China is set to impose anti-dumping tariffs ranging from 27.7 to 34.9% on distilled spirits from the European Union, with several major industry players escaping the tariffs.
The tariffs will take effect on 5 July for a period of five years, following a months-long investigation into dumping practices, according to the Chinese Ministry of Commerce. Companies that commit to certain price promises may receive exemptions.
Provisional tariffs on these distilled spirits, mainly cognac, were already in place earlier.
On the French stock market, shares of spirits producers Rémy Cointreau and Pernod Ricard initially fell by 7% and 4.7%, respectively, but later showed some recovery.
Major cognac producers such as Hennessy, Rémy Cointreau, and Martell have secured price agreements with China and will avoid the tariffs.
This measure marks a new phase in the tariff conflict between China and the European Union, with the EU imposing heavy import duties on electric vehicles from China.
"We regret the decision to impose definitive anti-dumping duties on EU wine-based and marc-based spirits producers, despite the clear evidence presented to the contrary," said spiritsEUROPE Director General Hervé Dumesny.
Industry federation spiritsEUROPE firmly maintains that minimum price commitments do not imply any wrongdoing or dumping. While they will help soften the impact, the terms remain less favourable than the previous conditions, while a significant number of EU producers are not covered by these arrangements and will face steep and unjustified duties.
“Beyond its direct impact on our sector, this decision risks fuelling trade tensions at a time when mutual cooperation is more important than ever. We nonetheless welcome the conclusion of price undertakings with certain companies, as they offer partial relief, and we urge that this option be extended to all companies that have signed up.”
