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China has had its first defeat at the World Trade Organization (WTO), in a case centred on restrictions on the importation of foreign-made car parts.

Upholding a complaint from the European Union, Canada and US, the preliminary WTO finding agrees that current Chinese practice is protectionist.

Under existing Chinese rules, its carmakers must use 60% Chinese-made parts - or pay higher taxes.

The ruling says China must end this policy to meet its WTO obligations.

'Less favourable'

"We can confirm that, in all major respects, the panel has agreed with the United States that China has acted inconsistently with its WTO commitments," a US trade official told the Reuters news agency.

The WTO report says that foreign-made car parts are currently in a "less favourable" position than their Chinese-made alternatives.

"The dispute settlement body requests China to bring these inconsistent measures as listed above into conformity with its obligations," says the ruling.

The WTO is now due to make its final report later this year, when the Chinese government will have the opportunity to appeal.

Western complaints

Based in Switzerland, the WTO is tasked with increasing global free trade, and rules on such disputes between countries.

China first joined the organisation in 2001, pledging to open up its domestic market to overseas firms and abide by WTO rules for international trade.

However, Western governments have repeatedly complained that China is not moving quickly enough.

The US announced last year that it was seeking a WTO inquiry over whether Chinese limits on imports of copyrighted US goods broke trade rules.

America has also complained against continuing high levels of music and film piracy in China.

Separately, the EU said earlier this month that it was considering launching WTO action against Chinese restrictions on foreign financial news groups.

China in return has complained about EU limits on Chinese shoe exports.

BBC NEWS

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Russia's Foreign Minister Sergei Lavrov has criticised Iran for its repeated declarations over its nuclear and rocket technology ambitions.

"We don't approve of Iran's permanent demonstration of its intentions to develop its rocket sector and continue to enrich uranium," Mr Lavrov said.

Mr Lavrov said Iran should refrain from raising international tensions.

Iran has been trying to develop the nuclear fuel capabilities and earlier this month fired a rocket into space.

"It's impossible to ignore the fact that problems with Iran's nuclear programme have arisen in recent years," Mr Lavrov was quoted by Russia's Interfax news agency as saying.

"While they haven't been resolved it would be better to refrain from actions that raise tensions and create the impression Iran is ignoring the international community," he said.

Mr Lavrov was speaking as he travelled back from an EU-Russia meeting in Ljubljana, Slovenia.

Western fears

Recently Russia spoke out after Iran launched a rocket into space, saying it raised suspicion over the true aim of its nuclear programme, which many Western nations say is aimed at developing nuclear weapons, but which Iran says is solely for energy production.

Iran said the rocket which was test-fired would be used to launch research satellites.

In the past, Russia has been more sceptical than some Western powers about Iran's missile capability, saying it would take a long time to build long-range missiles.

Russia has been supplying Tehran with uranium for the Bushehr nuclear power station being built by Moscow in the south of the country.

BBC NEWS