China – EU: European Commission Appeals to WTO Against Chinese Tariffs

Additional taxes in China, which hit French and European brandy and cognac producers, will take effect on October 11

The trade war between the European Union and China is gaining momentum. The European Commission has announced that it will challenge at the World Trade Organization (WTO) Chinese tariffs on imports of brandy and cognac imposed by Beijing following the EU’s criticized decision to impose additional levies on electric cars produced in China.

“We believe that these Chinese measures are unjustified, we are determined to protect European industry from the misuse of trade defense instruments,” said Olof Gill of the EU Commission. According to him, “China’s announced introduction of temporary anti-monopoly measures are dumping measures on imports of brandy and cognac from the EU.”

Starting Friday, October 11, China will require importers of European cognac to leave a deposit at Chinese customs. Beijing’s move is seen as a direct response to the EU’s decision to impose additional customs duties of 35% to 48% on electric car imports from China.

The statements came amid growing trade tensions between China and the European Union, the Asian giant’s key economic partner and the world’s second-largest economy. According to many analysts, after the hit on brandy and cognac, which will primarily affect France, China will be able to impose prohibitive duties on European car exports. This will put the three major German automakers (Volkswagen, Mercedes Benz, BMW) in a quandary.