2024-08-20 18:25:18
In its commercial battle with China, the European Commission is walking a fine line between appearing firm and being wary of over-guiding the Chinese government, which could quickly lead to retaliation. “compensate”Brussels imposed tariffs on imports of electric vehicles produced in China on Tuesday, August 20, taking a new step towards the final adoption of this measure. “Business Defense” Facing Chinese subsidies, it is considered “Illegal”.
The European Commission has been investigating unfair competition practices in China’s subsidy model since October 2023 and has proposed a differentiated approach. Import duties on electric vehicles produced by good-faith companies that cooperate with EU officials will increase by 21.3%, while those that do not play the transparency game will be subject to a 36.3% tariff.
Furthermore, the Commission has selected a sample of three representative companies, specifically on the basis of their export volumes to the EU, and calculated an “individual tariff”, i.e. a specific tax rate aimed at compensating the volume of subsidies they receive from Chinese national or local authorities in the form of loans, material aid or direct subsidies.
BYD will thus be subject to a 17% tariff. Geely Auto, which works with several European manufacturers, should pay a 19.3% surcharge at the border. For giant SAIC, the tariff will rise to 36.3%. Tesla cars produced in China will be subject to a 9% tariff. These tariffs will be added to the 10% tariff that is already in effect.
‘A political signal’
With this increase, “The European Commission is sending a political signal. commented Elvire Fabry of the Jacques Delors Institute. On the one hand, we are giving European producers breathing space, on the other hand, with this graded and calibrated approach, the Commission is trying to correct distortions of competition without closing access to the European market. Electric vehicles are a laboratory for the adjustment of European business strategy in the face of Chinese overproduction, something that can be replicated in many industrial sectors. »
The Chinese government and relevant companies now have ten days to respond. “Compensator”Before it can be adopted, it must be approved by a vote of member states before October 30 and will be valid for five years.
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