September 25, 2012 / 6:20 PM / 5 years ago

EU delays decision in U.S. "chateau" wine claim

BRUSSELS (Reuters) - French fears of competition from a flood of U.S. wine bearing the word "chateau" on the label eased on Tuesday, after EU officials delayed a decision on a plan that has left Bordeaux winemakers seeing red.

The European Union's wine management committee had been expected to approve an application to allow U.S. wine exports to Europe to use the word "chateau", in what one EU official described as a "purely technical rubber-stamping exercise".

But after complaints from producers in French wine growing regions including Bordeaux, the country's Agriculture Minister Stephane Le Foll asked the committee to delay the vote to give France a chance to present alternative proposals.

"We've been talking to the French authorities for a number of weeks and they never raised any problem. Then two weeks ago, someone in Bordeaux woke up and said we're selling off the term 'chateau' too cheaply," said the EU official, speaking on condition of anonymity.

European consumers associate the word chateau with wines from a specific vineyard attached to a stately home, while in the United States the term can be used to describe wines made from grapes from multiple sources, the head of Bordeaux producers' union CIVB, Georges Haushalter, said.

"The authorisation would lead to unfair competition, as the American definition of the term chateau is extremely lax," he told a news conference on Monday.

French winemakers welcomed the delay, but warned that the plan had not been abandoned, with a vote still likely at some point later this year.

"It's not a victory but it at least gives us time to get ready to defend our rights when it comes back on the agenda... We are continuing to fight," Bernard Fages, President of the Federation of Great Bordeaux Wines, told Reuters.

But some questioned the impact of the proposed move, given that U.S. wines bearing the name would be clearly labelled as having been produced in the United States.

"One does wonder to what extent it's going to make any difference whatsoever," the EU official said.

Indeed, U.S. wine exports were allowed to carry the chateau label in Europe between 2006 and 2009, before the authorisation lapsed under the terms of a bilateral wine agreement between the two partners.

In 2010, when U.S. wines were no longer allowed to carry the chateau label, the country's exports to Europe rose 13 percent to $422 million, data from the U.S. Department of Commerce showed.

Europe accounts for about a third of total U.S. wine exports. Of the total, 90 percent were produced in California in regions such as Napa Valley and Sonoma.

European wine exports to the United States were worth $2.5 billion in 2010, with French exports accounting for $950 million, figures from the U.S. Department of Agriculture showed.

Additional reporting by Claude Canellas in Bordeaux and Madeline O'Leary in Brussels, editing by Paul Casciato

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