COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT pursuant to the second subparagraph of Article 251 (2) of the EC Treaty concerning the common position of the Council on the adoption of a EUROPEAN PARLIAMENT AND COUNCIL REGULATION establishing a system for the identification and registration of bovine animals and regarding the labelling of beef and beef products and repealing Council Regulation (EC) No 820/97

1. Background

1.1 On 13 October 1999, the Commission made a proposal to Parliament and Council, based on Article 152 (4) (b) of the EC Treaty, laying down general rules for a compulsory beef labelling system [COM(1999) 487 final - 1999/0204 (COD)].

1.2 At its plenary session of 12 April 2000, the Parliament adopted a total of 56 of the 62 amendments originally tabled for this proposal.

1.3 The Commission formally accepted 18 of these amendments, which were incorporated in its amended proposal [COM(2000) 301 final], adopted on 17 May 2000 and engaged itself to present Parliament's view on several other amendments in Council.

1.4 On 5 June 2000, the Council adopted the Common Position addressed here, in accordance with Article 251 (2) of the EC Treaty.

2. Aim of the Commission Proposal

2.1 The Commission's proposal aimed to lay down general rules for a compulsory system, in two separate phases, which:

- Introduced immediately a compulsory beef labelling system, obligatory in all Member States. It was proposed that operators and organisations marketing beef shall indicate on the label information about certain characteristics of the beef at the point of slaughter of the animal or animals from which that beef was derived.

- In the second phase, starting on 1 January 2003, reinforced the compulsory beef labelling system. It was proposed that operators and organisations marketing beef shall, in addition, indicate on the label information concerning origin, in particular where the animal or animals from which the beef was derived were born, reared and slaughtered.

- By derogation from these rules, certain simplifications were introduced with regard to the labelling of minced beef and beef originating from third countries.

2.2 In the second phase, in its amended proposal COM(2000) 301 final, the Commission included the Parliament's proposal that only the Member State indication shall be retained and that origin shall be defined by place of birth, rearing and slaughtering of the animal from which the beef was derived (i.e. place of de-boning shall be deleted).

2.3 Furthermore, the Commission agreed with the Parliament's amendment to delete the indication "Origin: EC" for beef derived from an animal born, reared and slaughtered in one Member State.

2.4 The other amendments accepted included a clarification of how regional labelling may co-exist with compulsory Member State labelling, without undermining the Protected Geographical Indications and Protected Denominations of Origin, as laid down in Council Regulation (EC) No 2081/92, and the date of entry into force of the first phase of compulsory labelling.

2.5 The Commission also accepted a number of amendments of the Parliament which improved the editing of the text related to definitions of labelling and the relation of beef labelling to other relevant Community legislation.

2.6 In its amended proposal, the Commission did not formally accept the Parliament's amendment to bring forward the date of entry into force of the second phase of labelling on 1 September 2001 because it was considered that this matter was still a major point of discussion.

2.7 Furthermore, the Commission preferred to retain its original proposal with regard to the indication "Origin: EC" for describing the origin of beef derived from animals, which were born, raised and slaughtered in more than one Member State and with regard to the indication of the category of the animal from which the beef was derived.

2.8 Owing to the complexity of the production process for minced beef, the Commission also reserved its position on the Parliament's proposal to remove the simplified labelling arrangements for such beef. The Parliament was informed in the plenary session that the Commission believed that some sort of simplified procedure would still be necessary, even if that was not the solution already found in Article 14 of the proposal.

2.9 Finally, for a number of amendments regarding the voluntary system of beef labelling, the Commission, though not in a position to accept them at the plenary session, indicated to Parliament that their aim of restoring a system of formal approval, was clearly understood. The Parliament was informed that the Commission would ensure that Parliament's position on these amendments was understood in the discussions, which would take place in Council.

3. Comments on the Common Position of the Council

3.1 In its Common Position, the Council accepted all the modifications incorporated in the Commission's amended proposal. With regard to other points, the Council introduced, in agreement with the Commission, the modifications set out below.

3.2 In the first type of modification, the Council accepted, in agreement with the Commission, three of the Parliament's amendments and these were included in the Common Position, namely:

- To clarify the relationship between the current regulation and other relevant Community legislation, in particular that concerning beef. In order to establish a clear statement of which legislation is relevant, the Commission agreed to the declaration found in Annex 1.

- To delete the indication "Origin: EC" for describing the origin of beef derived from animals, which were born, raised and slaughtered in more than one Member State [Article 13 (5)]. Since deleting such an indication poses a certain risk of re-nationalisation of the beef market, the Commission only accepted this proposal, supported by the Parliament and a clear majority in Council, on the basis of the declaration found in Annex 2.

