The European Union trade chief, Karel De Gucht, is likely to seek support from the members of the European Commission to launch probe into suspected unfair trade practises by Chinese network-equipment suppliers Huawei Technologies and ZTE.
The threat comes during a sensitive period for European telecommunications-equipment suppliers, which are seeking to expand their business in China.
The investigation is expected to be among the first ever embarked by the commission without receiving a complaint from a European firm.
Europe’s three major suppliers, Ericsson, Alcatel-Lucent and Nokia Siemens Networks, are hopeful of bagging major business from Chinese telecommunications operators upon commencement of multibillion-dollar investment programmes to launch high-speed wireless data networks.
The EU officials argue that Huawei and ZTE made use of bulky subsidies from the Chinese government, including cheap credit from state-owned banks offered to the Chinese firms or their customers, to purchase their equipment.
In addition, officials believe that the subsidies may have been used to sell their goods at unfairly low prices and grab major share of the EU market.
