China said on Thursday that it has concluded after looking into EU procedures that Brussels had unfairly placed “trade and investment barriers” on Beijing, escalating long-standing business disputes.
After the group began looking into whether Chinese government subsidies were hurting European competitiveness, Beijing announced the investigation in July.
In order to defend the legal rights and interests of Chinese enterprises, Beijing has repeatedly claimed that its industrial policies are discriminatory and has threatened to take action against the EU.
Its commerce ministry said on Thursday that the EU’s Foreign Subsidies Regulation (FSR) “constitutes trade and investment barriers” and has discriminated against Chinese companies.
The ministry said that “selective enforcement” of FSR measures resulted in “Chinese products being treated more unfavourably during the process of export to the EU than products from third countries”.
It added that the FSR had “vague” criteria for investigating foreign subsidies, placed a “severe burden” on the targeted companies and had opaque procedures that created “huge uncertainty”.
EU measures like surprise inspections “clearly exceeded the necessary limits”, while investigators were “subjective and arbitrary” on issues like market distortion, according to the ministry.
It stated that “severe penalties” were imposed on companies found to have disregarded inquiries, putting “huge pressure” on Chinese companies.
According to the ministry, Chinese enterprises have lost more than 15 billion yuan ($2.05 billion) as a result of having to halt or reduce projects because to FSR investigations.
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