Handelsblatt and other German media reported on April 24 that the European Commission had raided the offices of a Chinese company in the Netherlands and Poland. EU authorities said there were indications that the company "may" be receiving foreign subsidies that distort competition in the internal market under the Foreign Subsidies Regulation (FSR).
This incident may mean that the possibility of a trade dispute between the EU and China has not been ruled out. The Chinese side also criticized and responded to this at the first time.
▲Source: DPA
The EC said the raids were a preliminary step in the investigation of alleged distorting foreign subsidies and neither showed that the companies in question had indeed received distorting foreign subsidies nor foreshadowed the outcome of the investigation, and that "if sufficient indications of distorting foreign subsidies are found, an in-depth investigation will be initiated." ”
Although the European Commission's statement did not name the company, Handelsblatt quoted a so-called Brussels authority as saying that the company being inspected was Tongfang Nuctech, a manufacturer of security equipment for airports and seaports that originated at Tsinghua University in China.
Nuctech did not confirm the investigation, but a company representative told Handelsblatt: "If there is an investigation, we will fully cooperate with the authorities." ”
▲机场旅客经过同方威视的安检设备，图源：picture alliance
According to the report, the European Commission cooperated with the security services of member states during the raid, which means that the Dutch and Polish authorities were also involved in the case. The search began on the 23rd, but was not known to the outside world until the next day.
Regarding the EU's surprise inspection of Chinese companies, the person in charge of the Trade Remedies Bureau of the Ministry of Commerce responded on the 24th.
The person in charge said that the Chinese side believes that the European Commission directly raided the normal office premises of enterprises and detained the operating equipment of enterprises without prior notice and without notice of filing a case, which violated the principle of due process, interfered with the normal order of fair market competition, seriously damaged the confidence of all foreign enterprises operating in Europe, highlighted the further deterioration of the EU's business environment, and sent an extremely negative signal to all foreign enterprises operating in Europe. "China expresses its grave concern and strong opposition to this."
The EU Chinese Chamber of Commerce also issued a statement in the early morning of the 24th, saying that the EU Chinese Chamber of Commerce issued a statement saying that the chamber learned that on April 23, 2024, the offices of a Chinese company in Poland and the Netherlands were suddenly investigated by the European side without notice. The law enforcement agencies authorized by the European Commission went to the company's offices in both countries in the morning of the same day without prior notice, took control of the company's information equipment and employees' mobile phones, checked office documents and requested relevant data.
▲Screenshot of the statement of the Chinese Chamber of Commerce in the European Union
The statement concluded: "The Chinese Chamber of Commerce in the EU and the majority of Chinese enterprises in Europe express their shock and dissatisfaction with the incident that occurred on the 23rd. We urge the EU not to abuse the FSR investigation tool, effectively protect the legitimate rights and interests of foreign companies in the EU, and provide a truly fair and non-discriminatory business environment for non-EU companies. ”
The European Commission's raid can be seen as part of a larger trade conflict between the two largest economies. As China's Ministry of Commerce said, this is the fifth subsidy investigation launched by the European side since February 2024, all of which are directed at Chinese companies, and it is also the first on-site search.
▲欧委会主席冯德莱恩，图源：picture alliance/dpa
Previously, the EU has accused China of deliberately creating "excess capacity" in areas such as electric vehicles, which will be released to the global market at "dump prices" to grab market share, according to the EU's latest report on China's trade practices.
Nuctech, which is suspected of being targeted by Brussels, was called "a very important enterprise for the Chinese government" by Handelsblatt. During Scholz's visit to China in 2022, the head of Nuctech was one of the business representatives who met with the German Chancellor in Beijing. Many years ago, the United States banned the United States from entering the country on the grounds of so-called "safeguarding national security".