France-China brandy talks resume

Talks between France and China over brandy tariffs have resumed, sparking hopes that Beijing may reduce taxes imposed on European imports of the beverage. Industry representatives from the Cognac and Armagnac sectors met this week with the French president to address the situation surrounding the anti-dumping duties China has maintained on European Union brandy, a policy that continues to affect exports. The issue emerged in response to the EU's threat to impose tariffs on Chinese electric vehicles, a measure that has already been enacted.

The Bureau National Interprofessionnel du Cognac (BNIC) stated on Tuesday that China's investigation "is not a legal problem but a political one," implying that a political solution is required. This statement underscores the pressure on the French government from the brandy sector to seek a resolution through diplomatic channels. The conflict intensified following actions by the European Commission targeting Chinese car exports, triggering Beijing's retaliatory measures.

Within the context of these tensions, some industry representatives point to recent high-level meetings that have shown signs of progress. Discussions held in Shanghai between French and Chinese officials have reopened the dialogue, viewed as a crucial step toward a bilateral resolution. French lobbying groups, including the BNIC, the Bureau National Interprofessionnel de l'Armagnac (BNIA), the Fédération des Exportateurs de Vins et Spiritueux (FEVS), and the Maison des Vins et Spiritueux (MVS), have coordinated efforts to push for strategies that could ease the impact of the tariffs on the sector.

Meanwhile, China's Ministry of Commerce (MOFCOM) has indicated the possibility of replacing the security deposit required from Cognac and Armagnac importers since October 11 with a bank guarantee, which would mean fewer administrative hurdles. Currently, importers of wine-based spirits like Cognac and Armagnac have to pay a deposit equivalent to the announced tariffs, which average 35% and were implemented on August 29.

French lobbying groups have interpreted this announcement as a "positive initial response," although they acknowledge that a final resolution is still a long way off. Since October, the deposit requirement has posed significant challenges for French exporters, who fear that the prolonged dispute could harm sales in one of their key markets. Achieving a political agreement remains a priority for both sides as negotiations continue to progress in an environment fraught with trade tensions.