Bovine animals are currently identified by two plastic eartags. The Commission is currently exploring the possibility of introducing electronic identification as official method to identify bovine animals within the EU. Electronic identification can contribute to improvements in existing systems of cattle identification.
Report from the Commission to the Council and the European Parliament on the possibility of introduction of electronic identification for bovine animals - COM/2005/0009
Presentation
from the Commission at the
Meeting of the Animal Health Advisory Committee (19 May 2008)
In May 2009, the Food Chain Evaluation Consortium (FCEC) carried out an analysis of the technical feasibility and the associated costs of the introduction of Electronic Identification for bovine animals within the legal framework of regulation (EC No 1760/2000).
The final report of this study is found here
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Subsequently the initiative was discussed with the Animal Health Advisory Committee on 14 February 2011 and on 17 June 2011. See further information here: http://ec.europa.eu/food/animal/diseases/strategy/animal_health_advisory_committee_en.htm
The European Commission adopted on 30 August 2011 two proposals to modify current rules on bovine identification and to introduce electronic identification that will, when implemented, further enhance food safety and better safeguard animal health in the EU.
In particular, the Commission proposals provide the legal framework for the introduction, for the first time and on a voluntary basis, of an electronic identification system (EID) for bovine animals. Bovine EID is already used in several EU Member States on a private basis mainly for farm management purposes. Its implementation on a wider scale will strengthen the current traceability system for bovine animals and food products (e.g. beef) making it faster and more accurate. Finally, it may bring benefits to farmers and other stakeholders as it will reduce the administrative burden through the simplification of the current administrative procedures. Despite its voluntary character, the Commission proposal allows Member States to introduce a mandatory regime at national level.
In addition to EID, the Commission proposal introduces changes in relation to labelling, by repealing the current provisions on voluntary beef labelling. The main objective is to reduce unnecessary administrative burden.
Press release: http://europa.eu/rapid/pressReleasesAction.do?reference=IP/11/991&format=HTML&aged=0&language=EN&guiLanguage=en
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A Question and Answers document

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Proposal for a Regulation amending Regulation (EC) No 1760/2000 as regards electronic identification of bovine animals and deleting the provisions on voluntary beef labelling

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Proposal for a Directive amending Council Directive 64/432/EEC as regards computer databases which are part of the surveillance networks in the Member States

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The Executive Summary of the Impact Assessment

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The Impact Assessment

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The opinion of the Impact Assessment Board

All official EU language versions of the final proposals and the executive summary of the Impact Assessment (SEC/2011/1009/FINAL) can be accessed on the following pages (when you are on those pages, please choose the preferred language in the drop down menu of the top right corner):
http://ec.europa.eu/prelex/detail_dossier_real.cfm?CL=en&DosId=200765
http://ec.europa.eu/prelex/detail_dossier_real.cfm?CL=en&DosId=200764
From the first of January 2010, sheep and goats already need to be electronically identified. Information about sheep and goats identification can be found here.