MOFCOM spokesperson He Yadong at a press conference on December 28, 2023 Photo: Tao Mingyang/GT

China’s Commerce Ministry on Thursday urged the EU to adhere to the WTO rules, respect the principle of market economy and use foreign subsidies regulation prudently, in response to European Commission’s anti-subsidy investigation into CRRC Qingdao Sifang Locomotive.

It is hoped that the EU will provide a fair and non-discriminatory business environment for Chinese enterprises, and jointly promote China-EU economic and trade cooperation, He Yadong, a spokesperson from the Ministry of Commerce (MOFCOM) told a press conference in Beijing on Thursday.

On Friday, the EU's antitrust regulators launched an investigation into Chinese train-maker CRRC Qingdao Sifang Locomotive, a subsidiary of CRRC Corp, the world's biggest producer of rolling stock, as the firm notified EU authorities about its plan to take part in a Bulgarian tender for electric trains, Reuters reported.

Following a preliminary review, the EU said that it would launch a full-scale investigation, citing "sufficient indications that the company has been granted a foreign subsidy that distorts the internal market," according to Reuters.

Chinese business communities and authorities have expresses serious concern about the so-called subsidy issue.

China Chamber of Commerce to the EU (CCCEU) on Saturday said the initiation of the investigation has sent a discouraging message to Chinese investors intending to cultivate and operate in the EU market. 

“It has impacted their enthusiasm and confidence in continuing to expand their business and carry out in-depth cooperation in Europe,” the business group said in a statement.

The CCCEU expresses deep concern over the increasing protectionist tendencies and abusive use of policy instruments, including the initiation of the anti-subsidy investigation targeting Chinese electric vehicles since the last quarter of 2023, as well as over the growing politicization of the EU’s business environment.

China is competitive in manufacturing electric vehicles and high-speed rail and the competition between the two sides in certain industries is inevitable. However, the EU's increasing use of protectionist measures is concerning, Dong Yifan, a research fellow with the Institute of European Studies under the China Institutes of Contemporary International Relations, told the Global Times on Thursday.

“The EU needs to recognize the mutually beneficial economic relationship between China and Europe, and avoid damaging this partnership with its unilateral protectionist actions," Dong noted

Commenting on China’s electric vehicle development, the spokesperson said the MOFCOM will strengthen cooperation with various countries in the field of new-energy vehicles to promote a fair, stable, inclusive and convenient trade environment, better serving green transformation and global low-carbon development.