Policy Brief 59 - Facts Available, Limited Cooperation, and EU Anti-Subsidy Investigations

Executive Summary

This paper examines a practical problem that has become central to contemporary countervailing duty investigations: what an investigating authority may do when the firms and public bodies holding the most relevant information do not cooperate. The immediate context is the European Union’s anti-subsidy practice, particularly the investigation concerning battery electric vehicles from China. The broader legal question concerns the operation of the WTO Agreement on Subsidies and Countervailing Measures and, in EU law, Article 28 of Regulation (EU) 2016/1037.

The paper argues that so-called facts available should be understood neither as a punitive shortcut nor as a merely technical evidentiary rule. Rather, they are a structured substitute mechanism that allows investigations to continue despite informational asymmetry, while remaining subject to strict requirements of accuracy, reasoned explanation, and procedural fairness. The Chinese BEVs investigation, together with the earlier glass fibre cases, shows both why this mechanism matters and where its limits lie.

The central issue is straightforward. In anti-subsidy investigations, the European Commission often needs detailed information that only the investigated companies, their affiliates, or the foreign government can provide. When that information is withheld, delayed, or produced in an unusable form, the Commission must decide whether the investigation can still proceed and, if so, on what evidentiary basis.

That question has become particularly visible in investigations involving Chinese firms and the Government of China, including the recent case on battery electric vehicles (BEVs). The policy problem, therefore, is not abstract: it concerns the Commission’s ability to establish the existence and amount of subsidisation when the most probative evidence is not fully available.

The legal answer lies in the mechanism of facts available. At the multilateral level, Article 12.7 of the WTO Agreement on Subsidies and Countervailing Measures (ASCM) permits determinations on the basis of available facts when an interested Member or party refuses access to necessary information, fails to provide it within a reasonable period, or significantly impedes the investigation.

In EU law, Article 28 of the Basic Anti-Subsidy Regulation performs the same function but in more operational terms. It allows the Commission to move forward, while also requiring notice of the consequences of non-cooperation, acceptance of imperfect yet usable information where appropriate, and cross-checking of complaint-based material where practicable.

The article develops three claims. First, the Chinese BEVs case is best understood as a particularly visible example of a recurring institutional problem rather than as a unique anomaly. Earlier EU cases involving glass fibre rovings and glass fibre fabrics already showed that the Commission may rely on prior findings and other independent material when Chinese exporters or the Government of China do not cooperate.

Secondly, WTO jurisprudence makes clear that facts available are lawful only if they reasonably replace the missing information and are supported by a reasoned explanation. The mechanism is therefore facilitative, but not unbounded.

Thirdly, the underlying issue is not confined to trade defence. Similar information asymmetries arise, albeit under different legal regimes, in other forms of EU enforcement, including investigations directed at large digital platforms. The specific legal tools differ, but the institutional dilemma is similar: how should a regulator act when essential information remains in the hands of the investigated party?

For that reason, the article begins with the concrete policy problem and only then turns to the legal architecture and the case law. The conclusion offers a limited set of policy recommendations: the Commission should preserve facts available as a substitute mechanism rather than a punitive device; develop a disciplined hierarchy of substitute evidence; strengthen confidentiality and structured disclosure; and distinguish more clearly between genuine legal impediments to disclosure and strategic non-cooperation.

IEP@BU does not express opinions of its own. The opinions expressed in this publication are those of the authors. Any errors or omissions are the responsibility of the authors.

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