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EU refers China to WTO following trade restrictions on Lithuania

29 Jan '22
2 min read
Pic: Shutterstock
Pic: Shutterstock

The European Union (EU) recently filed a case at the World Trade Organisation (WTO) against China over the latter’s alleged discriminatory trade practices against Lithuania that are also affecting other exports from the EU’s single market. As attempts to bilaterally resolve the issue have failed, the EU has resorted to initiating dispute settlement proceedings against China.

These actions, which, according to an EU press release, appear to be discriminatory and illegal under WTO rules, are harming exporters both in Lithuania and elsewhere in the EU, as they also target products with Lithuanian content exported from other EU countries.

The WTO consultations initiated recently are the first step in this process.

Over the past weeks, the European Commission has built up evidence of the various types of Chinese restrictions. These include a refusal to clear Lithuanian goods through customs, rejection of import applications from Lithuania and pressuring EU companies operating out of other EU member states to remove Lithuanian inputs from their supply chains when exporting to China.

To deal with such cases in future, the Commission is strengthening its toolbox of autonomous measures, the press release said. Last month, the Commission adopted a proposal document for an anti-coercion instrument, which would give the EU more possibilities to react in the event of economic coercion.

The proposal is currently being considered by the European Parliament and the Council of the EU.

From December 2021, and without informing the EU or Lithuanian authorities, China began to heavily restrict or de facto block imports from and exports to Lithuania, or linked to Lithuania, the press release added. The Commission has repeatedly raised the matter with the Chinese authorities.

Fibre2Fashion News Desk (DS)

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