10 March, 2022
Australia – EU Free Trade Agreement
The 12th Round of negotiations were held virtually between 7-18 February. The round saw progress made in a number of areas including government procurement, second round of market access offers and progression across a number of chapter texts. For wine relevant ongoing discussions include the treatment of the Wine Agreement and Geographic Indications. Separate ongoing discussions on technical aspects of wine will also continue to be progressed through the Joint Standing Committee established under the current Wine Agreement with the EU.
Common Agricultural Policy (CAP) Reforms
Following over three years of EU negotiation, On 6 December 2021, the three Regulations that make up the EU’s Common Agricultural Policy (CAP) were published in the EU’s Official Journal:
Of these, Regulation 2021/2117 the Common Market Organisation (CMO) regulation, has the most significant implications for wine. It includes amendments to EU regulation in relation to:
- Dealcoholised and partially dealcoholised wines – The new CMO regulation establishes the framework for production of total or partial dealcoholised wines: this includes conditions for their production, authorization for PDO GI use and labeling obligations.
- Nutritional declaration Labelling and ingredient listing – Introduction by the CMO regulation of a specific framework for wine labelling of nutritional declaration (energy content) on-label and of the list of ingredients off-label (e.g. digital)
- Protected Designations of Origin and Geographic Indications – The CAP reforms also include a range of amendments to the use of Protected Designations of Origin (PDO) and Geographic Indications (GIs) including Alignment of definitions PDO and GI with the Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement, amendments to label claim rules, simplification of GI registration processes and other amendments aimed at creating greater flexibility in production standards for PDO and GIs related to climate change.
The new conditions for dealcoholized product entered into force on 7 December 2021. The new rules on the mandatory nutrition declaration and list of ingredients will enter into force on 8 December 2023.
EU Sustainability Initiatives
Australian Grape and Wine continues to maintain a watching brief on several sustainability initiatives being initiated by the EU and its member state which may have potential to impact the sector. The EU and its member states are becoming highly active in this space as they work towards delivery of their high level strategic priorities outlined under the EU Green Deal and Farm To Fork Strategy. Of note at present are:
- Product Environment Footprint (PEF) and the wine category rules – the EU is in the process of releasing legislation which establishes methodologies for the PEF. These will pertain to methodology for substantiating green claims and if producers want to make a claim on a label, on an EU marketing website or in EU advertising they will need to comply with the wine PEF category rules which are set out at: Single Market for Green Products – The Product Environmental Footprint Pilots – Environment – European Commission (europa.eu). The main concerns are a lack of consistency with international methods for calculating environmental footprint, how these will be tailored to suit differing conditions for imported product, labelling and the treatment of existing well established sustainability programs. Australian Grape and Wine has been in discussions with the agricultural councillor in Brussels as well as working with WWTG members to respond to the EU and seek clarity on the measures.
- In July 2021 the French Ministry of Ecological Transition published a draft decree through its domestic consultation (TRIS) process “on the minimum proportion of reused packaging to be placed on the market annually”. The decree set specific targets for reducing single-use plastic package waste by 2025, including a mandate for reusing packaging, starting 1 January 2022. The decree is based on the Circular Economy and Fight Against Waste Law which seeks to ban all plastic packaging by 2040. The decree lacks detail, but it appears to impose an obligation to require that a certain proportion of packaging be ‘reusable’ (increasing from 1.5% in 2022 up to 10% in 2027). In January 2022, the United States Department of Agriculture (USDA) provided further information on the decree, however there remain a number of unanswered questions. We have also recently been informed that the decree is not yet being implemented by the French government and may now be delayed to mid-year with impending French elections. As currently understood, these measures would present a significant trade barrier for imported wine products.
- World Wine Trade Group members have also recently raised the fact that a number of the EUs member states have been implementing domestic measures on sustainability including: Italy’s alphanumeric codes for waste storing; Portugal considering alphanumeric codes; Bulgaria recently adopted a packaging decree; a waste law in Spain; and Netherlands considering light-weighting for spirit containers.
