China targets Canada with first-ever anti-discrimination investigation

Nobody knows what the anti-discrimination investigation means, but it’s provocative.

China’s response to Canada’s tariffs on Chinese electric vehicles and steel contained one element worth examining.

• Namely, China’s first-ever use of an anti-discrimination investigation (ADI).

Some context: The ADI derives from China’s Foreign Trade Law, which provides the legal basis for China to impose countermeasures against any country that applies discriminatory measures against China.

So far, we have more questions than answers:

• What constitutes discrimination?
• How long will the ADI take?
• What concrete countermeasures will it deploy?

Get smart: Given that Sino-Canadian relations are already in the dumpster, Canada is a sensible first target for China’s new anti-tariff tool.

• China is also signaling to other countries that they could be next.

Get smarter: We don’t know if the ADI will be a game-changer or a flash in the pan, but we’ll keep an eye on how it progresses.

• So should multinationals.