EU-China equipment pact in trouble - Mobile World Live

EU-China equipment pact in trouble

05 AUG 2016

A 2014 settlement that ended a dispute between the EU and China over sales of telecoms equipment in EU member states vendors is “floundering”, according to The Wall Street Journal.

The nub of the problem is that China is not abiding by the terms of the settlement, according to unnamed European and industry officials.

The 2014 deal involved Europe dropping the threat of import tariffs on equipment made by Huawei and ZTE, while China committed to ensuring its market is open to companies such as Ericsson and Nokia.

A number of measures were agreed, including the creation of an independent body to monitor the Chinese and EU equipment markets, ensuring activities such as “dumping” (flooding markets with products priced below market rates) do not occur.

But, two years after the settlement was inked, the independent commission has still not been set up. One source said the Chinese government will not contribute funds for the panel and refused to rule out appointing members with ties to the government, WSJ said.

China’s Ministry of Commerce did not respond to a request for comment from the paper.

The drift in appointing the commission shows the lack of leverage that the EU can bring on the Chinese state, EU officials say.

Some EU countries were reluctant to back tariffs, for fear of an adverse reaction from China. Vendors were notably reluctant to support a probe, nervous they might be the subject of retribution.

China denies its companies are dumping products in Europe.

Huawei argues its products are as good, or better, quality wise than European rivals. “We’re not winning business on price anymore,” said Kenneth Fredriksen, chief executive of Huawei’s Swedish subsidiary.

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Richard Handford

Richard is the editor of Mobile World Live’s money channel and a contributor to the daily news service. He is an experienced technology and business journalist who previously worked as a freelancer for many publications over the last decade including...

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