Proposal for a COUNCIL DECISION on the position to be taken on behalf of the European Union in the International Sugar Council concerning the accession of the United Kingdom to the International Sugar Agreement, 1992
Date: 2020-10-30
Institutions: Directorate-General for Agriculture and Rural Development, European Commission
Subjects: United Kingdom, accession to an agreement, commodity agreement, international organisation, sugar

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   EUROPEAN COMMISSION  Brussels, 30.10.2020  COM(2020) 671 final 2020/0303 (NLE)  Proposal for a COUNCIL DECISION on the position to be taken on behalf of the European Union in the International Sugar Council concerning the accession of the United Kingdom to the International Sugar Agreement, 1992  
 
EXPLANATORY MEMORANDUM 

1. 

SUBJECT MATTER OF THE PROPOSAL 

This proposal concerns the decision establishing the position to be taken on the Union's behalf 
in  the  International  Sugar  Council  (‘ISC’)  in  connection  with  the  accession  of  the  United 
Kingdom to the International Sugar Agreement, 1992. 

2. 

CONTEXT OF THE PROPOSAL 

The International Sugar Agreement, 1992 

2.1. 
The International Sugar Agreement, 19921 (‘the Agreement’) aims to enhanced international 
cooperation in connection with world sugar matters and related issues, to provide a forum for 
intergovernmental consultations on sugar and on ways to improve the world sugar economy, 
to facilitate the trade by collecting and providing information on the world sugar market and 
other  sweeteners  and 
increased  demand  for  sugar,  particularly  for 
non‑ traditional uses. 
The Agreement entered into force on 1st January 1993.  
The Union is a party to the Agreement2. 

to  encourage 

2.2. 

The International Sugar Organization 

The International Sugar Organization (‘ISO’) which administers the Agreement is a London-
based intergovernmental organisation that seeks to meet the objectives laid down by Article 1 
of the Agreement. 

These  objectives  are  sought  by  improving  market  transparency  through  the  collection  and 
publication  of  statistical  information  and  studies  on  world  production,  prices,  exports  and 
imports, consumption and stocks of sugar. 

Currently, the ISO has 87 members, including many of the world’s largest sugar producers as 
well as importers. Besides the Union, its members are, among others, Brazil, India, Thailand, 
Australia, the Russian Federation and Cuba. The last country joining the ISO was Sri Lanka, 
who became member on 6 August 2013. The 87 members of the ISO have a total number of 
2,000 votes.  

For  budgetary  procedures  (see  Article  25  of  the  Agreement),  i.e.  for  fixing  the  annual 
financial contributions of members, the Union has 538 votes in 20203. The number of votes 
are  determined  according  to  Article  25  and  adjusted  annually  on  the  basis  of  the  change  in 
Members’ share in the total of all Members’ composite tonnage bases from that for the same 
membership  for  the  previous  year.  The  composite  tonnage  is  calculated  as  35%  of  that 
Member’s exports to the free market plus 15% of that Member’s total exports under special 
arrangements  plus  35%  of  that  Member’s  free  market  imports  plus  15%  of  that  Member’s 
total  imports  under  special  arrangements.  The  data  used  to  calculate  the  composite  tonnage 
basis of each Member is, for each category above, the average of that category for the highest 
three  of  the  four  last  years  published  in  the  most  recent  edition  of  the  organisation's  Sugar 
Year Book.  

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3 

International Sugar Agreement 1992 (OJ L 379, 23.12.1992, p. 16). 
Council Decision 92/580/EEC of 13 November 1992 on the signing and conclusion of the International 
Sugar Agreement 1992 (OJ L 379, 23.12.1992, p. 15). 
The International Sugar Organization operates on a financial year basis, which runs from 1 January to 
31 December. 

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For  decision  making,  the  voting  rights  are  distributed  under  Article  11  of  the  International 
Sugar Agreement, which takes into account the redistribution of the votes of the Members that 
have  their  voting  right  suspended  due  to  the  non-payment  of  their  contribution  to  the 
administrative  budget.  According  to  the  latest  distribution  of  votes  under  Article  11,  the 
European Union has 697 votes.  

