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EU Commission abandons Chinese infrastructure investigation

The European Commission has deemed its investigation into Chinese vendors supposedly receiving subsidies from the country’s government as being “no longer necessary”.

The investigation was spearheaded by EU Trade Commissioner Karel De Gucht and was being conducted ‘ex officio’, i.e. without the EU receiving a complaint by a vendor.

Reportedly, the EC has reached an “amicable settlement” with the Chinese government, which involves various concessions. These include the appointment of an independent body to monitor both the Chinese and EU telecom sectors; guaranteed and impartial access for European firms to the Chinese standards body; and impartial treatment towards firms bidding for R&D projects using public funds.

The EC has not named the particular vendors that formed the focus of its investigation, but Huawei and ZTE are clear candidates as they have seen significant success outside of China. The EC took a decision in principle to establish whether these vendors were undercutting European rivals by selling products at for less overseas than in their home market.

No European vendors had actually complained about the supposed ‘undercutting’; China is a highly important market for virtually all telecoms equipment vendors and it is understandable that they would not wish to jeopardise their businesses by accusing the Chinese government of misconduct.

“The EU pursues every opportunity to level out the playing field for our companies by engaging with our strategic partners including China. The concerns that have led us to launch the case last May can now be addressed in a systematic and regular dialogue between the two sides for the benefit of our industry,” said Karel De Gucht.

 

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