Italy and Spain Back EU Tariffs on Chinese EVs Amid Trade Tensions

Italy and Spain support European Union tariffs on Chinese electric vehicles, influencing the EU's largest trade case yet. The non-binding vote will guide the European Commission's decision on provisional duties up to 37.6%. Past instances showed EU's manufacturing collapse when tariffs weren't imposed.

Italy and Spain are backing European Union tariffs on imports of China-built electric vehicles, government sources said ahead of a Monday midnight deadline for all 27 EU members to take their stand on the matter. The vote is non-binding, but it could influence the final conclusion of the European Commission, which oversees the bloc's trade policy. It set provisional duties of up to 37.6% on EVs imported from China, ratcheting up tensions with Beijing.

The EU executive is canvassing EU governments' views in an 'advisory' vote, which the Commission is expected to take into account when deciding whether to follow up with definitive duties in what is the EU's highest profile trade case yet. Government sources said on Monday that Italy had voted in favour and that Spain would do the same in their written submissions. Poland's development ministry said Warsaw's position was still the subject of consultations between ministries. Germany is set to abstain, sources said on Friday. Greece had yet to take a position as of Saturday.

A decade ago, the EU executive did not impose tariffs on Chinese solar panels after it became clear that a large group of EU members did not support them. EU manufacturing subsequently collapsed. The Commission will continue its investigation and determine whether to propose definitive duties that would typically apply for five years.

If it does push for tariffs, they will come up for a binding vote among the EU members, and would be blocked if a qualified majority of 15 member countries representing 65% of the EU population vote against.