ARCHIVES HISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(77)638
Vol.1977/0204

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(7)638 final
Brussels ,28November 1977
REPORT FROM THE COT /EMISSION TOTHE COUNCIL
ontheapplication ofthethird subparagraph ofArticle 9{uof
Regulation (EEC)No816/70laying down additional provisions for
thecommon organization ofthemarket inwine
(application ofthereference price tocertain liqueur wines )
C014(77 )638final
1 Tilfil il.* ■Ift'.iHiiniTii.M.ir'rl -n,-f/ti-'tr-HlII■■I-ååiW

INTRODUCTION
Thisreportissubmitted totheCouncilinaccordance withthe
following statement writtenintotheminutesoftheCouncilmeetingof
17/18May1976:
"4.TheCouncil takesnoteoftheCommission 'sintention to
maintainuntil31December 1977theprovisions adopted
pursuant tothethirdsubparagraph ofArticle9(3)of
Regulation (EEC)No816/70,andtosubmittoitbefore
thatdateareportontheimplementation ofthoseprovisions ."
Thisreporttracesthebackground to:
thefixingofreference pricesforliqueurwines;
-exemption ofsomeofthesewinesfromthecountervailing chargeandthe
consequences oftheabolition ofthisexemption witheffectfrom
1January 1978.
Itincludes ananalysis ofrecentofferpricesforthesewineson
thebasisofinformation whichhasbeengathered .

I.BACKGROUND
Eversincereference priceswerefirstfixedin1970thefollowing
elements havebeentakenintoconsideration inaccordance withCouncil
1Regulation (EEC)No947/70.
Guidepnce
+Forwarding costs(including transport costs)
=Referenceprice
Infixingthereference pricesforliqueurwines,forwhichthere
isnoguideprice,themarketpricesoftheCommunity liqueurwines
ofwhichproduction isthehighest,i.e.Banyuls andRivesaltes witha
totalproduction ofabout800000hi,weretakenintoconsideration .
Thischoicetookaccountoftheverylargeshareofqualityliqueurwines
inCommunity production :Banyuls,Rivesaltes ,MuscatdeFrontignan
anddeLunelinthecaseofFranceandMarsala andMuscatdePantelleria
inthecaseofItaly,atotalofabout 1300000hi.Onthisbasis
andincluding forwarding coststhereference pricewasfixedat4.30u.a./
degree/hiandhasremained atthisleveleversince.Thenorthern Member
Stateswhichtraditionally importandconsumethistypeofwine,
especially Spanishsherry,considered thepriceof4.30u.a„/degree/hl
excessively high.TheCommission haskeptthispriceunchanged for
sevenyears.
Duringthisperiodqualityliqueurwines,i.e.port,Madeira,sherry,
Setubal muscatel andTokay,towhichwasaddedBoberg (SouthAfrican
liqueurwine),werenotsubjecttoacountervailing charge,onthe
basisthatthesewines,becauseoftheirintrinsic value,wouldinany
caseobservethereference priceandthatitwastherefore notdesirable
toincreasetheirpricewithintheCommunity byapplying acountervailing
CouncilRegulation (EEC)No947/70of26May1970layingdowngeneral
rulesforfixingthereference priceandlevyingthecountervai ling
chargeforwine(0JNoL114,27May1970)

3.
charge *Thisderogation wasconfirmed byArticle 4(4)ofCommission
Regulation (EEC)No1019/70.
Ithasbeenfoundthatthesequalityliqueurwineshavenotalways
observed thereference price.However,nosolution hasyetbeenfound
tothisdelicate problem.
Thefollowing tablecompares thetrendofreference pricesforred
wineswiththatofreference pricesforliqueurwines:
YearReference
pricefor
redwine%increase
over
1970/71Reference price
forliqueur
wine
1970/71 1.66 4.30
1971/72 1.71 +3.01 4.30
1972/73 1.84 +10.84 4.30
1973/74 1.93 +16.27 4.30
1974/75 2.22 +33.73 4.30
1975/76 2.37 +42.77 4.30
1976/77 2.50 +50.60 4.30
.../...

