China mulls filing a grievance against EU car tariffs in the World Trade Organization.
The European Commission declared on a Wednesday that they'll impose fines on Chinese-made electric cars, effective from July 4th. Their reason for this action was due to allegedly "unfair" subsidies offered to the Chinese electric car industry.
The European Commission will negotiate with Chinese officials and corporations until July 4th. If no resolution is reached, existing 10% tariffs on vehicles produced in the People's Republic will drastically increase. The suggested additional fees are: 17.4% for BYD, 20% for Geely, and 38.1% for SAIC.
On Thursday, the Chinese Foreign Ministry's representative commented that the EU Commission's decision "lacks a factual and legal basis." The spokesperson asserted it infringes on the rights and interests of the Chinese electric car industry, potentially causing disruptions in automotive production and global supply chains - encompassing those within the EU.
Both the German government and German vehicle manufacturers have publicly opposed the fines, as they fear the onset of a trade war. In particular, Germany is concerned as Brussels, where France supported imposing greater tariffs more vocally. French car manufacturers have lower market presence in China than their counterparts from Germany.
However, the Federation of German Industries (BDI) supported the Brussels approach on Wednesday: China has ignored WTO guidelines. Hence, it's proper for the EU Commission to "persistently utilize its defensive measures."
If the Commission's decision is to be nullified, Germany must convince 15 member states in the Council of Ministers, collectively representing a minimum of 65% of the EU population. If this goal isn't attained, temporary fines will transition to permanent ones after a few months.
