Brussels, 21/02/2001 (Agence Europe) - On Wednesday, the European Commission adopted a proposal aimed at setting up a common market organisation (cmo) for ethyl alcohol of agricultural origin. The draft regulation introduces the possibility of a surveillance system for trade in agricultural alcohol through certificates, and places alcohol under the responsibility of the wines management committee. It has to lead to improved market information, control trade flows and create a forum for discussing decision-taking. It takes account of the need to decide on simple, clear and transparent legislation. Not providing for any intervention measures on the Community market, the proposal has no budgetary effect. Even though it may be a "light" cmo, one finds in it measures similar to those proposed for other common market organisations for agricultural products. These measures comprise, notably: - the definition of the different types of alcohol of agricultural origin; - the gathering of statistical information; - the issue of import and export certificates; - the introduction of tariff quotas; - the possibility of using inward processing, or not, as the case may be (the Commission will administer these measures in relation to any market disturbances); - a safeguard clause with emergency measures in the framework of trade with third countries (in the same context); - compatibility of State aid with rule of competition.
The common market for alcohol is a surplus market and, for five years now, the sector has run up against a series of problems. The increase in imports from third countries following agreements in the Uruguay Round, imports of diluted alcohol at zero duty applicable to spirits, and increase in imports of alcohol mixtures and denatured alcohol, subjected to much lower duties, have stepped up the pressure on the market. In addition, it is most likely that the next round of WTO negotiations will play in favour of tariff reductions. All these factors will further step-up competition. At the same time, the European Union's traditional alcohol markets risk suffering competition from alcohol produced in the framework of vast bio-fuel manufacturing programmes. The common market for agricultural alcohol being proposed should be the appropriate instrument to tackle these difficulties, Commission sources claim.