The Ministry of Commerce of China File photo: VCG

China ruled on Monday that certain dairy products from the EU are subsidized, and it will slap provisional duties of 21.9 percent to 42.7 percent on certain dairy products imported from the EU starting on Tuesday, following a preliminary anti-subsidy probe that began more than a year ago, according to the Ministry of Commerce (MOFCOM) on Monday.

As global trade protectionism is widespread and trade competition is intensifying, these measures, which are implemented in response to industry concerns and are law-based and rational, are intended solely to ensure a level playing field, in stark contrast to some protectionist actions targeting Chinese businesses, Chinese experts said.

The MOFCOM announced on Monday that the investigating authority has preliminarily determined that certain dairy products from the EU are subsidized, that China's domestic dairy industry has suffered material injury, and that there is a causal link between the subsidies and the material injury. 

Starting from Tuesday, provisional countervailing measures will be imposed on the corresponding products in the form of a security deposit for provisional countervailing duties, per the MOFCOM.

The MOFCOM initiated a countervailing investigation into certain dairy products imported from the EU on August 21, 2024, at the request of the China Dairy Association and the China Dairy Industry Association.  The launch of the probe came after the Global Times learned exclusively last June from a business insider that relevant Chinese industries were preparing evidence, as they planned to apply to the competent authorities to launch an anti-subsidy investigation into imports of relevant dairy products from the EU.

Following the initiation of the case, the MOFCOM conducted the investigation in a fair, impartial, open, and transparent manner, in strict accordance with Chinese laws and regulations as well as relevant World Trade Organization rules, fully safeguarding the rights of interested parties, a spokesperson of the MOFCOM said on Monday in response to a media inquiry regarding the ruling.

The preliminary ruling shows that certain EU dairy imports are subsidized and have caused material injury to China's domestic industry, said the spokesperson.
In accordance with the relevant provisions of the China's regulations on countervailing measures, the MOFCOM released its preliminary ruling announcement on Monday, determining ad valorem subsidy rates for EU companies ranging from 21.9 percent to 42.7 percent, and decided to impose provisional countervailing measures, according the ministry's spokesperson.

On August 18, 2025, the MOFCOM issued a notice of extension, extending the investigation period for the case until February 21, 2026.

The Chinese side's moves are based on relevant laws and regulations and are aimed at maintaining a stable and healthy market, as well as protecting the rights and interests of the corresponding domestic industry and enterprises, Cui Hongjian, director of the Center for European Union and Regional Development Studies at Beijing Foreign Studies University, told the Global Times on Monday. The expert noted that as global trade protectionism is widespread and trade competition is intensifying, these measures, which are law-based and rational, are only intended to ensure a level playing field, with "their main purpose being to safeguard the market, not to target or suppress any individual enterprises."

Also on the same day, responding to media questions on the preliminary ruling, a head of the trade remedy and investigation bureau of the MOFCOM reiterated that China has consistently exercised caution and restraint in using trade remedy measures. 

The investigating authority conducted the probe in an open and transparent manner in accordance with the law, through multiple methods and procedures. These included distributing questionnaires and supplemental questionnaires, soliciting and considering comments, holding hearings, conducting on-site verifications with the EU and its member state governments as well as sampled enterprises, and carrying out on-site investigations of domestic Chinese enterprises, thereby fully safeguarding the rights of all interested parties, according to the MOFCOM official.

After more than a year of prudent investigation, preliminary evidence showed that the EU has provided substantial subsidies to agriculture-related sectors, including the milk and dairy products industry, through programs such as the common agricultural policy, the official said, noting that during the investigation period, China's domestic industry was affected by imports of subsidized EU products, with inventories continuing to rise, profits turning into losses, and production and operations also encountering difficulties.

However, since the beginning of 2025, China has not initiated any new trade remedy investigations on the EU, only issuing final rulings on three anti-dumping cases concerning brandy, polyformaldehyde copolymer, and pork, said the MOFCOM official.

In the same period, the EU has imposed provisional duties in 18 trade remedy cases against China, issued final duties in 18 cases, and launched 15 new trade remedy investigations, including three initiated against China on Friday, December 19 alone, according to the official. 

"China's temporary measures targeting certain EU dairy products are moderate and differ from some Western countries that often implement politically motivated protectionist actions against certain Chinese industries and businesses," Zhao Junjie, a senior research fellow at the Institute of European Studies at the Chinese Academy of Social Sciences, told the Global Times on Monday, noting that the Chinese side's moves were made in response to domestic industry concerns and represent a provisional anti-subsidy measure implemented after more than a year-long careful and thorough investigation.

"Moreover, we target only specific products for a limited period, exercising considerable restraint... in upholding the principle of market fairness, we handle the matter on a case-by-case basis," Zhao noted.

On a further note, the MOFCOM official said that China's position against the abuse of trade remedy measures remains unchanged, and it is willing to properly handle trade frictions with the EU through dialogue and consultation, jointly safeguarding the overall situation of China-EU economic and trade cooperation.

Looking ahead, the official said that China will continue to carry out subsequent investigations strictly in accordance with its relevant laws and regulations and WTO rules, making final rulings based on the principles of fairness, justice, openness, and transparency, while fully safeguarding the rights of all stakeholders.