The European Commission had warned Germany months ago against allowing Chinese investors to invest in the Hamburg port, a source familiar with the matter told AFP on Saturday amid criticism of Chancellor Olaf Scholz over his backing of the transaction.

The source confirmed information written in a Handelsblatt report, which said the EU executive did not approve of Berlin giving a 35% stake in the Hamburg port to Chinese shipping giant Cosco. The deal was agreed upon by Germany last year, but it is yet to be authorized.

Reportedly, the commission was worried that Beijing would benefit from "sensitive information" about activity in the port, which is the third-busiest in Europe. However, the EU's recommendation was non-binding, giving Germany the final say on the deal.

Scholz's office, according to German broadcasters NDR and WDR, was planning on approving the deal despite six ministries going against him.

The two German outlets said the deal would effectively be approved automatically if the government did actively decide to take a u-turn by the end of October.

Scholz, who was the city's mayor for seven years between 2011-2018, said "nothing is decided" about the Chinese investment in the port, highlighting how there were Chinese stakes in other European ports.

After attending an EU summit on Friday, Scholz said he would be visiting China in November amid growing distaste for Beijing in Brussels over its growing foothold in the global economy, as well as its warming ties with Russia in light of the West's enmity for Moscow.

However, the EU heads of state agreed after the summit that they were not after a confrontation with China, wanting to cooperate with Beijing on climate change, among other issues.

EU chief Charles Michel said following the summit that there needs to be "more reciprocity and rebalancing in particular in the economic relations between China and the EU."

Despite Scholz still not moving to strike down the agreement, Germany vowed last month to impose a "robust trade policy" on Beijing, citing concerns of over-reliance on China and alleged human rights violations.

German Economy Minister Robert Habeck told reporters that any "naivety" in relations with China was "over".

Germany, just like other western countries, sought to wrest back control of key technologies, such as batteries and semiconductors.

"China is one of the concerns, concern on distortion, industrial subsidies, on transparency," European Union trade commissioner Vladis Dombrovskis said as quoted by AFP. 

Earlier this year, the EU also unmasked a multibillion-euro "Chips Act" aimed at doubling Europe's semiconductor market share and reducing reliance on Asian supplies.

Global chip shortages and supply chain bottlenecks have affected the automotive, healthcare, and telecom industries, among others.