EU challenges dairy trade dispute with China
The European Commission has decided to launch a so-called consultation request at the World Trade Organization (WTO), challenging China’s initiation of an anti-subsidy investigation against imports of certain dairy products from the EU. In so doing, the Commission is following through on its commitment to firmly defend the interests of the EU dairy industry and the Common Agricultural Policy against abusive proceedings.
In August, China announced an investigation into whether European producers exporting milk and cream with a fat content higher than 10% and certain types of cheese to its market benefit from EU subsidies and national support schemes, leading to unfair competition. That dairy investigation, and a similar one into the import of pork, is widely seen as a retaliation to the European import tariffs on electric vehicles from China, although the Chinese authorities deny that. The Commission said earlier that it is confident that the subsidy schemes for the dairy industry are fully in line with international rules and are not causing injury to the Chinese dairy industry.
First time challenge
This is the first time the EU has decided to challenge an investigation at its initiation stage, Brussels says. The EU’s action “was prompted by an emerging pattern of China initiating trade defence measures, based on questionable allegations and insufficient evidence, within a short period of time”.
The Commission has followed the investigations very closely from the beginning, in full cooperation with exporting EU producers and Member State authorities. The Commission is determined to make full use of all available legal means to defend the EU industry against the abuse of trade defence instruments. The consultations requested by the EU now represent the first step in WTO dispute settlement proceedings. If they do not lead to a satisfactory solution, the EU could request a panel to be set by the WTO to decide on this investigation.
EU dairy exports
Earlier, the European umbrella organisation for the dairy industry, Eucolait, condemned the decision of China to launch anti-subsidy investigations into EU dairy exports. “The EU has proven itself over the years as a reliable supplier of high-quality dairy products and ingredients to the Chinese market. Moreover, in an era where food security is an ever-pressing priority, it is manifestly unfair that food be sacrificed in an industrial dispute concerning electric vehicles.”
China is a major importer of dairy products and ingredients, despite a growing domestic industry and a 7% decline in milk equivalent in dairy imports in 2023 versus 2022. We call on the European Commission to work at the highest level to urgently resolve this dispute and to ensure that any investigation is conducted in compliance with WTO rules, Eucolait said.
Join 13,000+ subscribers
Subscribe to our newsletter to stay updated about all the need-to-know content in the dairy sector, two times a week.
