CAP Reform: wine reform will help Europe regain lost market share

Friday 6 July 2007

The European Commission today adopted proposals for a wide-ranging reform of the Common Market Organisation for wine. This follows more than one year's discussion with all parties on the ideas launched in the June 2006 Communication. This aims to increase the competitiveness of EU producers, win back markets, balance supply and demand, simplify the rules, preserve the best traditions of EU wine production, reinforce the social fabric of rural areas and respect the environment. Key to the reform will be making better use of the budget (€1.3 billion), which will remain at the current level. Under the proposals, all the inefficient market support measures – various aids for distillation, private storage aid, export refunds – would be abolished from day one. The addition of sugar to enrich wine – chaptalisation – would be banned, and aid for must for enrichment, introduced to compensate for the higher cost compared to chaptalisation, would also be abolished. Crisis distillation would be replaced by two crisis management measures, paid for from national financial envelopes. Much more money would go into promoting EU wine, particularly on third country markets. For a five-year transitional period, planting restrictions would be kept in place and uncompetitive producers would have the possibility to leave the sector with attractive financial support. After 2013, restrictions on planting would be lifted to allow competitive producers to expand their production if they so choose. Labelling rules would be made simpler, certain wine making practices accepted by all producer countries in the International Organisation of Vine and Wine would be adopted by the EU and quality policy would be based on a geographical origin approach. Member States would receive a national financial envelope and a menu of actions to allow them to take measures best suited to the local situation. More money would go into Rural Development to fund measures including the setting up of young wine producers and environmental protection.

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