China Challenges EU’s ‘Unfair’ Foreign Subsidy Probes
China’s Ministry of Commerce has urged the European Union (EU) to reconsider its approach to foreign subsidy investigations involving Chinese companies. On Thursday, the ministry stated that the EU’s practices create trade and investment barriers, harming the competitiveness of Chinese enterprises.
The call comes after a six-month probe initiated by the China Chamber of Commerce for Import and Export of Machinery and Electronic Products. The investigation examined the EU’s inquiries into Chinese companies in sectors like locomotives, solar panels, wind power, and security equipment.
According to the ministry, the EU’s investigations involve “unreasonable practices” that violate core principles of the World Trade Organization, including non-discrimination. Stakeholders believe the EU imposed inappropriate penalties, set tight time constraints, and lacked transparency in its procedures.
The probe found that regulations were selectively enforced and that criteria for determining foreign subsidies were vague. Key concepts like “market distortion” were defined subjectively, placing a heavy burden on companies.
“These investigations restrict Chinese products, services, and investments from entering the EU market,” the ministry said. “This not only damages the competitiveness of Chinese companies but also hinders trade and investment between China and the EU.”
Chinese enterprises have reportedly faced significant economic losses due to the EU’s actions. The probe identified approximately 7.6 billion yuan (about $1.06 billion) in abandoned projects, with other affected projects valued at over 8 billion yuan.
The ministry also warned that these practices could backfire on the EU, leading to higher operational costs for businesses, increased consumer prices, and potential job losses, ultimately impacting the EU’s economic and social stability.
During the investigation, the European Commission did not provide feedback on materials submitted by the Chinese side, according to ministry spokesperson He Yadong.
China plans to engage in bilateral consultations with the EU, urging adjustments to ensure an open, fair, just, non-discriminatory, and predictable environment for Chinese enterprises in Europe. “We seek an environment where businesses can thrive,” He said.
Reference(s):
China says EU's foreign subsidy probes trade and investment barriers
cgtn.com
