1. Tradition of Wine
 

There are two perceptions of wine: on the one hand wine can be considered as a product like any other, fermented grape juice. On the other hand, it can be considered as a cultural experience, a part of the France’s Old tradition. How the French wine culture is perceived can be understood with François Rabelais’ words: “Wine is the most civilized thing in the world”.

2. Awakening

World renowned “appellations” from Beaujolais, Bordeaux, Bourgogne contributed to the French reputations for the last decades and were sold at colossal prices. France historic dominance of the export market worked against her: French wine sector took leadership for granted and did not pay enough attention to its “New World” competitors (incumbent’s curse?).

Of course, French wines or more generally “Old World” wines are, on average, of better quality than “New World. With 383 “appellations” French wines are also the most complex in comparison with “New World” wines. Its great variety confuses most of the consumers but also contributed to their success and belongs to France’s tradition.

Since the rise of competition in the 2000’s, France realised their leadership position was threatened by New World countries as well as bordering countries such as its close competitors (Italy & Spain).

3. Sociological and lifestyle evolution

During the last decade, specialists observed a significative trend among wine consumers. The following can be resumed as  ‘Less but better’ consumption, indeed quantitative consumption has been replaced by qualitative consumption since people are getting interested in well-being and sharing. Population growth and reinforcement of the middle class contributed to urbanization and resulted in lifestyle evolution.  

4. Regulation

4.1 Reforms of the EU wine market

In 2006, the European Commission proposed an in-depth reform of the EU wine market in order to:

• ensure EU wine production matches demand;

• eliminate wasteful public intervention in EU wine markets;

• redirect spending to make European wine more competitive;

• create a wine regime that operates through clear rules and preserves the best traditions.

At last, the reform was adopted in 2008 and EU launched its grubbing-up premium program to encourage competitive winemakers to increase the quality of European wines and to offer occupational retraining opportunities for the others. The main problem was the overproduction brought by mass methods which generated large volumes of low quality wines for the last two decades. In parallel with its grubbing-up premium program, EU imposed restrictions on setting up new vineyards until 2013 to avoid any abuse.

In 2013, EU adopted the Common Agricultural Policy which renewed the previous measures and brought new ones. The 2013 reform introduced, as a new measure, innovation in the wine sector aiming at the development of new products, processes and technologies concerning the wine products. Moreover, it opened promotion measures to inform consumers about the Union systems covering designations of origin and geographical indications.

The restrictions on setting up new vineyard has ended by December 2015 in order to put EU wine producers on an equal footing with their competitors. Nevertheless, a new system for the management of vine plantings has been set up in the form of a scheme of authorisations for vine plantings depending on areas and production conditions covered by Geographical Indications.

As a result, French vineyard surface has dropped by 10% during the last 8 years (as seen before) and the French wine sector now counts less wine-producers but larger vineyards since the reform has been launched. European reforms have significantly contributed to reduce production of poor quality wines in France and have boosted its exports in value while declining in volumes.

4.2 Domestic regulation

In the past, there was an important administrative rigidity that certainly contributed to the loss of market shares in the wine sector. However, for a few years, legislation has become more and more flexible and is no longer an issue for French producers but in practice administrative processes keep the system rigid. Given the fact that French wine sector represents an important contribution to France’s balance of trade, government has simplified processes and declarations relatives to wine exportations. Nowadays, French legislation is in favour of exportations.

Although it must be stated that the different designations are complicated, producers are helped by local authorities in the acquisition of strict special mentions (AOC, AOP…).