FOR YOUR INFORMATION
We share below a number of recent developments. As always, we rely on FIVS Members to apprise us of noteworthy matters. Please contact the FIVS Secretariat with items that may be of interest.
INTERNATIONAL TRADE
EU imposes retaliatory tariffs on U.S. imports, including alcohol – A majority of EU governments reportedly backed imposing widely expected tariffs in retaliation for U.S. subsidies to Boeing after EU trade ministers had an opportunity to meet on 09 November 2020. Retaliatory duties were subsequently announced on 09 November on approximately $4 billion of U.S. imports, and have been imposed on distilled spirits, among other products such as U.S. planes and parts, fruits, nuts and other farm produce, orange juice, construction equipment, and casino tables. Retaliatory duties are reportedly effective as of 10 November 2020 but will not cover products already exported to Europe prior to this date.
- Spirits – As can be seen in this document, spirits products targeted for a 25% tariff hike include vermouth, raw distillates, rums, and vodkas. This listing was taken in the face of strong industry opposition to targeting spirits on both sides of the Atlantic.
- Impact – The Official Journal of the European Union indicates that these additional duties will not exceed the approximately $4 billion authorised by the WTO, meaning that the EU can still impose additional retaliatory tariffs. The United States has already seen a 41 percent drop in whiskey exports to Europe due to previous EU retaliatory duties. Meanwhile, the impact on European exports to the United States, such as in the case of Spanish wines, has been significant.
- Rebooting talks? – An EU official speaking on the condition of anonymity suggested that European officials hope for a reboot of trans-Atlantic cooperation before the Biden administration takes office in January 2021. This EU press release stresses the European Union’s desire for a negotiated outcome, as does this renewed call by the U.S. and European wine sectors.
- Impact of Biden win on fine wines – This article considers how the outcome of the U.S. Presidential election could affect the fine wine market, concluding that a Biden victory may not necessarily bring an end to retaliatory tariffs.
China confirms Australian wine imports suspension – The Chinese government reportedly used an English-language article in a Communist Party paper to announce public confirmation of “import suspension” on seven types of Australian exports, including wine. The suspension would reportedly cut the value of Australian exports to China by US$5-6 billion annually.
MARKET OPENING
Legalizing farm sales of alcohol beverages in Sweden – The Swedish temperance movement is criticizing support for legalizing farm sales of alcohol beverages, arguing the change would benefit large alcohol beverage companies more than small scale farmers in Sweden.
Decriminalising alcohol consumption in United Arab Emirates – The UAE government has reportedly made significant changes to its legal system, effective immediately, including the decriminalisation of the consumption of alcohol beverages. Individuals who sell alcohol beverages in authorised areas without a licence will no longer be prosecuted. Certain regulations remain unchanged, including that alcohol beverages may be consumed only privately or in licensed public areas by individuals at least 21 years of age, and anyone selling to someone underage will be punished. The amendments also give each emirate “the right to issue legislation regulating this issue.”
PRODUCT INNOVATION
Non-alcohol wine in Argentina – Argentine’s wine sector is reportedly urging legislative changes that would permit the production of non-alcohol wine. The president of the National Institute of Viticulture has reportedly indicated that modified regulations are under consideration, touting the benefit that non-alcohol wines might have for Argentina’s foreign trade.
UNDERAGE DRINKING
Fining parents for underage children drinking in Vietnam – The Vietnamese government has issued a new decree that will reportedly fine parents for underage children drinking alcohol beverages, effective 15 November 2020. Article 36 of the decree authorises the imposition of fines of 500,000 to 1 million VND (about US$21 to US$42) for not educating, supervising, or reminding family members under 18 not to drink alcohol beverages. Another decree would impose fines of 05 to 10 million VND (US$214 to US$428) if alcohol beverages are sold for on-site consumption within 100 meters of medical facilities or schools.
DRINK DRIVE
Confiscating cars for drink driving in Russia – Spurred on by an alleged increase in the number of inebriated drivers, the Russian Ministry of Internal Affairs has reportedly proposed new plans to confiscate the vehicles of repeat offenders. The head of the Ministry said that the public has helped identify individuals driving while intoxicated, noting more than 16,000 had appeals filed with the police.