Opinion of the European Economic and Social Committee on the Proposal for a Council Regulation on the common organisation of the market in wine and amending certain Regulations COM(2007) 372 final — 2007/0138 (CNS)
Date: 2007-12-12
Institutions: European Economic and Social Committee
Subjects: EU aid, common organisation of markets, designation of origin, labelling, marketing, mode of production, reform of the CAP, viticulture, wine

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Official Journal of the European Union

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Opinion of the European Economic and Social Committee on the ‘Proposal for a Council Regulation
on the common organisation of the market in wine and amending certain Regulations’

COM(2007) 372 final — 2007/0138 (CNS)

(2008/C 120/10)

On 7 September 2007, the Council decided to consult the European Economic and Social Committee,
under Articles 36 and 37 of the Treaty establishing the European Community, on the

Proposal
Regulations.

for a Council Regulation on the common organisation of

the market

in wine and amending certain

The Section for Agriculture, Rural Development and the Environment, which was responsible for preparing
the Committee's work on the subject, adopted its opinion on 27 November 2007. The rapporteur was
Mr Kienle.

At its 440th plenary session, held on 12 and 13 December 2007 (meeting of 12 December), the European
Economic and Social Committee adopted the following opinion by 109 votes to five with 12 abstentions.

1. Summary of EESC conclusions and recommendations

that have a positive impact on the incomes of wine-growers and
job opportunities in Europe's wine-growing sector.

1.1
The European Economic and Social Committee (EESC)
welcomes the Commission's recommendation in its proposal on
reform of the European market organisation in wine to maintain
a specific market organisation for wine. The Committee would
have liked the European Commission to take on board more of
the
in its opinion of
14 December 2006 on the Communication from the Commission
to the Council and the European Parliament — Towards a sustainable
European wine sector (1).

recommendations

elaborated

it

1.2
The EESC repeats its point that the main aim of the
reform must be to improve the competitiveness of European
wines and win back market shares. As far as the reform and
external trade provisions are concerned, the Commission should
take more account of the fact that Europe's wine sector leads
the global market.

1.3
The EESC notes that wine and wine-growing are impor-
tant and integral aspects of Europe's culture and way of life.
Wine-growing shapes the social and economic environment of
many European wine-growing regions. The Committee therefore
believes it
that both the objectives and the
measures of the reform should reflect not just the economic
effects, but also the consequences for employment, social struc-
tures and the environment — in particular through grubbing-up
programmes — as well as consumer protection and health. The
European Commission's proposal falls short in this regard.

is important

1.4
The EESC would point out that wine-growing provides a
livelihood for 1.5 million mainly small, family-run businesses in
the European Union and at least seasonal employment for over
2.5 million workers. The Committee is therefore particularly
concerned that the reform should give preference to measures

1.5
The EESC considers the European Commission's proposal
to provide the wine-producing Member States with an individual
national budget envelope as an important fillip to subsidiarity
and consideration of regional differences. However, the list of
support instruments must be extended if the objectives of the
reform are to be achieved.

the proposals

The EESC regards

1.6
submitted by the
European Commission on consumer information measures as
inadequate. It welcomes the proposals for promotion in export
markets, but believes this idea should be extended to include the
internal market.

2. Proposals of the Commission

The European Commission is proposing reform of the

2.1
market organisation for wine mainly in the following areas:

— support measures within a national budget envelope to
restructure and convert vineyards,
fodder crops, mutual
funds, harvest insurance and promotion of wine on third
markets;

— financial transfer to rural development;

— changing wine-making provisions, especially as

regards
oenological practices, increasing alcohol strength, and acidi-
fication;

— changing labelling requirements, in particular for the indica-
tion of provenance and origin, as well as adaptation of other
labelling requirements;

(1) OJ C 325, 30.12.2006, p. 29.

— producer and inter-branch organisations;

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— relaxation of planting rules from 2013;

— voluntary grubbing-up programme;

— dismantling of current market mechanisms;

— transfer of powers from the Council of Ministers to the

European Commission.

the negative effects of one-off grubbing-up measures (e.g. fallow
land surrounded by vineyards) and ensure systematic implemen-
tation.

3.9
The EESC reiterates its objection to complete liberalisa-
tion of planting rules, as this would jeopardise the economic,
social, environmental and landscape maintenance objectives of
wine market reform.

