Europe
EU probe into Chinese EVs: ‘The whole supply chain is subsidized’
In Brussels, Belgium, EU officials announced new taxes on Chinese electric vehicles (EVs) and shared the findings of an ongoing investigation into “state subsidies”.
Dozens of EU officials spent 250 working days in China, visiting more than 100 companies and gathering thousands of pages of evidence.
“The whole supply chain is subsidised,” a senior official at the meeting was quoted as saying by the SCMP, reporting on the findings of the investigation, which many predict could spark a trade war.
The official pointed out that this meant that the Chinese government was subsidising all players, and that this chain extended from the refining of lithium used in batteries, to the production of cells and batteries, to the production of BEVs [battery electric vehicles], and even the transport of BEVs to EU markets.
Automotive manufacturer pledges to ship hybrid cars to Europe
According to the SCMP reporter, “Chinese business representatives were shocked by the presentation. After a quick check of the figures, an executive from an electric car company promised to start shipping hybrid cars to Europe instead, as they would not be subject to such high taxes.
“The EU has ignored facts and WTO rules, disregarded China’s repeated strong opposition and acted unilaterally, disregarding the objections and warnings of many EU member governments and industries,” China’s Ministry of Commerce said in a statement minutes after receiving the notification.
Separate tariffs for three Chinese companies
Following the announcement in September by Ursula von der Leyen, President of the European Commission, that an investigation into Chinese electric cars would be launched, work began immediately and the sample size was reduced from 21 Chinese groups exporting electric vehicles to Europe to three.
These were BYD, soon to become the world’s biggest seller of electric vehicles; Geely, which spent the 2000s acquiring major European brands such as Volvo; and SAIC Motor, owner of the iconic MG and Volkswagen’s joint venture partner.
The final tax on most Chinese electric vehicle exports to Europe will be a weighted average calculated on the basis of the subsidies on the books of these three companies. This is likely to mean an additional tax of around 21 per cent on average.
When experts realised that the giant SAIC was on the list, they predicted that the countervailing duties could far exceed the EU’s average rate of 19 per cent.
Details of the EU investigation: Thousands of questionnaires sent out
As part of the investigation, the companies were sent questionnaires of more than 60 pages and 18,000 words each. They asked for access to financial information and forensic-level details of the assistance each received from the Chinese state.
According to the SCMP, the document said: “It is in your own interest to answer as accurately and completely as possible and to provide supporting documentation. You may supplement your answer with additional data”, but in reality it was a veiled threat to “comply or you will be excluded from the European market”.
According to Rhodium Group research, only SAIC chose not to comply and on Wednesday found itself facing the highest import tax on all EU electric vehicle shipments and the third highest tax ever imposed by the EU.
This tax is on top of the existing 10 per cent rate, meaning the cars will cost almost 50 per cent more.
Other companies, including BYD and Geely, will be taxed at a lower rate than standard EU models, with a weighted average of 21 per cent.
BYD could benefit from new taxes
“SAIC is very dependent on the European market and has no plans to localise production yet, so it will be very affected,” said Ilaria Mazzocco, an expert on China’s electric vehicle trade at the Centre for Strategic and International Studies.
BYD, on the other hand, appears to be in a good position with an EU factory, low tariffs and a geographically diversified market.
The EU also sent a series of questionnaires to the Chinese government, asking it to forward them to selected lithium suppliers and local banks. Beijing refused.
“The Chinese government has been very active in seeking justification for various steps. There has been a lot of interaction, but less positive activity on their side in terms of providing us with the information we requested,” the senior EU official said.
Instead, according to the EU, Beijing has tried to obstruct the investigation with a series of threats that have multiplied as the Brussels probe has drawn to a close.
EU not afraid of WTO
Brussels is confident it has a “watertight” justification for the tariffs and is not worried about a WTO challenge that would point to the fact that some Chinese companies pay lower taxes than their European competitors.
Judging by the EU’s findings, the inspectors found subsidies everywhere they looked. Lithium processors and battery makers are told by the state to sell to electric vehicle companies at below-market prices, while car companies are exempt from battery excise taxes.