At the meetings of the ISO the Union is represented by the Commission by virtue of Article 
17 TEU. Member States can attend the ISO meetings, in particular the Council Sessions. 

The envisaged act of the International Sugar Council (ISC) 

2.3. 
On  2nd  October  2020,  the  United  Kingdom4  has  formally  applied  for  accession  to  the 
Agreement. On 9 October 2020 the Secretariat of the ISO has informed its Members about the 
application of the United Kingdom. The United Kingdom applies for membership in the ISO 
as  from  1  January  2021,  i.e.  after  the  expiration  of  the  transition  period  following  the 
withdrawal of the United Kingdom from the European Union. 

Pursuant to Article 8 of the Agreement, the ISC performs or arranges for the performance of 
all functions as are necessary to carry out the provisions of the Agreement. 

According to Article 41 of the Agreement, accession is open to the Governments of all States 
upon  such  conditions,  as  the  ISC  considers  appropriate.  Under  Article  25(4)  of  the 
Agreement,  in  the  event  of  the  accession  of  a  Member  after  the  entry  into  force  of  this 
Agreement, when the acceding Member is not listed in the annex of the Agreement, the ISC 
shall decide the number of votes to be allocated to that Member. Following the acceptance by 
the  acceding  Member  of  the  number  of  votes  allocated  by  the  ISC,  the  votes  of  existing 
Members shall be re‑ calculated so that the total of votes remains at 2000. The votes allocated 
to the United Kingdom, based on the current distribution of votes, would amount to 55 votes 
and be deducted from the votes allocated to the European Union in accordance with Article 25 
of the ISA. Consequently, the financial contribution of the European Union would be reduced 
accordingly for financial year 2021. 

There  was  no  formal  discussion  about  the  application  of  the  United  Kingdom  in  the  ISO 
Administrative  Committee  or  in  the  ISC  meetings  before  the  notification  dated  9  October 
20205  published  by  the  Secretariat  of  the  ISO  secretariat  concerning  the  letter,  dated  2nd 
October  2020  of  the  Government  of  the  United  Kingdom  of  Great  Britain  and  Northern 
Ireland. During the 57th session of the ISC on 27 November 2020, the ISC will establish the 
conditions for accession of the United Kingdom of Great Britain and Northern Ireland in line 
with Article 41 of the Agreement.  

The Withdrawal Agreement 

In accordance with Article 129(2) of the withdrawal of the United Kingdom of Great Britain 
and  Northern  Ireland  from  the  European  Union  and  the  European  Atomic  Energy 
Community6  (‘the  Withdrawal  Agreement’),  during  the  transition  period  the  Union  will 
continue representing the United Kingdom in the work of any bodies set up by international 
agreements concluded by the Union. The United Kingdom should refrain during the transition 
period  from  any  action  or  initiative  that  is  likely  to  be  prejudicial  to  the  Union's  interests. 
However, as laid down by Article 129(4) of the Withdrawal Agreement, the United Kingdom 
may negotiate, sign and ratify international agreements entered into in its own capacity in the 

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By the letter of the Parliamentary Undersecretary of State for Department for Food, Environment and 
Rural Affairs. 
Memo (20)68. 
Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the 
European Union and the European Atomic Energy Community. 

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areas  of  exclusive  competence  of  the  Union,  provided  those  agreements  do  not  enter  into 
force or apply during the transition period. 

3. 

POSITION TO BE TAKEN ON THE UNION'S BEHALF 

The  International  Sugar  Agreement,  1992  was  concluded  by  the  Union  by  Council 
Decision 92/580/EEC7 until 31 December 1995. On each occasion, the Agreement is extended 
for a maximum period of two years in accordance with Article 45(2) of the Agreement. On 19 
July  2019  the  ISC  took  the  decision  to  extend  the  ISA  for  two  years,  until  31  December 
20218.  

The Union has always been an active member of the ISO and supported the expansion of the 
organisation.  

