China has launched a WTO dispute against the US as other countries consider semiconductor restrictions

China files WTO dispute to curb the US’ semiconductor sanctions

A semiconductor war is brewing between the US and China, with the former introducing sanctions that would control semiconductor exports to the growing superpower. The US’ new export regulations, which came into force in October, are designed to slow the growth of China’s semiconductor industry by denying the country access to western chipmaking tools. Now, Japan and the Netherlands (the home nation of ASML) are reportedly ready to join the US by tightening their own export controls (as reported by Bloomberg). 

By denying China access to the world’s most advanced chipmaking tools, the US and its allies hopes to limit China’s ability to utilise semiconductor technologies for military applications and to prevent China’s semiconductor industry from growing. For the US, these sanctions against China will help to maintain the leadership position that the US and their allies have on the global semiconductor market, and in the long term it will force China to create their own home-grown semiconductor manufacturing tools.

China’s response

China has launched a trade dispute at the World Trade Organisation (WTO) against the US over its export controls, stating that the US’ export controls “threatened the stability of the global industrial supply chains”. 

The Chinese commerce ministry released the following statement regarding their actions at the World Trade Organisation. 

  China takes legal actions within the WTO framework as a necessary way to address our concerns and to defend our legitimate interests,

What the US says

In response to China’s complaints at the World Trade Organisation, Adam Hodge, a spokesperson for the US Trade Representative’s office had this to say to Reuters.   

   We have received a request for consultations from the (People’s Republic of China) related to certain U.S. actions affecting semiconductors,

As we have already communicated to the PRC, these targeted actions relate to national security, and the WTO is not the appropriate forum to discuss issues related to national security,

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