The European Commission has warned three Chinese electric vehicle makers — BYD, SAIC and Geely — that they have not supplied sufficient information for its anti-subsidy investigation, and if it is not forthcoming, the commission will use evidence available elsewhere to compute tariffs that can markedly inflate their products’ retail price in the European Union market, according to a Reuters’ report on Friday.
The EU is investigating alleged government subsidy support for Chinese EV makers with the intention of raising tariffs on Chinese EVs if its investigation concludes there has been distortion of the market. The investigation, launched on Oct 4, could last up to 13 months. The commission could impose provisional anti-subsidy duties nine months after the start of the probe.
At the same time, the United States is also considering doing the same or even banning Chinese EVs from the US market citing a similar reason, plus its groundless suspicion that Chinese EVs spy on US users.
Although such a warning by the European Commission is common and similar ones have been issued in previous EU trade defense cases, and the Chinese companies concerned have been given the right to respond to the warning, the EU executive body’s mentioning that it will use “facts available” to fill in certain gaps if the Chinese companies fail to provide relevant information to make their anti-subsidy probe complete sounds more like a threat, exposing the nature of the investigation as a political manipulation that gives a dog a bad name to hang it.
SAIC said it had “fully cooperated” with the commission and provided all necessary information in accordance with World Trade Organization and EU rules. “It is worth pointing out that commercially sensitive information — such as battery formulation — should not belong to this category.”
SAIC’s response clearly shows that some information requested by the commission has gone far beyond what the probe entails but directly concerns the company’s core technology secrets. That’s why the China Chamber of Commerce to the EU said the reported allegations of noncooperation were unfounded and that the companies had participated in multiple rounds of questionnaires and facilitated on-site inspections.
The competitiveness of Chinese EVs originates from Chinese manufacturers mastering advanced technologies in battery and other core parts of the products. That comes from their long-term inputs and fierce competition at home. The Chinese EV sector, along with its solar panel, wind turbine and other green technology and equipment manufacturing industries, which are also being targeted by the EU and the US, on the unwarranted grounds of subsidy or national security concerns, actually contributes to the global green transition.
In a trilateral talk with visiting Chinese President Xi Jinping and French President Emmanuel Macron in Paris on Monday, European Commission President Ursula von der Leyen said that the EU commends China for its efforts and progress made in green transition and development, acknowledges China’s legitimate right to develop, and wishes to continue candid dialogue with China and strengthen their cooperation.
Yet the EU seems to be following the US’ lead in saying one thing and doing another in dealing with China. How can it continue candid dialogue with China or strengthen cooperation? If the EU is really what it claims to be, a steadfast supporter of free trade, fair competition, market economy and economic globalization, it should stop taking a leaf from the US’ protectionist operations manual, especially since that also contains a chapter targeting EU green-tech enterprises.