Export officials from a Bradford trade body are trying to resolve an international dispute over the export of blended teas, including one of Yorkshire’s best-known brands, which could affect all similar sales from the European Union.

Chamber International experts are working to help Taylors of Harrogate, which blends Yorkshire Tea, to resolve a regulatory dispute with South Korea, which has been accused of ‘protectionism’.

Chamber International has warned that the ‘country of origin’ labelling dispute could become an EU-wide issue.

The dispute, which has been bubbling for two years, has arisen over the definition of the ‘substantive change’ in a tea product which is used to determine its country of origin. Taylors of Harrogate, acting on advice from HM Customs and Chamber International, has believed that blending and tasting different teas to create a distinctive, consistent brand flavour constitutes the ‘substantive change’ to meet the country of origin requirements of a free trade agreement with South Korea.

But South Korean customs officials argue that the only ‘substantive change’ occurs when the freshly-picked green tea is turned into black tea.

South Korean retail labelling regulations also demand that the country of origin where the tea leaf is grown, such as Rwanda or Kenya, is displayed rather than where it was blended.

Chamber International has taken up the matter with the South Korean customs which asked UK tax officials to visit Taylors to conduct an audit on the tea blending process.

Madeline Wolfe, Taylors of Harrogate export sales administrator, said: “This makes a big difference for our customer supplying South Korea.

“If they are able to claim EU origin, as we have previously done for many countries for years without any difficulties, they pay lower import tariffs.

“However, the South Korean customs ruling means that they are breaching domestic labelling regulations and risk a substantial fine.

“If they obey the domestic regulations, they do not benefit from the lower tariffs afforded which is what our customer has been doing.

“This means that our customer cannot buy as much of our blended teas as they might like to and the end price makes our product uncompetitive for consumers who want to enjoy blended teas from Yorkshire which also include our Earl Grey and English Breakfast brands”

Chamber International senior export advisor Mike Strawson said: “While South Korea is not a major international market for Taylors of Harrogate, it is one which is increasing for EU black tea exports generally. This is a very important issue at a time when UK companies are being encouraged to step up exports to help re-balance the national economy.

“In our view, this is a clear case of protectionism on the part of the South Korean authorities. It could be the thin end of the wedge and, if not resolved, this dispute could affect all blended teas exported from within the EU.

“We are making representations to a number of international trade bodies and working with Geneva-based specialist trade lawyers to try and resolve the matter.”

Exports of EU fermented and partly-fermented black tea to South Korea rose rom of £160 million to more than £755 million between 2009 and 2012.