on the position to be taken on behalf of the European Union in the International Sugar Council concerning the accession of the Kingdom of Saudi Arabia to the International Sugar Agreement, 1992

EXPLANATORY MEMORANDUM

1.Subject matter of the proposal

This proposal concerns the decision establishing the position to be taken on the Union's behalf in the International Sugar Council in connection with the envisaged adoption of a decision concerning the accession of the Kingdom of Saudi Arabia to the International Sugar Agreement, 1992

2.Context of the proposal

2.1.The International Sugar Agreement, 1992

The International Sugar Agreement, 1992 (‘the Agreement’) aims to enhance international cooperation in connection with world sugar matters and related issues, to provide a forum for intergovernmental consultations on sugar and on ways to improve the world sugar economy, to facilitate the trade by collecting and providing information on the world sugar market and other sweeteners and to encourage increased demand for sugar, particularly for non‑traditional uses. The Agreement entered into force on 1st January 1993.

The European Union is a party to the Agreement.

2.2.The International Sugar Organisation

The International Sugar Organization (‘ISO’) which administers the Agreement is a London-based intergovernmental organisation that seeks to meet the objectives laid down by Article 1 of the Agreement.

Currently, the ISO has 87 members, including many of the world’s largest sugar producers as well as importers. Besides the Union, its members are, among others, Brazil, India, Thailand, and Australia. The last country joining the ISO was the United Kingdom, who became member on 1 January 2021. The 87 members of the ISO have a total number of 2,000 votes.

Pursuant to Article 8 of the Agreement, the International Sugar Council performs or arranges for the performance of all functions as are necessary to carry out the provisions of the Agreement.

At the sessions of the International Sugar Council the Union is represented by the Commission by virtue of Article 17 TEU. Member States can also attend the sessions of the International Sugar Council.

2.3.The envisaged act of the International Sugar Council

Following the formal application of the Kingdom of Saudi Arabia to accede to the Agreement on 15 December 2021, it is expected that the International Sugar Council will adopt during a future session thereof, or within the framework of a procedure for adoption of decisions by the International Sugar Council by exchange of correspondence, a decision concerning the accession of the Kingdom of Saudi Arabia.

The purpose of the envisaged act is to establish the Union’s position on the conditions for the accession of the Kingdom of Saudi Arabia to the Agreement pursuant to Article 41 of the Agreement.

According to Article 41 of the Agreement, accession is open to the Governments of all States upon such conditions, as the International Sugar Council considers appropriate. Under Article 25(4) of the Agreement, in the event of the accession of a Member after the entry into force of this Agreement, when the acceding Member is not listed in the annex of the Agreement, the International Sugar Council shall decide the number of votes to be allocated to that Member. Following the acceptance by the acceding Member of the number of votes allocated by the International Sugar Council, the votes of existing Members shall be re‑calculated so that the total of votes remains at 2000. The votes to be allocated to the Kingdom of Saudi Arabia, based on the current distribution of votes, would amount to 31. Once the Kingdom of Saudi Arabia will become a member of the Agreement, the votes allocated to the European Union in accordance with Article 25 of the ISA will be reduced. Consequently, the financial contribution of the European Union would be reduced accordingly for the future financial years in which Kingdom of Saudi Arabia is a member of the Agreement.

3.Position to be taken on the Union's behalf

The Union has always been an active member of the ISO and supported the expansion of the organisation.

Even though the Kingdom of Saudi Arabia is not a sugar producer, it is a quite important actor at world level due to its important sugar imports over the years and an important trade partner of the EU in the area of agricultural and food products, including sugar.