Australian winemakers have preserved the right to keep making and selling prosecco domestically under the landmark free trade agreement signed this week between Australia and the European Union. It represents a pragmatic win for an industry that has invested two decades building the name at home, though it comes with a trade-off that threatens future export growth.
After nearly eight years of negotiations, Prime Minister Anthony Albanese and EU President Ursula von der Leyen signed an agreement in Canberra. The accord tackles a dispute that derailed talks in 2023 and hinged partly on product naming rights for food and drink. On prosecco, the compromise is this: Australia wins indefinite domestic use of the name, but exports will face a 10-year phase-out period, after which Australian prosecco can still be exported but not labelled as such.
For King Valley producers and others who pioneered prosecco grape growing in Australia, the outcome is mixed. Prosecco now accounts for approximately 1 in every 4 bottles of sparkling wine sold in Australia, with one bottle sold every 1.5 seconds. The category has posted double-digit growth, making it a genuine commercial success. Yet 95 per cent of Australian prosecco is consumed domestically, meaning the 10-year export restriction may not sting immediately. Industry sources, however, worry about what happens when that countdown ends.
The broader trade deal carries genuine economic weight. Von der Leyen said the agreement would remove nearly all tariffs and add about A$8 billion to Australia's economy a year. Australian wine exported to the European Union will receive zero tariff treatment upon entry, delivering an estimated AUD $14.5 million per year in tariff savings. The agreement will result in 98 per cent of the current value of Australia's exports entering the European Union duty free.
The naming rights dispute reflected deeper tensions. Australian producers had always been allowed to use the name prosecco for wine made from prosecco grapes under a bilateral wine treaty with the EU, and have been able to export prosecco-labelled wine despite not being able to sell it to the EU itself. Italy had fought to lock down geographic indication status for prosecco, much as France protects Champagne. Australia is now the first country outside Italy to secure the right to use the name in reference to locally made sparkling white wine made with glera grapes.
Whether this represents a genuine long-term victory depends on what Australian winemakers do in the decade ahead. Domestic market growth is strong, but building export credentials takes time and money. Once the 10-year window closes, producers will face the costly task of rebranding their product for overseas sale. The government secured breathing room. How the industry uses it will determine whether that breath becomes lasting momentum or just a pause before a harder decision arrives.
On the consumer side, the deal cuts both ways. The removal of most Australian tariffs on imports from the EU will make things like European wine, spirits, biscuits, chocolates and pasta cheaper at Australian checkouts. That's a tangible win for household budgets, though it comes alongside concerns from Australian farmers who worry the agricultural access gains do not match what they lobbied for.