U.S. to announce China trade enforcement action

WASHINGTON (Reuters) - U.S. trade officials will announce a major trade enforcement action against China on Tuesday, according to an advisory from the U.S. Trade Representative's office.

The advisory, which was obtained from a business group, said U.S. Trade Representative Ron Kirk "will hold a press conference to announce a major trade enforcement action against China." It gave no other details.

One possible action could target China's export restrictions on rare earths, which are crucial for global electronics production and the defense and renewable energy industries.

They are also used in a wide range of consumer products from iPhones to electric car motors.

The United States, the European Union and Mexico recently won a case against China for similar restrictions on exports of raw materials used in steel and other industrial products.

China appealed that decision and a final ruling is still months away.

In recent weeks, Democrats have raised alarm about Chinese solar panel subsidies that they said are driving U.S. producers out of business.

They also hae pressed Kirk's office to investigate charges China is pressing GM to turn over technologies for its electric car, the Chevrolet Volt, in order for it to qualify for generous Chinese government subsidies to encourage consumers to buy it.

Many Democrats also have long complained about China's currency practices and have urged the U.S. Trade Representative's office to bring a case.

Republican presidential candidate Mitt Romney recently criticized President Barack Obama for not doing more to push China to raise the value of its yuan against the dollar.

A currency case would be a major departure for the Obama administration after refusing to formally label China as a "currency manipulator" in a Treasury Department report.

(Reporting by Doug Palmer; Editing by Peter Cooney)