Dies ist eine HTML Version eines Anhanges der Informationsfreiheitsanfrage 'Responses to public consultation on EU-China trade relations in the twenty-first century'.

Ref. Ares(2019)3648351 - 06/06/2019
Directorate-General for Trade 
  G3 - Sustainable development (including trade and environment); dialogue with civil society 
Brussels, 7 September 2006 
DG Trade - G3/CS/RtB/sa D(2006) 10058 
1. Introduction: 
On 8 May Trade Unit G3 launched a public consultation designed to form part of its 
forthcoming strategic review of trade economic relations between the EU and China in the 
years to come. We received 102 contributions of interested parties e.g: private companies 
(21), NGO's (9), academics (2), regional governments (3), consultants (1), trade unions (2) 
business associations and industry federations(58) and citizens (6)  commented, often in detail 
and with strong recommendations, on how they wish the Commission should react on the 
opportunities and challenges that one of the EU's top trading partner offers. 
The consultation has given excellent results, with an important number of replies, generally of 
high quality. While most industries believe that they can compete with China, when 
China is playing by the rules
, the general opinion is that they are facing an excessive 
number of barriers and obstacles which put them at a competitive disadvantage.  
Notwithstanding all barriers and obstacles, the overall attitude vis-à-vis China is fairly 
positive and entails a stronger call for constructive rather than defensive measures. Almost all 
submissions are convinced that the EU disposes of the potential and resources to cope with 
the rise of China.
 They see China also as an opportunity, but only provided that China plays 
by the rules, opens her market and creates an open investment climate– which is seen as not 
being the case now. On the contrary, several submissions highlight the rise of Chinese 
economic nationalism by increasingly protecting its industrial base. 
2. Key obstacles identified: 
The most important obstacles are:  
•  IPR, counterfeiting and technology transfers which are by far the biggest problem;  
•  standards, regulations and the China Compulsory Certification (CCC): 
•  unfair competition (not playing by the rules); 
•  lack of a predictable, transparent and stable investment climate, and to much red tape 
is curtailed. 
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The number of specific issues raised in the submissions is considerable, each of them with an 
important impact for a given sector. Due to the export strength of China, these obstacles have 
a global impact on the competitiveness of EU firms. 
Other issues often mentioned are: animal welfare, use of trade defence mechanism, subsidies, 
MES, services liberalisation, minimum standards in the field of labour and environment,  non-
respect for non-implementation of WTO obligations, improved cooperation and dialogue 
between the EU and China at all levels of bureaucracy, public procurement, technical barriers 
to trade, market access limitations (in particular for services), access to raw materials, 
collusion between the government and Chinese business, absence of rule of law and lack of 
transparency / due process.  
Tariffs are also often mentioned (EU tariffs much lower than China's). Also references to 
currency issues, but generally moderate and in line with our policy (gradual move to flexible 
exchange rate) and the enormous untapped potential with regard to agricultural quality 
products from Europe. 
Finally, many calls for involving business more closely in our trade related dialogues. The 
IPR working group is often mentioned as best practice. There are calls for an Annual Report 
on China Trade Barriers similar to the USTR one. Quite many industry submissions ask 
formally for more resources on China in particular the reinforcement of our trade section in 
A number of contributions had a much wider focus than trade policy – animal welfare in 
China for instance being often mentioned (6 submissions). 
3. Proposed solutions: 
The replies show a very high level of expectation that the EU can play a considerable role in 
redressing the situation. The tendency is in general to call for a continuation of our positive 
engagement vis-à-vis China and develop new initiatives, but also to have a more robust 
and assertive trade policy that should be based on reciprocity. 
Dialogues should seek to deliver concrete results under real deadlines. China should be 
considered as an equal partner, i.e. no asymmetry of preferences, strict reciprocity for bilateral 
agreements and China should no longer be treated as a developing country. Many submissions 
call for the Commission to play a role going beyond trade policy: supporting operators on the 
ground in particular SMEs (including trade promotion), creation of an export helpdesk to 
China, better border controls, promoting the impetus of entrepreneurs and aid in reconversion 
of sectors affected by Chinese competition, disseminating information and, promoting tourism 
to Europe, promoting learning of China language and (business) culture and training 
executives.  But also helping the Chinese to address internal problems (infrastructure, social 
policy, access to modern technology, improve quality of goods, modern management etc). 
