CELEX: 51989PC0674
Language: en
Date: 1989-12-20
Title: PROPOSAL FOR A COUNCIL DECISION CONCERNING ADJUSTMENTS TO THE VOLUNTARY RESTRAINT AGREEMENT FOR SHEEPMEAT AND GOATMEAT CONCLUDED WITH URUGUAY

OMMISSION OF THE EUROPEAN COMMUNITIES
                                     COMC89)  674    final
                                     Brussels, 20 December 1989
                           Proposal for a
                          COUNCIL DECISION
      concerning adjustments to the voluntary restraint agreement
           for sheepmeat and goatmeat concluded with Uruguay
                   (presented by the Commission)
 ---pagebreak---                          EXPLANATORY MEMORANDUM
1. The changes recently decided on for Improving the operation of the
   common organization of the market in sheepmeat and goatmeat will
   result in tighter discipline and a decrease In support for Community
   producers.
   As the Commission has emphasized several times in Its communications
   to the Council on the future of the CAP, the extra effort being
   required from the Community's agricultural producers must be backed
   up by parallel import measures. This in turn will make It necessary
   to make adjustments to the voluntary restraint agreements concluded
   between the Community and the main supplier countries.
2.  It was against this background and in line  with the conclusions of
   the European Council of February 1988 that   the Council adopted
   negotiating directives for this subject on   15 November of the same
   year. Negotiations, notably with Uruguay,    followed and resulted in
   the attached draft agreement.
3. The essential elements of the adjustments to be made are as follows:
   -   reducing the quantities initially provided for, which are reduced
       from 5 800 t to 5 220 t. However, until 31 December 1990, Uruguay
       may deliver a part of the quota attributed to another supplying
       country which has not been used in 1989. This (non-utilized)
       quantity is fixed at 1 700 t of which 500 tonnes is a form which
       has never been frozen.
   -   setting up a system of Import price surveillance;
   -   restricting the opportunities for importing chilled meat;
   -   total suspension of import levies-,
   -   provisions for sensitive areas of the Community for 1989 and 1990.
4. The issue of sensitive areas will be addressed in an additional
   exchange of letters between the Commission and Uruguay. For the
   quantities Involved, Uruguay will undertake that for 1989 the exports
   to France are limited to 400 t and to 100 t for Ireland (carcass
   weigh equivalent). In 1990, these limits will be increased by 20%.
 ---pagebreak---                        PROPOSAL FOR A COUNCIL DECISION
         concerning adjustments to the voluntary restraint agreement
              for sheepmeat and goatmeat concluded with Uruguay
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic Community,
and in particular Article 113 thereof,
Having regard to the proposal from the Commission,
Whereas the Community has taken measures to stabilize the market in
sheepmeat and goatmeat and whereas it intends to bring about better
Integration of that market;
Whereas in the context of those adjustments to the common organization of
the market it would be opportune to make adjustments to the voluntary
restraint agreements concluded in the sector with certain third countries,
in order to stabilize imports and improve import prices,
Whereas the Commission has held negotiations on the matter which have led
to an agreement with Uruguay,
HAS DECIDED AS FOLLOWS:
                                  Article 1
1.    The Agreement in the form of an exchange of letters concerning
      adjustments to the voluntary restraint agreement for sheepmeat and
      goatmeat with Uruguay,
       is hereby approved on behalf of the European Economic Community.
      The text of the Agreement Is attached to this Decision.
                                  Article 2
The President of the Council is hereby authorized to designate the person
empowered to sign the Agreement in order to bind the Community.
