CELEX: 51981PC0192
Language: en
Date: 1981-04-14
Title: PROPOSAL FOR A COUNCIL REGULATION (EEC) laying down general rules on the distillation of table wines as provided for in Article 15 of Regulation (EEC) No 337/79 (presented by the Commission to the Council)

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DOCUMENTS "COM"
COM (81) 192
Vol. 1981/0074
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                               COM(81)192 final
                                               Brussels , 14th April 1981
                     PROPOSAL FOR A COUNCIL REGULATION ( EEC )
            laying down general rules on the distillation of table
            wines as provided for in Article 15 of Regulation ( EEC )
            No 337 / 79
                  ( presented by the' Commission to the Council )
                                                             «
                        Ë' '           - ^ -
                                S** ^ ^
 COM ( 81 ) 192 final
 ---pagebreak---                                                 C<5        AQ L
                             Explanatory memorandum
After a record harvest in 1979 , the 1980/81 wine year began with
exceptionally large carry-over stocks despite the implementation of all
the intervention measures provided for in the rules . The 1980 harvest ,
which exceeded foreseeable normal demand , made the disparity between
supplies and market outlets even worse ". This situation prompted the
Commission to make use of all the intervention instruments at its
disposal . These included preventive distillation ( Article 11 of • . -
Regulation ( EEC ) No 337/79 ), measures applicable to holders of long-term
storage contracts ( Article 12 ) and compulsory distillation of wine
produced from table grapes and additional deliveries of wine and
by-products .                                       - ; V'
Furthermore the Commission decided to permit the conclusion of long-term
storage contracts for musts and wines ; authorisation of the conclusion of
short-term storage contracts has been maintained permanently in view of
the level of representative prices .
 It may be estimated that the optional distillation operations could
 result in the withdrawal of > 14.5-15 million hi from the market , while
 compulsory operations should account for about 2 million hi . Among the
 optional distillation operations , those described as "performance
 guarantee " measures , which could theoreticaly have accounted for
 21.3 million hi , will in fact concern 14.2-14.8 million hi .
  The drop in the volume of the French harvest on the previous year is due
 in particular to a drop in quality wines psr and white wines of all
 categories ; the production of red table wine , especially in the main
wine-producing departments , has remained virtually unchanged .
 ---pagebreak---                                      - 2 -
 Given the disparity between supply and demand , which the intervention
 measures have failed to remedy , prices for the main types of table wine
 dropped to a level very much below the guide price and , in the last few
 weeks , down as far as 67% of the guide price for the most important red
 wines and 65% for white wines . This level is quite inadequate ; the
 present market situation warrants , in the Commission 's opinion , recourse
 to the exceptional distillation measures provided for in Article 15 of
Regulation ( EEC ) No 337/79 .
As regards the detailed rules for the application of these measures , past
experience has shown that , of the various formulas of quantitative
limitation already used , the formula adopted last year ( Regulation ( EEC )
No 564/80 ) might meet the present requirements best . In the Commission 's
view , it is not expedient this year to limit the period of distillation
because the many commitments of distilleries under existing measures make
it quite impossible to evaluate correctly the distillation capacities
ever a given period . The Commission therefore proposes that the
distilled quantities should not exceed , per producer , 15% of the 1980
harvest of table wine .
In these circumstances , taking account of the proposed price level , the
quantities distilled should enable equilibrium to be restored on the
market . The Commission proposes that the prices to be paid for distilled
wine should be equal to 80% of the guide prices , i,e . 2.14 ECU/%/hl for
red wines of types R I and R II and 2.01 ECU/%/hl for white wines of
                                                      »
type AI .
Aid to distillation , based on the market price for alcohol in Italy , is
lower than the level fixed for distillation measures applicable to
holders of long-term storage contracts ( Regulation 2325/80 ).
