French brandy makers sacrificial lambs in China-EU trade war

China has decided to impose a provisional anti-dumping tariff on brandy imported from the European Union after the bloc voted for the imposition of a 7.8-35.3% tariff on Chinese electric vehicles.

The Chinese Ministry of Commerce said in a statement on Tuesday that it had reached a preliminary conclusion on August 29 that the brandy imports from the EU were being dumped in China’s market, posing a threat of substantial harm to the domestic industry.

It said the new tariffs will be imposed in the form of cash deposits, effective from Friday. The deposit rates are set at between 30.6% and 39%.

It stressed that the decision was made after it conducted an anti-dumping investigation against the EU’s brandy in accordance with Chinese laws and regulations, as well as the rules of the World Trade Organization (WTO).

It also said the anti-dumping and anti-subsidy probes into imports of pork and dairy products from the EU are still ongoing. It said it will make an objective and fair judgment after the investigations to ensure that all parties’ interests are fully protected.

China’s new provisional tariffs are expected to hit French brands from Hennessy to Remy Martin.

In 2023, France exported 165.3 million bottles of cognac to the US and 61.5 million bottles to China, according to the Bureau National Interprofessionnel du Cognac (BNIC), France’s Cognac governing body.

The BNIC said Tuesday that France will work with the EU to take action at the World Trade Organization level to protest against China’s brandy tariffs.

The Chinese ministry had said on August 29 that it would not impose provisional duties on EU brandy. At that time, Chinese and European officials were having final negotiations on the EV tariff issue with Beijing