Done at Brussels,                                      For the Council,
                                                       The President
 ---pagebreak---      FINANCIAL                      STATEMENT
                                                                      DATE: 11 December 1989
1. BUDGET HEADING: 100                                                APPROPRIATIONS: ECU 1 152,8 mi II ion
                                                                                      1990 draft budget
2. TITLE: Proposal for a Council Decision concerning the adaptation of the voluntary restraint agreement
           between the European Economic Camunity and Uruguay on trade in sheepmeat and goatmeat
3. LEGAL BASIS: Article 113 of the Treaty
4. AIMS OF PROJECT: To import a quota of 5 220 tonnes of sheepmeat frcm Uruguay subject to zero levy.
                                   Period of 12 months   Current Financial Year    Following Financial Year
5. FINANCIAL IMPLICATIONS                                        1990                         1991
5.0 EXPENDITURE
    - CHARGED TO THE EC BUDGET
    - (REFUNDS/INTERVENT ION)           p.m. (1)               p.m. (1)                      p.m. (1)
    - NATIONAL ADMINISTRATION
    -OTHER
5.1 REVENUE
    - OWN RESOURCES OF THE EC       - ECU 0,9 mi 11 ion     - ECU 1,4 mi 11 Ion          - ECU 0,9 ml 11 Ion
       (LEVIES/CUSTOMS DUTIES)
    - NATIONAL
                                          1992
5.0.1 ESTIMATED EXPENDITURE               p.m.
5.1.1 ESTIMATED REVENUE              ECU 0,9 ml 11 Ion
5.2 METHOD OF CALCULATION: The average levy appl led to imports of sheepmeat Is ECU 1,750/t. However, for
     imports frcm Uruguay the levy is limited to the autonomous 10% duty arising frcm binding within the
    GATT, i.e. approximately ECU 150/t. The abolition of this duty would result in a loss of revenue over
    12 months of: 5 220 t x ECU 150/t x 1,14 (DR) - ECU 0,9 m ill ion
    Since the measure applies retroactively from 1 January 1989, In 1990 levies collected In 1989 on Imports
    of meat frcm Uruguay must be refunded. The cost of reimbursement In the 1990 financial year is estimated
    at ECU 0,5 mi 11 ion.
(TÔTCAN THE PROJECT BE FINANCED FRCM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE    CURRETFBUX*    n ""
                                                                                                              Hi
6.1 CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET?
                                                                                                              m
6.2 IS A SUPPLEMENTARY BUDGET NECESSARY?
                                                                                                              M>
6.3 WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY?
                                                                                                         YFS
OBSERVATIONS:
(1) No precise ccnmltment appears In the agreement as regards import prices and the zero Import levy on such
    meat could result in a fall in prices on the Camunity market with a corresponding rise in premluns
    granted and therefore In expenditure to the Camunity budget. It is difficult to estimate the scale.
    cost.
 ---pagebreak---                                      - 7 -
                FICHE D'IMPACT SUR LA COMPETITIVITE ET L'EMPLO
                      Proposition de Décision du Conseil
     concernant l'adaptation de l'accord d'auto-lImitât ion avec l'Uruguay
Ce projet d'accord envisage une modification du régime à l'importation des
viandes ovine et caprine, actuellement applicable dans le cadre de l'accord
d'auto-limitation conclu avec l'Uruguay.
Dans la mesure où il prévoit essentiellement, d'une part, le maintien des
quantités importées et, d'autre part, l'instauration d'une procédure de
surveillance des prix à l'importation, ce projet n'a pratiquement pas
d'impact   sur   les entreprises. On peut également       considérer  que  les
modifications proposées ne leur Imposeront pas de coûts supplémentaires.
 ---pagebreak---           EXCHANGE OF LETTERS RELATING TO THE 1980 AGREEMENT BETWEEN
                  THE EUROPEAN COMMUNITY AND URUGUAY ON TRADE
                              IN MUTTON AND LAMB.
                                 A. Letter N°1
Sir,
I have the honour to refer to the exchange of letters of 14 October 1980
constituting an Agreement between the European Community and Uruguay
establishing provisions relating to import of mutton and lamb Into the
Community from Uruguay and to negotiations held between our respective
delegations for the purpose of establishing temporary derogations from
certain of those provisions concurrent with the implementation of measures to
stabilise the European Community sheepmeat sector and to reform the European
Community's Internal regime In order to achieve a unified European Community
sheepmeat market. Accordingly, they have agreed on the following derogations
from the Principal Agreement which shall remain in force for the duration of
this Agreement.
