China Launches WTO Dispute Over US Chip Sanctions

China has filed a dispute with the World Trade Organization over U.S. restrictions on chip exports, Beijing’s commerce ministry said in a statement late on Dec. 12, accusing Washington of threatening global supply chains. The United States in October announced new export controls aimed at restricting China’s ability to buy and manufacture high-end chips with military applications, complicating Beijing’s push to further its own semiconductor industry and develop advanced military systems.

The moves include export restrictions on some chips used in supercomputing as well as stricter requirements on the sale of semiconductor equipment. The aim is to prevent “sensitive technologies with military applications” from being acquired by China’s military, intelligence and security services, the US Commerce Department said in October. But China’s Ministry of Commerce on Dec. 12 accused the United States of “obstructing normal international trade in products including chips and threatening the stability of the global industrial supply chain”, as well as violating international trade rules and engaging in “protectionist practices”.

The WTO dispute is intended to defend China’s “legitimate rights and interests”, the ministry said in its statement, urging Washington to “give up zero-sum thinking”. The two superpowers have long faced off over a range of issues including technology, trade, Hong Kong, Taiwan and human rights. Chinese leader Xi Jinping and US President Joe Biden pledged to repair frayed relations at a summit in Bali, Indonesia. Days before the latest chip controls, the Pentagon added 13 more Chinese firms including drone manufacturer DJI and surveillance firm Zhejiang Dahua Technology to a blacklist of military-linked entities.