The United Kingdom is an important producer of agricultural products, including sugar which 
is  the  main  crop  covered  by  the  ISO.  While  being  a  Member  of  the  Union  the  United 
Kingdom had significant trade of sugar and sugar containing products with Member States. 

During the transition period following the withdrawal of the United Kingdom from the Union, 
the United Kingdom continues to be bound by the Union’s international agreements and the 
Union continues to represent the United Kingdom at the ISO.  

In  accordance  with  Article  26(1)  of  the  Agreement,  the  annual  financial  contributions  of 
Members become due on the first day of the financial year while contributions of Members in 
respect of the year in which they join the ISO become due on the date on which they become 
Members.  The  Union  therefore  pays  its  annual  contributions  to  the  ISO  at  the  beginning  of 
January for the entire financial year concerned, which starts in January and ends in December. 
The Union’s contribution for 2020 was paid from the 2020 Union budget, to which the United 
Kingdom  also  contributes.  Consequently,  in  respect  of  the  entire  2020  financial  year,  the 
Union’s contribution to the ISO also covers the United Kingdom. With the United Kingdom’s 
accession on 1st January 2021, the Union’s contribution to the ISO in respect of 2021 financial 
year will no longer cover the United Kingdom. 

The purpose of this proposal is to establish the Union’s position in the ISO on the accession of 
the  United  Kingdom  to  the  Agreement  as  of  1  January  2021.  Given  that  the  accession 
procedure  pursuant  to  the  Agreement  provisions  is  subject  to  a  decision  by  the  ISC,  the 
Union’s  position  will  be  established  on  the  basis  of  Article  218(9)  of  the  Treaty  on  the 
Functioning of the European Union (TFEU).  

4. 

LEGAL BASIS 

4.1. 

Procedural legal basis 

4.1.1.  Principles 

Article 218(9) of the Treaty on the Functioning of the European Union (TFEU) provides for 
decisions establishing ‘the positions to be adopted on the Union’s behalf in a body set up by 
an  agreement,  when  that  body  is  called  upon  to  adopt  acts  having  legal  effects,  with  the 
exception of acts supplementing or amending the institutional framework of the agreement.’ 

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OJ L 379, 23.12.1992, p. 15. 
Proposal  for  a  Council  Decision  on  the  position  to  be  taken  on  behalf  of  the  European  Union  in  the 
International Sugar Council with respect to the extension of the International Sugar Agreement, 1992 - 
COM(2019) 286 final - approved by the Council in its General Affairs meeting on 25 September 2017. 

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The concept of ‘acts having legal effects’ includes acts that have legal effects by virtue of the 
rules of international law governing the body in question.  

4.1.2.  Application to the present case 

The envisaged act of the ISC has the effect of expanding the membership of the International 
Sugar  Agreement,  1992.  The  envisaged  act  of  the  ISC  has  legal  effects  because  it  will 
establish the conditions of such accession, notably because it will affect the decisional balance 
within  the  ISC,  whose  decisions  are  taken  and  recommendations  are  made,  in  principle,  by 
consensus. ln the absence of consensus, decisions and recommendations are made by simple 
majority  vote,  unless  this  Agreement  provides  for  a  special  vote9,  and  are  binding  for  its 
Members, as expressed in Article 13 of the Agreement. The respective financial contributions 
of the Members will also be affected by the expanding of the membership of the International 
Sugar Agreement, 1992. The Union position will therefore need to be established. 

The  envisaged  act  does  not  supplement  or  amend  the  institutional  framework  of  the 
Agreement. 

Therefore, the procedural legal basis for the proposed decision is Article 218(9) TFEU. 

4.2. 

Substantive legal basis 

4.2.1.  Principles 

The  substantive  legal  basis  for  a  decision  under  Article  218(9)  TFEU  depends  primarily  on 
the objective and content of the envisaged act in respect of which a position is taken on the 
Union's  behalf.  If  the envisaged act  pursues  two  aims  or  has  two  components  and  if  one  of 
those  aims  or  components  is  identifiable  as  the  main  one,  whereas  the  other  is  merely 
incidental, the decision under Article 218(9) TFEU must be founded on a single substantive 
legal basis, namely that required by the main or predominant aim or component. 

