The United States and the European Union filed a WTO case against China on 23 June over that country's export restraints on various raw materials, namely bauxite, coke, fluorspar, magnesium, manganese, silicon metal, silicon carbide, yellow phosphorus and zinc. These materials are key inputs for numerous downstream products in the steel, aluminium and chemical sectors across the globe. A press release issued by the Office of the U.S. Trade Representative notes that these measures "appear to be part of a troubling industrial policy aimed at providing substantial competitive advantage for the Chinese industries using these inputs." The U.S., the EU and China now have until late August to resolve the issue through consultations, after which the complainants may request the establishment of a dispute settlement panel if no such agreement is reached.

This is the first WTO dispute settlement proceeding launched by the United States under the leadership of President Obama. Trade enforcement features prominently in the President's trade agenda for 2009 and additional enforcement actions are likely to be pursued during the second half of this year and beyond. In fact, there is a fair possibility that additional actions could be taken at the WTO in the coming months.

Commerce Secretary Gary Locke and USTR Ron Kirk sent a joint letter to their counterparts in China on 24 June urging Beijing to revoke a proposed rule (Circular 26) that would mandate that all computers produced and sold in the mainland pre-install a mainland Chinese Internet filtering programme known as Green Dam. The letter notes that the proposed rule, which is slated to take effect on 1 July, raises fundamental questions regarding regulatory transparency as well as concerns about China's compliance with certain WTO requirements. Kirk stated that mandating the pre-installation of the "technically flawed" Green Dam software and precluding manufacturers and consumers from selecting other filtering software "poses a serious barrier to trade." For his part, Locke believes that China "is putting companies in an untenable position by requiring them, with virtually no public notice, to pre-install software that appears to have broad-based censorship implications and network security issues.".  [On 30 June, China's Ministry of Industry & Information Technology announced the postponement of the implementation of the rule.]