– having regard to the Commission proposal to Parliament and the Council (COM(2011)0384),
– having regard to Article 294(2) and Article 207 of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0170/2011),
– having regard to Article 294(3) of the Treaty on the Functioning of the European Union,
– having regard to the undertaking given by the Council representative by letter of ..... to approve Parliament’s position, in accordance with Article 294(4) of the Treaty on the Functioning of the European Union,
– having regard to Rule 55 of its Rules of Procedure,
– having regard to the report of the Committee on International Trade and the opinion of the Committee on Agriculture and Rural Development (A7-0025/2012),
1. Adopts its position at first reading hereinafter set out;
2. Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;
3. Instructs its President to forward its position to the Council, the Commission and the national parliaments.
Proposal for a regulation
Article 2 - paragraph 1 a (new)
Text proposed by the Commission
It shall apply from ......* .
* OJ : insert the date - the first day of the month following the entry into force of this Regulation
Beef hormone dispute
The dispute on beefhormones negatively affected transatlantic trade relations in agricultural products for more than two decades. In 1988 the EU banned imports of beef and beef products, treated with certain growth-promoting hormones for reasons of consumer protection and food safety. In 1996 the United States and Canada challenged the ban in the WTO dispute settlement system and were subsequently authorised to impose trade sanctions on agricultural products imported from the EU. Since 1999 the US and Canada imposed retaliatory tariffs on a wide range of European products, respectively worth US$116.8 million and C$11.3 million a year.
Although the conflict over hormone-treated beef involved relatively small amount of trade, it led to trade reduction and had significant repercussions on both sides of the Atlantic. Close trading partners got entrenched in a lengthy and unconstructive trade dispute.
Continued application of retaliatory duties on certain European products hampered exports and EU producers subsequently suffered a loss of market share. Canada and the US primarily targeted bovine and swine meat products, with the latter also sanctioning Roquefort cheese, truffles, toasted breads, juice, mustards, jams, chocolate, soups and other products.
The US Administration's initial intention to start applying "carousel sanctions" – increase some duties and change the scope and list of products subject to them – from March 2009 would have had an even more severe disruptive effect and could have further escalated the spiral of retaliatory trade reduction.
In its resolution of 8 May 2008 on the Transatlantic Economic Council, European Parliament has called upon the US to end retaliatory sanctions on European goods(1). In the resolution of 8 March 2011 on EU Agriculture and international trade the European Parliament has urged European Commission to ensure that the settlement of the ‘beef hormones’ dispute would allow for the suspension of the sanctions on EU products, while guaranteeing that beef imports to the EU will be in line with EU requirements(2).
A pragmatic way out of the destructive dynamics of trade sanctions was found through bilateral negotiations between the European Union, the United States(3) and Canada(4). The negotiations resulted in a so called Memorandums of Understanding (MoUs), which foresee gradual lifting of sanctions imposed on EU agricultural products by the US and Canada in exchange of an autonomous, zero-duty, tariff-rate quota for high quality beef not treated with hormones.
In line with commitments for "Phase 1" of the MoU with the US, the Union established with Council Regulation (EC) No 617/2009(5) an additional Union import tariff quota for high-quality beef of an annual quantity of 20.000 tonnes. In return the US refrained from applying "carousel" sanctions and brought the total amount of annual sanctions down by 68% from US$116.8 million to US$37.8 million.
An amendment of the Regulation (EC) No. 617/2009 is prerequisite for the implementation of "Phases 1 and 2" of the MoU with Canada and of "Phase 2" of both MoUs. This is the substance of the present legislative procedure. By amending the Regulation (EC) No. 617/2009 the European Parliament and the Council increase the annual Union import tariff quota to 48.200 tonnes. The US and Canada have already fulfilled their commitments under Phase 2 and suspended all retaliatory sanctions in the course of 2011.
Your Rapporteur strongly supports the Commission's proposal for a regulation of the European Parliament and of the Council amending Council Regulation (EC) No 617/2009 opening an autonomous tariff quota for imports of high-quality beef.