- To restore a formal approval procedure for voluntary labelling specifications (Article 17). This modification strengthens the Commission's proposal but is more burdensome to Member State administrations. Since a majority is in favour of this strengthening of the measure, the Commission can agree.

3.3 The second type of modification consists of two changes to the text which are very close to the amendments proposed by the Parliament:

- The spirit of the Parliament's amendment to Article 7 (4) was accepted but the Council preferred that the Member States were given the opportunity to fix themselves, within the limit agreed by Parliament, the delay for producers to notify the movements of bovines. Since the production systems and movement of new-born animals vary between Member States, this suggestion is seen by the Commission as a acceptable solution to a practical problem.

- A new Article 13 (6) is introduced to allow, in a more comprehensive way than that proposed by the Parliament regional labelling to co-exist with compulsory Member State labelling, without undermining the Protected Geographical Indications and Protected Denominations of Origin. The Commission had already indicated in the plenary session that it was necessary to find an improved editing for this measure in order for it to be more effective and is satisfied with the text prepared by the Council.

3.4 Finally, there were five elements where the Council, with the agreement of the Commission, has proposed modifications, which do not completely coincide with those of the Parliament, namely:

- The addition of Article 37 as a joint legal base, together with Article 152.

- The indications that shall be given on labels in the first phase of compulsory labelling. The Parliament proposed to delete category of animal and minimum maturation period but to retain slaughter date. It is now proposed to delete slaughter date and minimum maturation period but to retain category [Article 13 (2)].

- The Parliament proposed that national compulsory labelling systems could continue after the date on which the second phase of full origin labelling was introduced in the Community. The Council supports the Commission's original proposal that such national systems should end on that date [Article 13 (3)].

- The Parliament proposed that the second phase of full origin labelling shall begin on 1 September 2001. It is now proposed that it shall start on 1 January 2002 [Article 13 (3)].

- The Parliament proposed to remove completely the simplified labelling arrangements for minced beef. The Council retained the idea of a simplified arrangement for such beef but tightened the original proposal by obliging operators to indicate the traceability code, the Member State or third country in which the animal was slaughtered and the Member State or third country in which the minced beef was prepared, without the possibility of the indication "non-EC". Furthermore, operators may complete the label with any other of the indications required under the compulsory labelling system (Article 14).

3.5 The Commission's view on the Council's Common Position on these five points is the following:

- Following the introduction of the Amsterdam Treaty, the Commission considers that Article 152 of the Treaty is the appropriate legal base for the regulation, since it deals with measures in the veterinary field, which have as their direct objective the protection of public health. However, the Commission, acknowledging the judgement of the European Court of Justice on 4 April 2000, with regard to the legal base for Council Regulation (EC) No 820/97 (Case C-269/97), and recognising Council's unanimous wishes to add Article 37, could accept a double legal base, provided that it was understood that this did not undermine any of the Parliament's prerogatives, acquired under Article 152.

- The compulsory indication of category of the animal from which the beef was derived was an element of the Commission's original proposal and constitutes an important indicator of quality in beef. In its amendments at first reading, the Parliament gave preference to limiting the labelling system only to the indications ensuring traceability. However, in view of the Common Position of the Council, and the benefits to the consumer of receiving such information on beef, the Commission supports the compromise offered by Council.

- The Commission has always defended the view that the proposed beef labelling system must be uniform across the Community and that national systems should end when the full Community system begins. In view of the compromise solution offered by the Council, which retains certain elements of current national labelling systems demanded by the consumer, the Commission can agree to the Council's Common Position on this point.

- The Commission has defended a cautious approach to the speed of introduction of the second phase of full origin labelling in the Community. However, taking account of the Parliament's wishes, a special effort has been made by starting the second phase on 1 January 2002, which is only four months after the Parliament's proposed date. This compromise solution is therefore acceptable to the Commission.

- On the issue of the labelling of minced beef, the Council has shown in its Common Position a willingness to move towards the Parliament's position, which required much more strict labelling requirements for minced beef than originally proposed by the Commission. In the Commission's opinion, the Council's Common Position on this point provides a creditworthy solution that strikes a balance between consumer's right to guarantees over traceability and the necessity for a feasible system.

4. Conclusions

4.1 Taking into account the above-mentioned considerations, the Commission supports the Common Position adopted by the Council.

ANNEX 1

"The Council and the Commission declare that the list of Community legal texts referred to in Article 11 will be established and updated by the Commission and distributed at the Management Committee for Beef and Veal."

ANNEX 2

"The Commission confirms the importance which it attaches to ensuring that the application of the beef labelling system must be consistent with the full operation of the single market. It will follow closely the development of trade within the EU, particularly in relation to the position of exporting Member States, with a view to taking corrective action if necessary."