By Ryan Woo and Tassilo Hummel
BEIJING (Reuters) -The Chinese investigation which led to hefty preliminary import tariffs on French-made cognac and armagnac will conclude later than initially planned, France’s foreign minister said during a trip to the country.
“Following this visit, I received confirmation that the investigation has been postponed by three months, which rules out the scenario of a sudden application of definitive law to this sector,” Jean-Noel Barrot told journalists.
The move will not lift existing tariffs, but it hands the embattled cognac industry some “breathing space” before any duties become definitive during which French state officials and industry players could further step up their lobbying efforts, Barrot said.
Shares in French drinks companies Remy Cointreau and Pernod Ricard also rose sharply and were up by around 3% during Friday afternoon trading.
China imposed temporary anti-dumping measures on imports of brandy from the EU after the 27-state bloc voted for tariffs on Chinese-made electric vehicles (EVs), heavily hitting sales of cognac, a high-end brandy produced in western France.
China has also essentially banned cognac duty free sales due to the tensions, industry officials said.
France’s BNIC cognac industry group issued a cautious response to Barrot’s announcements.
“We have taken note of this and are awaiting the French government’s detailed debrief in the near future,” BNIC said.
The step heavily impacted the French cognac industry at a time when it is also grappling with similar trade tensions with the United States. China and the United States are the cognac industry’s most important export markets.
The Chinese commerce ministry could not be immediately reached for comment outside of business hours.
(Reporting by Tassilo Hummel and Ryan Woo;Editing by Sudip Kar-Gupta)
