ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(73)327
Vol.1973/0052

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C0KMISSION 0?THE EURO PEAS COMMUNITIES
V
COM(73)327 final
Brussels ,2March 1973
Proposal fora
■REGULATION "(ESC )OFTHECOUNCIL
concerning theimportation ofwine exported as"Cyprus sherry ",
originating inandcoming from Cyprus,' andtheintroduction of
subsidies forsimilar wines produced intheCommunity asori- .
ginally constituted andshipped toIreland andtheUnited
Kingdom "
(submitted totheCouncil bytheCommission )
COM(73)327final

COM(73 )327final
' 1 ' ■
EXPLANATORY IEI'IORAIT JDUM ■
TheAssociation Agreement with Cyprus makes provision forspecial import
treatment tobeaccorded over agiven period towine exported as"Cyprus
sherry ".This wine constitutes asubstantial proportion ofCypriot exports
andthemarketing ofitisavital element intheCypriot economy .This
special treatment .,which isthesubject ofanexchange ofletters annexed to
theadditional Protocol totheAgreement ,wasaccorded "because ofthe
Community "sconcern toavoid disruption oftraditional exports toIreland
andtheUnited Kingdom when thereference price system becomes applicable
inthenewMember States on1February 1973 •Ifthereference price were
immediately applied tothis wine ,itwould probably mean itsexclusion from
theBritish market onwhich competing products ofbetter quality areavailable .
However ,toavoid perpetuating anarrangement which would inthelong run
prejudice thecommon organi zationofthemarket ,notably because ofthe
precedent that adefinitive special arrangement would inevitably create ,
Cyprus must adopt provisions which will allow arrangements applicable to
<5
"Cyprus sherry "tobealigned asquickly aspossible onthearrangement s
generally applicable under theCommunity "swine regulations .
This iswhy the special interim import treatment isbeing accorded on'
condition that Cyprus will ,during theperiod specified ,introduce andgradually
implement legislation onwine production which will correspond toexisting
Community legislation inthis field .
TheCommunity isalso concerned that there should benodisruption ,during the
period inwhich "Cyprus sherry "enjoys special treatment ,ofnormal trade
patterns anddeliveries tothe British and Irish markets ofsimilar
Community wines .Forthis reason the special treatment has "been restricted
(andthis restriction hasbeen incorporated intheexchange ofletters )to
thelevel ofimports inprevious years (200000hectolitres ).TheCommission
also proposes theadoption ofprovisions which would permit ofsimilar
Community wines being marketed inthecountries concerned onthe same
competitive basis as"Cyprus sherry'' .

-2- COMC73 )32?final
Ifthelegislation to "be .enacted byCyprus before 1September 1973 isfound
tobeinconformity with Community legislation ,-itwill benecessary ,ifthe
agreement embodied intheabovementioned exchange ofletters istobe
respected ,toextend thevalidity ofthe special treatment sothat itcan
beapplied tothe 1974 harvest .
■
Inconclusion ,thepurpose oftheattached proposal istogive force tothe
provisions oftheAgreement between theCommunity andCyprus asthese emerge
from the exchange ofletters referred toabove andtoprovide forthe
possibility ofsubsidies being made available for shipments toIreland and
theUnited Kingdom ofCommunity wines which aresimilar to"Cyprus sherry ".

COMC73)327final
COST
1.Ashasbeenindicatedabove,application ofthereferencepricesystem
wouldmeanthat,pursuanttoArticle9(3)ofRegulation(ESC)No816/70,a
■*countervailing charge,amountinginthisinstancetoabout50u.a./hl,would
havetobeleviedon"Cyprussherry",thusvirtuallyexcludingitfromBritish
andIrishmarkets.Non-application tothiswineofthecountervailing
charge-an"agricultural levy"withinthemeaningofArticle2(a)ofthe
Decisionof21April1970onthereplacement offinancialcontributions from
MemberStatesbytheCommunities'ownresources–wouldhavelittleorno
effectontotalreceiptsfromapplication ofthecountervailing chargesystem
towines.
i
2.ThecostofthesubsidiesforCommunitywineswhicharesimilarto
"Cyprussherry"willlargelydependonthelistreferredtoinArticle4
oftheProposal.ThiswillbedrawnupbytheCommissionfollowing
consultation withtheManagement Committee.Judgingbytheestimatesput
forwardbynationalexpertsatmeetingsoftheCouncil'sadhocWorkingParty
onCyprus,thequantitiesofwineaffectedcouldbeintheregionof800hi.
GiventhepricedifferencereferredtoinArticle3oftheProposal,
expenditure overtheperiodofapplication oftheproposedRegulation
(viz.1February1973to31December1973)wouldbeoftheorderof25000u.a.
Arrangements forfinancingthisexpenditure fromCommunitysourceswillbe
detailedinafurtherproposaltobesubmittedinduecourse.

