Australia and the European Union (EU) have concluded eights years of negotiations for the Australia-EU Free Trade Agreement, which will see the removal of tariffs on Australian wine exports to EU member states, but decimate prosecco exports.
Australian Grape & Wine has welcomed key elements of the agreement, which will result in 98% of the current value of Australia’s exports entering the European Union being duty free.
However, it noted significant implications for producers exporting Australian prosecco.
Under the agreement, Australian wine exported to the European Union will receive zero tariff treatment upon entry into force, delivering an estimated $14.5 million per year in tariff savings, however Australian producers will no longer be able to export Australian prosecco, following a 10-year phase out period.
Chief Executive of Australian Grape & Wine Lee McLean said: “The removal of tariffs on Australian wine entering the EU is good news for our exporters and for the long-term competitiveness of Australian wine in a major global market.
“Europe remains Australia’s largest export region by volume. In 2025 alone, 245 Australian wine exporters shipped 76 million litres of wine valued at $143 million to EU member markets.”
The agreement confirms that Australian producers will retain the right to use the term “Prosecco” as a grape variety in the Australian market.
“The Government has successfully negotiated the retention of the name Prosecco for use in Australia’s domestic market,” McLean said. “That provides certainty for a domestic prosecco market worth in the order of $200 million per year.
“We continue to maintain that prosecco is a grape variety and that efforts to restrict its use are nothing more than protectionist measures used to distort trade to the advantage of EU producers. This is clearly a blow for those Australian producers who currently export Australian prosecco, who will need to transition away from using that term for export markets.
“Encouragingly, we understand the agreement helps safeguard Australian producers’ ability to use established grape variety names, including those that may face future GI claims – avoiding a repeat of the prolonged uncertainty experienced by Prosecco producers.”
“For those producers impacted, the task now is to ensure a smooth transition with appropriate support. We will be engaging with the Australian Government on what assistance may be required to support export-focused prosecco producers as they adapt.”
Despite the setback for exports, Brown Family Wine Group Portfolio Manager Katherine Brown said the ability to retain the name Prosecco in the Australian market “marked a milestone we’ve all been working towards”.
“This is a significant and positive outcome for our growers, producers, and consumers. It provides certainty, protects a thriving category, and allows us to continue building on the incredible momentum Australian prosecco has achieved. A huge thank you to everyone across the industry and government who contributed to this result.”
Prime Minister Anthony Albanese said: “Australia’s relationship with the European Union continues to go from strength to strength.
“After almost eight years of negotiations, my good friend President von der Leyen and I agreed to the landmark Australia–European Union Free Trade Agreement.
“I am proud that we have been able to secure this deal, which will deliver benefits for both Australia and the European Union for generations to come.
“This deal creates major new opportunities for Australian exporters in the European Union’s massive $30 trillion economy, and will reduce costs for Australian consumers.”
Minister for Trade and Tourism Don Farrell said: “This hard-fought deal delivers real commercial gains for Australian exporters, farmers and producers into a market that has been difficult to enter or effectively closed for decades.”
“The removal of EU tariffs on most of Australia’s exports gives Australian exporters the opportunity to diversify trade with 27 European countries and 450 million consumers.”
“This is a strategically important and economically valuable agreement at a time when Australian exporters are navigating choppy trade waters.
“More trade, with more trading partners means more supply chain security, more well-paying jobs, cheaper prices, and more national income to build things like urgent care clinics and improve government services.”
Wine Australia CEO Dr Martin Cole said: “Europe is a significant region for Australian wine exporters. In 2025, 245 Australian wine exporters shipped 76 million litres of wine valued at $143 million to EU member markets, representing 12 per cent of total export volume and 6 per cent of export value, with additional wine sent to the United Kingdom and then on-shipped to EU destinations.
“The Wine Agreements between Australia and the EU in the past have helped to reduce barriers for Australian wine exporters, helping to give a competitive advantage in the region and have meant that fewer changes to labelling and winemaking practices are needed in order to sell their wine in the EU.”
