Jan. 12 (UPI) — The European Union published new pricing guidelines Monday that could allow the relaxation of tough import “anti-subsidy” duties on Chinese electric vehicles of up to 35.3% imposed by the 27-country economic block in October 2024.
The framework deal prescribes how Chinese EV-makers will submit “price undertaking offers” under which they commit to a minimum selling price where, if accepted, the EU will waive the anti-subsidy duties, Brussels said in a news release.
The European Commission said the guidance, the result of 15 months of negotiations with the Chinese Commerce Ministry, covered sales channels, cross-compensation and future investment in the EU — in addition to the minimum price offer — and that every submission would receive a fair hearing.
“Each price undertaking offer is subject to the same legal criteria and the European Commission will conduct each assessment in an objective and fair manner, following the principle of non-discrimination and in accordance with World Trade Organization rules,” said the commission.
The Chinese Commerce Ministry hailed the agreement as an important step forward to resolving the long-running dispute over EU claims that the Chinese government is subsidizing its EV manufacturing sector, but which Beijing insists is overblown, unwarranted and manufactured from selective data.
“The progress fully reflects the spirit of dialogue and the outcomes of consultations between China and the EU. It shows that both China and the EU have the ability and willingness to properly resolve differences through consultation.
“This is conducive not only to ensuring the healthy development of China-EU economic and trade relations, but also to safeguarding the rules-based international trade order.”
The deal could offer relief for big producers like BYD, Geely and SAIC, which were slapped with tariff rates of 17%, 18.8% and 35.3%, respectively, beginning on Oct. 30, 2024, for five years following a year-long antitrust investigation into the EV market.
Tesla was given a rate of 7.8% following a “substantiated request” that its situation receive an individual examination.
However, the guidelines set a high bar for the Chinese to surmount, requiring offers to counterbalance the negative effects of the subsidies, with the EU claiming its EV industry is taking major hits, including being priced out of competing in the net-zero marketplace, with 2.5 million jobs under imminent threat and 10.3 million indirectly.
EU member states were split over the tariffs, with only 10 voting in favor in October 2024, with the sector itself, as well as economies with very large trade relationships with China, such as Germany, skeptical and fearful of Chinese retaliation.
Back then, Beijing accused the EU of protectionism, arguing Chinese EVs were cheaper because they were simply more efficient at making them.
“China’s competitive advantage in EVs is not due to subsidies but rather to a robust supply chain, developed through intense competition,” the Chinese Chamber of Commerce to the EU said.
Since then, the market share of Chinese-made EVs has risen steadily in Europe and around the world, with Tesla being toppled from its position as the best-selling brand by BYD sometime in 2025.