The companies issue green bonds, which state financial institutions are required to buy, and are given preferential land, income tax breaks and cheap refinancing options mandated by the People’s Bank of China.
Chinese companies’ market share in the EU rises to 25 per cent
The EU believes its own companies are suffering as a result. Between January 2020 and September 2023, Chinese companies increased their market share in the EU from 4 per cent to 25 per cent, while the share of their local competitors fell from 69 per cent to almost 60 per cent, officials said.
The inspectors added that Chinese subsidies are “jeopardising” Europe’s green transition by depressing the price at which European companies can sell electric vehicles, meaning that in some cases they are making a loss on every vehicle sold.
BYD’s growth plans unaffected
Chinese electric vehicle maker BYD, led by billionaire Wang Chuanfu, can withstand the EU’s additional tariffs on electric vehicles from China and take market share from harder-hit rivals, analysts say, according to Forbes.
Shares in the Chinese carmaker jumped 8.8 per cent in Hong Kong and up to 6 per cent in Shenzhen on Thursday as the tax hike was significantly lower than the 30 per cent previously expected.
The EU said BYD would have to pay an additional 17.4 per cent tax on top of the current 10 per cent from next month.
Kenny Ng, a Hong Kong-based securities strategist at Everbright Securities International, said: “The market believes that the impact on BYD will not be as severe as previously feared. Compared with other Chinese automakers, BYD may have an advantage in the region at the moment,” said Kenny Ng, a Hong Kong-based securities strategist at Everbright Securities International.
SAIC calls for ‘decision review’
Ng says BYD could take market share from SAIC as tariff hikes could reduce the appeal of the MG brand in Europe.
Thanks to its competitive pricing, MG counts Western Europe as its biggest market, where it was the fifth-largest EV brand by deliveries last year, according to market research firm Canalys.
The MG4, for example, has a starting price of 28,990 euros, compared with around 33,000 euros for its main rival, Volkswagen’s ID.3.
In a public statement, SAIC called on the EU to reconsider its decision, which it said would have a major negative impact on economic cooperation between China and the region.
Strong reaction from German car industry
On the other hand, the new tariffs imposed by Brussels have led to a split between Germany on the one hand and France on the other.
Berlin worked behind the scenes to stop the tariff increases, while Paris backed Leyen. One senior official said the Germans even used the term “so-called overcapacity” in the meetings as a sign of how much they were aligned with Beijing.
Wolfgang Niedermark, a board member of the Federation of German Industries, said: “The focus now should be on minimising the negative impact on international supply chains and European companies. European companies have no interest in an escalation of the trade conflict with China,” Niedermark said.
The VDA, which represents carmakers such as Volkswagen, BMW and Daimler, strongly criticised the decision, with president Hildegard Müller warning that it was “another step away from global cooperation”.
European carmakers producing electric vehicles in China will also be affected. The largest group is Dacia and BMW, which will face an import duty of 21%.
This is even higher than Chinese carmaker BYD, which will see a lower tariff of 17.4% for participating in the Commission’s investigation and providing evidence that it benefits from less state support.
ACEA, the European Automobile Manufacturers Association, whose members have more diverse interests, said it had merely “noted” the decision.
German government pushes for negotiations
“The European Commission’s punitive tariffs are hitting German companies and their best products,” said German Transport Minister Volker Wissing (FDP) in X.
“Vehicles must become cheaper, not through trade wars and market fragmentation, but through more competition, open markets and significantly better business conditions in the EU,” Wissing wrote.
Similar comments were made by Economy Minister Robert Habeck (Greens), who told German media that “tariffs are always a political measure of last resort and often the worst option”.
“It is very important that talks take place now,” Habeck said, calling for negotiations between the EU and China.
German firms fear retaliation
German companies are also concerned about possible Chinese retaliation, with Volker Treier of the German Chambers of Industry and Commerce (DIHK) warning that “the tariffs announced by the Commission on Chinese e-cars will not be without consequences for the export-oriented German economy”.
Fears were fuelled by the response of the Chinese Ministry of Commerce, which said it was ready to “take all necessary measures” to protect the interests of its manufacturers.