The Memorandums of Understanding and their implementation clearly constitutes a win-win situation for the trading partners on both sides of the Atlantic. As the US and Canada have already suspended all retaliatory sanctions in the course of 2011, failure to honour the deal on the European side could have very negative political consequences and would do damage to the transatlantic trade relationship.
The conclusion of the legislative procedure will permit the EU to comply with commitments undertaken towards resolving the dispute. Naturally the MoU ensures that all beef products shipped under this quota will continue to comply with stringent food safety requirements set out in the EU legislation. In particular doors will not be opened to hormone treated beef from the US or Canada, or from any other origin.
A quick and smooth adoption of the present Regulation will help to re-build and strengthen good faith and bridge existing gaps in the transatlantic trade relations in this sector. Nevertheless, the Commission must be empowered to fully or partially suspend the annual Union import tariff quota in case the agreement is not implemented or maintained by the United States or Canada. It is appropriate to use the examination procedure pursuant to Article 5 of the Regulation (EU) No 182/2011 of the European Parliament and of the Council of 16 February 2011 laying down the rules and general principles concerning mechanisms for control by Member States of the Commission’s exercise of implementing powers(6) for the suspension.
Your Rapporteur stresses that the final settlement of the beef hormone dispute should create further momentum towards greater economic and commercial integration between the EU on the one side and the US and Canada on the other side. Notwithstanding possible differences in opinion, it should always be the aim to reach a compromise rather than disrupting bilateral trade. By further dismounting trade barriers with its major trading partners the EU, demonstrates its commitment to strengthen this longstanding economic relationship in terms of trade.
The adoption of this Regulation by the European Parliament and the Council will lead to mutual benefits, will strengthen transatlantic trade links and will build confidence by improving market access on both sides of the Atlantic.
Commitments under MoUs signed by the EU with United States (13 May 2009) and Canada (17 March 2011)
EU tariff-rate quota for hormone-free beef (zero duty, tonnes, annual, MFN)
Commitments under MoU
on sanctions on EU products
United States (but MFN)
(sanctions since 1999)
Canada (sanctions since 1999)
From August 2009
·"Carousel" sanctions not imposed
·Reduction of increased duties from authorised value of USD 117 million to USD 38 million
Early unilateral withdrawal of all sanctions in May 2011
Before August 2012
21,500 (proposed amend. regulation)
Withdrawal of all sanctions from authorised value of 11.3 million CAD
Repealed all sanctions in August 2011
From August 2012
48,200 (proposed amend. regulation)
suspension of all increased duties
From August 2013
conditions TBD with the view of permanent settlement and elimination of sanctions (quota size remaining unchanged)
Following the stand off in the WTO between the United States of America (US) and the Union over imports of 'hormone treated beef', an agreement has now been reached between them that will bring to an end this long lasting and damaging dispute.
This solution, negotiated by Catherine Ashton, then EU Trade Commissioner, and the US Government was signed on 13 May 2009. The deal foresees a two-phase arrangement whereby the US progressively reduces the level of sanctions imposed on Union products, while the Union progressively increases its tariff-rate quota (TRQ) for hormone-free "High Quality" beef(1). The first phase of this agreement was established in Council Regulation (EC) No 617/2009 opening up an additional TRQ of 20,000 tonnes and in return the US removed 68% of their listed sanctions. It is now time to approve the second phase of this agreement which must be implemented by 1st August 2012, according to the relevant Memoranda of Understanding(2). This second step entails a complete removal of the US sanctions, in exchange for a further expansion of the Union TRQ by 25,000 tonnes for the US and 3,200 tonnes for Canada.
For the first time, the European Parliament is co-legislating with the Council on this dossier, according to the ordinary legislative procedure.
Your Rapporteur strongly supports the Commission’s proposal for a Regulation of the European Parliament and of the Council amending Council Regulation (EC) No 617/2009 opening an autonomous tariff quota for imports of high-quality beef.
Your Rapporteur would like to highlight some of the main benefits this agreement would bring to the Union.
