China uses several types of export restraints on the rare earth materials, including export duties, export quotas, export and pricing requirements, the USTR said in a press release. The restraints artificially increase prices for the materials, the agency said.

Representative Don Manzullo, an Illinois Republican and chairman of the House Foreign Affairs Subcommittee on Asia and the Pacific, said China's actions have resulted in "skyrocketing" costs for the materials.

"We are long overdue in bringing a trade dispute against China for its restrictive export quotas and taxes on rare earth minerals critical to the manufacture of a wide range of U.S. auto, electronic, medical, and defense products," Manzullo said in a statement. "China's near monopoly over these 17 rare earth minerals and blatant disregard for the rules of international trade place our manufacturers at a crippling disadvantage in securing economic growth in high-tech industries, growing our renewable energy sector, and developing new technologies."

The U.S. also needs to look for alternative sources for the materials, Manzullo said. 

TechAmerica, a technology trade group, praised the USTR for filing the complaint. "Everyone from computer manufacturers to military aircraft suppliers are seeing the supply limited and the cost driven up by the Chinese practice of rationing," TechAmerica President and CEO Shawn Osborne said in a statement. "We believe in a global marketplace but it's essential that all players use the same rulebook."