On 7 august 2014, the wto appellate body found that china's export management measures for rare soil were inconsistent with the relevant wto rules and with china's commitments when it joined wto. The following day, the sixth china-capital rare industries forum was opened, and participants engaged in in-depth exchanges and discussions on the development of rare earth industries。
What is the way forward for our rare-earth industry in the context of the distressing pattern of domestic exploitation and exploitation? Is integration the way for rare-earth enterprises to do something powerful? We hope to find a way out of this set of articles。
On the afternoon of 8 august, at this year's rare land industry forum, rare-earth entrepreneurs sat around a market segment to hear professor chen weidong, faculty of law of the university of foreign economics and trade, tell us about china's failure in the wto rare-earth case, the possible impact on rare-earth enterprises and the way in which our country will manage its natural resources。
Chen weidong said that in the future, domestic policies would focus on regulatory measures, such as resource taxes, supported by export quotas that paralleled domestic consumption restrictions, and that such policies would help to balance the interests of all。
"that's after the black chain." a director of a small-earth business said to a reporter, daily economy news, that formal businesses pay resource taxes, and that when resource tax prices rise, the black-industry chain becomes even worse and the black-business chain becomes more dynamic。
Many industry sources estimate that “black mines” currently account for about 30,000 of the country's more than 100,000 tons of rare earth supplies. This is also the result of the country's strict governance, which was more than ever, about half of the total supply。
Unexpected losing/
In fact, as early as 2009, when the united states, the european union and mexico brought a lawsuit against china for quotas and export tariffs on the export of nine raw materials, namely bauxite, coke, acetyphos, euphemism, magnesium, manganese, metallic silicon, silicon carbide and zinc (hereinafter referred to as “the nine raw materials case”), industry anticipated that the next target would be rare earth。
Informed sources have told daily economics reporters that united states prosecutions for export control of our resource products are tactical, and that 12 products, including rare earth, tungsten, molybdenum, were evaluated in the case of the nine raw materials, and that the prosecution of the nine raw materials mentioned above was a matter of stoning。
On 30 january 2012, the appellate body (dsb) of the world trade organization (wto) issued a decision in this case, in which it found that china had lost its claim that “china must reduce its export tariffs and lift its export limits” to comply with its obligations as a member of the world trade organization. Subsequently, two months after the success of the nine raw materials case, the united states of america and the united states of america filed a new case against the world trade organization (wto) concerning measures to regulate the export of rare earth, tungsten and molybdenum。
“because the case of raw materials did not eventually result in an interpretation of the rules in favour of china, it is unlikely that the chinese side will have a chance to win the case in the rare earth case.” chen weidong indicated。
“it's hard to get out once the defendant has reached the wto.” an individual close to the department of commerce told the daily economic news reporter that, according to statistics, 85 per cent of the prosecution had won。
China, on the other hand, invoked the exception to article 20 (g) of gatt, “protection of exhausted resources”, without the support of the panel of experts at the time of the initial decision or the final appellate body。
In accordance with the wto appeals procedure, we would have had a 60-day appeal period after the final decision of the appellate body was issued on 7 august, but the united states initiated the appeal on 17 april on a small procedural issue, which led to the disruption of our steps to prepare the appeal in this case. If an appeal is filed by one party, the other party may only submit an appeal in this case as other appellants and only within 10 days of the submission by the other party。
The purpose of the appeal in china was to ensure that, on certain specific issues, the appellate body would be able to interpret the rules more favourably for china。
“china's appeal point is primarily concerned with the relationship between the specific provisions of the protocol of accession and the wto agreement, rather than directly with regard to whether article 11, paragraph 3, of the protocol of accession can invoke the point that gatt article 20 (g), which has been rejected by the appellate body, in the hope of obtaining a possible favourable basis at the macro level for the appellate body to prepare china's future imports of resources from other countries.” chen weidong said, “but unfortunately, such expectations have not been supported.”
Dispute resource tax/
Those close to the ministry of commerce said to the daily economic news reporter that there was a negotiated transitional period after the case had been finalized and that if the negotiations had failed, the case could be brought again。
What kind of rare-earth management measures should we take after the transition period
Chen weidong said to the daily economic news reporter that my country would face three options: first, the elimination of export quotas and export tariffs, which would best meet the expectations of the united states and europe; secondly, the maintenance of existing export taxes and export quotas, but compensatory negotiations with the united states and europe in exchange for export restrictions on resource-based products such as rare soil by opening larger markets to the united states and europe in other trade sectors; and thirdly, the refusal to implement the final award, which would face retaliation for trade authorized by the united states and europe with the world trade organization。
Whatever choice is made, my country will pay the price。
According to those close to the ministry of commerce, china has an obligation from the perspective of wto to eliminate its export tariffs and quotas on rare earth and platinum products. Currently, the control of the volume of rare earth products, from extraction, processing to export, is an administrative tool. According to the source, controls from the beginning to the end could not be managed solely by administrative means。
Market instruments refer primarily to regulation of prices. In the light of our existing rare-earth management measures, it has been possible to combine administrative and market-based controls. The daily economic news reporter learned from a number of ministries that, in the future, china's management of rare land will establish policies in terms of prices and production restrictions。
According to the above-mentioned sources, the “regulation of prices” refers mainly to resource taxes。
Since 1 april 2011, the state council has harmonized the tax rates for rare earth ore resources, including fluorocarbon ore and monolithic ore of $60 per ton, and for heavy ore including phosphorus ore and ion-type ore of $30 per ton。
The head of a large rare-earth business said to journalists that the price of the rare-earth would certainly rise as a result of an increase in the resource tax, and that instead of wishing to raise the resource tax, the enterprise would prefer to raise the resource tax once the government had taken control of the rare-earth black chain, otherwise the formal-business tax would increase and the black chain would become more aggressive. Many industry sources estimate that, at present, there are about 30,000 tons of black mines in the country's rare-earth supply of more than 100,000 tons。
It is hoped that special geographical circumstances will be taken into account with respect to resource taxes. Elephant lands are co-located with iron ore in the form of co-production mines, which need to be extracted before they are separated. The tax base for steel-coated rare earth resources is currently based on the volume of iron ore mining。
A man close to a bag of steel, a resource tax for journalists. Each year, the steel pack group exploits 12 million tons of albino ore, with a resource tax of 12 million tons, or approximately 300 million yuan, for steel ore extraction of only 4 million tons。
Is the approach to capping resource taxes reasonable and effective in protecting resources and promoting enterprise development? Sun hongmei, deputy director of the national council for the development of new technologies in the rare land region, told journalists that communication was also under way with the general tax administration. The response was that tax policy was a national policy, and that the state would not easily modify policies because of their impact on a particular region when introducing a tax on scarce resources。
For steel-packed rare soil, only the right opportunity to adjust is awaited。
Responsible editor: zhang dei
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