 ---pagebreak---                                    PROPOSAL FOR
                           COUNCIL REGULATION ( EEC )
        laying down general rules on the distillation of table wines as
            provided for in Article 15 of Regulation ( EEC ) No 337/79
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community ,
Having regard to Council Regulation ( EEC ) No 337/79 of 5 February 1979 on
the common organisation of the market in wine ( 1 ), as last amended by
Regulation ( EEC) No 3456/80 ( 2 ), and in particular Article 15(1 ) thereof,
Having regard to the proposal from the Commission ,
Whereas Article 15 of Regulation ( EEC ) No 337/79 provides that provisions
concerning the distillation of table wines may be adopted where
application of the market support measures provided for in that
Regulation are unlikely to be effective in restoring price levels ;
                                                             i -
Whereas this is the case at present in view of the fact pat this year 's
abundant harvest and the very large stocks from .the previous year have
created supplies which considerably exceed the normal requirements for
the present year ; whereas , moreover , all the support measures have
                                                             ■
already been taken , but they have not yet succeeded in restoring
reasonable price levels ;
Whereas the conditions under which these distillation operations may take
place should be laid down ; whereas , in particular , ttpe price of the wines
going for distillation should not be such as to encourage the production
of wine principally for distillation , although it should be sufficiently
attractive for the operation to be effective ;                    / .
 ( 1 ) 03 No L 54 , 5 . 3.1979 , p. 1
 ( 2) OJ No L 360 , 31.12.1980 , p. 18
 ---pagebreak---   Whereas Article 67 of the Act of Accession of Greece provides that in
  fixing the level of the various amounts laid down within the common
  agricultural policy , account shall be taken , for Greece , of the accession
  compensatory amount , to the extent necessary for the proper functioning
  of the common agricultural policy ; whereas the present situation on the
  market for red table wines is such that a minimum buying-in price , less .
' the accession compensatory amount ,' should not be fixed for distillation
  operations carried out in , Greece ; whereas any risk of deflection of trade
  seems ruled out by the fact that the distillation capacity in Greece is
  limited and that no wine is sent to that country for distillation ;
  Whereas the marketing of the alcohol produced -under this Regulation
  should not be allowed to have a negative influence on the market for the
  product ;
  Whereas the maximum quantity of table wine which may be distilled for
  each producer should be limited in order to limit the overall cost of the
  operation ;
  Whereas , in order to ensure appropriate supervision of the distillation
  operations , distillers should be subject to a system of approval ;
  Whereas provision should be made for producers to conclude delivery
  contracts with distillers subject to approval by the intervention agency ,
  in order to facilitate monitoring of the progress of operations and of
  the observance of the obligations of both parties ; whereas this system
  would have the added advantage of making it easier to monitor the
  quantitative effects of distillation on the market and , where necessary ,
  to limit the volume of wines which may be distilled ;(
  Whereas , however , the contracts system must be adapted in order to take
  into account the fact that there are producers who intend to have their
  wine distilled on their behalf and producers who themselves make use of
  distillation plants ; whereas , in the pase of the latter producers , the
  absence of a contractual obligation necessitates an official analysis of
  certain characteristics of the wine to be distilled ;
 ---pagebreak---                                          - 3 -
     Whereas the price of wine going for distillation is not such as to enable
   . the products obtained from this operation to be marketed normally ;
     whereas , it is therefore necessary to grant aid and to fix the amount of
     aid , taking into account normal costs , at a level enabling the products
     obtained to be marketed ; .
     Whereas provision should be made for the minimum price guaranteed to the
     producer to be paid to him , as a general rule , within time limits which
     will enable him to obtain a profit comparable to that which he would have
  ' obtained from a commercial sale ;     .
