China launches a probe into EU’s actions on Chinese firms under its FSR
Published: Jul 10, 2024 04:45 PM
The Ministry of Commerce Photo: VCG

The Ministry of Commerce Photo: VCG

China's Ministry of Commerce (MOFCOM) on Wednesday announced that at the request of a Chinese industry association, it launched an investigation into the EU's relevant practices in its investigations of Chinese enterprises based on the Foreign Subsidies Regulation (FSR).

Measures investigated involve relevant practices adopted by the EU in investigations such as preliminary examinations, in-depth investigations and surprise inspections carried out targeting Chinese enterprises in accordance with the EU's FSR and the implementing rules. 

The application mainly involved products such as rolling stock, photovoltaics, wind power and security inspection equipment, the ministry said.

According to the ministry, it received on June 17 an application filed by the China Chamber of Commerce for Import and Export of Machinery and Electronic Products (CCCME), in which the applicant requested to conduct a trade and investment barrier investigation into the EU's investigations of Chinese enterprises.

After reviewing the qualifications of the applicant, the measures applied for investigation, the products involved in the measures, and the negative impact caused by the measures, the MOFCOM decided to launch the probe into the EU actions.

According to related laws, the MOFCOM may use questionnaires, hearings, field investigations and other means to obtain information from stakeholders and conduct investigations.

The probe shall be completed by January 10, 2025, and may be extended to April 10, 2025 under special circumstances.

On June 27, He Yadong, spokesperson for MOFCOM said the ministry has received trade barrier investigation application regarding the EU's FSR, noting that "we are highly concerned about the EU's FSR, which has caused a serious negative impact on Chinese enterprises' exports and investment operations in Europe. We have repeatedly expressed strong dissatisfaction and firm opposition."

The China Chamber of Commerce to the EU (CCCEU) expressed its strong support for the action by MOFCOM, saying that Chinese companies reported that the European side exceeded the scope of the FSR investigation. 

"Despite the opposition of Chinese enterprises, the EU side copied documents containing information about the companies' key technology components, which are classified as commercial secrets. We express strong dissatisfaction and opposition to the European side's alleged improper practice of using investigations to gather intelligence on the advanced technologies of Chinese enterprises," said the CCCEU.

On July 1, the European Commission spokesperson for competition, Lea Zuber, denied the commission had abused its FSR to steal business secrets, adding that the EU will continue to make "full use" of its legal and investigative mechanisms to ensure that non-European companies don't unfairly benefit from state subsidies.

Global Times