• China will impose anti-dumping tariffs of up to 34.9% on EU brandy starting July 5, 2025.
• The move follows an investigation into EU brandy linked to trade tensions over electric vehicle subsidies.
• Major French producers like Jas Hennessy, Remy Martin, and Martell could be significantly impacted.

China's Commerce Ministry has announced that it will impose anti-dumping tariffs of up to 34.9% on brandy imported from the European Union, effective July 5, 2025. This ruling is part of a broader trade dispute stemming from tensions over electric vehicle imports, initiated after the EU began investigating Chinese subsidies for its auto industry, which Beijing responded to with its own probes into EU products affecting the brandy sector, according to Reuters and Le Monde.

The investigation revealed that there was dumping of relevant brandy imported from the EU that threatened the domestic industry, prompting the imposition of duties designed to protect local producers. The tariffs will apply to brandy in containers of less than 200 liters, with specific rates imposed on major French spirits producers: Jas Hennessy will face a levy of 34.9%, Remy Martin will incur 34.3%, and Martell will be charged 27.7%, as reported by India Times and Bangkok Post.

Notably, some major cognac producers have entered into price commitments to avoid these tariffs; they must maintain sales at or above a set minimum price to escape the higher tax rate, according to Reuters and Le Monde. This strategy indicates China's ongoing efforts to negotiate trade terms with the EU while addressing its own economic interests amid rising tensions.

The impact of these new tariffs is significant: the cognac industry, which relies heavily on Chinese exports worth approximately 1.4 billion euros annually, has been adversely affected, losing around 50 million euros per month due to the ongoing trade dispute. This escalating tension comes as dialogues between top Chinese officials and their EU counterparts continue, especially in light of recent geopolitical strains, as highlighted by India Times and Bangkok Post.