EU cuts customs duties on Chinese-made electric vehicles

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The European Union is moving to ease trade tensions with China by planning to lower tariffs on electric vehicles made in China.

With this decision EU gave one of the clearest signals yet that he is ready to resolve his long-running trade dispute with China through negotiations, a move that could ease trade tensions between Brussels and Beijing.

The commission announced that tariffs on all three Chinese automakers under investigation would be reduced.: at BYD – from 17.4 to 17%, at Geely – from 19.9 to 19.3%, and at SAIC – from 37.6 to 36.3%. Dutiescollected from companies not included in the “selection” and did not cooperate with the commission's investigationalso reduced from 37.6 to 36.3%.

An EU official told Euractiv that the reduction in duties is due to “reasonable” comments received from the relevant parties. However, for cooperating companies that have not been separately investigated, The duty increased from 20.8 to 21.3%. The commission explained the increase “technical” an error related to the application of the formula for calculating the share of companies' exports to the EU.

The EU executive also announced that tariffs on US carmaker Tesla, which had requested an individual tariff rate, have now been significantly reduced to 9% from the original level of 21%. The commission said this was because the company received a lower subsidy rate from the Chinese government.

Today's statements are the strongest signal of opening the commission has given to its Chinese counterparts so far, with spokesman Olof Gill saying: “A solution can certainly be found, but it must be based on facts. Let me clarify that no final political decision has been made.”. “Negotiations with China are currently underway. The EU hopes to come to an alternative solution, – the official added. – China must come up with a WTO-compliant solution that addresses the illegal subsidies as we see them, which the commission has uncovered through its painstaking, fact-based investigation.”.

Meanwhile, the EU also said it would not levy preliminary duties in the form of bank guarantees, as previously announced, because “legal requirements” for this “were not fulfilled.” He added that the tariffs would likely only be in place until October 30, after EU member states vote on the tariffs. The votes of 15 EU countries representing at least 65% of the union's population are needed to block the tariffs. However, the commission also noted that there was a “risk” that suspending the tariffs could lead to a flood of cars arriving in the EU before October 30.

“Of course there is a risk that they will start to accumulate in Europe, but it takes time to move cars from China. There is a process we have to follow,” said an EU official. He added that the EU “will try to act as quickly as possible“, And“It is possible that tariffs will be introduced before October 30.” End of October – “This is the latest possible date,” said the official. – But if all goes well, it could be done sooner.”

The EU statement comes after China filed a formal complaint with the World Trade Organization (WTO) last week, saying the EU measures “serious violations of WTO rules.” The Commission has repeatedly confirmed that its investigation complies with WTO requirements. The decision is expected to ease growing trade tensions between Brussels and Beijing.

In recent months, the EU's executive arm has announced anti-dumping investigations into wind turbines, solar panels and electric vehicles made in China. Last month, the commission also announced tariffs of up to 36.4% on Chinese biofuels. China, in turn, launched its own anti-dumping investigation into EU cognac and pork exports in January and June, respectively.

P.S. A duty reduction of tenths of a percent is, of course, a lot. Apparently, China will respond with similar measures.

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