EU escalates trade dispute: WTO challenge over China's brandy tariffs
The European Commission has initiated a case against China at the World Trade Organization (WTO) concerning temporary anti-dumping measures imposed by Beijing on the import of brandy from the EU. These measures by China were applied in retaliation for EU tariffs on electric vehicles manufactured in China.
China's decision has led to EU brandy importers having to pay "security deposits to customs authorities," essentially meaning additional customs fees. Beijing's actions are perceived primarily as targeting France, which has pushed Brussels to investigate Chinese electric vehicles.
The EU does not intend to overlook China's actions. The European Commission announced that these actions are inconsistent with WTO rules and has filed a complaint.
China has not demonstrated any threat of harm to their brandy industry nor established a causal link between the alleged threat and the import of brandy from the EU. Furthermore, the EC argues that China initiated the case based on insufficient evidence, contrary to WTO standards.
The EU emphasises taking decisive action to protect its industry's and economy's interests.
China has limited time to respond
The EC's request is the first step in the WTO's dispute settlement process. China now has 10 days to respond. The aim is to find a mutually convenient format and date for consultations to resolve the dispute. The WTO acts as a mediator to help resolve the conflict. "Once a verdict has been announced [by WTO - ed. note], countries concentrate on complying with the rules, and perhaps later renegotiating them — rather than declaring war on each other," explains the organisation regarding its mission.
The EU takes very seriously any unfair or questionable use of trade defence instruments against any sector of our economy. By requesting consultations with China over its provisional anti-dumping measures on EU brandy, the commission is following through on its commitment to protect our industry from unfounded accusations and misuse of trade defence measures, said Valdis Dombrovskis, EC Vice-President for Trade, on Monday.
France was among 10 EU countries that voted in September to impose tariffs on electric vehicles produced in China. Beijing has subsidised electric vehicle production, and these charges are in addition to the standard EU import duty on cars, which is 10%.
China is also conducting anti-dumping investigations regarding the import of pork and dairy products from the EU.