3. General comments

4. Specific comments

the
3.1
The EESC broadly endorses
European Commission proposal. However,
it considers that
certain adjustments and improvements are needed in the case of
the measures recommended.

the objectives of

3.2
The EESC reiterates its call for the competitiveness of
European wine producers in the internal market and export
markets to be improved, for Europe as a business location to be
strengthened, for quality measures to be supported and for there
to be more focus on market developments and consumer prefer-
ences. The Commission does not take enough account of these
issues in its current proposal.

is important

The EESC also thinks it

to make the
3.3
economic objectives specific and to supplement
them with
social and employment policy objectives. These would include
improving the income of wine-producing holdings, making it
easier for young wine-growers to develop their businesses, and
providing sustainable employment opportunities and appro-
priate remuneration for permanent and seasonal workers.

3.4
The EESC still has reservations about transferring powers
from the Council of Ministers to the Commission, e.g. in rela-
tion to authorisation of more recent wine-making practices,
since the Commission has not adequately defended the interests
of European wine producers when negotiating bilateral agree-
ments.

3.5
The EESC re-affirms its view that current funding must
be increased to take account of the accession to the EU of two
new wine-producing countries.

3.6
The EESC again calls for improved and more comprehen-
sive market monitoring, so that better data on production, trade
and consumption are available as the basis for organisation of
the wine market. The general data used hitherto are important,
but inadequate. It is also necessary to provide updated informa-
tion on changes in production structures, distribution channels
and consumer behaviour.

4.1 Title II: support measures; Chapter 1: support programmes

4.1.1
The EESC welcomes the fact that its views have basi-
cally been taken on board in so far as the proposals provide for
more account to be taken of regional differences and more
consistent implementation of subsidiarity in the wine sector
envelopes.
through the
However, it regards the support measures provided for as inade-
quate.

introduction of national budget

The EESC agrees with the European Commission that a
4.1.2
more consistent and more appropriate Community framework
should be maintained. Within that framework, it should fall to
the Member States to select measures for their wine-producing
regions. Producer organisations, sectoral associations, regulatory
bodies and other organisations with equivalent objectives should
play an important role here.

4.1.3
The EESC would like to see a comprehensive list of
measures that reflect the goals of the market organisation. It
refers to its previous opinions on reform of
the CMO in
wine (2),
in which it already called among other things for
programmes
to promote product quality in wine-growing,
cellaring, marketing and consumer information, measures to
support disadvantaged areas, and the possibility of direct area
payments.

for coherent,

The EESC reiterates its call

4.1.4
integrated
measures with a view to maximising efficiency. Such measures
should be incorporated into comprehensive plants for the entire
production chain,
from wine-growing to processing and
marketing of
the product. This also includes measures to
develop alternative market outlets for all grape products.

4.1.5
The EESC once again urges that a special programme
be introduced to promote disadvantaged wine-growing areas,
to
such as steep and sloping vineyards, and areas subject
extreme climate conditions.

3.7
The EESC agrees with the Commission's view that the
new market organisation in wine should come into effect as
soon as possible. However, it considers a ‘phasing-out period’ to
be necessary so that businesses can adapt to the new framework
gradually if required.

The EESC is pleased that the European Commission has
3.8
modified its proposal for a grubbing-up programme. However,
it would make sense for these measures to be carried out under
regional or national structural programmes, in order to avoid

The EESC welcomes the fact that the EU Commission
4.1.6
has placed considerable
emphasis on export promotion
measures within the national budget envelope. Measures are also
needed to inform consumers in the internal market about wine-
growing and in particular about the advantages of moderate
wine consumption and the dangers of alcohol abuse. It reiterates
its call for support to be given to setting up a European market
monitoring system.

(2) OJ C 101, 12.4.1999, pp. 60-64 and document cited in footnote 1.

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4.1.7
The Committee does not regard immediate abolition of
intervention measures as feasible. It therefore recommends that
aids should be provided within the national envelopes during
the 2008-2010 ‘phasing-out period’ for distillation to produce
potable alcohol and for private storage support.

with OIV standards and lead to further distortions in competi-
tion. The EESC is also against the proposal to allow for wine
exports oenological practices that are banned on the internal
market.

the national

The Committee believes that

financial
4.1.8
envelopes should include crisis management measures based on
shared responsibility among wine-producers. Existing measures
(harvest
funds) are not adequate for
managing economic crises. This makes it necessary to consider
whether existing emergency distilling arrangements are effective
and whether an emergency distillation system could be provided
for within the national financial envelopes.

insurance and mutual

The prevailing ban on overpressing of grapes, grape
4.1.9
mash and wine lees has proved an effective way of ensuring the
quality of wine products and preventing abuse, and should
therefore be retained. Member States should be authorised to
raise the percentage of production for distillation during certain
years.

