Proposal for a COUNCIL DECISION on EU accession to the International Cotton Advisory Committee (ICAC)
Date: 2016-11-15
Institutions: Directorate-General for International Cooperation and Development, European Commission
Subjects: commodities market, cotton, international market, international organisation, primary product, textile industry

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   EUROPEAN COMMISSION  Brussels, 15.11.2016  COM(2016) 712 final 2016/0349 (NLE)   Proposal for a COUNCIL DECISION on EU accession to the International Cotton Advisory Committee (ICAC)  
 
EXPLANATORY MEMORANDUM 

1.  

CONTEXT OF THE PROPOSAL 

The International Cotton Advisory Committee (ICAC) is the International Commodity Body 
(ICB)  for  cotton.  Its  mission  is  to  assist  governments  in  fostering  a  healthy  world  cotton 
economy. It does this by ensuring transparency on the world cotton market, by serving as a 
clearinghouse  for  technical  information  on  cotton  production  and  a  forum  for  discussion  of 
cotton  issues  of  international  significance.  ICAC  acts  as  a  statistical  observer  and  brings 
together producing, consuming, and trading countries and all segments of the cotton industry. 
It has an overall facilitating role. It is not engaged in cotton price setting or determination. 
To date, the ICAC is one of the few ICBs1 where the European Union (EU) is not a member, 
whereas nine Member States have  been  members of the ICAC in  their own right  (Belgium, 
Germany,  Greece,  Finland,  France,  Italy,  Netherlands,  Poland  and  Spain).  Membership  of 
ICAC  is  in  the  interest  of  the  Union,  owing  to  the  significance  of  cotton  to  the  Union's 
economy. The EU is a producer of cotton and has evolved from a net cotton importer  (until 
2008)  to  a  net  cotton  exporter  as  of  2009.  The  EU  textiles  and  clothing  industry  is  an 
important  user  of  cotton  cloth.  Moreover,  cotton  is  an  important  area  for  European 
development cooperation, the EU remaining a main donor to the African cotton sector. 

On various occasions (namely in its conclusions of 2004 (ref. 8972/04), 2008 (ref. 9986/08) 
and  2010  (ref.  9648/10)),  the  Council  of  the  European  Union  has  requested  the  European 
Commission to consider EU membership of ICAC. It authorised the Commission in 2013 to 
negotiate,  on  behalf  of  the  European  Union  and  on  the  basis  of  negotiating  directives,  the 
accession of the Union to ICAC (Council Decision 13406/13, 16 Sept. 2013). In view of the 
accession  of  the  Union  to  ICAC,  all  the  Member  States  have  notified  ICAC  of  their 
withdrawal  from  membership  in  line  with  Article  II,  section  3  of  the  ICAC's  rules  and 
regulations2. 

2. 

LEGAL BASIS 

As trade issues  represent  the most  important part of ICAC's tasks, the legal basis should  be 
Article 207 TFEU.  

3. 

RESULTS  OF  STAKEHOLDERS  CONSULTATIONS  AND 
ASSESSMENTS 

IMPACT 

Taking into account the present situation, the Commission considers that membership to the 
ICAC would be desirable as it would: 

– 

– 

allow  the  EU  to  express  its  views  on  cotton  with  a  single  voice  and  paying  one 
contribution in the appropriate ICB, taking into account the views of the EU Member 
States, 

provide the EU access to information on cotton issues, in order to follow the cotton 
market and influence the cotton agenda, 

1 
EU is member of the International (I) Coffee Organisation (O), I. Cocoa O., I. Tropical Timber O., I. 
Sugar O., I. Olive Oil Council (C), I. Grains C., I. Rubber Study Group (SG), I. Lead and Zinc SG, I. Nickel SG, 
I. Non-Ferrous Metals SG.   
2 

See ICAC official website: https://www.icac.org/about-International-Cotton-Advisory-Committee/rules  

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– 

facilitate  linkages  and  partnerships  between  the  EU  private  sector  (cotton  and 
textiles),  cotton  producers  and  consumers  (from  the  EU  and  from  developing 
countries), and public authorities. 

The ICAC Secretariat is in favour of EU membership as it will increase the importance and 
international status of ICAC as an ICB. It has definitely asserted that EU has no liability at all 
in any current or future financial arrears of any members. 

