China takes EU to WTO over solar power subsidies

Featured - November 6th, 2012
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China has lodged a complaint with the World Trade Organization against the European Union over subsidies on solar power generation amid the increasing number of trade disputes in the sector.

China’s Ministry of Commerce said in a statement, reported by the Financial Times, that some EU countries’ laws provided subsidies for solar power if components for the projects were produced in Europe. This discriminates against foreign companies and is potentially in violation of international trade law.

“China considers that the measures are inconsistent with the WTO rules on national treatment … and constitute import substitution subsidies that are banned by the WTO,” the statement read.

Beijing claimed that Italy and Greece favour local producers with high “feed-in tariffs.”

“The subsidies… seriously affect Chinese exports, and harm China’s rightful interests as a WTO member,” ministry spokesman Shen Danyang told Reuters.

“The Chinese government has the right and the responsibility to fight for a fair international trade environment for China’s solar industry”.

Beijing launched the formal process for a WTO legal dispute on Monday and requested consultations with the EU. A spokesperson for the EU trade commission said it was studying the case.

The growing number of global trade cases related to renewable energy came as solar and wind power gain momentum in many countries. The sector’s growth is challenging the WTO as it attempts to address unfair competition.