China Files Complaint Against U.S. over Discriminatory EV Subsidy Policies: Uncertain Outcome Amid WTO’s Appellate Body Technical Issues

China to oppose Biden’s electric vehicle initiatives at the WTO

In response to the new U.S. rule that went into effect on January 1, which states that electric car buyers are not eligible for tax credits if critical minerals or other battery components were made by Chinese, Russian, North Korean, or Iranian companies, China has filed a complaint with the World Trade Organization against the United States. The Chinese Commerce Ministry expressed concerns that these policies discriminate against Chinese products and distort fair competition in the global market for new energy vehicles.

The real-world impact of the case is uncertain due to the WTO’s Appellate Body not functioning since late 2019. If the United States were to lose and appeal the ruling, China’s case would likely not progress. However, China is a dominant player in the battery market for electric vehicles and has a rapidly expanding auto industry that could challenge established carmakers globally. The European Union has also expressed concerns about Chinese subsidies for electric vehicles under President Joe Biden’s 2022 Inflation Reduction Act.

Under the new U.S. rule, only 13 out of over 50 EV models on sale in the U.S. were eligible for tax credits, prompting automakers to source eligible parts to qualify for the credits. This has led to criticism from some automakers who believe that it unfairly disadvantages them and hinders their ability to compete in the market. The United States maintains that these policies are necessary to ensure national security and protect domestic industries from foreign interference.

In conclusion, China’s complaint against the United States over discriminatory requirements for electric vehicle subsidies highlights tensions between two global powers over trade practices in the technology sector. The outcome of this dispute remains uncertain due to technical issues with the WTO’s dispute settlement process, but it is clear that both countries have different priorities when it comes to promoting sustainable transportation and protecting their respective industries.

In response to the new U.S. rule that went into effect on January 1, which states that electric car buyers are not eligible for tax credits if critical minerals or other battery components were made by Chinese, Russian, North Korean, or Iranian companies, China has filed a complaint with the World Trade Organization against the…

Leave a Reply