“It is also up to China to come to Europe with constructive proposals to prevent an escalation of trade conflicts and to stop anti-competitive behaviour consistently and quickly,” said VDA’s Müller, calling on the EU and China to resolve the issue through negotiations.
Müller said they needed China to solve global problems, including climate change, and argued that a trade war would jeopardise this transformation.
Objections from the Czech Republic and Malta
Like the German manufacturers, the Czech Association of the Automotive Industry has announced that it believes such measures could have a negative impact.
“On the contrary, it was the removal of trade barriers that led to an increase in international trade and prosperity in recent years, especially in the automotive sector, which relies on strong exports,” said Zdeněk Petzl, the association’s executive director.
Petzl warned that China could aggravate already tense trade relations by retaliating against Europe and the US, stressing that European car companies import more than 90 per cent of key materials for electric vehicles and batteries from China.
“The introduction of new tariff measures will certainly be felt by Chinese manufacturers and may slow their growth, but we do not expect it to affect China’s subsidy policy,” Petzl said, advocating a systemic approach to strengthen European industry, increase competitiveness and open new markets.
Malta’s energy minister, Miriam Dalli, told The Post last month: “We don’t want tariffs that don’t help us achieve our decarbonisation goals. Having more expensive products will not help us achieve our ambitious targets,” she told The Post last month.
Europe
Hungary’s new PM Magyar vows absolute ban on illegal migration, challenging Brussels over fines
Hungary’s newly elected Prime Minister Péter Magyar has pledged to block all illegal migration, reject European Union quotas, and challenge Brussels’ punitive fines, signaling a highly restrictive border policy even as he vows to restore ties with European partners.
In his first interview with the German newspaper Frankfurter Allgemeine Zeitung since taking office, Magyar outlined his administration’s strategic roadmap. He addressed the smear campaigns directed against him by the former government of Viktor Orbán, relations with the EU, migration policy, and the economic necessity of maintaining energy ties with Russia.
Reflecting on his transition to power, Magyar noted that the Orbán administration targeted him, his family, and his colleagues during a highly polarized campaign.
“I have known Viktor Orbán for a long time. What happened during the election campaign was no surprise to me, even if it might be difficult to imagine in other countries,” Magyar said. “The mudslinging campaign was not just directed at me personally, but also against my family, my colleagues, and my friends. However, those who faced each other were not Hungarians against Hungarians; it was Viktor Orbán and his vassals standing against the Hungarian nation. One of our most important campaign promises is that we will do everything we can to reunite the Hungarian nation.”
Despite running a pro-European campaign to secure victory, Magyar acknowledged fundamental disagreements with Brussels, particularly on migration. He argued that former Prime Minister Orbán’s hardline stance during the 2015 European migrant crisis was correct.
“My government will pursue an extremely strict and decisive policy regarding illegal migration,” Magyar said. “You can be as angry with Viktor Orbán as you want—and no one has criticized him more than I have—but when the migration crisis began in 2015, he was right. Many member states have now admitted they made wrong decisions at the time. In any case, we will protect our homeland, our country’s borders, and the external borders of Europe.”
“Hungary will not accept any illegal migrants”
Responding to whether Hungary would comply with newly implemented EU asylum rules, which mandate member states to conduct processing procedures at external borders, Magyar delivered a firm refusal regarding quotas and penalties.
“I can only say this: Hungary will not accept any illegal migrants. We will not pay any penalties for this either,” Magyar said. “However, we will help protect Europe’s external borders, whether in Greece, Malta, or Italy. The 2015 migration crisis must be a lesson for Europe. The most important duty of European politicians is to protect the safety of the people. I believe there are many ways to stop illegal migration without violating European Union rules. It is simply a matter of being able to negotiate.”
Magyar also dismissed the current relevance of a European Court of Justice ruling imposing a daily fine of 1 million euros on Hungary for failing to implement EU asylum procedures, arguing the decision is outdated.
