Beijing strongly denounces future EU levies on electric vehicles.
**Brussels and Beijing have been engaged in a dispute over tariffs for Chinese electric vehicles for a long time. Recently, the EU announced some changes – the idea of retroactive payments has been abandoned. However, China remains firmly opposed to these tariffs. “China strongly condemns this step and is deeply troubled by it,” Beijing’s Ministry of Commerce said. They expressed hope that the EU will engage in sensible and practical dialogue with China to avoid any escalation in the trade conflict.
The EU’s anti-dumping investigation, according to China’s Ministry of Commerce, goes against the provisions of the World Trade Organization and represents an unfair advantage disguised as fair competition. The EU has not given adequate weight to China’s views in its final decision and persists with its questionable tactics, the ministry complained.
During the investigation, Beijing and the automotive sector submitted legal documents and evidence to challenge the EU’s irrational practices. According to China’s Ministry of Commerce, both sides have had more than ten discussions on this issue since June. The EU Commission’s controversial strategy threatens to disrupt the stability of the global supply chain in this sector and harm European consumers, the Chinese authority warned.
EU member states must vote on tariffs
The EU initially stated that it would not initially impose additional tariffs on Chinese electric vehicles. Initially, there was an intention to apply substantial retroactive compensatory tariffs due to the fact that Chinese electric vehicles, among others, have benefited from distortive subsidies. The tariff rates set by the authority have been slightly modified. In many cases, there has been a slight decrease and the tariffs now range between 36.3% and 36.3%, effective at the end of October for an initial period of five years. For major manufacturers such as BMW, VW and Tesla that produce in China, lower rates apply.
The EU Commission claims that China is providing illicit financial aid to its producers and fears negative effects on European producers such as factory closures or job losses. However, the conditions for the levying of retroactive tariffs no longer exist, according to the Commission. Whether punitive tariffs will materialize or not will be known at the end of October. This decision must be ratified by the 27 EU member states, the Commission said.
Negotiations with Beijing remain an option to avoid tariffs, Commission officials stressed. So far, these negotiations have not produced positive results. Instead, China took the dispute to the World Trade Organization (WTO) in early August. Producers now have a ten-day period to submit their comments. The EU Commission will then submit its proposal to member states for a final decision.
The EU’s decision to impose tariffs on Chinese electric vehicles has met with strong opposition from China, with China’s Ministry of Commerce voicing concerns over the EU’s alleged unfair practices and its disinterest in China’s views. The tariff dispute between the EU and China requires the approval of all 27 EU member states before any action can be implemented.
Despite the ongoing negotiations between the EU and China to avert the tariffs, the EU Commission’s controversial strategy, if implemented, could potentially disrupt the global supply chain in the electric vehicle industry and negatively impact European consumers.