China has wrapped up its anti-dumping investigation into brandy imports from the European Union, ruling that dumping did occur but opting not to impose tariffs on companies that agree to sell at minimum prices.
On July 4, the Ministry of Commerce announced its final ruling, determining that EU-made brandy was sold in China at unfairly low prices, threatening substantial harm to the domestic industry. The ministry found dumping margins ranging from 27.7% to 34.9%. Under standard procedures, importers would be required to pay anti-dumping duties upon customs clearance.
However, in a significant development, the ministry accepted a price undertaking proposed by an EU industry association and several producers. Under this agreement, 34 listed companies — including leading brands such as Rémy Martin, Hennessy, and Martell — will be exempt from anti-dumping tariffs as long as they sell their products in China at or above agreed minimum prices.
Price undertakings are a common mechanism in anti-dumping cases, allowing exporters to voluntarily adjust prices to avoid sanctions. Once accepted by the importing country, such agreements suspend the imposition of duties for compliant companies.
The ministry said deposits or guarantees previously submitted to Chinese customs will be refunded or released under the final ruling.
“The minimum price commitment regime offers more tolerable conditions for our companies than the definitive anti-dumping duties announced, even if the market access they allow remains impaired,” Florent Morillon, president of cognac producers’ association BNIC, said in a statement.
The investigation was first launched on Jan. 5, 2024, and a preliminary ruling in August found evidence of dumping, triggering provisional duties or financial guarantees. The final decision had been delayed multiple times before being formally announced this week.
The prolonged uncertainty has taken a toll on China’s brandy imports. From January to May 2025, China imported just over 5.56 million litres of brandy worth US$132.2 million — a year-on-year decline of 60% in volume and 75.3% in value. Imports during the period even fell below those of whisky, a category typically disadvantaged in the Chinese market. French brandy dominates China’s imported brandy sector, accounting for more than 97% of total import value.
But brandy’s challenges in China began long before the trade investigation. The category, which heavily relies on business entertainment consumption, has struggled amid declining demand in that segment. Slowing sales and consumer downtrading have become more evident, industry insiders say.
One industry insider noted that importers front-loaded inventory early in the investigation in anticipation of duties, temporarily boosting figures. Brandy imports from January to April 2024 even recorded a 13.9% year-on-year increase before plummeting in the following months.
Despite the relief brought by the price deal, industry players say challenges remain. With diminished pricing advantages and fewer channel incentives, both producers and importers are under pressure to maintain sales momentum in an increasingly price-sensitive and cautious market.
Discover more from Vino Joy News
Subscribe to get the latest posts sent to your email.
