The European Commission has imposed provisional countervailing duties of up to 37.6% on imports of battery electric vehicles (BEVs) from China following a nine-month ex officio anti-subsidy investigation. The investigation found that the BEV value chain in China benefits from unfair subsidisation, posing a threat of economic injury to EU BEV producers.
Consultations with the Chinese government have intensified in recent weeks following an exchange of views between Executive Vice-President Valdis Dombrovskis and Chinese Trade Minister Wang Wentao, and contacts at technical level continue, aiming to reach a WTO-compatible solution addressing the concerns raised by the European Union.
“There is no basis for China to retaliate after the EU said it will impose tariffs of up to 37.6% on imports of electric vehicles made in China,” EU trade chief Valdis Dombrovskis said on Thursday in an interview with press agency Bloomberg.
The individual duties applied to sampled Chinese producers starting on Friday are BYD: 17.4%, Geely: 19.9%, and SAIC: 37.6%. Other cooperating BEV producers in China are subject to a 20.8% weighted average duty, while non-cooperating companies face a 37.6% duty.
European Commission President Ursula von der Leyen said the Commission’s new provisional duties of 17.4% to 37.6% aim to stop a threatened flood of cheap, state-subsidised electric vehicles.
Provisional duties, effective July 5, 2024, will last for a maximum of four months. A final decision on definitive duties, to be voted on by EU Member States, must be made within this timeframe. If adopted, the definitive duties would be in place for five years.
On October 4, 2023, the European Commission investigated subsidies for battery electric vehicles from China due to concerns about increasing low-priced imports. The investigation followed EU and WTO rules, allowing all involved parties, including the Chinese government and exporters, to present evidence and arguments.
Member States will vote on provisional measures, and interested parties can request hearings and provide comments within specific timeframes. The final determination will be presented to Member States for a binding vote. Any potential measures will be in effect for five years, extendable upon request and subsequent review. As a specific BEV producer in China, Tesla may receive an individually calculated duty rate, and other companies in China that were not initially selected can request an accelerated review after the imposition of definitive measures, with a 9-month deadline for conclusion.
