Cognac, according to the federal standards of identity, is grape brandy distilled in the Cognac region of France, which is entitled to be so designated by the laws and regulation of the French government.

Not all brandy is Cognac. The Cognac region of France is an area north of Bordeaux, bordering Atlantic Ocean, with city of Cognac near the center of this region. The Cognac region has been divided into seven subdivision, ranked in order of the quality of cognac made: Grande Champagne, Petite , Borderies, Bon Bardies, Fins Bois, Bon Bois, Bois Ordinaires, Bois a Terroir.

A fine champagne cognac, is required to have been produced from grapes grown in the two Champagnes. Grades of quality are marked with the inexpensive grade almost always marked 3-star; the next grade is marked VSOP (very superior old pale). The oldest and most expensive labels of the various shippers have various designations, including the Fine Champagne or Grandee Fine .