“The court’s decision was made at a very different time and under a different legal framework,” Magyar said. “Today, we are in a completely different situation. This decision no longer reflects today’s reality. Today, there are many countries acting just like Hungary, yet this European Court of Justice decision does not apply to them. I find this incredibly unfair. In order to protect our borders and avoid having to pay the daily fine of 1 million euros, we will hold talks with our European partners and find a common solution.”
While acknowledging that the judicial ruling is final and cannot be appealed, Magyar described the financial burden on Hungarian citizens as unjust.
“The decision cannot be appealed. We are looking for new rules and opportunities to avoid paying the fine,” he said. “It is unfair and disproportionate that the people of Hungary must pay a fine of 1 million euros every day. Similarly, it is a great injustice that while other member states receive these funds, Hungary has been provided with no financial resources for the wire fence it constructed to protect the external border of the European Union.”
“Exclusion only makes the far-right stronger”
Magyar strongly opposed pushback from member states—particularly pressure from Germany—to transition EU foreign policy decision-making from unanimity to qualified majority voting, defending the preservation of national sovereignty.
While rejecting the confrontational rhetoric favored by Orbán toward Brussels, Magyar emphasized the importance of compromise among sovereign states.
“I served as a diplomat within the European Union for a long time, and I know very well how difficult it is to reach a consensus among 27 countries. Yet, most of the time, this is achieved,” Magyar said. “Orbán always said, ‘We must defeat Brussels.’ I do not think that is the point. The point is to understand each other, to persuade, and not to try to defeat one another. People do not want a United States of Europe; they want a European Union based on strong member states. For this reason, I do not support transitioning to a majority voting system in many areas instead of the unanimity rule at this stage. We will negotiate and find a middle ground.”
Addressing the political rise of far-right parties across Europe, particularly in France and Germany, Magyar criticized traditional political elites for being disconnected from public anxieties and relying on political moralizing.
He warned that isolating these populist movements is counterproductive.
“I do not like labels like far-right or far-left. I do not like ideological wars,” Magyar said. “People deserve more than politically correct speeches where ideological labels are slapped on one another. I have no intention of interfering in the internal affairs of other member states, and I will not do so; on this point, I differ from Orbán. However, I observe that some countries make mistakes in combating extremist parties. In many countries, politicians do not act honestly. They do not understand people’s fears and expectations, and they do not dare to talk openly about problems and face them. They use the language of political correctness and, at the end of the day, fail to grasp reality itself. These are precisely the mistakes that certain groups exploit. Excluding these people and these parties, building a wall of isolation around them, is not a solution on its own. Exclusion only makes these forces stronger. In many countries, these mistakes have been recognized, but not yet everywhere.”
Asked if this critique applied to Germany, Magyar maintained his criticism of governing establishments.
“In many countries, the political, media, and economic elites protect their own positions and do not always address the real fears and problems of the people. But the public does not forget this. That is why what we need is honesty, honesty, and once again, honesty,” he said.
On the debate over whether conservative factions in the European Parliament should cooperate with the Alternative for Germany (AfD) party, Magyar shared his perspective on the future strategy of the European People’s Party (EPP), which includes his own party, Tisza.
“In the European Parliament, political forces must always seek a majority, and grand coalitions between the center-left and center-right can function. Germany and Austria are good examples of this,” Magyar said. “However, this does not always work, and that is why the CDU/CSU and the European People’s Party, which includes my party Tisza, may have to make a decision one day. In my view, the European Conservatives and Reformists (ECR) are the natural allies of the European People’s Party. Whether they want to cooperate with the AfD is not my decision to make. However, I believe that talking to one another and listening to the other’s arguments never causes harm. What we accept from each other’s proposals is an entirely separate matter.”
“Europe will partially return to Russian energy after the war”
Defending Hungary’s decision to continue importing crude oil and natural gas from Russia despite the war in Ukraine, Magyar emphasized the country’s landlocked geography and economic constraints.
