China has rejected the European Union's decision to impose significant tariffs on Chinese electric vehicles and has lodged a complaint with the World Trade Organization (WTO), according to the Chinese Ministry of Commerce on Wednesday.

On Tuesday night, the EU announced the implementation of extra duties on electric vehicles from China, which can reach as high as 35.3%, effective immediately.

"China does not recognize or accept this decision and has filed a complaint with the WTO," the ministry stated, stressing that the EU's anti-subsidy investigation into Chinese electric cars reflects a protectionist stance that constitutes "unfair competition" while masquerading as a commitment to "fair competition."

"China will continue to take all necessary measures to protect the rights and interests of its companies," it added.

On October 11, China implemented temporary anti-dumping measures on EU imports of brandy, which could significantly impact EU producers. In response, the EU Commission has pledged to contest China's decision at the WTO.

Industry reactions

German automakers, including Mercedes-Benz, BMW, and Volkswagen, have criticized the EU's decision to impose higher tariffs.

Mercedes-Benz called the tariffs a "mistake" with potentially severe consequences, urging the EU to delay the implementation and continue negotiations with China. BMW labeled the move a "fatal sign" for Europe's auto industry, while Volkswagen said the tariffs were the wrong strategy, advocating for a negotiated solution to avoid a trade conflict.

Volvo Cars, owned by China's Geely Holdings, reaffirmed its commitment to building cars where they are sold and investing in Europe. Stellantis highlighted the pressures from CO2 reduction plans and Chinese competition, stressing the need for policies that support demand and ensure stability.

At the time of reporting, European auto stocks were up 1.72%.

Read more: China warns of WTO lawsuit amid EU's electric car import restrictions