LVMH Moet Hennessy Louis Vuitton SE (XPAR-MC)’s flagship cognac brand, Hennessy, has secured an exemption from China’s newly announced anti dumping tariffs on European brandy, shielding the luxury group from a potential blow to one of its key export markets.

China’s Ministry of Commerce confirmed on Friday that it will impose duties of up to 34.9% on brandy imports from the European Union, effective immediately and lasting for five years. However, producers that have agreed to a price undertaking with Chinese authorities among them LVMH, Remy Cointreau, and Pernod Ricard will be spared from the levies.

The move concludes a 17 month investigation and comes amid escalating trade friction between Beijing and Brussels, particularly following the EU’s decision to impose tariffs on Chinese electric vehicles. China’s response appears calibrated: while asserting pressure through broad duties, it also offers relief to major players willing to cooperate on pricing. For LVMH, the exemption is a strategic win. Hennessy is a cornerstone of the group’s wines and spirits division, with China representing a critical growth market. The decision helps preserve LVMH’s competitive edge in the region, even as broader EU China trade relations remain strained.