1. This agreement makes it possible for the Union to keep its ban on hormone-treated meat and meat products in place, despite the fact that the Union was found in breach of its WTO obligations.
2. The adoption of the second phase of this agreement is vital for the Union to secure a complete lifting of the US sanctions placed on European products originating from 26 Member States (all except the UK) amounting to over 250 million US dollars in current trade terms. Some of the main beneficiaries that stand to gain from the lifting of sanctions are Italy with over 99 million USD worth of trade, Poland with 25 million USD, Greece and Ireland with each 24 million USD, Germany and Denmark with each 19 million USD, France with 13 million USD and Spain with 9 million USD. Some of the key national products affected by the sanctions are: mineral water, swine meat, canned and prepared fruits, chocolate, juices, oats, chewing gum, jams, Roquefort cheese, fresh truffles, etc.
3. If the agreement was to be rejected, the sanctions would be reinstated and the dispute settlement process would collapse. The Union would find itself running the risk of further retaliation measures, effectively having to compensate the US for the damage caused following failure to comply with WTO rulings.
4. It should also be noted that the impact of the second phase of the agreement on the EU beef market should be small, given that the additional autonomous tariff quota for hormone-free beef corresponds to only 0.36% of the EU total beef and veal market(3).
5. In concluding this final agreement, the European Parliament sends a very important signal to the US that it is willing to deepen transatlantic trade relations and improve dispute settlement resolutions in the WTO, by embracing a more pragmatic, more efficient and less politically damaging way forward on difficult issues.
The US has already agreed to a full suspension of all sanctions against the Union in May 2011, paving the way for a swift implementation of the second phase of the agreement. It is therefore important for the Union to honour its side of the deal in a timely manner to meet the deadline of 1st August 2012.
The Committee on Agriculture and Rural Development calls on the Committee on International Trade, as the committee responsible, to propose that Parliament adopts its position at first reading taking over the Commission proposal.
Amending Council Regulation (EC) No 617/2009 opening an autonomous tariff quota for imports of high-quality beef
John Stuart Agnew, Richard Ashworth, Liam Aylward, Luis Manuel Capoulas Santos, Michel Dantin, Paolo De Castro, Albert Deß, Herbert Dorfmann, Iratxe García Pérez, Sergio Gutiérrez Prieto, Martin Häusling, Esther Herranz García, Peter Jahr, Elisabeth Jeggle, Elisabeth Köstinger, Agnès Le Brun, George Lyon, Gabriel Mato Adrover, Mairead McGuinness, Mariya Nedelcheva, James Nicholson, Wojciech Michał Olejniczak, Georgios Papastamkos, Marit Paulsen, Britta Reimers, Ulrike Rodust, Giancarlo Scottà, Czesław Adam Siekierski, Sergio Paolo Francesco Silvestris, Marc Tarabella, Janusz Wojciechowski
Substitute(s) present for the final vote
Spyros Danellis, Marian Harkin, Christa Klaß, Giovanni La Via, Astrid Lulling, Milan Zver
William (The Earl of) Dartmouth, Laima Liucija Andrikienė, María Auxiliadora Correa Zamora, Marielle De Sarnez, Christofer Fjellner, Yannick Jadot, Metin Kazak, Bernd Lange, Emilio Menéndez del Valle, Vital Moreira, Paul Murphy, Cristiana Muscardini, Franck Proust, Godelieve Quisthoudt-Rowohl, Niccolò Rinaldi, Helmut Scholz, Peter Šťastný, Gianluca Susta, Keith Taylor, Jan Zahradil, Paweł Zalewski
Substitute(s) present for the final vote
Amelia Andersdotter, José Bové, George Sabin Cutaş, Mário David, Syed Kamall, Silvana Koch-Mehrin, Inese Vaidere, Pablo Zalba Bidegain
Substitute(s) under Rule 187(2) present for the final vote
Véronique De Keyser, Jutta Haug, Pier Antonio Panzeri, Jean Roatta, Traian Ungureanu