Shares in French spirits companies Remy Cointreau and Pernod Ricard fell today after China announced the launch of an anti-dumping investigation on brandy imported from the European Union.
Pernod Ricard was down 4% this morning, while Remy Cointreau slipped 8%.
The investigation follows a complaint submitted by the China Alcoholic Beverages Association on behalf of China's brandy industry, the commerce ministry said.
China said it has begun an anti-dumping investigation on brandy imported from the European Union, a step likely to increase tensions with the bloc that is scrutinising Chinese electric vehicle subsidies and biodiesel imports.
The investigation announced by China's commerce ministry will focus on brandy in containers of less than 200 litres (43.99 UK gallons) from the European Union.
China is a major market for French brandy.
Pernod Ricard and Remy Cointreau sell cognac, brandy from the Cognac region of France, under brands including Hennessy, Remy Martin and Martell.
Tension between China and Europe has mounted, especially over trade. In December at a summit, EU leaders said Europe would not tolerate "unfair competition" from China, and Beijing told the EU it expected Brussels to exercise prudence when introducing "restrictive" trade policies.
Since September, the EU has weighed levying tariffs on Chinese-made EVs, saying they unfairly benefit from subsidies.
In December, the EU said it would begin an anti-dumping investigation into biodiesel imports from China, which the bloc's industry says has had a severe impact on domestic production, leaving it unable to compete.
