Quote from Alex bobby on July 6, 2025, 5:39 AM

EU Commission Bewails 'Unfair' Chinese Cognac Duties Ahead of High-Stakes Summit

Trade relations between the European Union and China have taken a sharp turn for the worse just weeks before a critical EU-China summit, set to take place in Beijing at the end of July 2025. The European Commission has denounced China’s imposition of anti-dumping duties on European brandy — specifically Cognac — calling the move “unfair,” “unjustified,” and in violation of international trade rules.

China's decision to slap anti-dumping duties of up to 34.9% on EU brandy imports comes amid mounting tensions and tit-for-tat measures between the two global powers, as economic disputes over electric vehicles, agricultural products, and now luxury spirits widen the diplomatic rift.

What Triggered the Dispute?

According to Commission spokesperson Olof Gill, the European Commission strongly rejects the justification for the duties. Speaking to the press on Friday, Gill stated, “China’s measures are unfair... they are inconsistent with applicable international rules and are thus unfounded.”

The duties, which officially took effect on 5 July 2025, are to last for five years and primarily target EU-produced Cognac and brandy. However, major European producers such as Remy Cointreau, Pernod Ricard, and LVMH’s Hennessy have been spared the harshest tariffs after agreeing to minimum price commitments, shielding them from the full brunt of the new rules.

The Chinese investigation into European brandy began in 2024, widely seen as a retaliatory measure following the EU’s move to impose tariffs on Chinese electric vehicles. Since then, China has broadened its scrutiny to include EU pork, dairy products, and industrial plastics — creating a worrying pattern of escalating trade friction.

EU Accuses China of Misusing Trade Instruments

The European Commission has expressed concern over what it sees as a growing misuse of trade defence mechanisms by Beijing. “This is part of a worrying pattern of China abusing trade defence instruments,” Gill said. “They are starting and conducting investigations based on questionable allegations and insufficient evidence.”

This practice, according to the Commission, not only threatens fair trade practices but undermines trust and cooperation between two of the world’s largest economic blocs. It also casts a shadow over the upcoming EU-China summit, which was intended to mend strained ties amid broader global tensions, particularly involving the United States.

Summit in Doubt Amid Rising Frictions

The brandy tariff decision couldn’t have come at a worse time. Reports have surfaced that China has cancelled the second day of the planned EU-China summit, originally scheduled for 24 and 25 July. While the Commission’s chief spokesperson Paula Pinho has not confirmed this, stating only that the summit agenda “has not been agreed yet,” the signal is clear: diplomatic nerves are fraying.

The summit was initially seen as an opportunity for a diplomatic reset, particularly in light of both sides’ complicated relationships with the United States. However, recent developments suggest deeper strategic mistrust. On Friday, the South China Morning Post reported that Chinese Foreign Minister Wang Yi told the EU’s foreign policy chief Kaja Kallas that China did not want to see a Russian defeat in Ukraine, fearing it would allow the U.S. to focus its attention entirely on containing China.

The Bigger Picture: Trade War on the Horizon?

The Cognac tariff saga is only the latest chapter in a broader and increasingly bitter EU-China trade standoff. The EU’s move to curb Chinese EV imports, citing unfair subsidies and market distortions, has touched a nerve in Beijing. In response, China appears willing to use every tool at its disposal to strike back — even if it means hitting high-profile European exports like luxury spirits, a booming market in China.

These retaliatory steps are raising fears of a full-scale trade war, with implications for global supply chains, inflation, and diplomatic cooperation on other fronts — from climate policy to tech regulation.

Cognac Industry Caught in the Crossfire

The European Cognac industry, a historic and symbolic export sector for countries like France, now finds itself caught in the geopolitical crossfire. While some major producers have dodged the heaviest duties by preemptively cooperating with Chinese authorities, smaller producers without the leverage to negotiate may face severe financial consequences.

For the EU, the situation underscores the fragility of global trade and the importance of rules-based multilateralism, which is increasingly under strain. The Commission is expected to raise the Cognac dispute at the upcoming summit — should it go ahead as planned.

Conclusion

The EU’s sharp response to China’s anti-dumping duties on Cognac highlights a critical juncture in EU-China relations. With tit-for-tat tariffs escalating and diplomatic ties fraying, the planned summit in Beijing may serve as either a reset point — or a breaking point. For now, the message from Brussels is clear: Europe won’t accept what it views as politically motivated trade retaliation, especially when it strikes at the heart of its economic identity and core industries.

Meta Description:
The EU calls China's anti-dumping duties on European Cognac "unfair" and "unjustified" ahead of a critical EU-China summit. Trade tensions are rising amid ongoing disputes.