China sues EU against punitive tariffs on electric cars
China's electric vehicle boom is causing concern among automakers and governments in the EU, leading them to temporarily impose tariffs. China has now filed a complaint with the WTO. If the EU imposes longer import restrictions, companies like BYD may struggle to enter the European market for years.
In the dispute over state subsidies for electric vehicles, the Chinese government has turned to the World Trade Organization (WTO) to challenge the European Union's anti-dumping duties on electric vehicles from China. The Chinese Ministry of Commerce stated that the EU's measures violate WTO rules and undermine global cooperation on climate change.
The ministry called on the EU to immediately correct its "wrong practices" and work together to maintain the stability of economic and trade cooperation between China and the EU, as well as the stability of industrial and supply chains for electric vehicles.
The EU Commission imposed provisional duties on Chinese electric vehicles in early July, accusing China of unfair competition through high subsidies. These duties are valid for up to four months from July 5, after which a decision will be made on whether to impose duties for up to five years. This decision is expected in the fall. EU member states must submit their opinions on the provisional duties by next week through a consultation procedure.
This vote is not binding for the EU Commission and does not commit member states to a later vote on the final imposition of duties. The German government has reservations about the duties, as there are concerns that German automakers and the overall economy could suffer under the impacts or potential countermeasures from China. Therefore, it is hoped that the EU Commission will reach an agreement with China in the coming months.
The ongoing dispute over electric vehicle subsidies has put a strain on the economy of EU automakers, as they worry about the lasting impact of import restrictions on Chinese companies like BYD. The Chinese Ministry of Commerce has advocated for the EU to rectify its practices, emphasizing the importance of maintaining economic and trade cooperation between the two regions.
