WTO Establishes Dispute Panel for China's Claims Against the EU's CVD on Chinese EVs
The World Trade Organization's Dispute Settlement Body on April 25 agreed to establish a panel to review the EU's countervailing duties on new battery electric vehicles from China. The panel was created following China's second request to do so, because Beijing says the CVD violate Article VI of the General Agreement on Tariffs and Trade 1994 (see 2408140010).
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The EU said it "strongly maintains that its measures are entirely justified," and it's confident it will prevail in the dispute, the WTO said. Various countries, including the U.S., Japan, India and Russia, reserved their "third-party rights to participate in the proceedings."
China formally filed the dispute in November after the EU imposed its definitive CVD on Chinese EVs. Beijing alleged that the EU committed many substantive errors in imposing the duties, including in the bloc's decisions to countervail alleged preferential financing to EV makers and the provision of inputs and land-use rights below cost. The dispute also alleged that the EU wrongly found financial institutions and input suppliers to be public or private bodies instructed by the Chinese government for all the alleged subsidies.
In addition, the dispute contested the EU's finding that China's fiscal subsidy policy and grants to EV makers led to countervailable subsidies, as well as its conclusion that the Chinese government chose to forgo revenue through a tax exemption and reduction for EV makers. China also raised a host of procedural complaints about the EU's process, including that the bloc didn't properly show the existence of "special circumstances and sufficient evidence regarding the existence of alleged subsidization."