EXCHANGE OF LETTERS regarding the Price Guarantee Agreement between the EEC and the Republic of Austria for exports of Austrian wine to the European Community

I. Letter from the Austrian Federal Government Brussels, . . .

Sir,

In the two exchanges of letters of 4 November 1970 regarding the principles and details of the Price Guarantee Agreement for exports of Austrian wine to the European Community, the Community undertook, pursuant to Article 9 (3), second indent of Council Regulation (EEC) No 816/70 of 28 April 1970, not to levy and countervailing charge on the import to the Community of wine originating in and coming from the Republic of Austria. In return, the Austrian Federal Government undertook to guarantee that, in accordance with the arrangements agreed between the Community and Austria, the Austrian exporter's prices for the Community and Austria, the Austrian exporter's prices for the Community would not be lower than the reference price less customs duties, and that any deflection of trade would be avoided.

Taking into account the negotiations on the EEA Agreement and in accordance with the talks between representatives of the Commission of the European Communities and of Austria that took place in connection with these negotiations, I have the honour to confirm the following:

I. Pursuant to Article 1 of Commission Regulation (EEC) No 333/88 of 4 February 1988, the Community will levy no countervailing charge on the import of wine originating in and coming from the Republic of Austria.

II. The Austrian Federal Government undertakes to guarantee that Austrian exporters' prices for any exports to the Community of wine originating in and coming from the Republic of Austria on which the countervailing charge referred to in Point I is waived will not be lower than the reference price less customs duties.

The following conditions and arrangements apply to this guarantee:

1. The guarantee covers the following products:

(a) red wine;

(b) white wine other than that designated under (c);

(c) white wine which at the time of import bears the name of the 'Riesling' or 'Sylvaner' grape varieties;

(d) liqueur wine;

(e) wine fortified for distillation.

Insofar as, by application of Article 53 (3), third indent, of Council Regulation (EEC) No 822/84 of 16 March 1987, all or part of the countervailing charge on the import is not waived, the wines concerned are excluded from the guarantee.

2. The certification of adherence to the reference price is undertaken by the Austrian Chambers of Commerce in accordance with applicable national law.

The wine exported to the Community must be accompanied by an approved commercial document as defined in Commission Regulation (EEC) No 986/89 of 10 April 1989, which, in addition to the usual information, must include:

- the free-at-frontier offer price,

- the actual alcoholic strength and where appropriate total alcoholic strength,

- the chamber of commerce certification of adherence to free-at-frontier reference price.

On the original and the copy under the headings 'official comments' the following must also be entered and validated by a stamp together with the date and the signature of official responsible:

'Adherence to the reference price currently in force under Regulation (EEC) No . . . is hereby confirmed.'

The chamber of commerce may certify adherence to the free-at-frontier reference price only if the free-at-frontier offer price corresponds to or is higher than the reference price less customs duties.

3. In respect of adherence to the reference price, the Austrian Federal Government undertakes:

- not to take over costs of any kind associated with the sale and not to alter the sale price,

- to avoid any deflection of trade.

4. Wines exported to the Community and covered by this guarantee must be made exclusively from grapes harvested on the sovereign territory of the Republic of Austria, and may not be blended with imported wines.

5. The Commission will inform the Austrian Federal Government of any alterations to reference prices and countervailing charges.

The conditions and arrangements specified in Points II.1 and II.2 may be adjusted by mutual agreement between the Commission of the European Communities and the competent Austrian authorities.

This exchange of letters comes into effect at the same time as the Agreement on the EEA and replaces both the abovementioned Exchanges of Letters of 4 November 1970 concerning the price guarantee Agreement.

I should be obliged if you would confirm that you are in agreement with the above.

Yours faithfully,

On behalf of the Austrian Federal Government II. Letter from the Commission of the European Communities Brussels, . . .

Your Excellency,

I have the honour to acknowledge receipt of your letter of . . . ., which reads as follows:

'Sir,

In the two exchanges of letters of 4 November 1970 regarding the principles and details of the Price Guarantee Agreement for exports of Austrian wine to the European Community, the Community undertook, pursuant to Article 9 (3), second indent of Council Regulation (EEC) No 816/70 of 28 April 1970, not to levy and countervailing charge on the import to the Community of wine originating in and coming from the Republic of Austria. In return, the Austrian Federal Government undertook to guarantee that, in accordance with the arrangements agreed between the Community and Austria, the Austrian exporter's prices for the Community and Austria, the Austrian exporter's prices for the Community would not be lower than the reference price less customs duties, and that any deflection of trade would be avoided.

Taking into account the negotiations on the EEA Agreement and in accordance with the talks between representatives of the Commission of the European Communities and of Austria that took place in connection with these negotiations, I have the honour to confirm the following:

I. Pursuant to Article 1 of Commission Regulation (EEC) No 333/88 of 4 February 1988, the Community will levy no countervailing charge on the import of wine originating in and coming from the Republic of Austria.

II. The Austrian Federal Government undertakes to guarantee that Austrian exporters' prices for any exports to the Community of wine originating in and coming from the Republic of Austria on which the countervailing charge referred to in Point I is waived will not be lower than the reference price less customs duties.

The following conditions and arrangements apply to this guarantee:

1. The guarantee covers the following products:

(a) red wine;

(b) white wine other than that designated under (c);

(c) white wine which at the time of import bears the name of the "Riesling" or "Sylvaner" grape varieties;

(d) liqueur wine;

(e) wine fortified for distillation.

Insofar as, by application of Article 53 (3), third indent, of Council Regulation (EEC) No 822/84 of 16 March 1987, all or part of the countervailing charge on the import is not waived, the wines concerned are excluded from the guarantee.

2. The certification of adherence to the reference price is undertaken by the Austrian Chambers of Commerce in accordance with applicable national law.

The wine exported to the Community must be accompanied by an approved commercial document as defined in Commission Regulation (EEC) No 986/89 of 10 April 1989, which, in addition to the usual information, must include:

- the free-at-frontier offer price,

- the actual alcoholic strength and where appropriate total alcoholic strength,

- the chamber of commerce certification of adherence to free-at-frontier reference price.

On the original and the copy under the headings "official comments" the following must also be entered and validated by a stamp together with the date and the signature of official responsible:

"Adherence to the reference price currently in force under Regulation (EEC) No . . . is hereby confirmed."

The chamber of commerce may certify adherence to the free-at-frontier reference price only if the free-at-frontier offer price corresponds to or is higher than the reference price less customs duties.

3. In respect of adherence to the reference price, the Austrian Federal Government undertakes:

- not to take over costs of any kind associated with the sale and not to alter the sale price,

- to avoid any deflection of trade.

4. Wines exported to the Community and covered by this guarantee must be made exclusively from grapes harvested on the sovereign territory of the Republic of Austria, and may not be blended with imported wines.

5. The Commission will inform the Austrian Federal Government of any alterations to reference prices and countervailing charges.

The conditions and arrangements specified in Points II.1 and II.2 may be adjusted by mutual agreement between the Commission of the European Communities and the competent Austrian authorities.

This exchange of letters comes into effect at the same time as the Agreement on the EEA and replaces both the abovementioned Exchanges of Letters of 4 November 1970 concerning the price guarantee Agreement.

I should be obliged if you would confirm that you are in agreement with the above.'

I have the honour to confirm that the Commission is in agreement with the contents of your letter.

Yours faithfully,

On behalf of the Commission of the European Communities