China’s Ministry of Commerce (MOFCOM) announced on Wednesday the initiation of a trade and investment barrier investigation into the European Union’s (EU) practices concerning foreign subsidy investigations. The move comes amid growing scrutiny by the EU on Chinese companies operating in sectors such as locomotives, photovoltaics, wind power, and security check equipment.
According to a statement from MOFCOM, the investigation was launched at the request of the China Chamber of Commerce for Import and Export of Machinery and Electronic Products. The chamber’s qualifications and submitted documents have been verified, legitimizing the investigation under Chinese trade regulations.
Under its foreign subsidies regulation, the EU has conducted preliminary, in-depth, and spot investigations into several Chinese enterprises. MOFCOM indicated that it would examine the EU’s practices in these investigations to determine if they constitute trade and investment barriers adversely affecting Chinese businesses.
The ministry outlined that the investigation would involve comprehensive methods, including surveys, hearings, and on-site verification activities, to gather information from all relevant stakeholders. This approach aims to ensure a thorough understanding of the EU’s practices and their impact on trade relations.
The investigation is scheduled to conclude by January 10, 2025. However, MOFCOM noted that the deadline could be extended to April 10 under special circumstances, allowing for additional time if necessary to reach a conclusive outcome.
The development highlights the increasing complexities in China-EU trade relations, particularly concerning industry subsidies and fair competition. Business professionals and analysts are closely monitoring the situation, given its potential implications for global trade dynamics and investment flows between Asia and Europe.
