Cognac Probe in China Delayed Three Months, Says France’s Barrot

China has postponed the conclusion of its anti-dumping investigation of Cognac and Armagnac, providing a reprieve to European spirits makers just as they face tariff threats from US President Donald Trump.

French Foreign Minister Jean-Noel Barrot, speaking during a trip to China, said the announcement was a first step to resolving a dispute that has seen Cognac makers Pernod Ricard SA, Remy Cointreau SA and LVMH’s Hennessy unable to stock duty free channels, a key outlet for their sales in the country. The companies have also been forced to deposit customs duties on the brandy while awaiting the outcome of the investigation. 

“This measure should give us a few months’ breathing space with the reopening of duty-free sales of Cognac and Armagnac, which represent a significant volume of sales for some brands,” said Barrot, in emailed comments. 

Shares in Pernod rose as much as 4%, while Remy jumped up to 5.4% in Paris.

The three biggest Cognac makers — Pernod, Remy and Hennessy — have been unable to restock duty-free travel hubs across China since early December. Monthly shipments of Cognac to China, one of their biggest markets, have fallen 50%, according to the industry group BNIC. 

China targeted the brandy — which is produced only in France — following an investigation into allegations that producers were dumping the spirit into the market.

Barrot said that stocks that had been blocked in China since December could now be delivered to duty free stores. The outcome of the investigation, which was due to end on April 5, was delayed by three months. 

The postponement comes as the companies brace for levies in the US after Trump threatened to impose a 200% tariff on European wine and other alcoholic drinks in response to the EU’s plan to impose duties on $28 billion of US goods.

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