4.
11.AMENDMENT OFREGULATION (EEC)No1019/70ONDETAILED RULESFOR
ESTABLISHING FREE-AT-FRQNTIEROFFERPRICESANDFIXINGTHE
COUNTERVAILING CHARGE INTHEWINESECTOR
InthecontextoftheEEC'srelations withCyprus,theCommission
proposedtotheCouncilatariffconcessionforCyprussherry,subject
toobservance ofthereferenceprice.However,itstatedthatthis
condition wouldapplyonlyifcompeting wines(port,Madeira,sherry,
Boberg,etc.)wererequiredtoobservethereferenceprice.
TothisendtheCommission adoptedon16June1977Regulation (EEC)
No1297/77repealingArticle4(4)ofRegulation (EEC)No1019/70which
exemptswinescompetingwithCyprussherryfromthecountervailing
charge,inordertoensurethatthereferencepriceisattainedinfull
bythesewines.ThisRegulation appliesfrom1January1978o
Itshouldberemembered thattherulesgoverning thewinesector
allowexemption fromthecountervailing chargers regardsthirdcountries
whichareprepared andinapositiontoguaranteethatthepriceior
importsofproductsoriginating inandcomingfromtheirterritorywill
notbelowerthanthereference pricelesscustomsduties....(second
subparagraph ofArticle9(3)ofRegulation (EEC)No816/70).
Thissystemisthatnormallyappliedtoredwines,whitewines
andqualityliqueurwinesotherthanport,Madeira,sherry,Tokay,
Setubalmuscatel andBobergasaresultoftheundertaking toobserve
thereferencepriceenteredintobetheeighteenmainCommunitysuppliers
Β■·/Οβ·

5.
andtheconditional form©fthepreferential treatment accorded .The
Commission isseekingtonormalize theposition oftheseliqueurwines
onasimilarbasis.
III.ANALYSIS OFTHEPRESENT POSITION
AnnexesIandIIgivethepriceschargedbySpainforsherry
exportedtoGermany,DenmarkandtheUnitedKingdombetween 1January
and31May1977andtotheNetherlands between 1January and31August
1977andthepricesofqualityliqueurwinessuchassherry,port,Madeira
andSamosimported intotheNetherlands in1976andthethirdquarterof
1977.
Noformalconclusions canbedrawnfromthese'figures/butcertain
divergences canbeobserved according totheoriginoftheinformation :
thepricesofexportsfromSpaintothefourMemberStatesreferred
toinAnnexIrevealanormaldisparity betweenexportinbulkand
exportinbottles,whichgenerally doesnotexceed2u.a./degree/hi;
thepricesofimportstotheNetherlands giveninAnnexII,however,
revealafargreaterdisparity,rangingfrom3.02to8.53u.a./
degree/hiin1976andfrom2.09to5.77u.a./degree/hiinthethird
quarterof1977;
pricesforbulkexportsareveryhomogeneous forthefourMember
Statesexamined;
"reconstituted "importpricesarelowerintheNetherlands thanin
theotherthreeMemberStatesbecauseofthelowerforwarding costs;
■••/■■•

6.
""fh@s&"reconstituted "importpr1e©$plusfcustofnseluti&sarehigher
thanthepresentreference price(4.3u.a./degree/hi),withthe
exception ofcertainpricestotheNetherlands fromJune1977,the
dropbeingcausedmainlybythedevaluation ofthepeseta;
therangeofimportpricesintheNetherlands g'iveninAnnexII
revealsthatbulkpricesareconsiderably lowerthanthosecharged
bytheSpanishsuppliers .Somepricesappeartobelowerthanthe
minimumpriceapplied exvineyard bytheJerezRegulating Council.
TheSpanisheconomic bodiesquestioned bytheCommission saythatit
isimpossible forsherrytobesoldatsuchlowpricesintheNetherlands .
TheCommission staffarecontinuing toexchange information with
Spaininordertothrowmorelightonthesedifferences ,whichappear
hardtoexplain.Anyclarifications obtained willbeforwarded tothe
CounciI.
"Itwouldseemfromcertaininformal discussion whichhavetakenplace
withtheprincipal producerthirdcountries interested inthistrade,that
thesethirdcountries envisage signingagreements torespectreference
pricesoncondition thatthesepricesremainsubjecttosomestability in
thenearfuture."
Hungaryhasalreadyaddressed anofficiallettertotheCommission
expressing itsreadiness toundertake toabidebythepresentreference
priceforTokay.

