Diageo has suggested the US Government consider “enhanced rules of origin” for spirits in its trade negotiations as an alternative to Donald Trump’s recent tariff moves.
The proposals, which appear to firm up existing ‘designation of origin’ regulations for the likes of bourbon, tequila and scotch whisky, were included in a letter sent to the deputy assistant US trade representative for monitoring & enforcement earlier this week. The letter, written by Diageo North America’s VP of government relations, Alden Schacher, was sent in response to a request for “comments to assist in reviewing and identifying unfair trade practices and initiating all necessary actions to investigate harm from non-reciprocal trade arrangements”.
The proposed updates are that alcoholic beverages imported into the US use grain or plants wholly originating in the US or the territory of a strategic trade partner”, with the distillation process taking place in – and aging barrels originating from – either the US or the trade partner’s home country.
“This would deepen US supply chains, disincentivise the use of non-originating content, and support the Trump Administration’s policy objectives of growing US jobs, the US economy and resilient supply chains,” Schacher wrote.
The window for comments to the trade representative – Diageo’s can be viewed here – closed on Tuesday (11 March).
Earlier this week, President Trump threatened to implement a 200% tariff on wine, cognac and other alcohol imports from the European Union. The warning was the latest move in an escalating row that saw the EU line up a retaliatory 50% import tariff on American whiskey from 1 April.
