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Australia continues countervailing duty on bulk French brandy.

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Monday 28 February 2000


Australia continues countervailing duty on bulk French brandy Australia has extended countervailing duty on bulk brandy from France for a further five years, the Minister for Customs Senator Amanda Vanstone, announced today.

Senator Vanstone said the move was good news for the Australian industry, particularly those brandy producers in the Riverland, Reynella and Adelaide Hills in South Australia and at Griffith and Chullora in New South Wales as well as their suppliers.

The countervailing duty, in place since 1990, was due to expire later this month. However an investigation by the Australian Customs Service, initiated after an application by the Winemakersí Federation of Australia, resulted in a recommendation to Senator Vanstone that the duty continue until 2005. The Minister has accepted this recommendation.

Countervailing duty is a form of remedial action taken by the Australian government to counteract a subsidy which benefits a foreign exporter and causes or threatens to cause material injury to an Australian industry.

The investigation found that there were substantial subsidies provided by the European Commission that benefit French exporters and that these subsidies were likely to continue into the foreseeable future. The resulting price undercutting was likely to cause material injury to Australian industry.

"This move to continue countervailing duty will remedy a situation that holds a strong likelihood of a recurrence of injury to the Australian brandy industry," Senator Vanstone said

"It is clear that the on-going subsidy paid to the French brandy producers had the potential to harm Australian producers, who of course receive no such subsidy. This decision is good news for Australian wine-producing regions."