4. 

BUDGETARY IMPLICATION 

ICAC membership is based on the payment of an annual contribution. It is  calculated on an 
annual basis as a function of the number of ICAC's members (fixed part) and the volume of 
raw  cotton  traded  by  each  member  (variable  part).  A  first  contribution  of  maximum  EUR 
400 000 would be required, which will give the EU an appropriate influence in ICAC affairs 
and allow broad EU involvement in ICAC's activities. 

5. 

OTHER ELEMENTS: implementation plans 

The  Union  will  ensure  that  all  the  benefits  of  its  accession  shall  be  shared  with  the  Union 
Member  States.  Membership  of  subcommittees  and  working  groups  will  be  open  to 
representatives from Member States as part of the Union delegation, taking into account the 
importance of all the cotton value chain including production and consumption in regions of 
the  Union  where  it  is  important  for  the  agricultural  and  industrial  economy  and  the  trade 
business. Especially in the Private Sector Advisory Panel (PSAP) the European Commission 
representative will be accompanied by alternates and observers as per MS requests according 
to Article VI Section 3 a (1) of the ICAC Rules and Regulations. 

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2016/0349 (NLE) 

Proposal for a 

COUNCIL DECISION 

on EU accession to the International Cotton Advisory Committee (ICAC) 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  on  the  Functioning  of  the  European  Union,  and  in  particular 
Article 207 (3) and (4), in conjunction with Article 218 (6) thereof, 

Having regard to the proposal from the European Commission, 
Having regard to the consent of the European Parliament3, 

Whereas: 

(1) 

(2) 

(3) 

The  European  Union  (EU)  is  not  a  member  of  the  International  Cotton  Advisory 
Committee,  while  it  is  already  a  member  of  a  number  of  International  Commodity 
Bodies. 

On 27 April 2004, 27 May 2008, 10 May 2010, the Council, in its Conclusions on the 
EU  Action  Plan  on  agricultural  commodity  chains,  dependency  and  poverty,  on  the 
EU-Africa Partnership in support of cotton sector development and on enhancing the 
EU  action  in  the  area  of  commodities,  respectively,  invited  the  Commission  to 
consider EU membership of the International Cotton Advisory Committee. 

On 16 September 2013, the Council authorised the Commission to negotiate, on behalf 
of  the  European  Union,  the  accession  of  the  Union  to  the  ICAC  in  accordance  with 
Article II, Sections 1 and 2 of its Rules and Regulations4, stating that membership of 
ICAC is in the interest of the Union, owing to the significance of cotton to the Union's 
economy; the EU is a producer of cotton and has evolved from a net cotton importer 
(until 2008) to a net cotton exporter as of 2009. The EU textiles and clothing industry 
is  an  important  user  of  cotton  cloth.  Moreover,  cotton  is  an  important  area  for 
European  development  cooperation,  the  EU  remaining  a  main  donor  to  the  African 
cotton sector.  

(4) 

(5) 

The  Union  will  pay  a  contribution  in  line  with  Article  II  Section  2  a.(2)  (c)  of  the 
ICAC Rules and Regulations. The EU cannot be held liable for any current or future 
financial arrears of any members in the ICAC. 
The Protocol 4 on Cotton of the Act of the Hellenic Republic accession to the Union5 
should continue to be taken into account after the Union's accession to ICAC. 

3 
OJ C , , p. . 
4 
Rules and regulations of the International Cotton Advisory Committee  as adopted by the 31st Plenary 
Meeting,  16  June  1972,  with  amendments  by  the  74th  Plenary  Meeting,  11  December2015.  See  ICAC  official 
website: https://www.icac.org/about-International-Cotton-Advisory-Committee/rules 
5 

Official Journal of the EU, L 291, 19/11/1979 

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HAS ADOPTED THIS DECISION: 

Article 1 

The  accession  of  the  European  Union  to  the  International  Cotton  Advisory  Committee  is 
hereby approved on behalf of the Union.  

The  President  of  the  Council  shall  designate  the  person  empowered  to  communicate,  on 
behalf  of  the  European  Union,  the  present  Decision  to  the  International  Cotton  Advisory 
Committee.  

Article 2 

Article 3 

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

Done at Brussels, 

For the Council 
The President 

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