BEIJING, Nov. 23 -- The United States is not justified in launching an anti-subsidy investigation into China's exports of coated paper used for brochures, magazines and wrapping paper, the Ministry of Commerce said yesterday.

Ministry spokesman Chong Quan said that the U.S. decision to launch the probe is not in accordance with the rules of the World Trade Organization, and also violates U.S. laws.

He said the ministry regrets the U.S. move and "will pay close attention to the development of the issue, and reserve any right to protect China's proper interests."

The U.S. Department of Commerce decided to launch an anti-subsidy probe into China's coated free sheet paper on Monday following a request from New Page Corporation, headquartered in Dayton, Ohio. It is the first U.S. subsidy claim against China.

The company also made a dumping complaint at the same time.

China annually exports 300,000 to 500,000 tons of coated paper, which includes high-quality glossy paper used for magazines and wrapping paper.

Over a dozen Chinese firms, which may receive government subsidies mainly in East China's Jiangsu and Shandong provinces were listed in New Page's complaint.

But an official at the China Paper Association pointed out that only five or six of these companies actually export to the United States.

According to U.S. anti-subsidy regulations, the Chinese government must cooperate with the U.S. authorities if they probe Chinese firms.

A primary ruling on the complaint is expected in around six months. If it says that Chinese firms accept government subsides, the United States is likely to impose an anti-subsidy duty on imports of Chinese coated paper.

In addition, it may influence the U.S. evaluation of China's fulfilment of its World Trade Organization commitments.

The United States sometimes abuses trade remedies, said Fu Donghui, a legal expert at the Beijing Allbright Legal Office. For example, the U.S. anti-dumping and anti-subsidy investigations against China contradict each other.

He explained that in calculating dumping margins, the United States uses the costs of a third country rather than accepting Chinese exporters' figures because it declines to treat China as a full market economy.

But in this anti-subsidy probe, the first by the United States against a country it has not granted market economy status to, the United States will calculate Chinese firms' costs.