China launches dumping investigation against French cognac

China has initiated anti-dumping proceedings against imports of French cognac from EU countries. Authorities in Beijing say they are doing so at the request of Chinese beverage importers. Alcoholic drinks such as cognac that come to China in containers of less than 200 liters are affected by this investigation.

In foreign trade, dumping means selling a product below its production price, which violates international trade rules.

Cognac is the most imported spirit in China and mainly comes from France. The launch of the Chinese investigation comes just four months after the European Union launched a dumping investigation into the import of Chinese electric cars. Brussels already warned at the time of possible Chinese retaliation.

French companies, which have an important sales market in China, will probably be particularly affected by the investigation. Because Emmanuel Macron's French government strongly supported electric car research at the time, some analysts do not believe the cognac test was a coincidence.

In addition to the EU investigations, France has taken its own steps to promote European-made products. Purchase subsidies for electric vehicles will soon be limited so that they cannot apply to most cars made in China, based on their environmental performance.

In the past, China has taken similar steps against Australia when relations between Canberra and Beijing were tense. At the time, China imposed measures against Australian dairy and meat. Since last year, trade relations between the two countries have improved again.