AsianFin--China has asked the World Trade Organization (WTO) to establish an expert panel to address a dispute regarding electric vehicle (EV) subsidies provided under the U.S. Inflation Reduction Act, the Chinese commerce ministry announced on Monday.

The world's second-largest economy initiated the WTO dispute in late March after the Biden administration enacted the Inflation Reduction Act (IRA), a comprehensive law that allocates billions of dollars in tax credits to encourage consumers to purchase EVs and support firms in producing renewable energy, as part of efforts to decarbonize the U.S. power sector.

China's attempts to resolve the issue through consultations with the U.S. have been unsuccessful in protecting the rights and interests of its EV industry, prompting the ministry to advancing the matter at the WTO.

The IRA "excludes products from WTO members such as China, artificially creates trade barriers, and increases the costs of the green energy transition," said China's commerce ministry.

"We urge the U.S. to adhere to WTO rules and cease misusing its industrial policies to hinder international cooperation on climate change," China asserted.