ANNEXI
PRICES CHARGED BYSPAIN FORSHERRY EXPORTS
1.Table A
ExportstotheFederalRepublicofGermany,January-May 1977
2.TableB
ExportstoDenmark,January-May 1977
3.Table C
ExportstotheUnitedKingdom,January-May 1977
4.Table D
ExportstotheNetherlands ,January-August 1977
Source:Figuressupplied bySpanishexporters

TABLE A
1Pta=0.0108345 u.a.
FEDERAL REPUBLIC OFGERMANY -17°50
!
i
iPta/500l.Pta/hl
iPta/°/hlu.a./°/hlForwarding costs/°/hl
(8u.a./hl)Duty
11u.a./hlTôtal
u.a.
BULK
Jaraiary 32911 6582376 !
I4.074 0.457 0.629 5.160
|February |353677073 404 !
I4.377 0.457 0.629 5.463
Ma.rch 33917 6783 388 4.204 0.457 0.629 5.290
Aprïl 30483 6097 348 !
I!3.770
I0.457 0.629 4.8:"'
jMay 'I30868 6174 I353 !!3.825 II0.457 II0.629 iI4."
!
iBOTTLES
Carton 9l.Pta/hlPta/°/hl !
iiu.a./0/hl
ii
Jarauary 866 9622 550 '5.959
February 892 9911 566 !
i!6.132
ii i
March 762 8467 484 !
i!5.244
I
April 867 9633550 !
iî5.959
i
May 934 10378593 i
i
i!6.425
i
ii
i

TABLE B
1Pta=0.0108345 u.a.
DENMARK -17°50
Pta/500I.Pta/htPta/°/hLjil
!u.a./°/hlForwarding costs/°/hlTotalr i
i
!I (7u.a./hl) u.a.
BULK
January 32419 6484 371
ι4.020
ι0.514 4.534 +duty
February 33398 6680 382
ι4.139
ι0.514 4.653 +duty
March 28223 5645323 |
I!3.500
I0.514 4.014 +duty
Apml 27085 5417310 |
Ij3.359
I0.514 3.873 +duty
May 293905878|336 j!3.640 0.514 4.154 Il+duty
BOTTLE
Carton 9L.Pta/hlPta/°/hl !
iîu.a./°/hl
i
January 681 7567 432 4.681
February 1213 13478 770 8.343
IMarch |818 9089 519 5.623
Aprii 1016 11289 645ι
6.988
May 907 10078 576 j
iI
!6.241
j

TABLE C
1Pta=0.0108345 u.a.
UNITED KINGDOM -17°50
Pta/500I.Pta/hlPta/°/hli
ju,
i
i
υ.a./°/hlForwarding costs/°/hl
<9u.a./hi)Total
u.a.
BULK
Jareuary 27305 5461 312m
u
u3.380 0.514 3.894 +duty
February 26512 5302 303u
ii
u3.283 0.514 3.797 +duty
Mareh 26968 5394 308ii
n
u3.337 0.514 3.851 +duty
ApriI 26303 5261 301n
n
n3.261 0.514 3.775 +duty
May |268445369|307n
n3.326 I0.514 3.840 +duty
BOTTLES
Carton 9l.Pta/hlPta/°/hln
11un
u.a./o/hl
Jartuary 739 8211 469n
n
n
n5.081
l
February 690 7667 438II
II
II4.746
Mairch 715 7944 454H
11
il4.919
ApriI 752 8356 477m
n
n5.168
May 781 8678 496m
n
m
n
u5.374

NETHERLANDS -17°50TABLE D
1Pta=0.0108345 u.a.
January
February
Marcn
April
May
June
1Pta=Q.0107486u.a.
July
1Pta=0.0106293u.a.
August
1Pta=0.00870066 u.a.Pta/500l.Pta/hlPta/°/hlïu.a./°/ht
iiForwarding costs/°/hl
(6u.a./hl)Duty
11u.a./hlTotal
u.a.
BULK
31431 6286 359 3.890' 0.343 0.629 4.862
28653 5731 327 3.543 0.343 0.629 4.515
27489 5498 314 3.402 0.343 0.629 4.374
25500 5100 291 3.153 0.343 0.629 4.125
27064 5413 309 I3.348
ι0.343 0.629 4.320
24777 4955 283 3.042 0.343 0.629 4.014
24326 4865 278 2.955 0.343 0.629 3.927
26399 5280 302 !I
!2.628 0.343 0.629 3.600
BOTTLES
ICarton9l.Pta/hlPta/°/hlh
h
uu.a./°/hl
January800 8889 508ii
u
u
u5.504
February 747 8300 474u
u
n5.136
March 719 7989 457u
u
u4.951
April717 7967 455»
u
u4.930■ i
May733 8144 465u
u
n5.038
June•693 7700 440 4.729
1Pta=0.0107486 u.a.r
July 731 8122 464 4.932
1Pta=0.0106293u.a.
August 892 9911 566n
n
n
n
u4.925
1Pta=0.00870066 u.a.

