China’s Ministry of Commerce has filed a complaint with the World Trade Organisation (WTO) over the decision by the European Union (EU) to significantly raise tariffs on Chinese-made electric vehicles (EVs), the South China Morning Post reports.
Following failed negotiations with Chinese officials, the European Commission published on Tuesday its final ruling on the long-anticipated tariff hikes – the result of the commission’s belief that state subsidies given to Chinese EV makers allow them to unfairly undercut other manufacturers’ prices.
A top rate of 35.3 percent now applies to EVs from Chinese state-owned company SAIC Motor and its subsidiaries, in addition to the baseline 10 percent duty already imposed on all EV imports. BYD and Geely are set to face hikes of 17 and 18.8 percent respectively. The rate variations are based on the European Commission’s unilateral assessment of how well each manufacturer cooperated with its investigation into China’s state subsidies.
[See more: China penalises European brandy in the wake of EU tariffs on electric vehicles]
Beijing filed its complaint with the WTO’s dispute settlement mechanism in response, and said that “China will continue to take all necessary measures to resolutely safeguard the legitimate rights and interests of Chinese companies.” According to the Post, these measures would intensify the now simmering trade war between the two major markets.
At the same time, the Ministry of Commerce says China will launch a “new phase of consultations” with the EU. “We hope that the European side will work with China in a constructive manner … and reach a solution acceptable to both sides as soon as possible to avoid escalating trade frictions,” it said.
Beijing has strongly denied allegations that its EV makers have an unfair advantage on the open market, describing any resulting tariffs as protectionist behaviour that will only serve to endanger climate-change goals and raise the cost of switching to an EV for European consumers.
