The punitive measures were introduced following the EU vote to introduce tariffs on Chinese-made EVs by the end of October (Photo: Canva)
4 min read Last updated: October 8, 2024 | 2:17 PM IST
China on Tuesday imposed temporary anti-dumping measures on brandy imports from the European Union, after a 27-state bloc passed tariffs on Chinese-made electric vehicles (EVs). The following brands were targeted.
China’s Ministry of Commerce has announced that an investigation has preliminary found that China’s domestic brandy sector is exposed to “serious damage” due to brandy dumping from the EU.
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Hinting at the possibility of more to come, the Chinese ministry said the EU’s anti-dumping and anti-subsidy investigation into pork products was ongoing and would make an “objective and fair” decision at the end of the investigation. .
The ministry added that it is considering raising import duties on large-engine vehicles. The levy hike hit German manufacturers the hardest, with German exports to China worth $1.2 billion last year of cars with engines larger than 2.5 liters.
According to the ministry, as of October 11, importers of EU brandy will primarily be required to post a deposit ranging from 34.8% to 39.0% of the import value.
France was seen as a target of the Chinese government’s investigation into Brandy because of its support for tariffs on Chinese-made EVs. Last year, France accounted for 99% of China’s brandy imports, and the value of French brandy shipments reached $1.7 billion.
Hennessy and Rémy Martin were among the hardest hit brands, with importers having to pay deposits of 39.0% and 38.1% respectively.
This deposit would make the initial cost of importing brandy from the EU higher. It was not immediately clear when and how importers would be able to get their deposits back. China’s Ministry of Commerce did not provide details.
Stock price plummets
On the news, Pernod Ricard’s stock price fell 2.9% as of 7:14 p.m. Japan time, Remy Cointreau’s stock price fell 5%, and Hennessy owner LVMH’s stock price fell 4%. 34.8%. Martel had the lowest percentage at 30.6%.
France’s cognac industry association, the National Cognac Professional Association (BNIC), Pernod Ricard and Rémy Cointreau did not respond to requests for comment.
The punitive measures came after the EU voted to introduce tariffs on Chinese-made EVs by the end of October. Ahead of the late August vote, China announced planned anti-dumping measures against EU brandy in an apparent show of goodwill, even though it determined that the brandy was being sold in China at below-market prices. was temporarily suspended.
At the time, the Commerce Department said the investigation would end by January 5, 2025, but could be extended.
China’s Ministry of Commerce previously said European distilleries were found to be selling brandy in a consumer market of 1.4 billion people at dumping margins ranging from 30.6% to 39%, harming the domestic industry. It was announced.
In the EU’s decision to impose tariffs on Chinese-made EVs, the EU imposed tariffs ranging from 7.8% on Tesla to 35.3% on SAIC and other producers deemed not to be cooperating with EU anti-subsidy investigations. was set. These will be on top of the EU’s standard 10% car import tax.
The European Commission has indicated its intention to continue negotiating alternative plans even after the tariffs go into effect.
(Only the headline and photo in this report may have been reworked by Business Standard staff. The rest of the content is auto-generated from a syndicated feed.)
First published: October 8, 2024 | 2:17 PM IST
