China yesterday blocked a request by the US, EU and Canada to set up a panel at the World Trade Organization (WTO) to probe into China's rules on auto part imports.

 

At a meeting of the WTO's Dispute Settlement Body, representatives of the US, EU and Canada formally made the request for a panel of experts to investigate China's rules on auto part imports, which they say hinder the China operations of foreign automakers and parts suppliers.

 

But China reiterated that its regulations were meant to keep "criminal elements" from exploiting the different tariff rates for whole automobiles and auto parts, and to protect consumers' interests, adding that they were in line with WTO rules.

 

Any WTO member, including China, has the right to reject a first panel request. But a panel will be established if a second request is made, which could be done at the next Dispute Settlement Body meeting in October.

 

China classifies car parts as being a whole vehicle if they account for 60 percent or more of the value of a finished vehicle and charges a higher tariff for these.

 

But the US, EU and Canada complain that the rule gives Chinese car parts makers an advantage and violates WTO rules.

 

The three took the rare step earlier this year of joining forces to call on Beijing to talk about changing the rule.

 

Trade officials of the three trading partners said they had tried to negotiate with China for a solution but found China's stance left them with no choice but to proceed with a WTO case -- the first litigation against China at the trade body, which it joined in 2001.

 

Even if a WTO panel is established, the investigation could last months or even years before a judgment is made.

 

(Xinhua News Agency September 29, 2006)