Beijing has praised Brussels’ decision to issue advice to Chinese electric vehicle (EV) manufacturers to avoid sweeping EU tariffs, easing long-running frictions between the bloc and the world’s second-largest economy.

In a note published on Monday, the European Commission provided “general guidance” to Chinese EV makers to make agreements to sell exported cars at or above a minimum price, allowing them to sidestep EU duties of up to 35.3%.

The levies, which were imposed in October 2024 following a lengthy anti-subsidy investigation by the Commission, are fiercely opposed by Beijing and Germany, whose own automakers remain heavily dependent on Chinese demand. China is the world’s largest EV producer and exporter.

Monday’s move indicates a thawing in tensions between Brussels and Beijing, which have long been strained as a result of China’s massive trade surplus, export controls on strategically critical minerals, and deepening ties to Russia since Moscow’s full-scale invasion of Ukraine in 2022.

The decision “is not only conducive to the healthy development of China-EU economic and trade relations, but also conducive to maintaining a rules-based international trade order,” China’s commerce ministry said in a statement following the Commission’s note.

The China Chamber of Commerce to the European Union (CCCEU), which represents more than a thousand Chinese firms operating across the bloc, also welcomed the move.

“This constructive outcome will significantly boost market confidence, provide a more stable and predictable environment for Chinese electric vehicle manufacturers, and related supply-chain companies operating in Europe,” the CCCEU said.

The Commission’s guidance document notes that the “price undertaking” offers should be “adequate to eliminate the injurious effects of the subsidies” Chinese EV makers allegedly receive from Beijing.

They should also have the same effect as tariffs, be workable in practice, prevent companies from offsetting losses elsewhere, and align with broader EU policy goals, Brussels said.

Speaking to reporters later on Monday, Commission spokesperson Olof Gill downplayed the significance of the move.

“Let’s just all calm down a bit,” Gill said, adding that the decision does not entail that the EU’s levies on Chinese EVs will ultimately be scrapped. “It’s guidance at this stage, nothing more.”

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