Case against Inflation Reduction Act aims to uphold global trade system

China has initiated dispute settlement proceedings against the United States at the World Trade Organization, contesting "discriminatory subsidies" under the US Inflation Reduction Act that resulted in the exclusion of goods from China and other members of the WTO.

The wide-ranging law provides billions of dollars in tax credits to help US consumers buy electric vehicles and US companies produce renewable energy, as US President Joe Biden aims to "decarbonize" the US power sector.

As the Chinese mission to the WTO said, "under the disguise of responding to climate change, reducing carbon emissions and protecting the environment, (these subsidies) are in fact contingent upon the purchase and use of goods from the US, or those imported from certain particular regions".