On Wednesday 10 April, the European Commission published a 700-page report on Chinese practices that distort competition. The paper looks in detail at recent legislation in China, the country’s industrial policy and other developments. This report is part of the 2016 Regulation on dumping by third countries, which requires the Commission to produce a report on market conditions in countries where distortions are found.
The purpose of the document is not to draw conclusions, but to describe in detail how the Chinese market operates. Only specific investigations initiated under the 2016 Regulation or under the Foreign Subsidies Regulation can conclude that unfair competition has taken place, leading to countermeasures by the EU. The Commission’s report provides useful factual information for European companies wishing to lodge complaints about dumping.
The points made by the Commission in its report fall into three categories: - transversal distortions, due to the planning system of the socialist market economy; - distortions in the factors of production, such as the allocation of and access to land, labour and raw materials; - distortions by industrial sector, also caused by State support.
In this final section, the Commission looked at the steel, aluminium, chemicals, ceramics, telecommunications, semiconductors, rail equipment, environmental goods and new energy vehicles sectors. They were chosen, in particular, for their involvement in the anti-dumping and anti-subsidy investigations carried out by the EU in recent years.
Recently, the Commission targeted China in the opening of several investigations into subsidies likely to distort competition on the European market (see EUROPE 13387/15, 13383/6). On the other hand, its investigation into subsidies for Chinese electric vehicles is still ongoing.
China has reacted to the Commission’s announcement on Tuesday 9 April that it is opening an investigation in the wind energy sector against Chinese manufacturers allegedly benefiting from unfair State subsidies. “Many in the world are deeply unsettled by the EU’s rising protectionist tendency”, said Mao Ning, spokeswoman for the Ministry of Foreign Affairs, on Wednesday 10 April. The day before, the Chinese Chamber of Commerce in the EU had denounced “an act of economic coercion” against China.
See the report: https://aeur.eu/f/bp2 (Original version in French by Léa Marchal)