The request for an anti-subsidy investigation was initially submitted in July 2024 by the Dairy Association of China and the China Dairy Industry Association, both industry bodies representing the domestic dairy sector.
Thank you for reading this post, don't forget to subscribe!After reviewing the relevant information submitted, MoC announced late in August 2024 that it had found sufficient evidence warranting a formal anti-subsidy investigation to be conducted starting that same month.
“The application has surfaced claims that certain dairy products have received [and excessive amount of] subsidies from the EU and its member governments, with EU dairy companies potentially benefitting from a total of 20 subsidy projects,” MoC said via a formal statement.
“These relevant dairy products include items such as fresh cheese and curd, processed cheese, blue cheese, certain milks and creams and more.
“MoC will initiate an anti-subsidy investigation on the imports of relevant dairy products coming from the EU into China, where the subsidy investigation period for this investigation will be products from April 1 2023 until March 31 2024 whereas investigation into industry injury/losses will be investigated from the period of January 1 2020 until March 31 2024.”
Anti-subsidy investigations are conducted on markets suspected of subsidising their companies for their exports to the extent that it causes loss or ‘injury’ to the relevant industry in the export market.
“There are many subsidy projects provided to EU dairy firms by the government – under the EU Common Agricultural Policy there are already a number of income subsidies, basic payment schemes, green and ecological subsidies, dairy product storage subsidies, rural development subsidies and so on,” said MoC.
“This is not to mention the various subsidies offered by the various EU member states such as Ireland’s Dairy Equipment Subsidy Scheme, Austria’s Mobility Subsidy Scheme, Italy’s Livestock Insurance Subsidy, Croatia’s raw milk purchase cost subsidy, Finland’s agricultural producer damage subsidies, Romania’s Livestock Administrative Subsidy and many more.
“This investigation is expected to be completed before August 21 2025, and may be extended for six months in the event of any special circumstances.”
An eye for an eye?
This is not the first anti-subsidy investigation that China has initiated this year – on June 17, the MoC also announced that it was conducting similar investigations into pork and other pig products entering the country from the EU, based on a submission by the local pork sector.
The period of investigation for the pork sector is from January 1 2023 to December 31 2023, and industry injury investigation investigated from January 1 2020 to December 31 2023, targeting relevant items such as fresh pork, chilled pork, frozen pork, offal, dried pork, smoked pork, brined pork, pork lard.
This investigation is expected to conclude by June 17 2025.
Although China has not specifically mentioned that these investigations are meant as a retaliatory measure, notably the EU had also been conducting its own anti-subsidy investigations into China in 2023 and announced provisional anti-subsidy tariffs on electric vehicles entering the EU from China on June 12 this year – right before China announced the first of its own anti-subsidy investigations.
