China investigating EU wine

Chinese probe will look into pricing and subsidies.

China has formally launched an investigation into allegations that European producers are selling wine at below cost and enjoy unfair subsidies.  

The Chinese authorities say that it will spend the next 12 months, possibly 18 months, testing whether Chinese wine-makers are justified in claims filed in mid-May.    

The European Commission has rejected the allegations against the European wine industry.  

The Chinese authorities had announced on 5 June that an investigation might be launched into the wine industry.  

That announcement came a day after the European Commission said that it was imposing tariffs on Chinese producers of solar panels, which, the Commission said, had been selling their products at below price.   

José Ramon Fernandez, the secretary-general of the Comité Européen des Entreprises Vins (CEEV), an association representing the European wine industry, today said that the wine sector has been taken “hostage” to the dispute over solar panels, adding that “such blatantly retaliatory launch of an anti-dumping and/or anti-subsidies investigation against EU wines imported in China is incompatible with the international trade rules and totally unjustified”.  

CEEV called on “the EU and China to seize all opportunities for prompt amicable negotiated solutions that contribute to de-escalate the bilateral tension and secure the abandonment of this unjustified Chinese threat on EU wines”.  

The CEEV says that Europe’s global exports of wine amount to €8.8 billion a year, with China importing €761 million last year, making it the fifth-largest market for EU wines.  

During a visit to China in June, Karel De Gucht, the European commissioner for trade, said that he hoped an agreement on solar panels would contribute to ending the dispute over wine.  

The Commission has called for an “amicable solution” to the solar dispute and has established a phased approach that it hopes will encourage the Chinese and European solar industries to strike an agreement by 6 August on what is the biggest anti-dumping investigation ever undertaken by the Commission. In 2011, the value of EU imports of Chinese solar panels amounted to €21 billion.  

The Commission imposed tariffs of 11.8% on all Chinese solar panels on 4 June. After 6 August, the tariffs will rise for the following four months, with differentiated tariff regimes for co-operative and unco-operative Chinese companies. On average, the tariffs will amount to 47%. The EU’s member states will have to decide by 6 December whether to extend the tariffs for five years.   

China and the EU are also currently embroiled in a trade dispute over China’s decision last November to impose punitive tariffs on imports of European stainless steel tubes. The EU referred the case to the World Trade Organization on 13 June.  

In another recent case of the frictions evident in one of the world’s biggest trading relationships, China last Thursday (27 June) imposed anti-dumping duties of up to 36.9% on EU exports of toluidine, a chemical used in dyes, glues and pesticides.  

In May, the EU imposed tariffs on Chinese producers of ceramics and stoneware for five years.

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