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The EU plans to use quotas, tariffs and new regulatory tools to adjust single market rules and help companies decentralize their supply chains and reduce their dependence on countries like China.
The EU plans to make targeted adjustments to single market rules worth €18 trillion to help European companies hit targetssupply chain Diversify and reduce dependence on countries like China. These restrictions may take the form of import quotas orTariff The format will be announced in the first quarter of 2027.
The European Commission is expected to adopt recent restrictions on imports of Chinese hybrid vehicles. before thisEuropean Union An agreement was reached with Beijing to limit annual imports of hybrid vehicles into China to 350,000 units. The cap is considered high enough to help avoid retaliation from Beijing.
Citing people familiar with the matter, Bloomberg reported that the European Commission will revise rules related to motor vehicle type certification and foreign subsidies to more effectively deal with the economic security risks posed by some imported products, and at the same time reduce regulatory barriers for suppliers and companies from like-minded countries.
The European Commission also plans to amend the Forced Labor-related Rules and Trade Secrets Directive to facilitate European companies to diversify their supply chains in the EU internal market and raise the threshold for high-risk suppliers to enter the market.
People familiar with the matter said these adjustments are aimed at managing economic security risks, closing regulatory loopholes to better protect the EU single market, and will be included in a package of measures the EU plans to announce by mid-December. The EU’s trade deficit with the mainland reached 360 billion euros last year and is expected to grow.
In addition, this set of measures also includes a diversification tool to guide companies to switch to other sources of supply. The EU will identify key dependencies in goods and services, assess the associated risks and then propose plans to address the risks through existing or new measures.
At the same time, the EU also plans to launch new tools to respond more quickly to tough trade actions by restricting access to the single market for specific goods and services. This device will have a wider scope of application than existing methods and will be more flexible in its application.
People familiar with the matter also said the package of measures would propose a solidarity and mutual assistance mechanism to set out response options the EU could take when a third country takes adverse economic measures against one or more EU member states.
The EU also plans to use safeguard measures to reduce imports of products from China in industries such as chemicals, furniture and machinery, Bloomberg previously reported. When imports of products from a certain industry increase, safeguard measures allow the EU to impose restrictions on the products in question.
EU Trade Commissioner Maros Sefcovic plans to meet with Chinese officials early next year to review progress and discuss next steps.
Summary FAQ
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The main objectives are to reduce the dependence of European companies on supply chains from China and other countries, diversify sources, strengthen economic security by adjusting single market rules, and increase the EU’s resilience in the face of external risks and trade shocks.
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These measures could take the form of import quotas or tariffs as well as amendments to rules related to motor vehicle type certification, foreign subsidies, forced labor and trade secrets and could be announced as soon as the first quarter of 2027.
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The EU will launch diverse tools to identify key dependencies and assess risks before proposing countermeasures; It will also plan new instruments to restrict access to the single market for specific goods and services, as well as solidarity and mutual assistance mechanisms for Member States when faced with adverse measures by third countries.
