The UK’s Wine and Spirit Trade association (WSTA), Scotch Whisky Association (SWA), spiritsEUROPE and the Comité Européen des Entreprises Vins (CEEV) have created a joint paper that sets out the industry’s shared Brexit requests; and maps out how to overcome issues affecting the industry.
“With officials continuing to lock horns over Brexit, the trade has decided to take the bull by the horns,” says the WSTA as the four organizations launched their position paper this week.
“Unlike the politicians negotiating the divorce bill, there is a high degree of positive integration and collaboration within the European wine and spirit sector who have worked together for the last 44 years.”
Key priorities for the wine and spirits industry include preserving trade flows; avoiding border tariffs; protecting GIs and ensuring harmonized legislation.
Brexit is being discussed at a key summit of EU leaders in Brussels this week (October 19-20).
‘Large, well-established and balanced’ trade flows
The UK is the world’s second largest importer of wine, and a significant market for wines produced in the EU.
Meanwhile, the EU represents a significant export market for British spirits, such as Scotch whisky.
The trade flows between the two regions are ‘large, well-established and balanced’ – with €2.3bn ($3bn) of UK wine and spirits products going to the EU27 every year, and €2.9bn ($3.8bn) of European wine and spirits travelling the other way.
Wine and spirits traded between the EU and UK are not currently subject to tariffs. However, the industry warns that unless the UK remains in the Customs Union, or a Free Trade Agreement is negotiated, this tariff-free environment will change post Brexit.
Avoiding border tariffs and admin costs
The wine and spirit industry’s key aim is to urge the EU and UK to reach a negotiated settlement that preserves trade flows and avoids border tariffs and related administration costs.
“The wine and spirit sectors currently depend on the freedom of movement of goods, and also benefit from the freedom of movement of people and capital within the EU,” says the WSTA.
“These benefits are currently extended to the UK as a result of EU membership, and ensure smooth transit of goods across the continent.
“The wine and spirits industry has come together to urge the EU and UK to reach a negotiated settlement that preserves trade flows and avoid border tariffs and related administration costs.
“The paper makes clear that it is the united position of wine and spirit producers across Europe that no deal is an unacceptable outcome from negotiations."
Wine and spirit industry position summary: key points
- Our sectors currently depend on the freedom of movement of goods, and benefit from the freedom of movement of people and capital within the EU (including the UK).
- It is vital for the continued success of EU & UK businesses that trade is maintained after Brexit with minimum disturbance.
- We strongly urge the EU & UK to reach a negotiated settlement. No deal is not an acceptable outcome for our sector.
- Our aim is a gold standard, living agreement between the EU & UK that preserves fair competition and maintains consumers’ confidence.
- The future regime should maintain a high degree of harmonization or convergence of legislation including wine and spirits definitions, oenological practices and the recognition of GIs.
- We need frictionless trade between the EU & UK through a comprehensive customs agreement to avoid border tariffs, processing delays, (possible) conformity assessments and related administration costs.
- Transitional implementation arrangements will be needed: early announcement of those arrangements will facilitate business planning.
- Agreement to allow people currently legally working in the EU28 to remain in their place of work and for future hirings and movements to be as seamless as possible.
“A post-Brexit relationship should also look to preserve the high degree of harmonization and convergence of legislation found in both the EU and UK markets, with continued harmonization of wine and spirits definitions, wine making practices and mutual recognition of Geographical Indicators (GIs),” continues the WSTA.
Jean-Marie Barillère, president of CEEV, points out that the industry produces high quality products, many of which include PDO/PGI wines and GI spirits. “The industry supports hundreds of thousands of jobs, investment, and significant bilateral trade between the EU27 and the UK.
“Continuity and legal protection for wines and spirits in the UK and EU27 must be secured and this should include early and mutual recognition of PDO/PGI wines and GI spirit drinks.”
GI protection and rules of origin
Cognac, Scotch Whisky, Irish Whiskey, Polish Vodka, Champagne, Prosecco… many wine and spirits sectors are protected by geographical indicators: a ‘clear indication of a sector rooted in culture and tradition’.
In fact, some 63% of EU wines are protected by a PDO/PGI (protected designation of origin / protected geographical indication): and these wines make up 90% of the sector’s EU exports by value.
The position paper calls on the UK and EU to maintain the same level of protection for GIs, and says the UK should establish a GI register that mirrors the EU system, ensuring there is adequate protection for EU products in the UK.
Other rules affecting the industry include Spirit Drinks Regulation 110/2008, which sets out rules of defining, producing and labeling spirits in the EU.
Wines, meanwhile, are subject to detailed rules that encompass definitions, oenological practices, presentation, labeling and EU organic regulations.
Images (top to bottom): istock/nirodesign; istock/getty; istock.