Core Viewpoint - The Chinese Ministry of Commerce has announced a preliminary ruling on anti-subsidy investigations against dairy products imported from the EU, determining a subsidy rate of 21.9%-42.7% and implementing temporary anti-subsidy measures, marking a response to EU subsidy policies and domestic industry demands [2][5]. Group 1: Investigation Process and Findings - The investigation was conducted in accordance with Chinese laws and WTO rules, ensuring fairness and transparency throughout the process, including consultations and hearings with stakeholders [3][4]. - Preliminary evidence indicates that EU dairy products are subsidized, causing substantial harm to the domestic industry in China, with a causal relationship established between the subsidies and the damage [5][6]. Group 2: Impact of EU Subsidies - The EU provides numerous subsidies through its Common Agricultural Policy (CAP), which allows European dairy producers to maintain profitability even during low international milk prices, enabling them to export at prices below cost to China [5][6]. - The investigation specifically targets cheese and high-fat cream, which are critical areas for the transformation and value enhancement of China's dairy industry, indicating that EU products not only result in sales losses but also hinder the progress of local dairy products towards higher-end processing [5][6]. Group 3: China's Stance on Trade Measures - The Chinese Ministry of Commerce has emphasized its cautious and restrained approach to trade remedy measures, having initiated only a few investigations against the EU since 2025, while the EU has launched numerous investigations against Chinese products [7][8]. - The Ministry has expressed a willingness to resolve trade disputes through dialogue, contrasting its restrained actions with the EU's aggressive use of trade remedy tools, which are perceived as discriminatory against Chinese enterprises [8][9].

Core Viewpoint - The article discusses China's preliminary ruling on anti-subsidy investigations against EU dairy products, highlighting the significant subsidy rates and the impact on domestic industries, while emphasizing the legal basis and fairness of China's actions [3][4][7]. Group 1: Anti-Subsidy Investigation - The Ministry of Commerce announced a preliminary ruling on anti-subsidy investigations against EU dairy products, with subsidy rates ranging from 21.9% to 42.7% [3][4]. - The investigation is seen as a response to unfair competition and subsidies from the EU, aiming to protect China's domestic dairy industry [3][4][7]. - The investigation process adhered to legal standards, ensuring transparency and fairness, including consultations with the EU prior to the announcement [4][5]. Group 2: Impact on Domestic Industry - Preliminary evidence indicates that EU subsidies have caused substantial harm to China's domestic dairy industry, particularly affecting cheese and high-fat cream products [7][8]. - The subsidies allow EU producers to maintain profitability even during low international milk prices, enabling them to export at prices below production costs [7][8]. - The financial health of domestic dairy companies has deteriorated due to price pressures from subsidized EU products, leading to increased inventory and operational difficulties, especially for small and medium-sized enterprises [8]. Group 3: Trade Relations and EU's Subsidy Practices - The article highlights the disparity in trade remedy investigations between China and the EU, with the EU initiating numerous investigations against Chinese products while China has been more restrained [10][11]. - The EU's use of the Foreign Subsidies Regulation (FSR) is criticized for being overly aggressive and discriminatory, raising concerns for Chinese companies operating in Europe [11]. - Despite ongoing trade tensions, China expresses a willingness to resolve disputes through dialogue and cooperation, as evidenced by recent adjustments in anti-dumping measures [10][11].

Group 1 - The Chinese Ministry of Commerce has initiated a preliminary anti-subsidy investigation into dairy products imported from the European Union, determining a subsidy rate of 21.9%-42.7% and deciding to implement temporary anti-subsidy measures [1][6] - The investigation is based on substantial evidence indicating that EU subsidies have caused material harm to the domestic dairy industry in China, with a causal relationship established between the subsidies and the harm [3][6] - The EU's Common Agricultural Policy (CAP) has provided numerous subsidies to the dairy sector, allowing European producers to maintain profitability even during low international milk prices, thus enabling them to export at prices below cost to China [6][7] Group 2 - The Chinese dairy industry has faced significant financial difficulties due to the impact of subsidized EU products, leading to reduced profit margins and increased inventory levels, particularly affecting small and medium-sized enterprises [7] - The Ministry of Commerce has emphasized that the investigation process has been conducted fairly and transparently, adhering to both domestic laws and WTO regulations, ensuring the rights of all stakeholders involved [3][4] - The Chinese government has expressed a commitment to resolving trade disputes through dialogue, contrasting its restrained use of trade remedy measures with the EU's more aggressive approach, which has included multiple investigations and tariffs against Chinese products [8][10]