Agriculture and rural development

The reforms of the EU wine market

The reforms of the EU wine market

Wine
The reforms of the EU wine market

The Council of Ministers adopted in April 2008 a thorough reorganisation of the way the EU wine market is managed, in order to ensure EU wine production matches demand, eliminate wasteful public intervention in EU wine markets, and redirect spending to make European wine more competitive. In December 2013, the European parliament and the Council adopted a reform that harmonises, streamlines and simplifies the provisions of the CAP. For the wine sector, it mostly renews the measures and approaches initiated during the 2008 wine reform. As from 2016, in the wine sector, the planting rights system will be replaced by a dynamic planting-authorisation management mechanism.

Since the introduction of the common market organisation (CMO), the wine market has developed considerably.

In brief, it has been characterised by:

  • a very short initial period of equilibrium, followed by
  • a very marked increase in production against a constant level of demand,
  • and finally, a continuous decline and a very noticeable qualitative change in demand from the 1980s.

These changes have been dealt with by significantly developing the CMO:

  • It started out very open, with no curbs on plantings and very few market regulation instruments (the aim being to confront the annual variations in production).
  • It then restrained freedom on plantings, coupling it with the virtually guaranteed sales, thus generating serious structural surplus.
  • From 1976-1978 it became very interventionist with the ban on planting and the obligation to distil the surplus.
  • Towards the end of the 80s financial incentives for giving up vineyards were reinforced.

The 1999 reform of the CMO for wine strengthened the goal of achieving a better balance between supply and demand on the Community market, giving producers the chance to bring production into line with a market demanding higher quality and to allow the sector to become competitive in the long term - especially in the face of increased global competition following GATT - by financing the restructuring of a large part of present vineyards.

This reform proved insufficient to reduce wine surpluses and considerable sums still had to be spent on disposing of them. A new reform of the wine market was needed.

The reform adopted by the EU in 2008 has the following goals:

  • making EU wine producers even more competitive - enhancing the reputation of European wines and regaining market share both in the EU and outside
  • making the market-management rules simpler, clearer and more effective – to achieve a better balance between supply and demand
  • preserving the best traditions of European wine growing and boosting its social and environmental role in rural areas.

 

The reform adopted by the EU in 2013 aimed at harmonising, streamlining and simplifying the provisions of the CAP adopted in the course of the previous reforms.

 

 

The impact of 2013 CAP reform on the EU wine sector

The CAP reform adopted in December 2013 by the European Parliament and the Council of Ministers mostly renews the measures and approaches initiated during the 2008 wine reform which reorganised the way the EU wine market was managed, in order to ensure EU wine production matches demand, eliminate wasteful public intervention in EU wine markets, and redirect spending to make European wine more competitive.

 

The main issues addressed under the 2013 CMO reform are:

National support programmes

The approach of the National support programmes derived from the one adopted in the context of the 2008 Wine CMO reform.

Thus, the following measures already existed under the 2008 Wine CMO reform:

  • promotion in third countries;
  • restructuring and conversion of vineyards;
  • green harvesting;
  • mutual funds;
  • harvest insurance;
  • investments;
  • by-product distillation.

The 2013 CMO reforms introduces as a new measure innovation in the wine sector aiming at the development of new products, processes and technologies concerning the wine products. Furthermore it opens promotion measures to information in Member States, with a view to informing consumers about the responsible consumption of wine and about the Union systems covering designations of origin and geographical indications. It also extends the restructuring and conversion of vineyards to replanting of vineyards where that is necessary following mandatory grubbing up for health or phytosanitary reasons.

The budget allocations which results from the 2013 CMO reform mostly corresponds to the budget allocation defined in the 2008 Wine CMO reform, taking into account the transfer for some Member States to the single payment scheme.

 

Scheme of Authorisations for Vine plantings

The planting rights regime will end by December 2015. In order to ensure an orderly growth of vine plantings during the period between 2016 and 2030, a new system for the management of vine plantings is established at Union level, in the form of a scheme of authorisations for vine plantings.

The scheme of Authorisations for Vine plantings is based on the outcome of the High Level Group on Vine Planting Rights organised in 2012.

>> More about the High Level Group on Vine Planting Rights

 

Other regulatory measures

The rules in relation to wine-making practices and labelling introduced during the 2008 Wine CMO reform are still present in the new CMO.

 

Chronology (in reverse order)

17/12/2013: Regulation (EU) No 1308/2013 of the European Parliament and of the Council of 17 December 2013 establishing a common organisation of the markets in agricultural products and repealing Council Regulations (EEC) No 922/72, (EEC) No 234/79, (EC) No 1037/2001 and (EC) No 1234/2007 (CMO Regulation)

>> Read the Regulation

 

17/12/2013: Regulation (EU) No 1306/2013 of the European Parliament and of the Council of 17 December 2013 on the financing, management and monitoring of the common agricultural policy and repealing Council Regulations (EEC) No 352/78, (EC) No 165/94, (EC) No 2799/98, (EC) No 814/2000, (EC) No 1290/2005 and (EC) No 485/2008

>> Read the Regulation

 

29/04/2008: The Council of Ministers adopts Council Regulation (EC) No 479/2008 of 29 April 2008 on the common organisation of the market in wine

>> Read the Regulation

 

04/07/2007: The Commission adopts a Proposal for a Council Regulation on the common organisation of the market in wine. This proposal is accompanied by an impact assessment report.

>> Read the Proposal

>> Read the impact assessment report: Full text - Summary

 

22/06/2006: The Commission presents the Communication "Towards a sustainable European wine sector" together with an impact assessment report.

>> Read the Communication

>> Read the impact assessment report: Full text - Summary