France and Germany want a fresh EU mechanics aimed at China

chiny24.com 3 weeks ago

French president Emmanuel Macron and German Chancellor Friedrich Merz proposed 2 fresh economical instruments to the European Commission: to reduce dependency in supply chains and to respond to persistent interior marketplace disruptions. Possible measures include limiting access to the Single Market.

On 5 October, Macron and Merz sent the president of the European Commission, Ursula von der Leyen, a joint letter and the attached working document. Paris and Berlin want the Commission to draw up fresh rules supplementing the current EU trade defence tools.

The authors of the paper point to increasing trade deficits, concentration of supply in parts of the manufacture and practices that they believe distort competition. They exchange subsidies, dumping, currency exchange restrictions and currency manipulation. However, they do not indicate any country by name, although it is clear that China is the main addressee of these indications.

Two proposed instruments

The first proposal concerns diversification of supply. The Commission would be given a tool to recognise concentration in supply chains, reduce existing dependence and prevent fresh ones. The paper mentions the share of imports from the country concerned, the position of supplier on the planet marketplace and the origin of capital as examples of criteria that can be considered.

This approach refers to a wider EU policy to reduce the vulnerability of the economy to supply interruptions. We've already explained how they're made. dependency in global supply chains.

The second instrument is intended to respond to situations where a non-EU country, through political or economical action, makes it hard to reconstruct fair conditions of competition and creates serious systemic distortions in the interior market. France and Germany anticipate it to cover individual goods, full sectors and various types of economical practices.

The letter states that the catalogue of measures should be broad — from tailor-made solutions to a circumstantial case to immediate restrictions on access to the EU market, if necessary. At the same time, the paper talks about the examination of the interest of the Union, including the impact on companies, users and consumers, and the discussion with the country concerned.

Proposal, not fresh Commission power

In the debate around the letter, there are indications that Brussels already has the anticipation to close the marketplace immediately before import. Macron and Merz's paper does not give the Commission specified a right. It proposes that the Commission prepare a fresh legal instrument which would then gotta go through the EU legislative procedure.

France and Germany besides proposed a way of launching the future instrument. The Commission would present a measurement and it would be adopted if it was not blocked by a qualified majority of associate States. This is how the inverted qualified majority works. A simple vote requires majority support; in this model, a majority would be needed capable of retaining the Commission proposal.

The authors stress that the instrument should not be assigned to 1 country. They do not have a Chinese name in their document, although the proposal came in the midst of an intensified discussion on EU trade with China.

The proposal differs from anti-dumping duties

The European Union is already utilizing trade defence tools. However, anti-dumping, anti-subsidy and safeguard measures concern certain products or sectors and are preceded by investigations in which the Commission examines prices, subsidies and effects on Union producers.

An example is the September 25 decision: The Commission introduced definitive anti-dumping duties ranging from 40.5 to 67.1 per cent on imports of pea protein from China for 5 years. This is different from that of France and Germany, which assumes the anticipation to measure the established disturbances beyond 1 commodity.

The joint paper besides calls for more ex officio investigations by the Commission, faster handling of cases and analysis of distortions across sectors. Chemistry, PET and plug-in hybrids have been listed as areas for fast evaluation.

Earlier EU duties on electrical cars from China show the mechanics of proceeding concerning 1 kind of import. The fresh proposal concerns a different legal structure and would cover a broader catalogue of situations.

The current Regulation has a different purpose

The EU besides has a regulation of 2023 to counter economical coercion. They may be applied erstwhile a 3rd country tries to force trade or investment measures on the Union or on a associate State to amend a decision of its sovereign competence.

This regulation requires an evaluation of the Commission and the EU Council decision. The Commission's investigation should in rule take no longer than 4 months. The act was not created as a general tool for responding to trade deficits, subsidies or surplus production. That is why France and Germany are proposing a separate solution.

Trade with China and ongoing talks

In 2025. The EU exported goods worth EUR 199.6 billion to China and brought goods from China for EUR 559.4 billion. The EU deficit in commodity trade was EUR 359.8 billion. Eurostat reported that imports from China increased by 6.4% compared to 2024, while exports to China decreased by 6.5%.

The Chinese customs administration presents a commercial relation from a different perspective: according to its data, China-EU turnover reached 5.93 trillion yuan in 2025 and was 6% higher than the year before. Both parties consider themselves second-largest trading partners.

In parallel to the dispute over protective instruments, dialog is ongoing. On 29 June, Maroš Šefčovič, EU Commissioner for Trade and economical Security, and Chinese Trade Minister Wang Wentao launched a trade and investment consultation mechanics in Brussels. 4 fields of work have been established: balancing trade and investment, export control, intellectual property and the improvement of the planet Trade Organisation.

The Chinese Ministry of Commerce on 29 September, responding to erstwhile reports of a possible European counterpart of US Section 301 considered this direction to be protectionist and unilateral. At the same time, it stated that China would respond if the EU adopted the restrictions considered discriminatory by Beijing to Chinese companies or products.

The proposal from France and Germany came to the Commission before the European Council gathering scheduled for 15 and 16 October. Before a possible fresh instrument exists, the Commission would gotta present a draft and the EU countries and the European Parliament would gotta agree on its final form. For the time being, existing procedures are applied to Chinese imports, while the EU-China trade consultation is in operation.

Mr Merz and Mr Macron are most likely working exclusively to get image advantages in their countries. Not necessarily given that their activity in Europe does not stay unnoticed by the Chinese side. It's hard to trust people who may be playing the public, but possibly they just believe what they're doing. After all, it is in our tradition that the phrase is rooted: “by their fruits you will know them.”

Leszek B. Glass

Email: [email protected]

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