The European Union formally opened an anti-subsidy investigation into electric vehicles (EVs) from China, after unveiling the plan last month. China promptly voiced its opposition to the move.

"The European Commission has formally launched an anti-subsidy investigation into the imports of battery electric vehicles (BEV) from China," reads an announcement issued by the commission.

The investigation will first determine whether China's EV value chain has benefited from "illegal subsidization" and whether such subsidies have caused or threatens to cause economic injury to EU EV producers.

Based on the results of the investigation, the European Commission will determine whether it is in the EU's interest to remedy the effects of "unfair trade practices" by imposing countervailing duties on imports of EVs from China, the announcement said.

The European Commission launched the investigation on its own initiative, having gathered sufficient evidence that the recent surge in imports of low-priced subsidized EVs from China poses an economic threat to the EU's EV industry.

Although no formal complaint has been received from EU industry to initiate proceedings, EU anti-subsidy rules require EU industry to cooperate with ex officio investigations.

Pre-initiation consultations were held with the Chinese government prior to the issuance of the initiation notice, as legally required under EU and WTO rules, it said.

The European Commission unveiled the plan to launch the investigation last month, with European Commission President Ursula von der Leyen saying at the time that the global market is now flooded with cheap EVs from China.

Chinese EV prices are kept artificially low by huge state subsidies, which are distorting the EU market, she said.