French Champagne makers fear impact of potential new US duties

Workers collect grapes at a Taittinger vineyard during the traditional Champagne wine harvest in Pierry, France.
Workers collect grapes at a Taittinger vineyard during the traditional Champagne wine harvest in Pierry, France.PHOTO: REUTERS

PARIS (REUTERS) - French champagne producers and exporters decried a US government threat to slap tariffs of up to 100 per cent on a range of French products including sparkling wines, saying they have nothing to do with the dispute and calling for government help.

The punitive duties announced on Monday follow France's new digital services tax, which Washington says will harm US tech companies.

"We can understand the various positions but Champagne is not related to this. We fear we will bear the costs of a policy that is beyond us," Taittinger director-general Damien le Sueur told Reuters.

Other types of French wines already face additional US duties of 25 per cent as part of the Unites States' WTO-sanctioned response to illegal EU aircraft subsidies.

"For six weeks now, our companies have been strongly affected by the Airbus litigation. We must avoid creating new problems," FEVS chairman Antoine Leccia said in a statement.

"We therefore solemnly call on the President of the Republic to take, from today, all the necessary initiatives, at national, bi-lateral and international levels, so that our sector does not pay the price of the economic and political choices made by France," it said.

Exports of French sparkling wines to the United States amount to nearly €700 million (S$1 billion) per year, FEVS said.

The United States is Taittinger's second largest export market.

The famous Champagne house is looking at whether it can ship bottles overseas before possible tariffs are put in place, but Le Sueur said these stocks would not cover sales for the whole of 2020.