China Warns EU Over Hybrid Vehicle Export Limits, Vows to Protect Its Firms

China said on Friday it would keep a close watch on European Union measures targeting its electric vehicle industry and would act to protect the interests of Chinese companies, after reports that Brussels had sought a cap on hybrid vehicle exports.

The EU has asked China to voluntarily restrict hybrid vehicle sales to roughly 15% of the European market in order to avert a trade war, according to media reports. The European Commission did not immediately respond to a request for comment.

Speaking at a regular press conference in Beijing, Chinese foreign ministry spokesperson Guo Jiakun urged the EU to uphold its commitments to market openness and free trade. He said Brussels should abide by World Trade Organization rules and ensure a fair, just and non-discriminatory environment for businesses from all countries.

In a separate statement issued later, China's commerce ministry said it had noted the media reports. It described so-called voluntary export limits as a serious violation of WTO rules that run counter to market economy dynamics and the principles of fair competition, adding that China firmly opposes such measures.

The ministry did not confirm whether the EU had formally made such a request. It said its response was prompted by media reports suggesting the EU hoped China would limit hybrid vehicle exports or otherwise face the possibility of higher tariffs.

Any settlement between the two sides, the commerce ministry said, must ensure a balance of interests, comply with WTO rules and the domestic laws of each party, and take full account of the concerns of industries on both sides.