PARIS (Reuters) – Spirits groups such as Remy Cointreau and Pernod Ricard are struggling on the Paris Stock Exchange on Friday as the Chinese Ministry of Commerce announced the launch of an anti-competitive investigation into spirits of wine, such as cognac, imported from the European Union.
At 12:35 p.m., cognac producer Remy Cointreau fell 11.66% while the Pernod Ricard group, less exposed to wine spirits, lost 4.88%.
The luxury giant LVMH, which also owns spirits brands such as Hennessy cognac, fell 2.1%.
In London, the spirits group Diageo lost 2.35%.
The investigation by Chinese authorities follows a complaint from the China Alcoholic Beverage Association on behalf of the local wine spirits industry, the Ministry of Commerce said in a statement released Friday.
It comes in a context of growing tensions with the European Union (EU), which has launched investigations into subsidies on Chinese electric vehicles and imports of biodiesel.
“This is a very targeted first response which aims to warn the EU that it must exercise caution,” observes Max Zenglein, economist at the European think tank Mercator Institute for China Studies.
The method is not foreign to China: Beijing launched an investigation into wine imports from the EU in 2013 after the European Commission announced plans for customs duties on Chinese photovoltaic panels. . An agreement was finally reached and the investigation ended a few months later.
In 2020, China introduced customs duties on Australian wine amid diplomatic conflict between Beijing and Canberra.
The world’s second largest economy is a crucial market for French spirits groups. The country accounts for 10% of Pernod Ricard’s sales and 30% for Remy Cointreau, according to Jefferies analysts.
Remy Cointreau did not wish to comment. Pernod Ricard and LVMH were not immediately available for comment.
(Written by Blandine Hénault, with contributions from Michal Aleksandrowicz in Gdansk, Casey Hall and Brenda Goh in Shanghai, Joe Cash in Beijing, Dominique Vidalon and Mimosa Spencer in Paris, edited by Nicolas Delame and Kate Entringer)
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