Many submissions not only point out that the traditional trade irritants should be properly 
addressed, but (industry in particular) also favour a stable, predictable, transparent, non-
discriminatory and rule-based environment to invest in. The EU should stimulate the 
Chinese authorities to establish such an environment by good governance, transparency, 
democracy and human rights.
 Furthermore the EU should extend their relations and 
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cooperation agreements. Not only at governmental level, but also via training programmes 
and research and innovation schemes. This intensified cooperation could lay the foundations 
for good future relations at all levels. The EU itself should be able to make more use of 
opportunities offered by focusing more on R&D and excellence by producing goods and 
services with a high added value. Some submissions express the fear of an excessive reliance 
on China imports and the need to diversify our supplies. 
4. Positions of specific industries: 
that do business with China or encounter currently the consequences of China's 
economic growth  can be distinguished in: 
Even the industries that are currently in the defensive, such as traditional industries as 
textiles and ceramics, and who have to cope with fierce and often unfair competition, think 
they can compete with their Chinese counterparts. By reshuffling their product range towards 
specialised products with a high added value they create the potential to enter the Chinese 
market. However, this market is still hardly open for their products due to often high import 
tariffs and the introduction of Non Trade Barriers (NTBs), amongst others expensive Chinese 
certification requirements. Massive counterfeiting of designs and brand names is also 
common practice and hampers further market access.  
Although SMEs accept the consequences of globalisation, they feel less equipped to face 
competition, counterfeiting and difficulties in accessing the Chinese market which have a 
disproportionate impact on them. Faced with these unfair practices these industries deem 
Trade Defence Instruments (TDI) often as the only solution to protect the future of their 
, or at least ask, like the textile industry, for more specific calls to extend quotas to 
2008 and beyond. 
Amongst those industries that profit to a large extent from China's economic rise are: 
retailers, machinery, electronics, port authorities, ship owners, food and drink industries, 
sporting goods industries, chemical industry, digital technology industry, pharmaceutics, 
automotive industry and members of the European Express Association. These had or still 
have excellent opportunities
. Nevertheless it is worth mentioning that in analysing their 
submissions, there is a general appreciation that the situation has recently deteriorated rather 
than improved, even though their exports are still increasing due to their capacity for 
innovation, contribution of quality products, brand potential and contributions of technology. 
Problems they encounter are: bureaucracy, corruption, burdensome regulations, lack of 
enforcement of IPR rules, use of national standards, non-respect of national treatment, the 
China Compulsory Certification system, no consistency in implementing Chinese regulations 
in different parts of the country, numerous distortions in the economy, and lack of compliance 
with WTO obligations. 
Finally, remains a group of companies that intrinsically  has the potential to enter the 
Chinese market
 but is at this stage  not  able to obtain a significant market share due to legal 
Chinese restrictions, massive piracy, discrimination between domestic and foreign goods, 
protectionism and GPA not being in force e.g. cultural media markets, law firms, recording 
industry, insurers and banks. Services will be one of the most promising sectors for the EU 
where EU companies have a competitive advantage and should be able to redress the 
growing imbalances of trade with China. 
Therefore, China should accept all its WTO 
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obligations and opens its financial services sector under favourable conditions (no 
burdensome capital requirements) to foreign participants. 
5. Details on the most important issues
Intellectual Property Rights (IPR) is a recurrent key issue in almost all submissions and one 
of the main problems in trade relations with China. The EU is called upon to ensure 
innovation protection in China through strong enforcement of IP rules. This lack of 
enforcing IP rules by the Chinese authorities, at all levels, is creating widespread 
frustration for EU companies
. EU industry insists that the Chinese government takes its 
responsibilities and implements IPR accordingly to its WTO commitment, adopts meaningful 
administrative measures, legal action and increases penalties and border controls (taking 
counter measures e.g. by suing infringers is currently costly and often not effective). As a 
consequence abuse of IPR and counterfeiting of designs and brands is massive. Protection of 
patents is insufficient. A submission even indicated that Chinese partners are running parallel 
factories and e.g. the European recording industry is exposed to the highest piracy levels in 
the world as; the textile industry is stripped off of their design and models.  
The EU is therefore asked to take a vigorous standpoint on IPR,  and deliver results on 
the ground.  
Suggested actions are: 
•  putting more pressure on the Chinese (follow the US example); 
•  ensuring stronger presence of (a team of specialists of) the EC in Beijing to enforce IP; 
•  adopting  a common European position on IPR vis-à-vis China; 
•  supporting SMEs via a European Protection Agency; 
•  supporting SMEs in suing Chinese offenders. 
