A new front has opened up in the "steel war" between China and Europe after Brussels launched an investigation into whether the Beijing government is subsidising its steel producers. The European Commission said it was starting a probe into a complaint that China is subsiding its producers of hot rolled flat steel -- one of the most widely used forms of the alloy.


The new investigation could tackle the problem at source, by looking into claims China is subsidising its largely state-owned steel industry, damaging European rivals. If it finds subsidisation is taking place, further duties could be imposed on Chinese imports in an attempt to level the playing field

The announcement comes less than 24 hours after the European Parliament voted with an overwhelming majority against China being given the coveted Market Economy Status.  ''

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