EU Trade Commissioner Karel De Gucht noted that the agreement with China is expected to bring equilibrium to the solar panel market in Europe.

"We are confident that this price undertaking will stabilize the European solar panel market and will remove the injury that the dumping practices have caused to the European industry," De Gucht said in a statement.

Chinese Commerce Ministry stated that the country has backed this agreement. The EU is the largest export market for Chinese solar panel products.

This agreement comes after EU announced around 47% duties on Chinese solar panels, cells and wafers in June 2013.

The EU import taxes were aimed at around 100 Chinese companies such as Yingli Green Energy, Wuxi Suntech Power and Changzhou Trina Solar Energy.

This deal is expected to ease the larger war between the trading partners. China began investigations into wines and polysilicons imported from Europe and also announced that it planned to probe into the luxury cars.