China Challenges EU's EV Tariffs at WTO

In a significant escalation of trade tensions, China has filed a formal complaint with the World Trade Organization (WTO) over the European Union's (EU) imposition of provisional anti-subsidy duties on imports of Chinese battery electric vehicles (BEVs). Beijing argues that the EU's actions lack a solid factual and legal foundation and violate WTO rules, potentially undermining global efforts to combat climate change.

A spokesperson for China's Ministry of Commerce expressed strong dissatisfaction with the EU's decision, urging immediate rectification. "The EU's preliminary ruling is baseless and disrupts the stability of China-EU economic and trade relations, as well as the supply chain of electric vehicles," the spokesperson said.

The European Commission had imposed these additional duties on July 5th, targeting three major Chinese EV manufacturers. BYD, Geely, and SAIC faced new tariffs of 17.4%, 19.9%, and 37.6%, respectively. The duty on SAIC, China’s largest automaker, was slightly reduced from an initial 38.1%. The final determination on these duties, which could last for five years, will be made by EU member states.

SAIC, a key player in the EV market, with significant exports to the UK, France, Germany, and Spain, has formally requested a hearing on these temporary countervailing duties. The Chinese government also called for expedited consultations with the EU to reach a mutually agreeable solution.

China, which accounted for 59% of global BEV sales in the first half of the year, sees this move as detrimental not only to its economic interests but also to the broader goal of global climate cooperation. Meanwhile, Europe’s EV market growth has slowed significantly, largely due to the reduction of fiscal subsidies, slow progress in building charging infrastructure, and broader economic challenges.