4.2.2.  Application to the present case 

The main objective and content of the envisaged act relate to trade in agricultural products.  

Therefore, the substantive legal basis of the proposed decision is first subparagraph of Article 
207(4) TFEU. 

4.3. 

Conclusion 

The legal basis of the proposed decision should be Article 207(4), first subparagraph TFEU, 
in conjunction with Article 218(9) TFEU. 

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Article 2(4) of the Agreement defines special vote as a vote requiring at least two thirds of the votes 
cast by Members present and voting, on condition that these votes are cast by at least two thirds of the 
number of Members present and voting. 

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2020/0303 (NLE) 

Proposal for a 

COUNCIL DECISION 

on the position to be taken on behalf of the European Union in the International Sugar 
Council concerning the accession of the United Kingdom to the International Sugar 
Agreement, 1992 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty on the Functioning of the European Union, and in particular the 
first subparagraph of Article 207(4), in conjunction with Article 218(9) thereof, 

Having regard to the proposal from the European Commission, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

1 

2 

The  International  Sugar  Agreement,  1992  (‘the  Agreement’)  was  concluded  by  the 
Union by means of Council Decision 92/580/EEC1 and entered into force on 1 January 
1993. The Agreement was initially concluded for a period of three years. 

Pursuant  to  Article  45(2)  of  the  Agreement,  the  International  Sugar  Council  may 
extend  the  Agreement  for  successive  periods  not  exceeding  two  years  on  each 
occasion. Since its conclusion, the Agreement has regularly been extended for further 
periods  of  two  years.  The  Agreement  was  last  extended  by  Decision  of  the 
International Sugar Council on 10 July 20192 and remains in force until 31 December 
2021. 

Pursuant to Article 41 of the Agreement, it is open for accession by the Governments 
of all States in accordance with the conditions established by the International Sugar 
Council. 

On  2  October  2020,  the  United  Kingdom  formally  applied  for  accession  to  the 
Agreement as from 1 January 2021. 

During the 57th session of the International Sugar Council scheduled for 27 November 
2020, the International Sugar Council is set to establish the conditions for accession of 
the United Kingdom of Great Britain and Northern Ireland in line with Article 41 of 
the Agreement. 

It is therefore appropriate to establish the position to be taken on the Union's behalf in 
the International Sugar Council. 

The  United  Kingdom  is  a  major  producer  of  sugar.  Approving  the  accession  of  the 
United Kingdom to the Agreement subject to conditions set out in this Decision is in 
the interest of the Union. 

Council Decision 92/580/EEC of 13 November 1992 on the signing and conclusion of the International 
Sugar Agreement, 1992 (OJ L 379, 23.12.1992, p. 15). 
Proposal for a COUNCIL DECISION on the position to be taken on behalf of the European Union in 
the  International  Sugar  Council  with  respect  to  the  extension  of  the  International  Sugar  Agreement, 
1992 - COM(2019) 286 final - approved by the Council in its General Affairs meeting on 25 September 
2019. 

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(8) 

(9) 

The  votes  allocated  to  the  United  Kingdom  from  the  date  of  its  accession  to  the 
Agreement  should  be  deducted  from  the  votes  allocated  to  the  Union  in  accordance 
with  Article  25  of  that  Agreement.  Consequently,  the  financial  contribution  of  the 
European Union should be reduced accordingly from financial year 2021. 

The United Kingdom’s accession to the Agreement should only take effect after  the 
end  of  the  transition  period  referred  to  in  Article  126  of  the  Agreement  on  the 
withdrawal  of  the  United  Kingdom  of  Great  Britain  and  Northern  Ireland  from  the 
European  Union  and  the  European  Atomic  Energy  Community  and  the  Agreement 
should not be provisionally applied in respect of the United Kingdom before the end of 
that period, 

HAS ADOPTED THIS DECISION: 

Article 1 

1. 