                                    Clause 1
       Access and quant ity
        In Clause 2 of the Principal Agreement, as modified by Clause 6 of the
       Principal Agreement, the celling figure of 5.800 t shall be deemed to
        have been replaced by the figure of 5.220 t. This ceiling shall be
        deemed to include a maximum in 1989 of 2.000 t metric tonnes of lamb
        imported into the European Community from Uruguay in a form which has
        never been frozen, a maximum of 2.200 metric tonnes in 1990, a maximum
       of 2.400 metric tonnes In 1991, and a maximum of 2.600 metric tonnes
        in 1992.
B.      Tariff
        In Clause 5 of the Principal Agreement, the words "a maximum amount of
        10%, ad valorem" shall be deemed to be replaced by the word "zero".
C.      Price surveillance                         •
        With a view to improved sheepmeat prices within the European
        Community, prices for lamb Imported from Uruguay will be monitored in
        accordance with the procedures contained in the annex to this
        Agreement.
                                    Clause 2
Consultation
Notwithstanding Clause 1 C) of this Agreement either Party may request
consultations concerning the operation of this Agreement at any time.
 ---pagebreak---                                    CI ause 3_
GATT obi I gat Ions
The provisions of this Agreement shall be agreed without prejudice to the
rights of Uruguay and the European Community under GATT.
                                   Clause 4
This Agreement shall enter into force on 1 January 1989 and shall remain in
force until 31 December 1992.
                                   CI ause 5.
Within 6 months prior to expiration of this Agreement, Its provisions shall
be reviewed.
 I have the honour to propose that, if the foregoing is acceptable to your
Goverment, this letter and your confirmatory reply shall together constitute
and evidence an Agreement between the European Economic Community and Uruguay
on the matter.
Please accept, Sir, the assurance of my highest consideration.
                                                        For the CounclI
                                                        of the European
                                                        Commun 111 es
                                                                              tJ
 ---pagebreak---                                                                                          ANNEX
                                      Price Surveillance Procedure
1.      The European Community will monitor the prices In each Member State
        for Imported frozen lamb carcasses from Uruguay on the basis of the
        average prices over each monthly period.
2.      The relationship between the prices for Imported frozen lamb carcasses
        from Uruguay In each Member State and the market prices for Community
        produced lamb In each such Member State will be compared with the
        benchmark level specified below for each such Member State. If this
        comparison Indicates that the price relationship has, in two Member
        States In the same month, moved below the benchmark levels for those
        Member States, technical consultations will take place at the request
        of either Party to determine factors causing the downward movement.
        The factors that will be taken into account by the parties in such
        consultations shall include traditional and seasonal price
        relationships and fluctuations, the prices of cuts, the impact of
        prices of other meats, and other exceptional factors.
Me-roer States by region                                               Benchmark levels for the
                                                                       :        relationship between
                                                                       :        pr ices of imported
                                                                               frozen
                                                                                lamb carcasses and
                                                                               pr Ices of
                                                                               domestically produced
                                                                                lamb.
Northern Member States (Belgium,                                       55 percent
Denmark, Federal Republic of Germany,
France, Ireland, Luxembourg,
Netherlands, United Kingdom)
Southern Member States                                                 45 percent
(Greece, Italy, Portugal, Spain
        In the event that the downward movement of the relationship between
        prices for Uruguayan frozen lamb carcasses and Community produced lamb
        below the benchmark levels in the particular Member States under
        consideration Is indicative of a problem, the Parties shall consider
        any recommendations arising out of the technical consultations for the
        resolution of the problem. If the problem Identified is attributable
        to the prices at which Uruguayan frozen lamb carcasses are being sold
        In those member states by Uruguayan exporters then Uruguay would take
        what action is available to It to restore the price relationship
        between frozen lamb carcasses and Community produced lamb in those
        member states to the benchmark levels.
