China launched dispute settlement proceedings against the United States at the World Trade Organization on Tuesday, accusing Washington of providing “discriminatory” electric vehicle subsidies.

Under the subsidy provisions of the Inflation Reduction Act of 2022, which begins this year, U.S. car buyers will not be eligible for taxes of $3,750 to $7,500 if certain battery components are produced by Chinese, Russian, North Korean or Iranian manufacturers credit.

China’s Permanent Mission to the WTO said the policies “are under the guise of combating climate change” but “actually depend on the purchase and use of imported goods from the United States or certain specific regions.”

A spokesman for China’s Ministry of Commerce said Beijing had urged Washington to “immediately correct discriminatory industrial policies and maintain the stability of the global new energy vehicle industry chain and supply chain.”

The Commerce Ministry said in a statement posted online that the subsidy restrictions exclude Chinese products but also have a negative impact on global supply chains and fair competition in the electric vehicle market.

China surpassed Japan earlier this year to become the leading auto exporter. Customs data shows that in 2023, China exported 5.22 million vehicles, about one-third of which were electric vehicles.

Under the new U.S. regulations, which took effect on January 1, only 13 of the more than 50 electric vehicles sold in the United States are eligible for tax credits. By 2023, about two dozen models will be eligible. As a result, automakers have been working to source parts to make their vehicles eligible for tax credits, the AP reports.

China’s complaint follows other recent disputes between China and the United States, including tariffs and a U.S. bill to divest popular social media app TikTok from its Chinese parent company over national security concerns.

Information for this report was obtained in part from Reuters, the Associated Press and AFP.