* EU refrains from preliminary levy on Chinese solar panels
* Commission's definitive ruling on possible tariffs Dec 5
BRUSSELS, Aug 7 (Reuters) - The European Commission will continue an anti-subsidy investigation on Chinese solar panels but has decided not to impose provisional duties, it said on Wednesday.
China and the European Union, following six weeks of talks, defused their biggest trade dispute in July with a deal to regulate Chinese solar panel imports and avoid a wider war in goods from wine to steel.
In parallel to that anti-dumping probe, the European Union's executive arm also launched an anti-subsidy investigation into solar panels, cells and wafers from China in November last year and had nine months to decide whether to impose provisional duties.
The Commission chose not to take provisional measures but it has until December 5 to decide whether to impose definitive anti-subsidy duties.
"The investigation will continue without provisional measures and the Commission will continue working actively on the case in order to arrive (at) definitive findings that are due at the end of this year," it said in a statement.
The Commission said its decision not to impose any provisional anti-subsidy measures did not prejudice any subsequent decision at the final stage in December, after consulting interested parties.
The EU trade chief and his Chinese counterpart agreed late last month to set a minimum price for panels from China near spot market prices.
European solar panel makers have accused China of benefiting from huge state subsidies, allowing them to dump about 21 billion euros worth of below-cost panels in Europe last year.
The EU had planned to impose hefty tariffs from Aug. 6 but, wary of offending China's leaders and losing business in the world's No. 2 economy, a majority of governments, led by Germany, opposed the plan, allowing for the compromise deal.
Europe is China's most important trading partner, while for the EU, China is second only to the United States. Chinese exports of goods to the bloc totalled 290 billion euros last year, with 144 billion going the other way. (Reporting by Martin Santa; editing by James Jukwey)