These measures could take the form of import quotas or tariffs and may be introduced as early as the first quarter of 2027. According to sources, the European Commission aims to replicate a recent approach used for hybrid vehicles, where Brussels reached an agreement with Beijing to cap Chinese imports at 350,000 units per year—a threshold deemed high enough to avoid triggering retaliatory action.

This new initiative is part of a broader EU effort to reduce its trade deficit with China, which reached €360 billion ($404 billion) last year. The European Commission is seeking to support European industry while carefully avoiding countermeasures from Beijing or the outbreak of a trade war.

"Our industries have called for action, and we have heard them. We will respond, including through new safeguard measures," European Commission President Ursula von der Leyen stated this month.

Safeguard measures allow the EU to restrict imports in a given sector if a sharp surge in incoming goods is identified. Brussels has already begun analyzing trade data to determine where such surges are occurring. In addition to quotas, the EU could implement tariff-rate quotas, where duties are applied only to imports exceeding a specific volume. The EU has the authority to impose these measures unilaterally, without Beijing’s consent. However, these plans—and the list of affected sectors—remain subject to change following discussions with EU member states and China. As with the measures previously applied to hybrid vehicles, these new restrictions will comply with WTO rules and extend to countries outside the European Economic Area.

China’s Ministry of Commerce responded sternly earlier this month:

"The EU should not harbor illusions about gaining from exerting pressure, nor should it underestimate China’s resolve and capacity to defend its interests," the ministry stated.

Separately, the European Commission intends to present proposals in the coming weeks to impose limits on hybrid vehicles, with the measures set to take effect in December. These restrictions will remain in place for four years, with the quota for China increasing by 6% annually after the first year. Quotas for vehicles from Japan and South Korea will follow a similar logic.

Low-cost—and at times subsidized—Chinese goods are flooding the European market, undermining local industry and threatening jobs. Compounded by falling demand and limited access for European products to the Chinese market, this has resulted in a trade deficit exceeding $1 billion per day—a figure that continues to grow. In September, even before the agreement on hybrid vehicles, Chinese exports to Europe reached a record high.

At a summit in Brussels this month, EU leaders unanimously urged the European Commission to take swift action across various sectors and develop new tools to reduce the deficit while deterring China from taking retaliatory measures. By mid-December, the Commission plans to introduce a mechanism for supply-chain diversification, as well as a rapid-response tool to address aggressive trade practices; this would allow for more flexible and broader restrictions on access to the single market for specific goods and services than current measures permit.

It remains unclear whether Beijing is prepared to accept restrictions on its exports that extend beyond the hybrid vehicle sector. He has already reacted sharply to the prospect of the EU acquiring new instruments. EU Trade Commissioner Maroš Šefčovič will take stock of the situation early next year and discuss next steps with his Chinese counterparts.

The agreements reached thus far also entail that Beijing will lower tariffs on certain automotive components, olive oil, and ice cream. Furthermore, the EU is seeking better access to the Chinese market, as well as the simplification of export procedures for critical minerals and permanent magnets.