China Labels EU’s Foreign Subsidy Investigations as Trade Barriers
In a recent announcement, China’s Ministry of Commerce criticized the European Union’s practices in its foreign subsidy investigations against Chinese enterprises, labeling them as trade and investment barriers. The statement comes after a six-month probe initiated at the request of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products.
The ministry highlighted that under its foreign subsidies regulation, the EU has conducted extensive investigations into Chinese companies operating in sectors such as locomotives, photovoltaics, wind power, and security check equipment. According to the ministry, these investigations employed unreasonable practices that violate the World Trade Organization’s core principles, including non-discrimination.
Stakeholders involved in the probe expressed concerns over the EU’s approach, citing inappropriate penalties, unreasonable time constraints, and a lack of procedural transparency and legitimacy. They contended that regulations were selectively enforced, criteria for determining foreign subsidies were vague, and key concepts like market distortion were defined subjectively and arbitrarily.
The ministry reported that these investigations have significantly harmed trade and investment between China and the EU. Chinese companies have faced restrictions on their products, services, and investments entering the EU market, resulting in diminished competitiveness. The probe uncovered that Chinese enterprises have suffered substantial economic losses, with approximately 7.6 billion yuan (about $1.06 billion) in abandoned bidding projects and other affected projects valued at over 8 billion yuan.
Furthermore, the ministry noted potential adverse effects on the EU itself, including increased operational costs for businesses, higher consumer prices, and possible job losses, which could hinder the stable economic and social development of EU member states.
He Yadong, spokesperson for the Ministry of Commerce, mentioned that during the probe, the European Commission did not submit any completed answer sheets provided by the ministry or offer related comments. In response, the ministry plans to take measures, including bilateral consultations, urging the EU to adjust or change its practices to ensure an open, fair, just, non-discriminatory, and predictable environment for Chinese enterprises investing and operating in Europe.
Reference(s):
China says EU's foreign subsidy probes trade and investment barriers
cgtn.com