4.1.10
The EESC notes the European Commission's elabora-
tion of a proposal for allocating the budget for the national
financial envelopes. Special financial provisions should be set
out for the new Member States, for which no background infor-
mation is available, according to the amount of land planted
with vines.

4.2 Chapter 2: Financial transfer

4.2.1
In various opinions the Committee has emphasised the
importance of the second pillar for the future development of
rural areas, to which the European wine-producing areas also
belong. But even taking account of
this fundamental broad
objective, the EESC considers that, with a view to resolving the
specific problems of the wine sector, all the measures discussed
in connection with the reform of the wine market should be
financed from the wine budget. This budget must therefore not
be reduced, either through cuts or transfers of funding.

4.3 Title III: regulatory measures; Chapter 2: Oenological practices

and restrictions

The EESC believes that

to
4.3.1
establish an internationally recognised definition of ‘wine’. This
would also make it necessary to lay down recognised production
methods.
It should be made clear that ‘fruit wines’ are not
covered by the wine market organisation.

is absolutely essential

it

4.3.2
The EESC believes that measures to bring wine-making
practices into line with OIV standards should be incorporated
more consistently into the strategic thrust of bilateral or interna-
tional trade agreements. The authorisation of any practice for
imported wines that is approved elsewhere in the world would
conflict with the proposed closer alignment of European wines

4.3.3
The EESC recommends that a catalogue of authorised
oenological practices should be attached as an appendix to this
directive and that the Council should retain its powers to update
these practices and authorise new ones.

4.3.4
The EESC is pleased that the European Commission
has distanced itself from the proposal to authorise the produc-
tion in Europe of wine made from imported grape must or
must concentrate and the proposal to authorise the blending of
EU products with products from other countries.

The EESC calls on the Commission to take account in
4.3.5
the varying location,
its proposals for production rules of
climate and weather conditions in the European Union. It notes
that this issue is very sensitive and must not lead to rifts within
the European wine sector or even a boycott of
the reform
proposals. The EESC, however, supports the demand for tighter
control of oenological practices in order to enhance and guar-
antee the quality of wines.

its assessment of

The EESC therefore bases

the
4.3.6
Commission's proposals on its previous opinion, the analyses
set out by the Commission, the proposed liberalisation of wine
production methods, recognition of wine production processes
in bilateral agreements, and on the objectives of the reform,
especially increasing competitiveness and reducing production
costs. After weighing up the pros and cons of the Commission's
proposals, the EESC advocates a general continuation of the
existing rules governing the use of sucrose and aid for must
concentrate.

4.4 Chapter III: Designations of origin and geographical indications

The EESC welcomes

4.4.1
the European Commission's
elaboration of detailed proposals on labelling wines according
to their provenance. It shares the Commission's view that the
concept of quality wines in the Community is based inter alia
on the specific characteristics attributable to the wine's geogra-
phical origin. Protecting the designation of origin and geogra-
phical indications is a high priority. For this reason the use of a
designation of origin or geographical
indication should be
conditional on production within the delineated geographical
areas.

it

that

the fact

The EESC welcomes

4.4.2
the European
Commission has now explained and elaborated its proposals
such that
is possible to maintain tried-and-tested quality
policy systems that are not, or not solely, based on the principle
of designations of origin. Quality wine testing in particular has
proved effective in many countries for producers and in particu-
lar consumers.

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4.4.3 Many questions nevertheless
remain regarding the
compatibility with Commission Regulation (EC) No 753/2002
of 29 April 2002 laying down certain rules for applying
Council Regulation (EC) No 1493/1999 as regards the descrip-
tion, designation, presentation and protection of certain wine
sector products (3). The EESC therefore calls for an equivalency
table to be presented from which the impact on geographical
and traditional designations can be ascertained.

4.5 Chapter IV: Labelling

The EESC regards

in
4.5.1
respect of
labelling as highly complex, and it expects the
Commission to carry out an accurate simulation of the impact
of the proposed changes.

the Commission's proposals

The EESC draws attention to the fact that, following a
4.5.2
debate lasting a number of years,
labelling law has been
amended only very recently. It therefore calls upon the Commis-
sion to explain what new factors now come into play that were
not assessed in the debate which has just come to an end.