     Whereas provision should be made for producers who have concluded a -
     delivery contract to terminate it where the market situation would enable
     them to dispose of the wine more profitably ;
     Whereas , on the basis of experience gained , a certain margin should be
.    allowed for the quantity of wine specified in the delivery contracts ;
     whereas , moreover , provision should be made , in the event of chance
     circumstances or force majeure , for aid to be paid in respect of the
     quantity of wine which has' actually been distilled ;
     Whereas the manufacture of wine fortified for distillation must take
     place in the vicinity of the place where the table wine is held in order
     to limit transport costs to distilleries a long distance away;' whereas
     authorisation of the manufacture of wine fortified for distillation in a
     Member State other than that in which the producer 's winery is located is
     not justified economically and risks creating serious monitoring
     problems ; whereas it seems appropriate , therefore , to stipulate that the
     manufacture of wine fortified for distillation may take place only in the
     country where the table wine has been produced ;       .     „
     Whereas , in each Member State concerned , a body should be made responsibe
      for implementing the provisions in question ;
     Whereas the addition of an indicator to the wine to be distilled is an
     efficient monitoring method ; whereas it should be stated that the
     presence of such an indicator must not prevent the movement of these
     wines or of the products obtained therefrom ,
  , HAS ADOPTED THIS REGULATION :
 ---pagebreak---                                       - A -
                                    Article 1
1 . Producers wishing to distil table wines produced by them pursuant to
    Article 15 of Regulation (EEC ) No 337/79 shall conclude contracts for
    the delivery of table wines with an approved distiller and shall
    submit them to the intervention agency before 31 May 1981 .
    However a decision may be taken to amend the date laid down in the
    first subparagraph should the representative prices for all types of
    table wine , except types A II , A III and R III , be higher than the­
  . corresponding activating price for two consecutive weeks .
2 . For the purposes of this Regulation , each producer may distil a
    quantity of table wines not less than 10 hectolitres and not more than
    15% of the total quantity of table wine produced by him during the
    1980/81 wine year .                                -    ,
                                    Article 2
The delivery contracts shall not be valid under this Regulation unless
approved , before 15 June 1981 , by the intervention agency of the Member
State in which the wine happens to be when the contract is concluded .
These contracts shall cover :
(a)    the obligation for the distillers, to purchase the quantity of table
       wine entered in the contract and to pay not less than the amount
       specified in Article 6(1 ) for that quantity ;
(b)    the obligation for the distiller to process the wine into a product
                                                         i
       with an alcoholic strength by volume of 86% of more , or into a
       product with an alcoholic strength by volume of 85% or less .
2 . Where distillation takes place in a Member State other than that in
    which the contract is approved , the intervention agency which approved
    the contract shall forward a copy of it to the intervention agency in
    the first Member State .
 ---pagebreak---                                       - 5 -
                                    Article 3
                                          ■ '
1 . Producers :
    -  who themselves make use of distillation plants and who intend to
       carry out the distillation referred to in Article 1 , or         **
    -  who intend to have their wine distilled on their behalf in an
       approved distiller 's plant ,
    shall so inform the intervention agency of the Member State in whose
    territory their winery is located by means of a declaration of
    delivery for distillation , hereinafter called 'declaration' , and , if
    the distilling plant is located in another Member State , the latter' s
    intervention agency as well , by means of a copy of the declaration .
2 . For the purposes of this Regulation , the contract referred to in
    Article 1(1 ) sh^ll be replaced :
    - in the case specified in the first indent of paragraph 1 , by the '
       declaration ,                          '                            V
    - in the case specified in the second indent of paragraph 1 , by the
       declaration accompanied by a contract for delivery for distillation
       on the producer 's behalf concluded between the producer and the
       distiller .    .     _
3 . The declaration referred to in paragraph 2 shall not be valid under .
    this Regulation unless approved before 15 June 1981 by the
    intervention agency of the Member State on whose territory the 1
    producer 's winery is located .
    This declaration shall involve the distiller in an obligation to
    process the wine into a product with an alcoholic , strength by volume
    of 86% or more , or into a product with an alcoholic strength by volume
    of 85% or less .
4 . In the case referred to in the first indent of paragraph 1 , a sample
    of the wine to be distilled shall be taken by a representative of an
                                                  *
    official body of the Member State on whose territory the producer 's
    winery is situated for analysis by an official laboratory of its
    actual alcoholic strength by volume , total acidity , volatile acidity
    and sulphur dioxide content .
 ---pagebreak---                                         - 6 -
       The producer shall forward the results of this analysis , certified by
       an official body , to the intervention agency .