        Should the Parties In the technical consultations fail to reach
        agreement on appropriate measures to resolve the problem, the
        Consultative Committee established under Clause 10 of the Principal
        Agreement may be convened at a senior policy level at the request of
        either Party to give the matter urgent consideration. If agreement
        cannot be reached at official level, the matter may De referred by
        either party to the EC Commissioner for Agriculture and the Uruguayan
                 ~ •£
                      * / . i - i / « i i l t i i r « 1r\r resolution.
 ---pagebreak--- 5. Uruguay and the European Community adopt as targets for achievement by
   the end of 1992 an improvement In the previously defined benchmark
   levels for Northern Member States by 5 percentage points and for
   Southern Member States by 8 percentage points.
 ---pagebreak---                                  B. Letter N° 2
Sir,
I have the honour to acknowledge receipt of your letter of today's date,
which reads as follows :
"I have the honour to refer to the exchange of letters of 14 October 1980
constituting an Agreement between the European Community and Uruguay
establishing provisions relating to import of mutton and lamb Into the
Community from Uruguay and to negotiations held between our respective
delegations for the purpose of establishing temporary derogations from
certain of those provisions concurrent with the Implementation of measures to
stabilise the European Community sheepmeat sector and to reform the European
Community's internal regime in order to achieve a unified European Community
sheepmeat market. Accordingly, they have agreed on the following derogations
from the Principal Agreement which shall remain In force for the duration of
this Agreement.
                                    Clause i
A.     Access and quantIty
        In Clause 2 of the Principal Agreement, as modified by Clause 6 of the
       Principal Agreement, the ceiling figure of 5.800 t shall be deemed to
       have been replaced by the figure of 5.220 t. This celling shall be
       deemed to include a maximum In 1989 of 2.000 t metric tonnes of lamb
        imported Into the European Community from Uruguay In a form which has
       never been frozen, a maximum of 2.200 metric tonnes In 1990, a maximum
       of 2.400 metric tonnes In 1991, and a maximum of 2.600 metric tonnes
        In 1992.
B.     Tariff
        In Clause 5 of the Principal Agreement, the words "a maximum amount of
       10%, ad valorem" shall be deemed to be replaced by the word "zero".
C.     PrIce survelI lance
       With a view to improved sheepmeat prices within the European
       Community, prices for lamb imported from Uruguay will be monitored In
       accordance with the procedures contained in the annex to this
       Agreement.
                                    Clause 2
Consultation
Notwithstanding Clause 1 C) of this Agreement either Party may request
consultations concerning the operation of this Agreement at any time.
 ---pagebreak---                                    CIause 3
GATT obi I gat Ions
The provisions of this Agreement shall be agreed without prejudice to the
rights of Uruguay and the European Community under GATT.
                                   CIause ±
This Agreement shall enter Into force on 1 January 1989 and shall remain in
force until 31 December 1992.
                                   CI ause 5_
Within 6 months prior to expiration of this Agreement, Its provisions shall
be reviewed.
I have the honour to propose that, If the foregoing is acceptable to your
Goverment, this letter and your confirmatory reply shall together constitute
and evidence an Agreement between the European Economic Community and Uruguay
on the matter."
I have the honour to confirm the foregoing is acceptable to my Government and
that your letter together with this reply shall constitute an Agreement In
accordance with your proposal.
Please accept, Sir, the assurance of my highest consideration.
                                                       For the Government
                                                          of Uruguay
 ---pagebreak---                                                                  ANNEX
                          Price Surveillance Procedure
1.     The European Community will monitor the prices in each Member State
        for Imported frozen lamb carcasses from Uruguay on the basis of the
       average prices over each monthly period.