2. 

3. 

4. 

The  position  to  be  taken  on  the  Union’s  behalf  during  the  57th  session  of  the 
International Sugar Council on 27 November 2020 shall be to approve the accession 
of the United Kingdom to the International Sugar Agreement, 1992, (the Agreement) 
subject to conditions established in paragraphs 2, 3 and 4.  

The  accession  shall  not  take  effect  and  the  Agreement  shall  not  be  provisionally 
applied  in  respect  of  the  United  Kingdom  before  the  end  of  the  transition  period 
referred  to  in  Article  126  of  the  Agreement  on  the  withdrawal  of  the  United 
Kingdom  of  Great  Britain  and  Northern  Ireland  from  the  European  Union  and  the 
European Atomic Energy Community. 

From  the  date  of  its  accession  to  the  Agreement,  the  United  Kingdom  will  be 
allocated  a  number  of  votes  determined  in  accordance  with  Article  25  of  the 
Agreement  and  established  during  the  the  57th  session  of  the  International  Sugar 
Council on 27 November 2020, which will be deducted from the votes allocated to 
the European Union. 

The financial contribution of the Union will be reduced in accordance with Article 25 
of the Agreement. 

This Decision is addressed to the Commission. 

Done at Brussels, 

Article 2 

For the Council 
The President 

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FINANCIAL STATEMENT 

1. 

BUDGET HEADING: 

Fin 
Stat/20/PSHMK/pl/62
220293413793 

agri.ddg3.g.4(2020) 
6175239  
6.22.2020 

DATE: 13/10/2020 

APPROPRIATIONS: 

2. 

3. 

4. 

5. 

5.0 

Chapter 15 20 PILOT PROJECTS, PREPARATORY ACTIONS, 
PREROGATIVES AND OTHER ACTIONS 
15 20 03 06 International organisations and agreements 
TITLE: 
Proposal for a Council Decision on the position to be taken on behalf of the European 
Union in the International Sugar Council concerning the accession of the United 
Kingdom to the International Sugar Agreement, 1992 

B2021:EUR 15 605 
027  

LEGAL BASIS: The legal basis for this proposal is Article 207(4), in conjunction with 
Article 218(9), of the Treaty on the Functioning of the European Union. 
AIMS: 
To approve the accession of the United Kingdom to the International Sugar Agreement, 
1992.  
FINANCIAL IMPLICATIONS 

12 MONTH 
PERIOD 

CURRENT 
FINANCIAL 
YEAR 2020 
(EUR) 

FOLLOWING 
FINANCIAL 
YEAR 2021  
(EUR) 

- 42 937- 

CHARGED TO THE EU BUDGET 

EXPENDITURE 
- 
(REFUNDS/INTERVENTIONS) 
- 
- 

NATIONAL AUTHORITIES 
OTHER 

(EUR) 

5.1  REVENUE 

OWN RESOURCES OF THE EU  

- 
(LEVIES/CUSTOMS DUTIES) 
NATIONAL 
- 

5.0.1  ESTIMATED EXPENDITURE 
5.1.1  ESTIMATED REVENUE 
5.2  METHOD OF CALCULATION: 55 votes less for EU, 686 GBP/ vote 
6.0  CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE 

RELEVANT CHAPTER OF THE CURRENT BUDGET? 

6.1  CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF 

THE CURRENT BUDGET? 

N.A. 

N.A. 

6.2  WILL A SUPPLEMENTARY BUDGET BE NECESSARY? 
6.3  WILL APPROPRIATIONS NEED TO BE ENTERED IN FUTURE BUDGETS? 
The decision will have a positive impact for the EU budget from budget 2021. The EU 
contribution is expected to be EUR 42 937 less, as the UK will pay its own membership fee. 
The amount can vary depending on the amount to be paid per vote in GBP and on the 
EUR/GBP exchange rate. For this estimate the ECB’s GBP/EUR exchange of 12/10/2020 
was used (GBP 1 = EUR 1.1380). 

NO 

NO 

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