  5 . A representative of an official body shall check the quantity of wine
       distilled and the date of distillation .     .  '
  6 . Producers who have lodged a declaration shall be obliged to distil or
       to arrange for the distillation of the wine covered by that
       declaration .
                                      Article 4
. 1 . The minimum buying-in price for table wines for distillation shall be
    V
   „ fixed at :
       - 2.14 ECU per hectolitre per % vol for all red and rose table wines ,
       -  2.01 ECU per hectolitre per % vol for all white table wines .
       These wines must have an actual alcoholic strength by volume of more
       than 9.5% vol .
                                 ■>
  2 . The prices referred to in paragraph 1 shall apply to bulk merchandise
       ex producer 's premises .
                                     Article 5
  1 . .The intervention agency of the Member State in which the distillation
       has taken place shall pay aid for the wine distilled .
  2 . The amount of the aid shall be fixed , in respect of the wines referred
       to in the first indent of Article 4 ( 1 ) at :
       - 1.52 ECU per hectolitre per % vol if the wine was processed into a
          product with an alcoholic strength by volume of 86% vol or more , .
       - 1.47 ECU per hectolitre per % vol' if the wine was processed into a
          product with an alcoholic strength by volume of 85% of less .
       The amount of the aid shall be fixed , in respect of the wine referred
       to in the second indent of Article 4(1 ), at :
 ---pagebreak---                                                                \
                                       - 7 -
      - 1.39 ECU per hectolitre per % vol if the wine was processed into a
         product with an -alcoholic strength by volume of 86% vol or more ,
   , - 1.34 ECU per hectolitre per 56 vol if the wine was processed into a
         product with an alcoholic strength by volume of 85% vol or less .
                                     Article 6 ■
 1 . When the total quantity of wine in the contract enters the distillery ,
      the distiller shall pay the producer at least the difference between
      the minimum buying-in price referred to in Article 4 and the aid
      provided for in Article 5 .
"2 . When proof is supplied that the total quantity of wine in the contract
      has been distilled , the intervention agency shall pay the producer the
      amount referred to in Article 5(2 ).
 3 . The producer may ask for the amount of aid referred to in Article 5(2)
      to be paid to him in advance on condition that he has lodged a
      security equal to 110% of the amount in the name of the intervention
      agency . This security shall be given in the form of a guarantee by an
      establishment meeting the criteria laid down by the Member State to
    ' which the intervention agency is responsible .
      The advance payment may not be made until after the date of the
      approval provided for in Article 2(1 ) or Article 3(3 ).
      Subject to the provisions of Article 11 , the security provided for in
      the first subparagraph shall not be released unless , within a
      specified period , evidence is provided that the total quantity of wine
      appearing in the contract has been distilled . - \
      When the security is released , the intervention agency shall make the
      adjustments required to take account of the margins provided for in
      Article 10 .          '
                                     Article 7
 By way of derogation from Article 6(1 ), if distillation takes place in a
 Member State other than that to which the intervention agency which
 approved the contract is responsible , the distiller shall pay to the
 producer the minimum buying-in price specified in Article 4 once the
 total quantity of wine appearing in the contract has entered the
 distillery .
 ---pagebreak---                                                                                \
                                         - 8 -
     In this case the aid shall be paid to the distiller in accordance with
     the rules provided for in Article 6(2 ) or ( 3 ).
                                       Article 8
    Distillation operations may not take place before 15 May 1981 or after
     31 August 1981 .      .                           '
                                       Article 9
    Should the average prices for not less than 50% of the quantities quoted
    of a type of table wine exceed 90% of the activating price for that type
    of wine , it may be decided that delivery contracts for wines of this type
    shall be terminated wholly or in part at the request of the producer .
f
* Termination of the contract shall be permitted only in cases where the
    amounts paid by the intervention agency are refunded .
                                     Article 10
    A margin of 10% more or less than the quantity of wine indicated in the
    contracts referred to in Article 1 , subject to . the maximum and minimum
    amounts provided for in Article 1(2 ) shall be permitted for the quantity
    of wine actually delivered 'to the distillery .
