China Delays Brandy Probe

China has extended its antidumping investigation into European brandy imports by three months, pushing the conclusion to April 5, 2025. This extension, announced by the Ministry of Commerce on its official website, stems from what it described as the "complexity" of the case. The investigation, initially launched on January 5, 2024, was originally scheduled to be completed within a year, but Chinese regulations allow extensions of up to six months in special circumstances.

In preliminary findings issued in August, the Ministry determined that European brandy imports involve dumping margins ranging from 30.6% to 39%, posing a significant threat to China's domestic industry. As a provisional measure since November 15, 2024, importers of European brandy have been required to provide deposits or guarantees to Chinese customs based on these dumping margins.

The investigation is part of a broader trade dispute between China and the European Union. On July 18, Chinese officials analyzed the industrial impacts and public interest surrounding European brandy imports, aligning this probe with Beijing's broader response to EU trade policies. The tension originated from a European Commission decision to impose higher tariffs on Chinese electric vehicles beginning October 29, 2024, citing state subsidies that provide unfair competitive advantages. China retaliated with tariffs on several European products, including brandy, dairy products, and pork.

France, a leading exporter of brandy to China, is the most affected EU country. French exports include prestigious Cognac and Armagnac brands that have been popular among Chinese consumers. Despite the impact on French exporters, France has supported the European Commission's decision to impose tariffs on Chinese electric vehicles, describing the measures as "proportionate and calibrated." This stance contrasts with Germany's position, which has been more cautious about escalating trade tensions with China.