BEIJING: China said Thursday it “reserves the right” to file a suit with the World Trade Organization over planned new EU tariffs on imports of its electric vehicles.

“China reserves the right to file a suit to the WTO and take all necessary measures to resolutely defend the rights and interests of Chinese companies,” Beijing’s commerce ministry spokesman He Yadong told a briefing.

The European Union warned on Wednesday it would slap additional tariffs of up to 38 percent on Chinese electric car imports from next month after an anti-subsidy probe, a move that risks provoking a bitter trade war.

The European Commission has proposed a provisional hike of tariffs on Chinese manufacturers: 17.4 percent for market major BYD, 20 percent for Geely and 38.1 percent for SAIC.

The EU said the amount depended on the level of state subsidies received by the firms.

Beijing condemned the move on Thursday as lacking a “factual and legal basis”.

“This action not only harms the legal rights and interests of the Chinese electric vehicle industry… but will also distort auto production and supply chains around the world, including in the European Union,” he said.

“The actions by the European side are suspected of violating WTO rules and are naked protectionist behaviour,” he said.