The United States, the European Union and Japan have formally accused China of violating international trade rules when it restricted the shipments of rare earth elements that global industries use in manufacturing high-tech and other products.

The three economic entities claimed before the World Trade Organization (WTO) that Beijing aims to establish undue advantages for its domestic industries when it decided to limit the outflow of 17 rare minerals like lutetium, scandium, tungsten and molybdenum.

Manufacturers around the world require the elements in producing powerful magnets, batteries, and LEDs that in turn were deployed into tech gadgets, electric cars, lasers, wind turbines and missiles.

According to Agence France Presse (AFP), China controls about 97 percent of the total world supply of rare earths and for a government to strictly regulate their shipments was tantamount to the monopoly of global supply, the three economic powers said.

In a news briefing held Tuesday at the White House, U.S. President Barack Obama accused China of bending the set of rules that it agreed to follow as member of the international trading community.

"If China would simply let the market work on its own we would have no objections, but their policies currently are preventing that from happening and they go against the very rules that China agreed to follow," Mr Obama was reported by AFP as saying.

"We want our companies building those products right here in America, but to do that, American manufacturers need to have access to rare earth materials, which China supplies," the president added.

Earlier this year, the WTO had rebuked Beijing for its policies that virtually halted the export of bauxite, zinc and magnesium from China, measures that remained unchanged to this day, according to U.S. Trade Representative Ron Kirk.

"China continues to make its export restraints more restrictive, resulting in massive distortions and harmful disruptions in supply chains for these materials throughout the global marketplace," Mr Kirk told AFP.

Also, China's hardline stance on the issue compelled the EU "to challenge China's export regime again to ensure fair access for our businesses to these materials," according to EU Trade Commissioner Karel De Gucht.

"China's restrictions on rare earths and other products violate international trade rules and must be removed," AFP quoted Mr De Gucht as saying.

In China, the Chinese government argued in a statement that its policies on rare earth export were motivated by the need to protect the environment from the ill-effects of excessive mining activities directly attributed to the harvesting of rare earth minerals.

Beijing insisted that its policies were in full compliance with existing WTO rules.

"Based on environmental protection and in order to achieve sustainable development, China carries out management policies over the export of rare earths," foreign ministry spokesman Liu Weimin said in the statement.