to integrate , local, inter-enterprise , as well as upstream and downstream , etc. are all playing the abacus , each hold the interest . "


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