European lawmakers insisted Wednesday they should have oversight of talks on an EU-China investment protection agreement and set conditions which could prove unwelcome in Beijing.

A text adopted by the European Parliament said that compared with Chinese firms operating in the 28-member European Union, EU companies in China face discrimination, being forced into joint ventures in a state-controlled economy.

"Talks should be opened only on condition that China formally commits to negotiating easier access for EU firms to its market," Parliament said in a statement on its website.

Given the sensitive EU public concerns involved, the talks must also be conducted "with the highest possible level of transparency" and be subject to parliamentary oversight as a precondition for its consent to the deal, it added.

Audiovisual and cultural products should be excluded completely from the talks while goods made in Chinese labour camps must not benefit from any deal.

The impact of an agreement on human rights in China would also need to be assessed, the statement added.

In a separate resolution Wednesday, MEPs also called on the EU to consider upgrading economic ties with Taiwan at the same time as with China, it noted.

China considers Taiwan to be part of its sovereign territory and reacts angrily to what it sees as any intrusion in its internal affairs so this reference may be especially sensitive.

EU foreign ministers are expected to agree a mandate for the talks with China shortly and it is unclear how far the European Commission can or will go in taking on board Parliament's wishes.

Parliament has final approval of any accord, giving it an important say in a deal promoted by the Commission, the EU's executive arm.

On Tuesday, EU Trade Commissioner Karel De Gucht, who would lead the negotiations, said investment flows between the EU and China are far below what they should be given they are such large trading partners.

"Promoting bilateral investment should be our joint economic objective for the years ahead," De Gucht told the Parliament.

An accord would create "a level playing field on investment protection but above all (generate) ... further investment liberalisation," he added.

Bilateral trade last year was worth nearly $550 billion (415 billion euros), with China enjoying a significant surplus.

De Gucht has said previously that an investment protection deal could help pave the way for a Free Trade Agreement but that would come only later.