2.     The relationship between the prices for imported frozen lamb carcasses
        from Uruguay In each Member State and the market prices for Community
       produced lamb in each such Member State will be compared with the
       benchmark level specified below for each such Member State. If this
       comparison indicates that the price relationship has, in two Member
       States in the same month, moved below the benchmark levels for those
       Member States, technical consultations will take place at the request
       of either Party to determine factors causing the downward movement.
       The factors that will be taken into account by the parties in such
       consultations shall include traditional and seasonal price
       relationships and fluctuations, the prices of cuts, the impact of
       prices of other meats, and other exceptional factors.
Member States by region                         Benchmark levels for the
                                                        relationship between
                                                        pr ices of imported
                                                        frozen
                                                         lamb carcasses and
                                                        pr Ices of
                                                        domestically produced
                                                         lamb.
Northern Member States (Belgium,                55 percent
Denmark, Federal Republic of Germany,
France, Ireland, Luxembourg,
Netherlands, United Kingdom)
Southern Member States                          45 percent
(Greece, Italy, Portugal, Spain
3.      In the event that the downward movement of the relationship between
       prices for Uruguayan frozen lamb carcasses and Community produced lamb
       below the benchmark levels In the particular Member States under
       consideration Is indicative of a problem, the Parties shall consider
       any recommendations arising out of the technical consultations for the
       resolution of the problem. If the problem Identified is attributable
       to the prices at which Uruguayan frozen lamb carcasses are being sold
       In those member states by Uruguayan exporters then Uruguay would take
       what action is available to It to restore the price relationship
       between frozen lamb carcasses and Community produced iamb in those
       member states to the benchmark levels.
       Should the Parties in the technical consultations fail to reach
       agreement on appropriate measures to resolve the problem, the
       Consultative Committee established under Clause 10 of the Principal
       Agreement may be convened at a senior policy level at the request of
       either Party to give the matter urgent consideration. If agreement
       cannot be reached at official level, the matter may be referred by
       either party to the EC Commissioner for Agriculture and the Uruguayan
       Minister of Agriculture for resolution.
 ---pagebreak--- 5. Uruguay and the European Community adopt as targets for
   achievement by the end of 1992 an improvement in the
   previously defined benchmark levels for Northern Member States
   by 5 percentage points and for Southern Member States by 8
   percentage points.
 ---pagebreak---                                     - 8 -
                                   Letter No 1
                                                               Brussels,
Sir,
I have the honour to refer to Clause 1 of the Exchange of letters dated
relating to the 1980 Agreement between the European Community and Uruguay on
trade In mutton and lamb.
I also have the honour to confirm that before 31 December 1990, In addition
to the celling of 5 220 metric tonnes, a quantity of 1 700 tonnes may be
delIvered.
This additional volume shall be deemed to include a maximum of 500 metric
tonnes of lamb Imported Into the European Community from Uruguay in a form
which has never been frozen.
I should be obliged if you would kindly acknowledge receipt of this letter.
                                               For the Council of the
                                               European Communities
 ---pagebreak---                                      - 9 -
                               B.  Letter No 2
                                                               Brussels,
Sir,
I have to acknowledge receipt of your letter of today's date which reads as
fol lows :
"I have the honour to refer to Clause 1 of the Exchange of letters "-ted
..... relating to the 1980 Agreement between the European Community and
Uruguay on trade In mutton and lamb.
I also have the honour to confirm that before 31 December 1990, in addition
to the celling of 5 220 metric tonnes, a quantity of 1 700 tonnes may te
delivered.
This additional volume shall be deemed to include a mnximum of 500 metric
tonnes of lamb imported into the European Community from Uruguay in a form
which has never been frozen.
I should be obliged if you would kindly acknowledge receipt of this letter."
Please accept, Sir, the assurance of my highest consideration.
                                                For the Government o-
                                                Uruguay .
 ---pagebreak---  ---pagebreak---                                                                      ISSN 0254-1475
                                                              COM(89) 674 final
                                                      DOCUMENTS
EN                                                                         03 i l
                                 Catalogue number : CB-CO-89-614-EN-C
                                                             ISBN 92-77-56263-3
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