A Brief Overview of the EU Trade Defence Instruments and Their Potential Implications on Chinese Businesses

Op-ed by Maria Masdemont Fageda, ICES Research Assistant

4 December 2023

On the annual State of the Union Speech (SOTEU), President of the Commission Ursula von der Leyen announced the launch of a new investigation on Chinese subsidies targeting low-cost electric vehicles entering the European market and undermining the EU’s automotive sector. The announcement was initiated formally on 4 October 2023, and it came in a context where the bloc is working to de-risk and reduce its dependencies on China while striving to implement its green and digital transitions.

The declaration showcased, through the deployment of the EU trade defence instruments, a set of tools that, together with a de-risking strategy, have made a recurrent appearance in the discourses delivered throughout the last year. Not unexpectedly, the decision was received with rejection and criticism from Beijing. But beyond the Chinese government, doubts have emerged around the motivation that pushed for such a decision, questioning whether it came as the result of a political agenda or an actual unfair trade practice and the protectionist character of the policy.