Europe's top cognac makers to attend China meeting on anti-dumping probe, source says
Adds details or quotes from source in paragraphs 3-4, 9, 11-14; BNIC comment in 10
By Emma Rumney
LONDON, July 5 (Reuters) -Leading European cognac producers will attend a hearing on China's anti-dumping probe of the industry in Beijing on July 18 - their first chance to defend themselves in person since the investigation began earlier this year, an industry source said.
Companies behind major brands Martell, which is owned by Pernod Ricard PERP.PA, Remy Martin - part of Remy Cointreau RCOP.PA - and Hennessy, owned by LVMH LVMH.PA, received a summons overnight to attend the hearing, the source said.
"We will go ... and they will tell us what questions they want us to answer," the source said, asking not to be named as they were not authorised to speak on behalf of the industry.
"There may be some leeway to say what we want, which is that we are happy to cooperate but we don't think there is any dumping and there is no good reason for them to apply duties."
China announced plans on Friday for the hearing on European brandy imports, ramping up tension on the same day the European Commission's provisional tariffs on Chinese-made electric vehicles take effect.
Beijing announced its anti-dumping probe on EU brandy in January, saying European brandy producers were selling into China at below-market rates.
France's cognac makers said they suspected the probe was linked to a broader trade row rather than the liquor market. French cognac accounts for most of China's brandy imports.
The companies producing Martell, Remy Martin and Hennessy cognac were selected as sample firms for the investigation.
CAUTIOUS OPTIMISM
Cognac makers did not call the meeting, the source said. The industry had however previously signalled its willingness to participate in a hearing, which will mark its first opportunity to make a case against tariffs in person, the person said.
The industry "asked to be heard" and will attend the meeting, a spokesperson for industry association the Bureau National Interprofessionnel du Cognac said via email, adding the industry will continue to cooperate.
Ultimately, however, its fate will be decided in political negotiations, the industry source said, adding the cognac sector is "cautiously optimistic" now that officials from Beijing and Brussels are meeting to talk face to face.
Some media have reported that provisional tariffs on EU brandy could be announced as soon as August. However, the industry had not been given any information on time lines, the source said.
Chinese statute says that the investigation should conclude within a year, but that this can be extended by up to six months, the source continued. The probe could therefore run until July 2025.
After July's hearing, investigators may seek more information on how cognac companies price or make their products, or request to visit their sites, the source added.
Reporting by Emma Rumney;
Writing by Josephine Mason;
Editing by Jason Neely, Helen Popper and David Evans
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
