Proposal for a REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL amending Council Regulation (EC) No 55/2008 introducing autonomous trade preferences for the Republic of Moldova
Date: 2010-11-10
Institutions: European Commission
Subjects: Moldova, agricultural product, generalised preferences

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EUROPEAN COMMISSION 

Brussels, 10.11.2010 
COM(2010) 649 final 

2010/0318 (COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

amending Council Regulation (EC) No 55/2008 introducing autonomous trade 
preferences for the Republic of Moldova 

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EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

The  Republic  of  Moldova  (hereinafter  "Moldova")  is  experiencing  difficulties  with  its  wine 
exports  to  some  of  its  traditional  markets,  which  threaten  its  economic  recovery  and  the 
reform process that is vigorously pursued by the Moldovan government. 

This has led Moldova to request the European Commission in July 2010 to increase the duty 
free  tariff  quota  for  wine  under  the  Autonomous  Trade  Preferences,  granted  to  Moldova  by 
Council  Regulation  (EC)  55/2008  of  21  January  20081.  The  agricultural  sector  represents 
around  40  per  cent  of  Moldova's  economy  and  the  wine  sector  is  an  important  part  of  it, 
providing employment to some 300,000 people (one fourth of the working population), who 
are mainly living in rural areas and cultivating medium to smaller family plots. 

In order to support Moldova's economic recovery and provide a positive outlook to the people 
working in the wine industry in Moldova, it is proposed to increase the duty free tariff quota 
for  wine  for  2011  from  100,000  hectolitres  (hl)  to  150,000  hl,  for  2012  from  120,000  hl  to 
180,000 hl, and from 2013 onwards to 240,000 hl per year. The level of the proposed increase 
is  based  on  the  fact  that  Moldova  has  systematically  exhausted  the  existing  quota  and  the 
potential of the sector to improve its niche markets in the EU, while at the same time the level 
of the increase does not destabilise the EU wine industry. It is expected that Moldova's wine 
sector will continue to improve the quality of its wines.  

As Council Regulation (EC) No 55/2008 expires on 31 December 2012, and as it is important 
to ensure legal certainty for producers, exporters and importers, it is proposed to extend the 
validity of Council Regulation (EC) No 55/2008 for another three years to 31 December 2015. 
This is a reasonable amount of time, taking into account the perspectives for a future deep and 
comprehensive  free trade  area  (DCFTA) between the EU  and  Moldova. Council Regulation 
(EC) No 55/2008 foresees preferential tariff quotas also on other products in addition to wine. 
Having assessed the situation in the different sectors covered by the quotas, it is proposed to 
continue  the  progressive  increase  of  some  of  those  other  quotas  for  the  levels  indicated  in 
table 1 annexed to this proposal. 

2. 

LEGAL BASIS OF THE PROPOSAL 

The  legal  basis  for  the  proposal  is  Article  207(2)  of  the  Treaty  on  the  Functioning  of  the 
European Union. 

3. 

BUDGETARY IMPLICATIONS 

The proposed Regulation does not incur costs charged to the EU budget. As the general level 
of  imports  from  Moldova  is  merely  0.04%  of  all  EU  imports  further  market  opening  is  not 
expected  to  create  negative  effects  for  the  EU.  Currently  around  90%  of  all  imports  from 
Moldova enter the EU free of duties.  

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OJ L 20, 24.1.2008, p. 1. 

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The  additional  duty  free  tariff  quotas  proposed  for  the  years  2011  to  2015  will  result  in  a 
small loss of tariff revenue only for the year 2011. For the years 2012 to 2015 there will not 
be any loss of tariff revenue since present export volumes from Moldova of all the products 
covered by duty free tariff quotas are covered by the 2012 level of these quotas. Hypothetical 
revenue that could have been generated by future exports is not considered as a loss of tariff 
revenue. 