ANNEXII
isin1976
[COUNTRY TYPE 1Quantity Container CCT Average Value 1
(litres) I 22.05 alcoholic i(u,a./°
strength ]|/hl)
Spain Other 16036bottLe CIIIa2 17 5.56
If3395bottle CIVa2 18 8.53
II3206bottle CIIIa2 17 5.60
I"18005bottle CIVa2 18 6.54
I"839795cask CIIIb3 17 3.02
I"32096 cask CIVb3 18 A.31
I"110398 cask CIIIb3 17 3.70
I"30669 cask CIVb3 •18 4.01
sherry 12216100bottle CIIIa1 17 7.05
sherry 2400000bottle CIIIa1 17 6.54
sherry 853432bottle CIVa1 18 7.73
sherry 4285100cask CIIIb1 17 4.16
sherry 15456038cask CIIIb1 !17. 3.82
sherry 1031033cask C.IVb1 18 5.30
Portugal Other 9bottLe CIIIa2-17 12.34
II1869bottle CIVa2 19 13.38
II63bottle CIII-a2 17 11.90
II1206bottle ICIVa219 j11.91
II10373cask CIIIb3 17 3.58
M80cask CIVb3 19 3.87
Madeira 5502bottle CIVa1 19 9.22
Madeira 1692bottle CIIIa1 17 11.78
Madeira 2298bottle CIVa1 19 4.47
iMadeira 64145cask CIIIb1 17 4.94
i-Madeira 44135cask CIVb1 19 4.40
IMadeira 8883cask CIIIb1 17 4.66
Madeira 6619cask CIVb1 19 5.10
port 87360bottle CIVa1 19 7.49
port 25730bottle CIIIa1r177.91
port 1408485 Ibottle CIVal 19 8.09
port 54363cask CIIIb1 17 6.38
port 197479cask CIVb1 19 5.01
port 224407cask CIIIb1 17 5.35
port 1298264|cask |CIVb1 19 5.09.
iCARRY
40738265F0RWARD

-2-
COUNTRY TYPE Quantity
<Litres)Container CCT
22.05Average
alcoholi c
strengthValue
(u.a./°
/hl>
CARRIED
FORWARD40738265
Greece Other 546bottle cIIXa2 .17 5.35
ii266bottLe cIIIa2 17 6.90
•I42481 cask cIIIb3 17 4.26
II3025 cask •cIVb3 19 2.56
M6693 cask . cIIIb3 17• 2.45
taSamos 77222 *cask cIIIb3 17 3.00
|Samos3190
JcaskL*.IVb319 !|2.92
TOTAL
NON-MEMBE
COUNTRIES* 40871688
Notes
!•Thesefiguresaretakenfrom"Wineimportsin1976'*/editedbytheHoofdproduktschap .
*
2.Value=amountinvoiced +customsdutiesactually levied,onanannualaveragebasis.
3.Liqueurwinesaccountforabout30%ofallwineimports.
Source:Netherlands Delegation

valueofliqueurw^nesImported intoth9toe^fierlanas
inthethirdquarterof1977 AnnexII
C0UNTRY TYPE Quantity
(hl)Container Alcoholic
strengthVaLue
(u.a./°
/hL)
Spain MontiIta 99.80 cask 16.9 4.10
sherry 106.32 cask 16.6 2.50
sherry 4.48 cask 16.8 2.09
sherry 31.90 cask 17 3.59
sherry i13.63 cask 17.2 2.45
sherry 120.00 cask 17.5 3.85
sherry 740.70 cask 17.9 4.07
sherry 10.00 icask 19.5 4.18
sherry 100.80 bottle 16.5 4.90
sherry 4.20 bottle 16.9 5.07
sherry 117.60 bottle 17 4.26
sherry 16.80 bottle 17.5 5.63
sherry 50.28 bottle 17.6 4.68
sherry 18.48 bottle 18.1 5.77
sherry 100.80 bottle 19 4.48
Portugal jport 5.06 cask 18 4.69
iport 24.70 cask 18 4.81
port 225.00 cask 18.1 5.16
port 25.02 bottle 18 4.82
port 84.00 bottle 19.3 7.25
port 4.20 bottle 19.5 7.17
Madeira 13.63 cask 18 5.70
Madeira 4.23 cask 18.3 5.34
.Madeira 21.17 cask 18.4 5.88
Source:Netherlands Delegation
12October 1977