Following the European Commission’s imposition of duties on imports of Chinese electric cars, a trade association said on Wednesday that French cognac producers are “deeply” concerned about the findings of a Chinese investigation into European cognac imports.

The European Commission threatened to retaliate against Beijing, labelling the measure as protectionist, by informing manufacturers on Wednesday that it will levy additional taxes of up to 38.1% on Chinese electric cars imported starting in July.

As a reaction to the growing trade tensions between Beijing and Brussels, China already opened an anti-dumping probe on brandy imports from the EU in January.

France produces the majority of the European brandy that is shipped to China, and Pernod Ricard and Remy Cointreau both make substantial profits there.

“We take note of the European decision and once again reiterate our deepest concern regarding the consequences for the anti-dumping investigation launched by China on European brandy,” said Florent Morillon, president of the Bureau National Interprofessional du Cognac.

During a state visit to Paris last month, French President Emmanuel Macron expressed gratitude to his Chinese counterpart Xi Jinping for his “open attitude” about interim curbs on cognac.

(Adapted from MarketScreener.com)