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2010/0318 (COD) 

Proposal for a 

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

amending Council Regulation (EC) No 55/2008 introducing autonomous trade 
preferences for the Republic of Moldova 

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 207(2) thereof, 

Having regard to the proposal from the European Commission, 

After transmission of the draft legislative act to the national Parliaments, 

Acting in accordance with the ordinary legislative procedure, 

Whereas: 

(1) 

(2) 

Council  Regulation  (EC)  No  55/20082  entered  into  force  on  31  January  2008  and  is 
being  applied  as  of  1  March  2008.  That  Regulation  introduces  a  specific  scheme  of 
autonomous  trade  preferences  (ATPs)  to  the  Republic  of  Moldova  (hereinafter 
'Moldova').  It  gives  all  products  originating  in  Moldova  free  access  to  the  European 
Union market, except for certain agricultural products listed in its Annex I for which 
limited  concessions  have  been  given  either  in  the  form  of  exemption  from  customs 
duties within the limit of tariff quotas or of reduction of customs duties.  

In  the  framework  of  the  European  Neighbourhood  Policy  (ENP),  the  EU-Moldova 
ENP  Action  Plan,  and  the  Eastern  Partnership,  Moldova  has  adopted  an  ambitious 
agenda  for  political  association  and  further  economic  integration  with  the  Union. 
Negotiations  on  a  new  Association  Agreement  started  in  January  2010.  Moldova  is 
also making strong progress on regulatory approximation leading to convergence with 
Union  laws  and  standards  in  preparation  of  future  negotiations  of  a  deep  and 
comprehensive  free  trade  area  (DCFTA)  between  the  EU  and  Moldova,  in  the 
framework of the future Association Agreement. 

(3) 

Every year since the application of Regulation (EC) No 55/2008, the tariff quota for 
wine was fully used months before the end of the year.  

(4)  Moldova's economy is strongly affected by the adverse effects of the global financial 
and economic crises. The wine sector employs some 300,000 workers, and exports of 
wine are an important source of export earnings. 

2 

OJ L 20, 24.1.2008, p. 1. 

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(5) 

In  order  to  support  the  efforts  of  Moldova  in  line  with  the  ENP  and  the  Eastern 
Partnership, and to provide an attractive and reliable market for its wine exports it is 
proposed to increase the existing tariff quota for wine for the year 2011 from 100,000 
hl3 to 150,000 hl, for the year 2012 from 120,000 hl to 180,000 hl, and from the year 
2013 onwards to 240,000 hl per year. 

(6) 

Regulation (EC) No 55/2008 is applicable until 31 December 2012. 

(7) 

(8) 

(9) 

Negotiations  on  a  future  DCFTA  between  the  Union  and  Moldova  are  a  common 
objective  for  the  Union  and  Moldova,  once  Moldova  has  demonstrated  its 
preparedness to negotiate and sustain the effects of such an ambitious undertaking. In 
order  to  allow  enough  time  for  appropriate  preparations  and  the  negotiation  of  a 
DCFTA, it is necessary to extend Regulation (EC) No 55/2008 beyond 31 December 
2012. 

It is sound practice to decide on the renewal of Regulation (EC) No 55/2008 well in 
advance of its end date, so as to provide Moldovan economic operators in good time 
with a transparent and predictable trading regime for their exports to the Union beyond 
31 December 2012. The validity of that Regulation should therefore now be extended 
until 31 December 2015. 

In the  light of  the  experience  gained under the present ATP scheme, and  in  order to 
support further the development of Moldova's economy and the process of regulatory 
approximation leading to convergence with Union laws and standards in the context of 
the  Eastern  Partnership,  it  is  appropriate  to review  the  level  of  tariff  quotas  of  some 
products covered by the present ATPs. 

(10) 

In order to ensure the respect of the Union's international obligations, the preferences 
contained in this Regulation should be made conditional on continuation or renewal of 
the existing waiver from WTO obligations obtained by the Union. 

(11)  Regulation (EC) No 55/2008 should therefore be amended accordingly, 

HAVE ADOPTED THIS REGULATION: 

Regulation (EC) No 55/2008 is amended as follows: 

Article 1 

1. 

In Article 16, the second subparagraph is replaced by the following:  

"It shall apply until 31 December 2015.  

The preferences provided for in this Regulation shall cease to apply, in whole or in 
part, should the preferences provided in this Regulation not be permitted in whole or 
in part by a waiver granted by the World Trade Organisation.  

