China’s Ministry of Commerce says it will take action against the U.S. if the country goes ahead with its to withdraw on the basis of foreign supply and production. What that action would be remains unclear, but China says it will actively protect its legal interests from the , which it calls a “discriminatory” U.S. law, according to .

The vague legal threat comes on the heels of last week, when over a proposal to cut China out of the supply chain for domestic production of electric vehicles. Now, China says it’s evaluating the Inflation Reduction Act because it suspects the U.S. law violates rules, as reports.

If China determines that the U.S. is, indeed, breaking WTO rules, the country claims it will take necessary steps to protect its legitimate rights and interests, echoing last week’s talk of “.” Presumably, the idea is to convey a sense of mutual participation between the U.S., China and other countries as EV production takes off.

But it’s hard to be magnanimous when every country isn’t really participating “mutually” in the current ; China plays an outsized role in the raw materials that go into EV batteries. And regardless of where these battery metals come from, China has become the foremost refiner.

The U.S. has made a pointed effort to exclude Chinese-sourced and assembled EVs in new subsidies. This could chip away at China’s lead as the world’s de facto EV supplier. So, as a response, China’s latest volley escalates the warning to a possible legal threat, citing and appealing to the WTO.

As we noted , this challenge from the Chinese is heaping onto the U.S. is receiving for its long-term plan to source and build EVs domestically. Whether the U.S. is convinced to scale that plan back by foreign carmakers and countries — now, maybe, the WTO — is uncertain. The only thing certain is that the exchanges between are becoming less friendly.