COM(73 )327-E final
' t '
Proposal fora
■REGULATION (EEC )OFTHECOLWCIL
concerning theimportation ofwine exported as"Cyprus sherry ", .
originating inandcoming from Cyprus ,andtheintroduction of
subsidies for similar wines produced inthe Community as
originally constituted andshipped toIreland andthe
United Kingdom
TIESCOUNCIL OFTHEEUROPEAN COMMUNITIES ,
Having regard totheTreaty establishing theEuropean Economic Community ,and
inparticular Article 43thereof ; "
Having regard tothe proposal from the Commission ;
Having regard totheOpinion oftheEuropean Parliament ;
Whereas theexchange ofletters referred toinArticle 12oftheProtocol ^^
laying down certain provisions with regard totheAgreement establishing sin
association "between theEuropean Economic Community andtheRepublic of
Cyprus following theaccession ofnewMember States totheCommunity ,signed
atBrussels on19December 1972 ,makes provision forspecial interim
treatment ofwine exported as"Cyprus sherry ";whereas this treatment involves
thenon-application ,under certain conditions ,ofcountervailing charges
toimports ofthis wine into theCommunity ,uptoamaximum annual quota
of200000hectolitres ;
Whereas theprimary aim ofthis arrangement wastoavoid asudden disruption
oftraditional exports ofthis wine toIreland andtheUnited Kingdom
following enlargement oftheCommunity ;whereas ,inthemedium term ,this
arrangement wasdesigned ,ontheonehand ,toallow Cyprus tointroduce
legislation onvine production which would ensure that thewine inquestion
^0JNo

COM(73)327-2 finai
would Leproduced under conditions .corresponding tothose required by
Community regulations forsimilar Community products and ,ontheother ,
toallow theCommunity toexamine theclassification ofthewine in
question irith aview toreaching adecision onthedefinitive import
treatment to "beaccorded toit;whereas theGovernment ofCyprus has
undertaken tointroduce thelegislation specified above notlater than
1September 1973 ?-
Whereas ,inthese circumstances ,imports ofthewine inquestion should ,
until 31October 1973 ,beexempt from thecountervailing charge provided
forinthefirst subparagraph ofArticle 9(3)ofCouncil Regulation
(ESC)!TO816/70-'' laying down additional provisions forthecommon
organization ofthemarket inwine ,aslast amended byRegulation (EEC)
Eo2680/72^^;whereas thisperiod should belongenough toallow the
Community toestablish whether ornotthe legislation enacted byCyprus .
pursuant totheexchange ofletters isinconformity with Community
legislation and ,ifitis,toextend theimport treatment provided for
inthis Regulation sothat itcanbeapplied tothe1974 harvest ,duefor *
marketing inthefirst half of 1975 1
Whereas Ireland andtheUnited Kingdom aretheonly Member States which
aretraditional importers ofthis wine andwhereas annual consumption on
these twomarkets isintheregion of200000hi;
Whereas thefigure tobetaken into consideration must berelated tothe
period during which the special import treatment will apply ,viz .1February 1973
to31December 1973 ;whereas afigure of185000hiwould therefore be
appropriate ,this figure toinclude imports already effected on Nthebasis
ofCommission Regulation (EEC)Eo /73^"oninterim measures
fortheimportation into theCommunity ofwine exported as"Cyprus sherry "
originating inandcoming from Cyprus :
ν
^OJSoL99,5Kay1970 ,p.1.
^'0JEb.L289,21December 1972 ,p.
^'0JEoL•A

