The European Commission plans to impose provisional duties on electric vehicles (EVs) imported from China.
The European Commission has declared its intention to levy temporary tariffs on electric cars (EVs) produced in China, with rates varying from 17.4% to 38.1%. These responsibilities will be supplementary to the prevailing 10% duty that is already imposed on imported cars. The new measures are scheduled to be implemented by July 4.
Provisional measures refer to temporary actions taken to address a specific situation or problem. These measures are implemented as a temporary solution until a more permanent solution can be found or implemented.
If the Commission considers that there is a need to protect EU industry from harm, provisional levies can be introduced within nine months of commencing an EU anti-subsidy investigation. The duration of these obligations can extend up to four months, during which the Commission will make a decision on whether to impose final, or definitive, duties. The decision for the ongoing EV probe is anticipated to be made on November 3.
The responsibilities will only be levied if decisive duties are imposed upon the completion of the investigation. If the final duties are reduced or not imposed, the interim duties will be changed accordingly. Customs authorities usually want importers to furnish a bank guarantee until a definitive judgment is reached. Furthermore, these responsibilities can be implemented retrospectively for a maximum of 90 days, potentially impacting imports from the beginning of April, contingent upon the results of the investigation.
What is the subsequent course of events?
The Commission will release a comprehensive statement in the EU official journal on July 4, providing detailed information on the current investigation and its initial findings. The interim responsibilities will become effective on the subsequent day. China, EV producers, and other interested parties have until July 18 to provide comments on these findings and may even request a hearing.
The Commission has already completed thorough investigations, conducting visits to more than 100 automobile plants in China and Europe. Usually, the ultimate report closely corresponds to the preliminary findings, integrating modifications depending on the collected comments. Final responsibilities frequently entail slightly reduced fees compared to the temporary ones, in recognition of some of the points put up during the consultation phase.
A notable advancement is Tesla’s appeal to the Commission to compute a distinct tariff rate for its exports. As the leading exporter of Chinese electric vehicles (EVs) to Europe, Tesla’s objective is to obtain a reduced duty rate compared to the existing 21% charge imposed on enterprises that have participated in the probe, a category that includes Tesla.
The European Commission intends to reduce any potential damage to the EU automotive industry caused by subsidized Chinese electric vehicle imports by adopting these temporary levies. Stakeholders throughout the industry will closely monitor the ultimate determination of these actions.