Market Economy Status (MES) Approximately 15% of the submissions mention MES. It is 
clear that divergent views exists between those definitively opposed to market economy status 
and those in favour of it. Some submissions take a relatively cautious stance and are not really 
outspoken. They consider that MES should only be granted when EU criteria are fully met. 
The distribution sector is more positive about this issue. The general tendency is not in 
favour of using market economy as a political tool.  
On TDI as well exist divergent views between the more traditional industries, who see TDI as 
an important instrument as a safeguard against unfair practices of China, while others, 
mainly distributors / retailers ask for a review of the AD system. For them the trading 
environment should be predictable and not create uncertainty. Others are against misuse and 
support the amendments of WTO rules to ensure a more harmonised implementation of 
these rules. 
Business and Industry federations put in general strong emphasis on full compliance with  
WTO commitments, but also on the need to go beyond existing commitments. They urge the 
EU to persuade China to implement its WTO commitments to open wholesale services, 
insurance, telecom, retail sectors and banking sectors during 2006.  The Doha round was 
hardly mentioned.   
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Standards, regulations are also high on the agenda. The existence of Chinese standards, 
which feature Chinese technology, is strongly disapproved and considered as a significant 
technical barrier to trade for EU companies
. They are seen in a way to exclude foreign 
companies from participation in standardisation activities. Therefore industry puts strong 
emphasis on enforcement of international accepted standards. China should recognise ISO 
certification and abandon double testing. Furthermore, mutual recognition of testing and 
certification would help to achieve more transparency and a level playing-field. 
The China Compulsory Certification is heavily criticised. Not only is it considered as a TBT 
but also as burdensome, lengthy and expensive. List of products for which CCC certificates 
and labels are required is often without further notice modified. An option proposed,  to 
eliminate some of the most negative effects of the CCC scheme, could be to establish 
European testing laboratories which are to be accredited by Chinese authorities. 
The  regulatory framework/legislation is also severely criticised. In general there is no 
consistency in implementation of regulations in different parts of the country and 
procedures are considered to be too long compared to the EU
. Moreover, the Chinese 
legislation is opaque and inconsistently enforced by a unreliable and non transparent 
administration. There is a lack of compliance with international standards, trade and customs 
regulations. EU should strive towards regulatory convergence. 
Several submissions addressed public procurement as an important issue to be followed-up.  
China committed as part of its WTO commitments to join the General Procurement 
Agreement (GPA). Recently China has taken the decision to start negotiations on accession to 
the GPA by December 2007. Despite this announcement and the ongoing EU-China 
Government Procurement Dialogue there is a strong feeling that GPA accession should 
proceed expeditiously and that
 pressure needs to be maintained on China in order to ensure 
EU access to public procurement in China. 
Priorities are given for work to de done on the new EU-China Trade and cooperation 
 that will replace the existing one of 1985. The new agreement should address: 
better market access, liberalisation of trade and facilitation of investment flows; trade 
facilitation and regulatory cooperation, IPR, sustainable trade and natural resources. clearer 
information on custom procedures, simplify SPS and facilitate procedures linked to 
certification of products.  
Environmental issues such as: transparent natural resource management, are often addressed 
by NGOs. The EU should also take into account the impact of China on countries that provide 
natural resources and the industry also raises the issue of disruptive nature of the Chinese 
intervention on the commodity market. Sources should be used in a sustainable way in order 
to minimize the results of climate change. Special attention is drawn to illegal logging by 
China as one of the largest importers of illegal timber. The new EU-China Agreement 
should focus on sustainable trade
, production and consumption patterns. The EU should 
share best practices with China in order that they catches-up quickly with Europe (by the use 
of environmental-friendly technologies). 
An important number of replies address animal welfare e.g. trade in dog and cat fur, spread of 
industry farming. 
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Labour issues and human rights are often mentioned. A decent labour-market regulation 
to protect workers and implement fundamental ILO rights is strongly recommended

The best way of establishing such a market is via a civil society. Further issues raised are: 
freedom of association, corporate social responsibility, collective bargaining, identical 
behaviour of EU companies in and outside the EU as well as child and forced labour. The 
issue of human rights is important in relation to trade and should be incorporated in that 
context. Low labour, environment, health and safety standards are often seen by industry as 
conferring unfair advantages to the Chinese (asymmetry of enforcement in China penalising 
foreign companies often cited). Climate change and energy issues were as well often 
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Summary of the results of the public consultation on the China Communicatio2.doc