China preps for protracted trade fight with Canada tariff probe

Following a World Trade Organization complaint earlier this month, China has formally launched an investigation into what it has termed a “discriminatory” increase in tariffs from Canada against its electric vehicles (EVs), steel and aluminium.

In an official notice on Thursday, the Ministry of Commerce said it would be examining the North American country’s 100 per cent tariffs on Chinese EVs, its 25 per cent tariffs on steel and aluminium, and the exclusion of Chinese products from government incentives and subsidies.

“The process could involve written surveys, hearings and on-the-ground or delegated investigations,” the ministry said. “The investigation period is usually three months, and could be extended under special circumstances.”

While not specifying what actions could be taken after the investigation concludes, the ministry said Canada could request an intergovernmental negotiation within 30 days of its announcement.

This investigation is the first action of its kind to use “anti-discrimination”, as laid out by Chinese trade law, as its legal basis.