Such cessation of effects shall apply from the day on which the waiver is no longer 
in effect.  

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Hectolitres. 

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Sufficiently prior to that date, the Commission shall publish a notice in the Official 
Journal  of  the  European  Union  to  inform  operators  and  the  competent  authorities. 
The  notice  shall  specify  which  preferences  provided  for  by  this  Regulation  will  no 
longer apply and the date from which the preferences will no longer apply." 

2. 

Table 1 of Annex I is replaced by the text appearing in the Annex to this Regulation. 

This Regulation shall enter into force on the seventh day following that of its publication in 
the Official Journal of the European Union. 

Article 2 

This Regulation shall be binding in its entirety and directly applicable in all Member States. 

Done at […], 

For the European Parliament 
The President 

For the Council 
The President 

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ANNEX 

"ANNEX I 

PRODUCTS SUBMITTED TO QUANTITATIVE LIMITS OR PRICE THRESHOLDS REFERRED TO IN ARTICLE 3 

Notwithstanding the rules for the interpretation of the Combined Nomenclature, the wording for the description of the products is to be considered as 
having no more than an indicative value, the preferential scheme being determined, within the context of this Annex, by the coverage of the CN codes. 
Where  ex  CN  codes  are  indicated,  the  preferential  scheme  is  to  be  determined  by  application  of  the  CN  code  and  corresponding  description  taken 
together. 

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1. Products subject to annual duty free tariff quotas  

Order 
No 

09.0504 

CN Code 

Description 

2008 (1) 

2009 (1) 

2010 (1) 

2011 (1) 

2012 (1) 

2013 (1) 

2014 (1) 

2015 (1) 

0201 to 
0204 

Fresh, chilled and frozen meat of bovine animals, swine and sheep and 
goats 

3 000 (2) 

3 000 (2) 

4 000 (2) 

4 000 (2) 

4 000 (2) 

4 000 (2) 

4 000 (2) 

4 000 (2) 

09.0505 

ex 0207 

Meat and edible offal of the poultry of heading 0105, fresh, chilled or 
frozen, other than fatty livers of subheading 0207 34 

09.0506 

ex 0210 

Meat and edible meat offal of swine and bovine animals, salted, in brine, 
dried or smoked; edible flours and meals of meat or meat offals of 
domestic swine and bovine animals 

400 (2) 

400 (2) 

500 (2) 

500 (2) 

500 (2) 

500 (2) 

500 (2) 

500 (2) 

400 (2) 

400 (2) 

500 (2) 

500 (2) 

500 (2) 

500 (2) 

500 (2) 

500 (2) 

09.4210 

0401 to 
0406 

Dairy products 

09.0507 

0407.00 

Birds' eggs, in shell 

09.0508 

ex 0408 

09.0509 

1001 90 91  

1001 90 99 

Bird's eggs, not in shell and egg yolks, other than unfit for human 
consumption 

1 000 (2) 

1 000 (2) 

1 500 (2) 

1 500 (2) 

1 500 (2) 

1 500 (2) 

1 500 (2) 

1 500 (2) 

90 (3) 

95 (3) 

100 (3) 

110 (3) 

120 (3) 

120 (3) 

120 (3) 

120 (3) 

200 (2) 

200 (2) 

300 (2) 

300 (2) 

300 (2) 

300 (2) 

300 (2) 

300 (2) 

Other Spelt (other than spelt for sowing), common wheat and meslin 

25 000 (2) 

30 000 (2) 

35 000 (2) 

40 000 (2) 

50 000 (2) 

55 000 (2) 

60 000 (2) 

65 000 (2) 

09.0510 

1003 00 90 

Barley 

09.0511 

1005 90 

Maize 

20 000 (2) 
15 000 (2) 

25 000 (2) 
20 000 (2) 

30 000 (2) 
25 000 (2) 

35 000 (2) 
30 000 (2) 

45 000 (2) 
40 000 (2) 

50 000 (2) 
45 000 (2) 

55 000 (2) 
50 000 (2) 

60 000 (2) 
55 000 (2) 

1601 00 91  

and 
1601 00 99 

ex 1602 

09.0512 

Sausages and similar products, of meat, meat offal or blood; food 
preparations based on these products 