    The intervention agency shall pay the aid provided for in Article 5 for
  - the quantity of wine which has actually been distilled , within the margin
    referred to in the first paragraph .
                                     Article 11
    Where , owing to chance circumstaces or force majeure , all or some of teh
    wine covered by a contract referred to in Article 1 cannot be distilled ,
    the distiller or the producer shall immediately so inform :
    - the intervention agency of the Member State in whose territory the
        distillation plant is located , and
    - if the producer 's winery is located in another Member State , the ,
        intervention agency of the second Member State .
                                       /                 '
    In the cases referred to in the first paragraph , the intervention agency
    shall pay the aid referred to in Article 5 in respect of that quantity of
    wine which has actually been distilled .
 ---pagebreak---                                          - 9 -
                                     Article 12
The wine intended for distillation as provided for in Article 1(1 ) may be
processed into wine fortified for distillation by the distiller or by an
approved manufacturer other than the producer .
If the operation is carried out by a manufacturer , the provisions of
Articles 1 , 2 , 4 , 5 , 9 , 10 and 11 shall apply subject to the provisions
of the following Articles .
                                     Article 13
1 . The contracts provided for in Article 1 shall be concluded between a
     producer and a manufacturer .                                       .
2 . These contracts shall involve the manufacturer in the obligation :
(a )    to purchase the quantity of win^&ppearing therein and to process
        all of' it into wine fortified for distillation ,                    r
(b)     to deliver the wine fortified for distillation to an approved '
        distiller ,
( c)    to pay to the producer not less than the price specified in
        Article 4 .
                                     Article 14                                •
1 . Wine fortified for distillation may be produced only in the territory
     of the Member State where the producer 's winery is located and within
     a specified period of time .      '
2 . The manufacture of wine fortified for distillation shall be subject to
     official supervision . For this purpose :
     - the document(s ) and the register(s)' provided for in Article 53 of
        Regulation ( EEC ) No 337/79 shall state the increase in actual
        alcoholic strength by volume , expressed as % vol , giving the .
        strength before and after the addition of the distillate to the
        wine ;                                           ,
     - before the wine is processed into wine fortified for distillation ,
        a sample shall be taken by a representative of an official body for
        analysis by an official laboratory , or by a laboratory operating
        under official supervision , of the actual alcoholic strength by
        volume . Two copies of the results of this analysis shall be sent
        to the manufacturer of the wine fortified for distillation , who
        shall forward one copy to the intervention agency of the Member
        State where the wine fortified for distillation was produced .
 ---pagebreak---                                     - 10 -
                                  Article 15
 The price specified in Article A shall be paid by the manufacturer when
 the total quantity of wine appearing in the contract has entered his
 installations .
                                  Article 16
Wine fortified for distillation shall be distilled before a specified
date . The product obtained from the distillation of wine fortified for
that purpose shall have an alcoholic strength by volume of 85% or less .
                                  Article 17
1 . When evidence has been provided that all the wine fortified for
    distillation , produced from the wine appearing in the contract
    provided for in Article 13(1 ), has been distilled , the intervention
    agency of the Member State where the wine fortified for distillation
    has been produced shall pay to the manufacturer the aid provided for ,
    as applicable , in the second indent of the first subparagraph of
    Article 5(2 ) or in the second indent of the second subparagraph of
    Article 5(2 ).
2 . The aid shall be calculated by hectolitre and by % vol of the actual
    alcoholic strength of the wine before it is fortified for distillation .
3 . The margin provided for in Article 10 shall apply to the quantities of
    table wine delivered to the manufacturer 's installations .
    The aid shall be paid for the quantity of table wine which , after
    being fortified for distillation , has actually been distilled .
                                  Article 18
For the purposes of this Regulation , " an approved distiller " shall mean a
distiller included on a list to be compiled by the cqmpetent authorities
of the Member State .
A person on whose behalf distillation is carried out shall be treated in
the same way as a distiller within the meaning of the first paragraph .
Such distillation must be carried out by an approved distiller .
For the purposes of this Regulation "an approved manufacturer " shall mean
 a manufacturer included on a list to be compiled by the Member States .
