"The government will continue to vigorously defend the interests of Australian winemakers using the established system in the WTO to resolve our differences", he added.
Australia says it remains open to engaging directly with China to resolve the issue.
Australia's diplomatic relations with China, its largest trading partner, have worsened since Canberra called for an worldwide inquiry into the origins of the coronavirus, prompting trade reprisals from Beijing.
"We have been consistent in our position that Australian producers have not dumped wine on the Chinese market, nor received trade-distorting subsidies", said Tony Battaglene, chief executive of Australian Grape & Wine.
Disclaimer:Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The top commodities buyer said in March that Australian wine had been subsidized and sold under market value, a view that's been rejected by the Australian government.
The two countries are important trading partners but diplomatic relations between them have worsened since Australia called for an global inquiry into the origins of Covid-19.
Tehan acknowledged that the process before the WTO will be hard and the resolution will come within two to four years.
Australia is now progressing a WTO action Beijing's decision to slap 80 percent tariffs on barley exports, the action has been joined by Canada, Russia, and more recently New Zealand.
In March, China's Ministry of Commerce confirmed the huge tariffs on Australian wine would remain for five years.
'We've always said that we would take a very principled approach when dealing with these trade disputes, and if we think our industry has been harmed or injured, we will take all necessary steps and measures to try to address that, ' he told the ABC.
The action also came just days after a summit of the G7 grouping of advanced economies that echoed Australia's call for a tougher stand against China's trade practices and more assertive stance globally.
The group pledged hundreds of billions of dollars in infrastructure investments for low- and middle-income countries Build Back Better World Project (B3W).
"The most practical way to address economic coercion is to restore the world trade body's binding conflict resolution system", he said in a speech just before the summit.
Morrison has received explicit backing in his government's confrontation with China from the United States as well as from French President Emmanuel Macron during a visit to Paris following the G7 meeting.