“The Hungarian people elected me as the Prime Minister of Hungary. My government’s duties include ensuring energy security, security of supply, and the lowest possible energy prices,” Magyar said. “In recent years, Hungary has become one of the poorest and most corrupt countries in the European Union. Three million people live below the poverty line. Our neighbors in the European Union must understand that Hungary is a landlocked country. We are still dependent on Russian oil, and we cannot change this overnight. We have not seen economic growth for years, and we need cheap energy to grow. Of course, we are doing everything we can to diversify our energy resources, but we cannot afford to see our companies’ competitiveness decrease further and Hungarian families’ energy poverty increase. I think Europe will partially turn back to Russian energy resources and lift sanctions when the war ends, because the competitiveness of all of Europe is at stake here. In a future state of peace, no one has an interest in maintaining a new economic and political Cold War. For this, of course, the war must first end.”
While Orbán maintained close ties with American conservative movements and received explicit support from Donald Trump, Magyar indicated that the change in leadership in Budapest would not damage relations with Washington.
“The US is Hungary’s natural ally in NATO and a highly important economic partner. What happened during the election campaign will not change this. We will maintain good relations with every American administration,” Magyar said.
Magyar criticized Orbán’s personal relationship with Russian President Vladimir Putin, arguing instead for a pragmatic, non-ideological approach to Moscow in the post-war era.
“I know the role of Russia in Hungarian history very well. I have not forgotten the years 1849 and 1956. In both periods, Russian troops bloodily suppressed the Hungarian freedom movement,” Magyar said. “But on the other hand, the reality is that geography does not change. We must accept this as it is. Therefore, we must develop pragmatic relations with Russia once the war against Ukraine ends. Nonetheless, it is extremely clear that Russia currently poses a security risk to all of Europe. It is unacceptable that people in Europe must live in fear of Russian sabotage or a Russian attack. That is why this war must end, and we must provide international security guarantees to Ukraine. However, Europe can only develop when normalcy returns, and Russia cannot have an interest in a new Cold War becoming permanent on the continent.”
“We can turn a new page with Ukraine”
Magyar pledged to end the hostile state-sponsored propaganda directed at Ukraine by the previous administration, emphasizing his respect for Ukraine’s territorial integrity and his personal involvement in humanitarian efforts.
“We want to build good relations with all our neighbors, not least because a Hungarian minority lives in each of them. This also applies to Ukraine,” Magyar said. “We have always stated that Ukraine is the victim in the Russia-Ukraine war and that Ukraine has the right to its territorial integrity. When the Russians bombed the largest children’s hospital in Kyiv in the summer of 2024, I immediately went to Kyiv with our volunteers and personally delivered the humanitarian aid of the Hungarian people. Right after the attack, we set off in a 30-year-old Ford Transit and reached Kyiv within 20 hours under air raids and missile bombardments. I did not see any other European politician at that bombed hospital. We are currently holding talks with Ukraine at a technical level, and we are working to reach an agreement within a few days to restore and guarantee the language, education, and cultural rights of the 100,000 Hungarians living in Ukraine. Today, we need to clarify certain matters with Ukraine regarding our minority in that country, and I hope we will achieve this in the coming days. Ethnic Hungarians there currently do not have the opportunity to use their mother tongue in their relations with official authorities. However, if we resolve these issues on the basis of mutual interest, we can turn a new page.”
Magyar cautioned that future security guarantees for Ukraine must be concrete and enforceable, unlike previous international agreements.
“In 1994, the famous Budapest Memorandum was signed, in which the US and other major powers guaranteed Ukraine’s independence and integrity. However, these promises were not kept, because empty slogans are of little use,” Magyar said. “Right now, everything is at stake in Ukraine. A large number of people are dying, and it is possible that this country will lose part of its territory. Therefore, Ukraine needs real, enforceable international guarantees.”
However, the Prime Minister reiterated that Hungary would remain militarily uninvolved in the conflict, stating that arms shipments do not constitute a genuine security guarantee.
“I do not believe that weapons are a security guarantee. Security guarantees can only be provided by the international community,” the Hungarian leader concluded. “Hungary cannot play a decisive role here; this is the work of the major powers. We can provide diplomatic and humanitarian aid, and Hungary can also provide a suitable ground for negotiations.”
