WRITTEN QUESTION E-1980/99

by Markus Ferber (PPE-DE) to the Commission

(5 November 1999)

Subject: Polish tariffs on yoghurt imported from the EU

Polish tariffs have been progressively phased out as part of the Europe Agreement. The tariffs on fruit yoghurts gave fallen from 35 % in 1995 to 30 % (1996), 25 % (1997), 20 % (1998) to the current level of 9-12 %. In April 1999 the Polish authorities abolished the 9 % preferential tariff for fruit yoghurt with a fat content greater than 3,5 %, since when the GATT tariff of 35 % has applied.

On 24 August 1999 Poland announced application of the safeguard clause for all fruit yoghurt imported from the EU under the Europe Agreement. Mr Plewa, Polish Deputy Minister, announced, firstly, application of the clause for a period of two years; secondly, an EU import quota (16 000 t for 2000 and 17 000 t for 2001); and, thirdly, application of the preferential tariff for imports under the quota and a 29 % tariff on imports not covered by the quota.

These measures have an extremely distorting effect on the market and they prevent fair competition between EU producers and Polish producers.

In general the economic climate is no advantage to EU yoghurt producers. The export refund which has been the subject of considerable criticism from Poland amounts to 14 % of the price ex frontier, while the tariff is 12 %. Consequently, the price of untreated milk is 30-40 % below that of German milk.

1. What is the Commission's attitude to the foregoing?

2. What action will the Commission take to stop firms with registered offices in the European Union being placed at a disadvantage?

Answer given by Mr Verheugen on behalf of the Commission

(8 December 1999)

The Polish Government informed the Commission in a note verbale dated 24 March 1999 that it was invoking a safeguard clause in respect of the importation of flavoured yoghurt from the Community falling within headings 0403 10 (flavoured or containing added fruit, nuts or cocoa) and 0403 10 93 0 (other yoghurt containing between 3 % and 6 % of milk fat). The Community's preferential tariff for these products was 9 %; this was raised to 35 %.

The Polish Government justifies the measure on the grounds of the massive increase in imports of flavoured yoghurts from the Community in 1998. Total imports of such products rose from 552 tonnes in 1996, to 4 601 tonnes in 1997 and 30 900 tonnes in 1998. In the first half of 1999, imports of flavoured yoghurt from the Community reached 39 000 tonnes (January to May 1999). In 1998 Community yoghurt accounted for 25 % of the total Polish domestic market for all types of yoghurt. Poland also points out that in addition to introducing an import duty of 9 % in 1999 for yoghurt of these headings under Protocol 3, the Community increased the export refund for this category of products.

The Commission immediately objected to Poland's use of Article 30 of the Europe Agreement between the Community and its Member States and Poland as justification for applying a safeguard clause, and replied with a note verbale of 27 May 1999, after the position had been discussed in the Agriculture and Fisheries Sub-Committee on 13 and 14 April 1999.

Pursuant to the third sub-paragraph of Article 33(2), both sides agreed to hold technical consultation meetings to set a timetable for removing the safeguard measures as soon as circumstances allowed. Following the third technical consultation meeting on 24 August 1999, the Polish side notified the Commission of an amendment to the safeguard measures.

Poland has given assurances that these are temporary measures, for two years only, and that a quota will be opened for the community on the basis of average exports from 1996 to 1998 (16 000 tonnes in the first year, 17 000 tonnes in the second year), to which the duty provided for in Protocol 3 shall apply. The immediate application of a duty of 29 % on Community exports in 1999 and on imports above the quota in 2000 and 2001 is equivalent to most-favoured-nation status, compared with the 100 % applied to other third countries.

The Commission has noted the new measures, applicable from 17 September 1999, and reserves the right to ask Poland to suspend the measures depending on how the Polish market develops.