The European Union has launched a World Trade Organization (WTO) case against Chinese tariffs on brandy imports. In October, China’s Ministry of Commerce (MOFCOM) announced it would start collecting provisional anti-dumping duties ranging from 30.6% to 39% on liquors, mainly on cognac shipments from France. The move was broadly seen as retaliation against the European Commission’s anti-subsidy investigation and subsequent countervailing duties of up to 35.3% on Chinese-made electric vehicles (EVs). A request for consultation was formally lodged at the WTO on November 25. It is the first step in a dispute settlement process, to which China has 10 days to respond. If the dispute is not resolved through consultations, it will proceed to a disputes panel that could – if appealed – take years to finalize.
While the WTO’s Appellate Court has been sidelined because the United States has blocked the appointment of new judges, both China and the EU are signatories to the alternative Multi-Party Interim Appeal Arbitration Arrangement, meaning the case can be heard to its conclusion. In a statement, the European Commission said “China’s provisional measures on EU brandy are not based on facts, and thus are not in line with WTO rules”. “The EU takes very seriously any unfair or questionable use of trade defense instruments against any sector of our economy,” said Valdis Dombrovskis, the EU’s outgoing Trade Commissioner. “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 defense measures,” he added, as reported by the South China Morning Post.
Meanwhile, it has been reported that there is some progress in negotiations between the EU and China on the EU's imposition of anti-subsidy tariffs on Chinese electric vehicles (EVs). Bernd Lange, Chair of the Committee on International Trade of the European Parliament, told German broadcaster n-tv that both sides are close to reaching a deal that would see China commit to offering EVs in the EU at a minimum price. On October 30, the EU placed additional tariffs of up to 35.3% on Chinese EV imports for five years, on top of the standard 10% import duty. Under the agreement being discussed, China would agree to a mutually acceptable export price and volume for its EVs in exchange for the EU removing the tariff hikes, the China Daily adds.
