The notice marks the end of the first phase of a closely watched investigation that has raised the possibility of a trade war between the EU and China. The countervailing duties were in line with expected levels and higher than the 19% average EU tariff of this kind.
The rate will be added to an existing 10 percent import tariff on vehicles not included in the investigation, bringing the total rate to 31 percent from July 4. The Commission will then have four months to impose permanent tariffs.
During that period, heated discussions are expected among member states, many of which have expressed reservations about imposing tariffs on imports.
Through various media and business channels, China has hinted at the possibility of imposing a 25% tariff on certain imports of heavy vehicles, mainly affecting Germany and Slovakia, as well as possible investigations into EU pork and dairy imports.
Chinese Foreign Ministry spokesman Lin Jian, speaking at a news conference in Beijing on Wednesday, slammed reports of the tariffs as “protectionism.”
“We urge the EU to uphold its commitment to support free trade and oppose protectionism, and work with China to safeguard the overall China-EU economic and trade cooperation,” he said.
“China will take all necessary measures to firmly safeguard its legitimate rights and interests.”
The EU tariffs are an average calculated based on subsidies found at three Chinese automakers: BYD, SAIC and Geely.
The tariffs apply to both Chinese brands and Western brands made in China, but Tesla has already applied for a reduction in the tariffs, arguing that it receives less subsidies than the companies under investigation. This is the subject of a new investigation by the European Commission, and for now Tesla will have to pay the full tariffs. If the request is successful, the company will be refunded the difference.
EU member states with large car industries are thought to be ready to fight the European Commission over the introduction of permanent tariffs in November.
Germany, home to big brands like Volkswagen, BMW and Mercedes-Benz, many of which have voiced opposition, is expected to lead the pushback and has already launched an intense lobbying campaign against the tariffs. Sweden, home to Volvo and Polestar, now owned by Geely Automobile, is also among those opposed.
“Isolation and illegal tariff barriers only end up making everything more expensive and everyone poorer,” German Chancellor Olaf Scholz said over the weekend. “We will not close our markets to foreign companies, because we don’t want that for our companies either.”
China’s Commerce Ministry’s Ding Weishun slammed EU complaints about overcapacity in the Chinese economy as a “pretext” for “classic protectionism.”
“Some Chinese enterprises are choosing to set up factories in Europe, which clearly reflects the complementary advantages and mutual benefits between China and Europe,” Ding said.
“We hope that the European and Chinese sides can work together to properly resolve each other’s concerns through dialogue and communication.”
Additional reporting by Ji Shiqi in Beijing