Europe
EU agrees new deportation rules allowing migrant return centers outside the bloc
European Union lawmakers and member states have reached agreement on new legislation overhauling rules governing the deportation of asylum seekers.
According to Politico, the agreed text allows asylum applicants whose claims have been rejected to be sent to dedicated return centers established outside the EU.
As a key condition of the deal, measures to establish the return centers are set to be implemented immediately.
The move is said to be of particular importance to the Netherlands and Germany. Other provisions of the legislation are expected to take effect one year later.
The agreement must still receive final approval from both the EU Council and the European Parliament before it can formally enter into force.
European Commissioner for Migration Magnus Brunner said the agreement would help the EU regain control over both those arriving in the bloc and those required to leave it.
According to data from Eurostat, the proportion of migrants denied asylum in the European Union who ultimately leave the bloc remains at around 27%.
“We must give people the feeling again that we have everything under control,” Brunner said.
The new framework grants member states the authority to transfer individuals ordered to leave EU territory to return centers located outside the bloc.
Several member states are already examining the option, while human rights organizations have warned of risks of rights violations and abuse during the process.
The legislation also introduces stricter measures, including home searches, extended detention periods, entry bans, and penalties for individuals deemed security threats or those who refuse to cooperate.
French Member of the European Parliament François-Xavier Bellamy told the publication: “For years, Europe sent the worst possible message: even if you had no right to stay, there was a high likelihood that nothing would happen. That era is ending. If you do not have the right to remain in Europe, you must leave.”
The initiative, however, has faced opposition from lawmakers affiliated with liberal and left-wing groups.
Melissa Camara, a representative of the Greens group, described the agreement as “a legal arsenal serving a xenophobic ideology” and criticized both offshore centers and the detention of minors.
Marta Welander, head of the International Refugee Committee, said the new measures signaled “a troubling new era.”
Welander argued that the rules would normalize migrant raids and increase the risk of people being deported to countries where they could face persecution or torture.
According to available data, the number of migrants living within the European Union reached 64.2 million in 2025. During the same period, the foreign-born population arriving from outside the bloc increased by 2.1 million people annually.
In 2010, the European Union was home to approximately 40 million migrants.
As a result, the migrant population has increased by more than 60% over the past 15 years, while migrants’ share of the EU population has risen to 14.2%.
In December last year, US President Donald Trump said Europe faced the risk of destruction because of the migration policies pursued by European countries.
Trump had previously argued that the continent was facing a wave of migration and that, as a result, Europe was “no longer the Europe it once was.”
Europe
Anthropic invites EU cybersecurity agency to access Mythos AI hacking model
Anthropic has invited the European Union to access Mythos, its powerful AI-powered hacking tool, by sending an invitation to the bloc’s cybersecurity agency.
A European Commission official said the AI company issued the formal invitation following a meeting with the Commission in San Francisco last Thursday, adding that the EU must now establish a mechanism that would allow access to the model under appropriate security safeguards.
Bloomberg reported on Monday that ENISA, the EU’s cybersecurity agency based in Athens, would be granted access to Mythos.
European Commission spokesperson Thomas Regnier said the Commission had held “several productive meetings with Anthropic” and “welcomes the latest developments regarding potential future access.”
Anthropic unveiled Mythos in early April and warned that the model outperformed most humans in identifying and exploiting cybersecurity vulnerabilities.
The disclosure raised concerns that the model could be used to carry out large-scale attacks against critical and sensitive systems if it fell into the hands of cyber adversaries.
European officials were unable to access the cutting-edge cybersecurity AI technology for weeks, prompting urgent calls from European lawmakers and government officials to secure access.
Cybersecurity officials also urged Europe to develop its own version of the technology.
“This latest development is extremely important in helping us gain a clear understanding of the potential risks. We should not forget that Mythos is not an isolated case and that a new wave of powerful models is entering the market,” Regnier said.
An ENISA official said the agency does not currently have active access to the model but is working to make it operational.
The Commission is developing a formal action plan to respond to powerful AI hacking tools.
According to an industry official, the Commission has indicated that it wants to publish the plan before the summer break.
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