EU Drops Probe Into Chinese Mobile-Telecom Gear Makers

The European Union dropped an anti-subsidy investigation into Chinese makers of equipment for mobile telecommunications networks after the two sides reached a settlement.

EU Trade Commissioner Karel De Gucht and Chinese Commerce Minister Gao Hucheng came to an “amicable settlement” on the issue over the weekend, the EU said today in a statement. The probe had threatened to affect Chinese telecom-equipment manufacturers such as Huawei Technologies Co. and ZTE Corp.

“The concerns that have led us to launch the case can now be addressed in a systematic and regular dialogue between the two sides for the benefit of our industry,” De Gucht said. In March, the EU closed a related anti-dumping investigation of the same industry. The inquiries covered EU imports of more than 1 billion euros ($1.3 billion) a year.

The settlement came after EU President Herman Van Rompuy and European Commission President Jose Barroso met with Chinese Prime Minister Li Keqiang at a summit in Milan last week. The EU and China hope to finalize negotiations “as early as possible” on a bilateral investment agreement, they said on Oct. 15.

Under the telecom-gear settlement, an independent body will monitor the Chinese and EU telecom-networks markets, the EU said today. The accord also includes equal treatment of companies bidding for publicly funded research and development projects.

“With this settlement, we have much better and fairer competition and conditions for European companies that we used to have before,” De Gucht spokesman Wojtek Talko told reporters in Brussels. He said the issue of export credits will be discussed in a working group, “but there was no agreement on dropping it.”

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