China blocks US, Mexican requests for WTO panel on subsidies

China has blocked requests by the US and Mexico for a World Trade Organisation (WTO) investigation in to alleged industrial subsidies that contravene the WTO agreement, saying that it had already taken active measures to reform its corporate tax structure

It said that the measures cited by the two companies were fully consistent with WTO subsidy rules.

Xinhua news agency quoted the Chinese trade delegation as telling a meeting of the WTO''s dispute settlement body in Geneva that it was puzzled by by the complainants'' decision to initiate proceedings for an investigation.

China charged that the US and Mexico with having included "several non-existent measures" that could only prove their "misunderstanding."

"For the reasons mentioned, China is not able to accept the establishment of a panel at this meeting," it said.

In February this year the US had complained to the WTO accusing China of using tariffs to limit imports, saying that such measures violated WTO rules. Subsequently, Mexico later joined the US in a complaint to the WTO.

The two countries had already held two rounds of consultations with China on the so-called subsidies, which Washington said were "constructive."

But they insisted that the WTO panel process would continue because their concerns had not been resolved.