-3- COM(73)327-Efinal
VJhereasexemptionfromthecountervailing chargeforwineexported ,as
"Cyprussherry"shouldnothavetheeffectoffacilitating importscfthat
wineintoIrelandandtheUnitedKingdomattheexpenseofsimilarwinesproduced
intheCommunityasoriginallyconstituted ;whereas,inviewofthe
differencebetweenthepricesofthesesimilarwinesintheCommunityand
theimportpriceof"Cyprussherry",someoftheseCommunitywinescould
"beoustedfromthemarketsofthesetwonewMemberStatesby"Cyprus
sherry";whereas,toensurethatthisexceptional treatmentdoesnothave
k
theeifect01interfering withconditionsofcompetition betweenwine
exportedas"Cyprussherry"andsimilarwinesproducedintheCommunity
asoriginallyconstituted onthemarketsofthesetwonewMemberStates,
provisionshouldbemadeforthepaymentofasubsidyonshipmentsof
theselatterwinestothesetwonewMemberStates,thissubsidybeingbased
onthedifference onthemarketsoftheseStatesbetweenthepricesof
thesewinesanathepriceof"Cyprussherry";whereasthissubsidyshould
berestrictedtoshipmentstoIrelandandtheUnitedKingdomsince,given
consumerpreferences andtheincidenceoftariffsbetweenthenewMember
Sts.tesandbetweentheseStatesandtheCommunityasoriginallyconstituted ,
itcanbeforeseenthatwineimportedfromCypruswillinfactbeconsumed
inIrelandandtheUnitedKingdom;
VJhereasthesesubsidieswillbenecessaryforaslongastheexceptional
measuresfor"Cyprussherry"apply;
HASADOPTEDTHISREGULATION :
Article 1
Thecountervailing chargeprovidedforinthefirstsubparagraph of
Article9(3)ofRegulation(EEC)Bo816/70shallnotbeleviedonimports
ofwineexportedas"Cyprussherry"originatinginandcomingfromCyprus
uptoamaximumof185000hectolitres.Thisfigureincludesquantities

-4- COM(73)327-3final
1
alrec.cyimportedfreeofcountervailing chargepursuanttoRegulation
Uc)So/73.
Article2
1.Themaximumof185000hifixedinArticle1shall "bedividedintotwo
quotas,oneof1400hiforIrelandandoneof183600hiforthe
UnitedKingdom, .'
2.liieseKeniberStatesshallguaranteeimportersofthisproductestablished
ontheirterritoryfreeaccesstothequotasallocated.
3«TheextenttowhichthequotasoftheMemberStateshave"beenusedupshall
beassessedonthebe.sisofimportsoftheproductinquestionundercover
ofdeclarations thatithasbeenreleasedforconsumption .
4.TheseMemberStatesshallinformtheCommissionatregularintervalsof
importsfromCyprusactuallysetoffagainsttheirquotas.
Article3
1.Subsidiesshallbegrantedinrespectofshipmentseffectedfrom
1February1973toIrelandandtheUnitedKingdomofwinesproducedinthe
Communityasoriginallyconstituted whicharesimilartothewineexported
as"Cyprussherry".
2.Thesubsidiesreferredtoinparagraph 1shallbecalculated onthe
basisofthedifference ,onthemarketsoftheMemberStatesreferredtoin
paragraph 1,betweenthepricesoftheseCommunitywinesandthepriceof
wineexportedas"Cyprussherry".

-5- COK(73)327-Efinal
Article4
DetailedrulesfortheapplicationofthisRegulation,includingtheamount
ThetreatmentprovidedforinthisRegulationshallapplyuntil31October1973.
Howeverif,before1September1973,Cyprusenactslegislation onwine
production whichisinconformitywithCommunityrulesapplicabletoproducts
similartotheproductspecifiedinArticle 1,theCouncil,actingin
accordancewiththevotingprocedurelaiddowninArticle43(2)oftheTreaty
onaproposalfromtheCommission ,shalltakeallnecessarystepstoensurethat
thistreatmentisextendedinaccordancewiththetermsoftheexchangeof
lettersannexedtotheProtocollayingdowncertainprovisionswithregardto
theAgreementestablishing anAssociation betweentheEuropeanEconomic
CommunityanatheRepublicofCyprusfollowingtheaccessionofnewMember
StatestotheCommunity,signedatBrusselson19December1972.ofthesubsidyandthelistofCommunitywineseligibleforit,shallbe
adoptedinaccordancewiththeprocedurelaiddowninArticle7of
Regulation!To24^ontheprogressiveestablishmentofacommonorganization
ofthemarketinwine. > '■
Article5
Article6
ThisRegulationshallenterintoforceonthethirddayfollowingits
publication intheOfficialJournaloftheEuropeanCommunities .
ThisRegulationshallbebindinginitsentiretyanddirectlyapplicable
inallMemberStates.
BoneatBrussels 19FortheCouncil
^OJKo30,20April1962,p.989/62ThePresident