Opinion of the Economic and Social Committee on: the 'Proposal for a Council Directive amending Directives 69/169/EEC and 92/12/EEC as regards temporary quantitative restrictions on beer imports into Finland', and the 'Proposal for a Council Regulation amending Regulation (EEC) No 918/83 as regards a temporary derogation for duty-free imports of beer into Finland'
Date: 2000-05-24
Institutions: European Economic and Social Committee
Subjects: Finland, beer, excise duty, import restriction, third country

18.7.2000

EN

Official Journal of the European Communities

C 204/3

Opinion of the Economic and Social Committee on:

— the ‘Proposal for a Council Directive amending Directives 69/169/EEC and 92/12/EEC as

regards temporary quantitative restrictions on beer imports into Finland’, and

— the ‘Proposal for a Council Regulation amending Regulation (EEC) No 918/83 as regards a

temporary derogation for duty-free imports of beer into Finland’

(2000/C 204/02)

On 10 March 2000 the Council decided to consult the Economic and Social Committee, under Article 93
of the Treaty establishing the European Community, on the above-mentioned proposals.

The Section for the Single Market, Production and Consumption, which was responsible for preparing
the Committee’s work on the subject, adopted its opinion on 3 May 2000. The rapporteur was
Mr Wilkinson.

At its 373rd plenary session (meeting of 24 May 2000), the Economic and Social Committee adopted the
following opinion by 89 votes to one, with two abstentions.

1.

Introduction

2. Comments

1.1.
Under the terms of its Treaty of Accession to the
European Union, Finland was authorised to restrict the quan-
tities of alcoholic beverages and tobacco that could be
imported from other Member States without payment of
Finnish excise duty; for beer this limit was set at 15 litres per
person. At the same time Finland increased its allowance for
beer imports from third countries to 15 litres. This derogation
was granted until the end of 1996, later extended to the end
of 2003. When this extension was agreed, Finland was asked
to remove progressively the restriction, although no timetable
was set.

1.2.
Finland has now asked for a restriction on beer imports
from third countries of 6 litres per person, to last until
1 January 2006. The request is based on increased fiscal,
economic, social, health and public order problems caused by
imports from Russia and Estonia.

2.1.
The Committee regrets that the Finnish government
has found it necessary to seek a further derogation concerning
beer imports from non-EU Member States. It notes that while
this request concerns only trade with third countries, and only
beer, it further restricts the choices of the Finnish consumer. It
also notes that any easing of restrictions on beer imports
within the Single Market would, under current rules, have to
be matched by lesser restrictions in trade with third countries.

2.2.
It is clear that the root cause of the difficulties faced by
Finland is the difference between consumer prices for beer in
Finland and in their neighbours, Russia and, to a lesser extent,
Estonia. Differing standards of living also affect price. There
are also very significant differences in beer prices (and the
consumer prices for other alcoholic beverages) between Fin-
land and most EU Member States. These differences are caused
almost entirely by the excise duty rates.

The Commission has therefore made proposals for a
1.3.
Council Directive concerning the quantitative limits on beer
imports, to amend Directives 69/169/EEC and 92/12/EEC, and
for a Council Regulation concerning the customs aspects, to
amend Council Regulation (EEC) No 918/83.

2.3.
Details of excise rates on beer are in the Appendix,
from which, for example, it will be noted that currently the
rate for beer in Finland is about 17 times the rate applied in
Spain (that applies the lowest rate) or 44 % more than Ireland
(that applies the second highest rate).

1.4.
Imports from third countries are governed by Directive
69/169/EEC. This allows tax paid goods to be brought into
the EU up to a value of 175 euro without the payment of any
further taxes. This equates to more than 200 litres of beer at
Russian or Estonian tax paid prices, but less than 50 litres of
beer at Finnish consumer prices. The result has been that it is
now estimated that about 10 % of the Finnish retail market for
beer is supplied from Russia and Estonia.

It is also clear that the Finnish authorities asked for the
2.4.
derogation (on accession) on the amount of alcoholic bever-
ages that may be taken into Finland from other EU Member
States without payment of Finnish excise duties because of the
need to align their duty rates with the lower rates generally
applied elsewhere in the Union and to align their alcohol
policy.

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Official Journal of the European Communities

18.7.2000

2.5.
In the 5 years since joining the EU somewhat more
liberal alcohol policies have been introduced, but they have
In 1998 there was a
made only one reduction in rates.
reduction of 20 % in the excise duty rate for wine, but only for
wine sold in State shops. Further, although almost half way
through the extended derogation period agreed, they have not
started the process of progressive removal of restrictions on
intra EU purchases as required. Finnish consumers continue to
be unable to benefit fully from the Single Market because of
this exemption from one of its fundamental principles.

2.6.
It is recognised that it is for the Finnish Government
to set its own excise rates, but the Committee hopes that the
need for any further requests for derogations will be avoided
by tackling the problems caused by the extremely high excise
duty rates. It notes that Finnish producers and traders have
recently asked for such action.

2.7.
The Committee recognises and regrets the situation
that is causing increased social problems, particularly as they
affect employment in Finland’s border regions. It hopes that
this limited derogation will allow time for the causes of their
difficulties to be resolved.

The proposed Regulation will help by clarifying the

2.9.
legal situation and is supported.

3. Conclusions

Derogations set most unwelcome precedents that
3.1.
might be followed by others. Of most concern is the message
about derogations that it will send to the Candidate Countries
for EU accession. However, the Committee accepts that in
the circumstances the Commission’s proposals should be
supported.

3.2.
The Committee is pleased to note that the proposals
include a clear timetable to meet the Finnish obligation for the
removal of the current derogation on the quantities of beer
allowed into Finland from other Member States.

3.3.
It reminds the Finnish authorities of the obligation also
to relax these restrictions on other competing categories of
alcoholic drinks, where the excise rates are also high.

2.8.
The question of health problems is best dealt with by
education, since all the evidence is that high tax rates do not
deter heavy drinkers; rather, they penalise the great majority
of consumers who drink sensibly.

3.4.
It welcomes the confirmation that the derogation from
Internal Market rules, as they affect duty and tax paid purchases
of alcoholic drinks from other Member States, will cease at the
end of 2003.

Brussels, 24 May 2000.

The President

of the Economic and Social Committee

Beatrice RANGONI MACHIAVELLI

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C 204/5

APPENDIX

to the Opinion of the Economic and Social Committee

Excise duty rates on beer

The following rates are applied on beer as at 1 April 2000. They are shown in euro per 100 litres of pure alcohol on
beer at a strength of 5 % alcohol by volume.

EU Member States

Austria

Belgium

Denmark

Finland

France

Germany

Greece

Ireland

Italy

Luxembourg

Netherlands

Portugal

Spain

Sweden

United Kingdom

Other Countries

Estonia

Russia

363

428

930

2 859

259

197

292

1 987

350

198

426

281

168

1 681

1 830

351

52