China Challenges EU’s EV Tariffs at WTO

In a major escalation of trade tensions, China has lodged a formal complaint with the World Trade Organization (WTO) against the European Union’s (EU) decision to impose provisional anti-subsidy duties on imports of Chinese battery electric vehicles (BEVs). Beijing argues that the EU’s actions lack a sound factual and legal basis, violating WTO rules and potentially undermining global efforts to combat climate change.

A spokesperson for China’s Ministry of Commerce expressed strong dissatisfaction with the EU’s decision, calling for immediate rectification. “The EU’s preliminary ruling is groundless and disrupts the stability of China-EU economic and trade relations, as well as the supply chain for electric vehicles,” the spokesperson stated.

The European Commission imposed these additional duties on July 5th, targeting three major Chinese EV manufacturers. BYD, Geely, and SAIC were hit with 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%. EU member states will make the final determination on these duties, which could remain in place for up to five years.

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 has also called for expedited consultations with the EU to reach a mutually agreeable resolution.

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