China and the European Union have reached an agreement on price undertakings for Chinese electric vehicle exports to the bloc, a move that could pave the way for replacing additional tariffs imposed following the EU’s anti-subsidy investigation.
In a statement released on Monday, China’s Ministry of Commerce said both sides agreed on the need to provide general guidance on price undertakings for Chinese exporters of passenger battery electric vehicles (BEVs) to the EU. The aim is to address the EU’s concerns in what the ministry described as a pragmatic, targeted and World Trade Organization (WTO)-compliant manner.
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Under the agreement, the European Union will issue a guidance document on the submission of price undertaking offers. According to the Chinese ministry, the EU will assess each offer against the same legal criteria, following the principle of non-discrimination and in line with WTO rules.
The ministry said the progress reflects dialogue and consultations between China and the EU and shows both sides are willing to resolve differences through discussion within the WTO framework. It added that the agreement supports the development of China-EU economic and trade relations and helps uphold the rules-based international trading system.
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The discussions stem from an anti-subsidy investigation launched by the European Commission on Oct. 4, 2023, into battery electric vehicles imported from China. The probe alleged that Chinese EV makers benefit from unfair subsidies that distort competition in the European market.
After concluding the investigation, the European Commission decided in October 2025 to impose additional tariffs on Chinese-made BEVs for five years, while continuing talks on possible price undertakings. The extra duties are applied on top of the EU’s standard 10% import tariff, with rates varying by manufacturer.
Under the current tariff structure, Tesla faces an additional duty of 7.8%, while BYD is subject to a 17.0% rate. Nio and Xpeng face higher additional tariffs of 20.7%.
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The China Chamber of Commerce to the European Union welcomed the agreement, saying it would help boost market confidence and create a more stable and predictable environment for Chinese EV makers and related supply chain companies operating and investing in Europe.
The chamber added that it believes the competitiveness of China’s electric vehicle industry is driven by technological innovation and cost and scale efficiencies achieved through market competition, rather than by subsidies.