500 (2) 

500 (2) 

600 (2) 

600 (2) 

600 (2) 

600 (2) 

600 (2) 

600 (2) 

Other prepared or preserved meat, meat offal or blood: 
- of fowls of the species Gallus domesticus, uncooked, 
- of domestic swine, 
- of bovine animals, uncooked 

09.0513 

1701.99.10  White Sugar 

15 000 (2) 

18 000 (2) 

22 000 (2) 

26 000 (2) 

34 000 (2) 

34 000 (2) 

34 000 (2) 

34 000 (2) 

09.0514 

2204 21 and
2204 29 

Wine of fresh grapes other than sparkling wine 

60 000 (4) 

70 000 (4) 

80 000 (4) 

150 000 
(4) 

180 000 
(4) 

240 000 
(4) 

240 000 
(4) 

240 000 
(4) 

(1) From 1 January until 31 December, except for 2008 from the first day of application of the Regulation until 31 December. (2) tonnes (net weight), (3) million units, (4) hectolitres" 

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LEGISLATIVE FINANCIAL STATEMENT FOR PROPOSALS HAVING A BUDGETARY 
IMPACT EXCLUSIVELY LIMITED TO THE REVENUE SIDE 

1. 

NAME OF THE PROPOSAL: 

Regulation of the European Parliament and of the Council amending Council Regulation (EC) 
No 55/2008 introducing autonomous trade preferences for the Republic of Moldova. 

2. 

BUDGET LINES: 

Chapter and Article: Article 120 

Amount budgeted for the year concerned: 14 079 700 000 (Draft general budget 2011) 

3. 

FINANCIAL IMPACT  

(cid:133) 

(cid:59) 

Proposal has no financial implications 

Proposal has no financial impact on expenditure but has a financial impact on revenue – 
the effect is as follows: 

(€ million to one decimal place)  

Budget line 

Revenue4 

12 month period, 
starting dd/mm/aaaa

2011 

Article 120 

Impact  on  own  resources 
(customs duties) 

-0.1 

Situation following action 

2012 

2013 

2014 

2015 

Article 120 

- 

- 

- 

- 

4 

Regarding traditional own resources (agricultural duties, sugar levies, customs duties) the amounts indicated must 
be net amounts, i.e. gross amounts after deduction of 25 % of collection costs. 

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4. 

OTHER REMARKS 

In  2008  the  financial  implications  in  terms  of  loss  of  tariff  revenue  of  granting  Moldova 
additional  autonomous  trade  preferences  were  estimated  to  amount  to  a  gross  amount  of 
approximately € 1.500.000 (net amount 1.125.000).  

The additional duty free tariff quotas proposed for the years 2011 to 2015 will result in a loss 
of tariff revenue only for the year 2011. For the years 2012 to 2015 there will not be any loss 
of tariff revenue since present export volumes from Moldova  of all  the products  covered by 
duty free tariff quotas are covered by the 2012 level of these quotas. Hypothetical revenue that 
could have been generated by future exports is not considered as a loss of tariff revenue. 

Total wine imports from Moldova in 2009 amounted to 111,082hl, which exceeds the present 
duty  free  tariff  quota  for  2011  by  11,082  hl,  resulting  in  a  potential  loss  of  tariff  revenue, 
based on an average duty of €13.1 per hl, of under € 150,000. 

11,082 hl * 13.1 €/hl = 145 174 € (108 881 € net on revenue). 

The present duty free tariff quota for 2012 of 120,000 hl fully covers the present export level 
and will therefore not result in a loss of tariff revenue in 2012 and beyond. 

Total  imports  of  wheat  from  Moldova  in  2009  amounted  to  38,232  tonnes,  which  is  fully 
within the present duty free tariff quota for 2012 of 50,000 tonnes, and therefore not resulting 
in loss of tariff revenue.  

In  the  year  2009  the  duty  free  tariff  quotas  for  barley  and  maize  had  an  unused  balance  of 
respectively  16.8  and  11.9  per  cent,  and  remain  therefore  fully  within  the  present  duty  free 
tariff quotas established for 2012, therefore also not resulting in any loss of tariff revenue. 

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