The European Union (EU) has recently launched an investigation into China’s procurement of medical devices, as part of its ongoing efforts to protect home-grown manufacturers. This investigation is just one of several probes that the EU has initiated to determine whether Chinese companies are engaging in unfair practices, such as dumping subsidised goods on the EU market or unfairly benefiting from subsidies while operating within the EU.
The European Commission, responsible for carrying out these investigations, has highlighted its aim to prevent unfair competition and market distortion. In the case of medical devices, the probe specifically focuses on Chinese public procurement practices and whether they favour domestic suppliers over European ones. If European suppliers are found to face barriers in accessing the Chinese market, restrictions could be placed on Chinese medical device companies bidding in EU public tenders. The investigation is expected to be concluded within nine months, with a potential extension of five months by the Commission.
Another area of investigation by the EU is the subsidies received by Chinese suppliers of wind turbines destined for Europe. This probe, announced by the EU’s anti-trust commissioner Margrethe Vestager, will look into wind park development in countries such as Spain, Greece, France, Romania, and Bulgaria. Despite not naming specific companies, Vestager’s announcement has drawn criticism from China, which views the probe as discriminatory and endorsing protectionism.
The EU has also opened investigations under the Foreign Subsidies Regulation (FSR) into whether Chinese bidders benefitted excessively from subsidies in a public tender for a solar power park in Romania. This particular investigation involves a consortium of Romania’s ENEVO and a unit of China’s LONGi, as well as subsidiaries of Chinese state-owned Shanghai Electric Group. The Commission has until August 14 to make a decision on whether to block the contract, accept commitments from the companies to address competition distortion, or not object to the situation.
In yet another move, the EU announced an anti-subsidy investigation into Chinese electric vehicles, with the intention of determining whether punitive tariffs should be imposed on them. The goal is to assess whether Chinese exports of electric vehicles to the EU market are benefitting from excessive subsidies. This investigation, officially launched on October 4, will last up to 13 months, and provisional anti-subsidy duties can be imposed nine months after the start of the probe.
The EU’s investigations into various sectors of Chinese procurement are aimed at ensuring a level playing field within the European market and preventing unfair competition and market distortion. While these probes have sparked tensions with China and have been deemed discriminatory by Chinese authorities, the EU remains steadfast in its commitment to upholding fair trade practices. As these investigations unfold, the implications for both European and Chinese companies operating in these sectors will become clearer, shaping the future of trade relations between the EU and China.