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Posted: Thursday, December 13 2007. 1:00 PM

EU Parliament Dilutes Reforms

The European Parliament on Wednesday voted a significantly diluted version of the planned reform of the EU wine sector, removing the proposed ban on use of sugar, the most debated and controversial point.

The EU assembly also called for subsidies for wine enrichment with pure must grape juice, practiced in southern countries. Northern members like Germany may continue to add sugar. It also refused a proposal to fully liberalize planting rights for vintners producing quality wines on areas previously not used as vineyards by 2014.

Next week, EU agriculture ministers will hammer out a final compromise on the reform, proposed to reverse falling sales and remove trade-distorting measures.

The parliament's role is only consultative, and governments can overrule the assembly on any of the amendments. But the vote by EU lawmakers-some of them originally farmers by profession, is an important indicator of trends in the member states.

On Tuesday, the EU's top agriculture official had already said that the planned blanket ban on adding sugar to wine, a practice used by vintners in countries with a cooler climate, such as Germany, Austria, Luxembourg and the Czech Republic, to boost alcohol content in mass-market wines, may be scrapped.

But EU Farm Commissioner Mariann Fischer Boel said she would not agree to a complete watering down of her proposals to boost sales by producing more quality wines and to reduce "wine lakes" that cost hundreds of millions of euros to get rid of.

The European Commission insists the bloated EU wine industry must cut overproduction or risk further decline in the face of increased imports of New World wines. Its proposals include pulling up unprofitable vineyards, ending subsidies for massive and costly distillation of unsold wine into industrial products, and harmonizing labeling to make it more consumer-friendly.

Among other amendments, the European Parliament called subsidies for distillation to be maintained and for aid to producers of lower-quality wines who decide to stop production to be disbursed within three years instead of five.

The EU member states aim for a deal by the end of the year, although the most contentious issues are yet to be settled.

       

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