European Commission challenges China’s anti-dumping tariffs on EU brandy

The European Commission has formally requested consultations at the World Trade Organization (WTO) about China's provisional anti-dumping measures on imports of EU brandy.

It is taking “strong, early action” to protect the interests of its industry and economy, says the Commission. The move is just the latest installment in the ongoing trade tensions between Brussels and Beijing, which have been locked in trade disagreements about spirits, dairy, and meat products in recent months.

In October, the Chinese government announced plans to impose provisional tariffs on imports of EU brandy, with importers of the spirit having to pay taxes as high as 39%. The move came a week after EU member states voted to tax Chinese electric vehicles. 

The Commission argues that China’s provisional measures on EU brandy are not in line with WTO rules. It adds that the country “has not proven” there is any threat of injury to its brandy industry or that there is a causal link between the alleged threat of injury on brandy imports from the EU.

“The EU takes very seriously any unfair or questionable use of trade defence instruments against any sector of our economy. By requesting consultations with China over its provisional anti-dumping measures on EU brandy, the Commission is following through on its commitment to protect our industry from unfounded accusations and misuse of trade defence measures,” says Valdis Dombrovskis, executive vice-president and commissioner for trade.

Growing trade concerns

The tensions have triggered growing concerns in the European F&B industry about the potential impact of such measures if implemented. 

A spokesperson for trade group Spirits Europe tells Food Ingredients First that it is a “difficult situation” for the industry and has called on both sides to reach an agreement. 

“The procedure opened at the WTO gives the parties 60 days to reach a negotiated solution. We therefore call on both sides to use that time to arrive at a mutual agreement so that anti-dumping duties on EU wine-based and marc-based spirits may be lifted for good. More generally, we call on the EU and China to settle all their commercial differences through negotiations.”

The EU’s request is the first step in triggering WTO dispute settlement procedures. China has ten days to respond to the EU request, to find a “mutually convenient format and date” for the consultations. If no solution is found, a WTO panel could be asked to decide on the case.