 ---pagebreak---                                     - 11 -
                                  Article 19
1 . The intervention* agencies responsible for implementing this Regulation
    shall be those appointed by the Member States in accordance with
                   %
    Article 8 of Regulation ( EEC) No 343/79 .
2 . Without prejudice to Article 2(1 ), Article 3(3 ) and Article 17(1 ), the
    competent intervention agency shall be that located in the territory ,
    where distllation takes place .                           •
                                  Article 20            '
Member States shall take the measures necessary to ensure that this
Regulation and, in particular , checks to prevent the deflection of table
wine from its end-use of distillation , are implemented . To this end -
Member States may stipulate that an indicator may be used .         \
Member States may not prevent the movement within their territory of a
table wine intended for distillation or of distilled products obtained -
from such wine , because of the presence of an indicator .
                                  Article 21
This Regulation shall enter into force on the. day of its publication in
the Official Journal of the European Communities . .
This Regulation shall be binding in its entirety and directly applicable
in all Member States .       : ,
Done at Brussels ,                                 For the Council
                                                    The President
 ---pagebreak---                   1                          ·                 '
                       FI MAN C SAL            STATEiWENT
                                                                                       o*t * s    6 .4 . 81
   1.
         budget heading i        é912 wine distillation,                        Appropriation ^- «         eor . 1 *► (Π ECU
                                                                                                                              .
   2.    title s Proposal for a Council Regulation laying down general rules on the -,
                ■     distillation of; table wines , as provided for in Article 15 of
                      Regulation ( EEC) No 337 /79                 '
   5.
         legm. BASIS : Art > 15 of Reg > 337 /79
   4.    Alis or project j To p eïïiecjy a serious disturbance on the wine market by the
                    . implementation of exceptional disti I lation measures
                                                                                                 •
                                   ι       "        1,     '                       ,           '    *
  -5 .               l implications              period or 12 months     CURRENT FINANCIAL YEAR    FOLLOWING FINANCIAL TEAR
                                                                                 f       y                 (           )
  'S.-O Ε>Ρ£·.ΪΣΤυβΕ
          - C »* s Gí3 TO THE EC BUDGET
             »XX.X.2SC/ INTERVENTIONS )                55 m ECU.           55 m ECU                        token entry
          - {«fxsioiuaiWtfakSiaAfXW                                                                   •  ■
        ' -
   S.I WKSÍKXS
          - 80<<X«©í»XiX3®<KfXX>*€X5C
             XÜCX XD5 XOUS røUX »X WX 50
          - x«rx3f*x
                                                          ·*·«   ·
    5.0 . τ est:*"ated e < pen5i ture
S S. 1.1 ESTIMATED RECEIPTS
                                                   Relates to          one . year'      only
                                                                                            \
    s.2 «et*m of calculation Aid tQ distillation : 1 ..A3 ECU/% vol = 15.0 ECU/ hl '
                                      Estimated volume :             6 m hi .. Gross cost 6x15 - 90 m ECU
           As the quantities actually covered by other distillation operations , including
          'performance guarantee' operations , are lower than initially estimated, V
          entailing 35 m ECU less expenditure , the proposed exceptional operations will
          also cover these quantities . Consequently net expenditure is . 90-35 = » 55 m ECU .
     6.0 CAN THE PROJECT BE FINANCED FROM APPROBIAT IONS ENTEREO IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET ?,
     e.i CAN THE PROJECT SE FINANCED BY TRANSFER BEUEEN CHAPTERS OF THE CURRENT BUDGET 7
                                                                                                                     1       YES *»
      6.2 IS A SUPPLEMENTARY BUDGET 8E NECESSARY
                                                                                                                     3
      a . J ■ III fw'wRc BwrDGcT APPOSITIONS BE NECESSARY ?
                                                                                                                            XVtü /N0
       oôsmvatxcks : v
                              A sum of 55 m ECU would therefore ha,ve to be transferred; this
           can be covered from EA6GF Guarantee appropriations as a result of short-term
       . savings               .                                                                                    . '   •