4.5.3
The EESC welcomes moves to simplify labelling provi-
sions, provided that they promote improved consumer informa-
tion. Such changes must not, however,
increase the risk of
distorting competition or misleading consumers, resulting in a
flood of legal disputes. The proposal by the European Commis-
sion for the grape variety and vintage year to be optionally indi-
cated for wines without a designation of origin or geographical
indication should also be regarded as questionable from this
perspective. This proposal can only be endorsed if a control and
certification system is provided for to ensure the traceability of
such wines so as to protect consumers and prevent misinforma-
tion and unfair competition.

4.5.4
The EESC draws attention to the growing linguistic
diversity in an ever larger European Union. This linguistic diver-
sity may give rise to trade barriers, as is currently the case with
regard to the indication of sulphite use. It should therefore be
possible to give mandatory information on labels, e.g. ingredi-
ents, using readily comprehensible symbols.

4.6 Title V: Production potential

as an instrument of market organisation which is to be offered
as part of the regional or national structural programmes for
limited periods of three to five years within the overall Com-
munity framework. Grubbing-up should be offered as a volun-
tary measure for removing vines from land that is not suitable
for viticulture and as a cushion against the social effects of with-
drawal from production of businesses that are not viable.

The EESC is pleased that the Commission has changed
4.6.2
its original deadlines for liberalising planting rules. However, the
EESC is still against full liberalisation — even at a later point —
since this would jeopardise the economic, social, environmental
the wine-market
and landscape maintenance objectives of
reform. It is not acceptable to shift wine production from cultu-
rally valuable man-made wine-growing landscapes to areas that
are cheaper to cultivate, owing to general responsibility for
employment, the economy and infrastructure of wine-growing
regions, the social fabric, the environment and nature conserva-
tion.

4.6.3
If the EU planting regulation, together with a ban on
new planting, is to be abolished, an enabling framework should
be created to make it possible for wine-growing regions to
continue applying or develop their planting rules in accordance
with the objectives of the European wine market organisation.

4.7 New title: promotion and information

4.7.1
The EESC believes that the Commission proposals fall
short of what is needed in order to win back market shares
from wines from third countries, especially the New World.

The EESC calls on the Commission to provide, within
4.7.2
the national budget envelopes,
for promotion of consumer
information and sales promotion measures not just in export
markets, but also within the internal market. With this aim in
mind, particular attention must be paid to providing compre-
hensive information on the benefits of moderate wine consump-
tion as an integral part of a healthy diet and a modern lifestyle.

4.7.3
tional measures should include all products made from grapes.

The EESC stresses that any information and promo-

4.6.1
The EESC welcome the fact that the Commission has
modified its proposals on grubbing-up rules and reduced the
budget envisaged. It recognises the importance of grubbing-up

4.7.4
The EESC recommends that communication measures
for wine products be linked to tourism, gastronomic activities
and other products in wine-growing regions.

Brussels, 12 December 2007.

The President

of the European Economic and Social Committee

Dimitris DIMITRIADIS

(3) OJ L 118, 4.5.2002, pp. 1-54.

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APPENDIX

to the Committee Opinion

The following amendments were rejected by the assembly, but were supported by more than a quarter of the votes cast:

Point 4.3.6

Replace the final sentence with the following:

‘After weighing up the pros and cons of the Commission's proposals, the EESC advocates a general continuation of the existing
rules governing the use of sucrose and aid for must concentrate.considers that the possibility of using sucrose may be continued, in
conformity with the law and traditions, for those countries that make use of this practice. However, in order to guarantee equal
treatment of EU wine producers, aid for rectified must concentrate will have to be maintained and brought into line with the new
market conditions relating to lower sugar prices. This aid, which is necessary if substantial parity of cost is to be maintained,
must not affect the national envelopes, but constitute a separate heading in the wine budget.’

Reason

The reform of the CMO in sugar, which is already in effect, together with the comprehensive reform of the CMO in wine,
entail a radical change in the structure of production costs for wine; if there is a real desire to retain the ‘status quo ante’
and to respect the principle of not distorting competition — given that sugar and must are effectively competing products
in wine enrichment processes — then adjustment of aid for must concentrate, and its budget status separate from the
national envelopes must both be ensured.

Voting

For: 25 Against: 54 Abstentions: 8

Point 4.3.7

Add the following new point:

‘4.3.-
7Given
that the use of sucrose to enrich wines means adding a product not obtained from grape-processing, and in keeping with its offi-
cial concern for transparent labelling and consumer protection, the EESC considers that the practice should be indicated on the
labels of wines enriched by means of this method.’

Reason

It is the fundamental and non-negotiable duty of the EESC to uphold at all times maximum transparency of information
for users of goods and foodstuffs.

Voting

For: 30 Against: 70 Abstentions: 21