The World Trade Organisation has set up a dispute settlement panel to examine anti-dumping duties imposed by China on Australian wine.

The dispute settlement body, which met behind closed doors in Geneva on Tuesday, agreed to Australia’s second request after its first attempt was blocked by China, Reuters reported.

China last year slapped tariffs of around 200 per cent on Australian winemakers.

Australian producers had benefited from zero tariffs under the China-Australia free trade agreement.

The prohibitive duties had rendered Australian wine uncompetitive in the Chinese market. According to an update last week by industry body Wine Australia, since the interim tariffs were imposed in November the value of Australian wine exports to China had fallen by 77 per cent to A$274 million (US$205 million).

The WTO dispute process over wine, which involves setting up a three-person arbitration panel, is one of only nine cases Australia has ever initiated at the WTO. It will take anything from one to three years for the WTO to work through the case.