The European Commission has taken a significant step by launching an anti-subsidy investigation into the import of battery electric vehicles (BEVs) from China. The investigation's primary objective is to assess whether value chains related to BEVs in China benefit from unlawful subsidization, and whether this subsidization poses a genuine economic threat to BEV producers within the European Union (EU). If both aspects are confirmed, the investigation will proceed to analyze the potential consequences and effects of imposing measures on importers, users, and consumers of battery electric vehicles in the EU. Subsequently, based on the findings, the Commission will consider the imposition of anti-subsidy duties on imports of battery electric vehicles from China to protect the interests of the EU.
This investigation, which was first announced by Ursula von der Leyen, President of the European Commission, in her State of the European Union (SOTEU) speech on 13th September, will adhere to strict legal procedures in line with both EU and World Trade Organization (WTO) rules. This approach ensures that all involved parties, including the Chinese government and companies or exporters, have the opportunity to present their comments, evidence, and arguments.
Ursula von der Leyen underscored the importance of the electric vehicle sector for Europe's future competitiveness and green industrial leadership. She highlighted that EU car manufacturers and related sectors are actively investing in innovation and development to harness the sector's potential. However, if market distortions and unfair competition are hindering these efforts, the EU is committed to taking decisive action in line with its domestic and international obligations.
Notably, the Commission initiated this investigation independently, gathering substantial evidence indicating that the recent influx of low-priced and subsidized electric vehicle imports from China into the EU poses an economic threat to the EU's electric car industry. While no formal complaint was received from the EU industry, the EU's anti-subsidy regulations call for industry cooperation in such investigations.
In compliance with EU and WTO regulations, preliminary consultations were conducted with the Chinese government before the publication of the Notice of Initiation.
The Notice of Initiation outlines the allegations and delineates the procedure to determine potential subsidization threats to the EU industry. The investigation is expected to conclude within a maximum of 13 months from initiation. If warranted by legal grounds, provisional anti-subsidy duties may be imposed within 9 months of initiation, followed by potential definitive measures within 4 months or up to 13 months after the investigation's initiation. This diligent approach aims to safeguard fair competition and protect the interests of the EU's electric vehicle industry.