China's Exportation Restrictions On Natural Resources Under The WTO Regime

The "China-Raw Material " in 2008 marked the first dispute between China and the EU(the European Union)regarding the export of natural resources in light of WTO(World Trade Organization)obligations.By the 27th of October 2016,the EU and China have already had their third dispute with regard to restriction on the natural resources exportation.On this date,the EU requested the Dispute Settlement Body(DSB)of the WTO to set up a Panel to resolve the disputes tasked with analyzing China's export tariffs,export quotas and related export restriction measures with regard to copper,graphite,antimony,cobalt,lead,magnesium,talc,chromium,indium,tantalum,tin,iron,nickel.Disputes centering around restriction on natural resources are frequent because the EU's demand for important natural resources imported from China is on the rise,and China's restrictions on the export of natural resources are considered to harm the EU's economic interests,causing the EU to repeatedly turn to the WTO to resolve disputes.In this context,the EU-China disputes related to restriction on natural resources exportation are not likely to be eliminated in short term.Settling these disputes with the EU,however,requires a lot of time,effort and material resources,and to some extent will hurt the trade relations between China and the EU.The EU is China's largest trading partner and China is the EU's second largest trading partner and therefore,the close trade relations between China and the EU are important to both parties and even have a significant impact on the world economy.It is,for these reasons,important to maintain a smooth trade relationship between China and the EU.Therefore,the purpose of this paper is to study the export disputes between China and the EU.This thesis can afterwards be a starting point to explore how China can deal with disputes related to export restrictions of natural resources in light of WTO obligations so as to better safeguard Chinese interests in future.This thesis consists of five parts.First part introduces the background for the China-EU natural resource.In the second part,an overview will be given on previous and ongoing disputes between China and the EU related to export restrictions on natural resources,focusing on legal issues:China's Accession Protocol to the WTO,the given interpretation to the problem and the conditions for application of the general exceptions as formulated in GATT article XX.In the third part," An Analysis of the Causes of Frequent Disputes over Natural Resources between China and the EU " will be analysed to discern what the fundamental reason and other reasons of such disputes between China and the EU.In the next part titled "China's compliance measures in response to the disputes over export restrictions",based on the previous analysis,four measures,along with their compliance and feasibility shall be discussed and the conclusion will be given in the last part.Method of literature analysis is adopted to interpret the application of rules under the WTO.Specific attention will be given to the drafting of the relevant WTO rules,the preambles and the interpretation of the relevant rules by the dispute settlement body.At the same time disputes between China and the EU brought before the DSB with regard to the export of natural resources will be analysed(jurisprudential analysis)to explore how to better apply the rules of the WTO to export restrictions.As the EU is highly dependent on the raw materials exported by China,China's limitations on the export of raw materials results in the export of raw materials to the EU being reduced causing prices of raw materials to rise the number,affecting the stability of the EU raw material supply chain.The restrictions imposed by China violate the rules on the elimination of general restrictions and China's commitment to eliminate export duties,causing the EU to frequently use the dispute settlement mechanism to safeguard their own interests.To counter the EU allegations,China tried to invoke GATT Article 20(g)to justify its measures,but because of the lack of objective link to the relevant provisions of the China Accession Protocol and the non-compliance with the applicable conditions of Article 20 of GATT,the Dispute Settlement Body rejected China's arguments for justification of its measures.As the decision of the Dispute Settlement Body is difficult to overturn,invocation of GATT general exception terms in future cases of a similar nature by China will have slim chances of being successful.The author believes that China can seek to promote alteration of the WTO restrictions on export,and actively strive to broaden the scope of application of GATT Article 20 in order to allow duties on the export of resources.In my opinion,and based on the previous analysis,proposals should be made to re-evaluate the admissibility of export restrictions by focusing on the improvement of WTO rules,actively ensuring the accessibility of the cited exceptions in article XX GATT,the establishment of a comprehensive national resource management system and improving the litigation strategy before the WTO.