Lithuanian Confederation of Industrialists welcomes the decision of the European Union to apply to the World Trade Organization (WTO) due to China’s trading practices which the Community regards as being discriminatory against Lithuania.
On January 27th European Commission submitted an official request for consultations with China due to illegal economic pressure against Lithuania and the EU and thus launching a case in the World Trade Organization against the People’s Republic of China. The EU in this official request outlined that discriminatory trade practices against Lithuania are in breach of WTO rules, regulating trade in goods and services.
“By referring to WTO, the EU has expressed its support for Lithuanian business and institutions complaints when China is blocking imports from Lithuania and is taking discriminatory trade practices against Lithuania. This step is clear evidence that the EU does not tolerate unfounded actions of economic coercion“– highlighted the president of LPK Vidmantas Janulevičius.
This step by European Commission has been congratulated by the largest German federal industry association BDI. BDI comments on the EU’s initiation of WTO proceedings against China as follows: “We support the initiation of WTO proceedings against China by the European Commission.” It is just to react to China‘s behavior in this way because it does not comply WTO regulations and emphasize our approach.
“In the past few weeks, Beijing has failed to give any indication of lifting trade-restricting measures against Lithuania. Arbitrarily adjusted measures by the Chinese customs authorities are also causing considerable uncertainty among German companies. German exports to China with supplier products from Lithuania get stuck at the border and do not even reach German joint venture companies in China. This means that there is a de facto import ban for deliveries and components from Lithuania. The EU must react decisively to this clear trade discrimination in order to protect the integrity of the European internal market.” – BDI states in its comment.
The EU in its request for consultation outlines that China’s economic restrictions violate WTO legal norms regulating trade with goods and services. This consultation request is the first stage of mandatory WTO litigation proceedings where the aim is to find a solution for the occurred situation and thus avoid further litigation. If no mutually acceptable solution is reached within 60 days of the request for consultations, the EU will request the establishment of a WTO arbitration panel and thus initiate legal proceedings.