China imposes permanent duties on European brandy imports but spares leading cognac houses with pricing agreements
China’s Ministry of Commerce concluded its anti-dumping investigation into European Union brandy imports, finalizing five-year tariffs of 27.7% to 34.9%, effective July 5
On July 4, China’s Ministry of Commerce (MOFCOM) concluded its anti-dumping investigation into European Union brandy imports, finalizing five-year tariffs of 27.7% to 34.9%, effective July 5. The ruling follows a provisional duty period that began in late 2024 and forms part of a broader set of trade measures between China and the European Union.
The new duties target mainly French cognac, which makes up most of the EU’s brandy exports to China. However, several major producers including Pernod Ricard, Rémy Cointreau and Moët Hennessy have been granted exemptions by submitting minimum import pricing commitments that Chinese authorities accepted.
Reports indicate that these price commitments range from US$20 per liter for entry-level products to US$300 for ultra-premium expressions. A total of 34 EU producers reportedly signed similar pricing agreements. Under the terms, China will refund duties paid between October 2024 and July 2025 for producers who now qualify for exemption.
China remains the largest export market by value for French brandy, accounting for about US$1.7 billion annually, and ranks second by volume after the United States. Cognac has historically performed well in the duty free and travel retail channels, but the category has come under pressure due to shifting consumer preferences, softer demand in China and growing geopolitical uncertainty. After provisional tariffs peaked at 39%, affected producers saw monthly exports to China drop by nearly 70%.
According to China, the tariffs are based on findings of unfair pricing practices by EU exporters. However, the European Commission disputes this claim, describing the tariffs as unjustified and viewing them as retaliatory measures linked to the EU’s earlier tariffs on Chinese electric vehicles. The Commission has warned that these duties could worsen already tense trade relations between the two economic powers.
By granting exemptions, Chinese authorities signal a selective approach that aims to maintain access to major players while still enforcing their trade policy measures. Producers that did not agree to the pricing terms will now face the full tariffs.
The ruling provides clarity for some exporters, allowing them to continue supplying the Chinese market under adjusted pricing models. Smaller cognac houses, many without the scale or flexibility to absorb higher tariffs or meet minimum import pricing commitments, face greater uncertainty.
The upcoming China-EU summit later this month is set to address this issue alongside other trade concerns. While the decision closes this investigation, it illustrates how the spirits industry has become part of the wider chessboard in cross-border trade policy.
