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Sat, Mar 20, 2004 - Page 12 News List

Beijing says it hopes to resolve chip tiff with US

AFP , SHANGHAI AND TOKYO

China said yesterday it is working with the US to resolve a dispute over its tax system for domestic chip companies after Washington launched a complaint to the WTO.

The Ministry of Commerce has yet to receive any official documentation but said it was in touch with its US trade counterparts in hopes of finding a solution.

"We are negotiating with the US side," said a commerce ministry spokesman, surnamed Huang.

Japan said yesterday it may also file a complaint against China's tax policies with the WTO if necessary, after similar action taken by the US.

Japan will seek to join a dispute between the US and China about tax breaks for its domestic integrated circuit industry as a third-party country, trade minister Shoichi Nakagawa told a news conference.

"We have both interest in and concerns about the dispute," he said a day after the US launched the first WTO complaint against China.

Under WTO rules, a third group of countries can join WTO negotiations with an observer status if the countries involved express their consent.

"The request for our participation into their talks is part of our efforts to gather information so that Japanese semiconductor companies can avoid having a disadvantage," a trade ministry official said.

"We are not at the stage to file a complaint with the WTO immediately but we are considering taking action in the future if necessary," the official said without elaborating further.

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