The proposals, an update of an existing agreement signed back in 1994, aim to cut back on the number of Australian producers using popular European geographical indicators on their products. The agreement also modifies existing labelling standards to provide greater information on a product.

Australia is a major partner for both exports and imports of wine in the EU. Any measures to strengthen this partnership therefore could be hugely significant for wine manufacturers within the bloc keen to protect their identity in the congested global market for the product.

As such, EU agricultural commissioner Mariann Fischer Boel praised the move as a vital step in protecting the reputation of the regions wines, whilst also expanding their attractiveness to importers.

"I am delighted that we have been able to finalise our negotiations with such an important trade partner and I commend this agreement to the Member States," she stated.

"This accord safeguards EU interests by establishing principles for the protection of GIs [geographical indicators] and traditional expressions and protecting our wine labelling regime."

If the deal is backed by the Australian authorities, producers in the country will be given a year from the date that the reforms come into place to amend there practices.

This will call on the phasing out of geographically specific terms like Champagne being used on Australian wines.

Production techniques relating to wine and grape processing are also expected to be overhauled, to give clear guidance on sanitary and phytosanitary requirements within production.

Other additions to the legislation will include modifying wine labelling. Wine will therefore be allowed to include specific details relating to vine variety, colour, accolades and other specifics related to the product. This will bring the Australian products further inline with labelling on its European counterparts.

The deal is also expected to grant Australian producers some rights to claim European wines brands where standards were met, the EU added.

According to EU figures, the blocs wine exports to Australia were worth €62 million in 2006, while imports conversely totalled €868 million.