China has filed a formal complaint at the World Trade Organisation against European Union tariffs on Chinese-made electric vehicles, with a panel ruling not expected until mid-2027. The dispute has drawn global attention as the United States pursues similar countervailing duties to counter alleged Chinese subsidies in the EV sector.
According to a post by the United States Trade Representative (USTR), China initiated formal proceedings at the World Trade Organisation (WTO) on 4 November 2024, challenging the European Union’s imposition of definitive countervailing duties on battery electric vehicles imported from China. The complaint targets both the tariffs themselves and the investigative process that preceded their implementation.
The case has attracted significant international attention, with seventeen countries—including the US, Japan, Korea, Brazil, Canada, and the United Kingdom—reserving their rights to participate as third parties in the proceedings.
Legal claims and arbitration agreement
China’s complaint alleges violations of numerous provisions within the Agreement on Subsidies and Countervailing Measures, as well as Article VI:3 of the General Agreement on Tariffs and Trade 1994. The dispute centres on whether the EU properly conducted its subsidy investigation and justified the resulting duties.
Following China’s request on 13 March 2025, the Dispute Settlement Body established a panel on 25 April 2025 to examine the case. In a notable procedural development, both parties agreed on 31 July 2025 to use alternative arbitration procedures under Article 25 of the Dispute Settlement Understanding. This arrangement serves as a backup appeals mechanism, given that the WTO Appellate Body remains non-functional due to insufficient members.
Parallel US action
The US has taken similar action against Chinese electric vehicles. The US Trade Representative announced its own definitive countervailing duties on battery electric vehicles originating from China, citing concerns over Chinese state subsidies and unfair trade practices. The American measures aim to protect domestic EV manufacturing and form part of a broader strategy to rebuild tariff enforcement tools following a Supreme Court ruling on the International Emergency Economic Powers Act.
Extended timeline
The panel composition was finalised on 13 October 2025, but the proceedings have experienced substantial delays. On 1 April 2026, the panel chair notified the Dispute Settlement Body that both China and the EU had requested considerably extended deadlines for submitting their legal arguments beyond the originally proposed schedule. After reviewing the parties’ justifications, the panel granted these requests.
These extensions have significantly postponed the panel’s substantive work. The chair indicated that a final report is not expected before the second quarter of 2027, with public circulation dependent on completing translations into all three official WTO languages.
