France has failed to find a solution to its ongoing trade spat with China, including tariffs on Cognac, the EU country’s economic and finance minister Eric Lombard said today (15 May).
In a speech broadcast by French network BFMTV, Lombard said following talks with China vice premier He Lifeng: “The economic dialogue, at this stage, has not allowed us to find a definitive solution to this dispute.”
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He added, however, that the door to future talks on the matter “remains open”.
The Cognac industry has been facing tariffs on exports to China since October, when the Asian country’s commerce ministry imposed “provisional dumping measures” on imports of EU-origin brandy.
During the negotiations, Lombard said he “wanted to emphasise the importance for us of returning to the prevailing solution before 2024”.
Since 11 October, companies importing products including brandy have had to pay a security deposit to Chinese authorities upon arrival.
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By GlobalDataChina launched its investigation last year after receiving complaints of brandy dumping from the China Liquor Industry Association. The move followed the EU’s launch of an anti-subsidy investigation into Chinese electric vehicles in September 2023.
The probe has been assessing dumping allegations made between 1 October 2022 and 30 September 2023 for EU brandy imported in containers of under 200 litres.
At the end of March, reports emerged suggesting China had postponed concluding its anti-dumping investigation into EU brandy products.
According to news outlets Bloomberg and Reuters, France’s Foreign Minister Jean-Noël Barrot told journalists during a trip to China in March that the completion of the probe had been delayed by three months.
“This measure should give us a few months’ breathing space with the reopening of duty-free sales of Cognac and Armagnac, which represent a significant volume of sales for some brands,” he said in emailed comments to Bloomberg at the time.
China’s Ministry of Commerce announced in January that it had extended its anti-dumping probe of brandy originating from the EU by three months.
The investigation, launched on 5 January 2024 and initially due to last one year, was expected to be completed by 5 April.
Cognac makers such as Pernod Ricard had been unable to sell in duty-free channels for some time.
In response to the reports on China postponing its investigation, three French spirits trade bodies warned the potential delay to China’s anti-dumping probe of brandy did shift the ongoing impact of Beijing’s taxes on Cognac and Armagnac producers.
In a joint statement at the time, the Bureau National Interprofessionnel du Cognac (BNIC), Bureau National Interprofessionnel de l’Armagnac (BNIA) and Fédération des Exportateurs de Vins & Spiritueux de France (FEVS) said they had been “informed” about the outcomes of Barrot’s visit to China.
The BNIC, BNIA and FEVS said their members viewed the latest developments “positively” but added that “in substance, these developments do not alter the situation for Cognac exporters”, given the taxes they have faced on their imports to China since October.
