Explanatory Memorandum to COM(2018)332 - Authorisation to open negotiations on an agreement with the USA on the import of High Quality Beef from animals not treated with certain growth-promoting hormones

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CONTEXT OF THE PROPOSAL

2.

Reasons for and objectives ofthe proposal


This initiative is intended to modify the current arrangements with the US regarding the importation of hormone~free beef. It is not meantto affect in any way the EU ban on h o r m o n es_tre ate d beef as such.

In Uecem ber 2016 the U nited States took steps to reinstate increased duties on c e rta i n EU products following concerns raised by the US beef industry claiming that the European Union may be violating the Revised M emorandum of Understanding with the United States of A merica Regarding the Importation of Beef fro m A n i mals NotT reated with Certain Growth"Pro m oti ng Hormones and Increased Duties applied by the United Otates to Uerta i n Products of the Luropean Union of 21 0 cto ber 2013 Ithe revised MOU"). T he revised MOU was concluded between the Luropean Union and United States of America following a WTO dispute settlement proceeding in DS26 EC - Mea sures concerning M eat and M eat Products (Hormones) and notified to the WTO Dispute Settlement Body on 14 Apri, 2014 as a mutually agreed solution to implementthe report in the dispute settlement proceedings.

Pursuant to the original MOU and its revised version the EU opened an annual tariff rate quota for High Quality Beef.

Following the opening of the procedure by the United States to rein state increased duties on certain EU products in December 2016 the parties conducted consultations regarding the operation ofthe revised MOU, as referred to in its Article IV.

The recommendation seeks an authorisation to negotiate an agreement with the United States of A merica, following the mentioned consultations, as regards the operation the tariff rate quota for High Quali ty Beef and possibly its country allocation.

Negotiations with other supplying countries may be needed to ensure that any agreed country allocation of the said tariff rate quota with the United States respects their existing rights under the WTO/GATT A g re e m e n ts.

Consistency with existing policy provisions in the policy area N ot a p pIi ca bIe.

Consistency with other Union policies N ot a p pIi ca bIe.

3.

LEGAL BASIS, SUBSI DIARITY AND PROPORTIONALITY


L

4.

e g a I basis


Artie,e 207 of the TFEU ( common commercial policy) together with Artie,e 218(3) and (4).

OJ L 27, 30.1.2014 P. 2. OJ L 148, 8.6.2012 P. 9.

EN

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EN

Sub

sidiarity [for non-exclusive competence^

Not applicable, as the Union competence in the area of common commercial policy is exclusive (Artie,e 3(1)(e) of TFEU).

5.

Proportiona I ity


N ot a p pIi ca bIe.

6.

Choice of the instrument


The conclusion of an International agreement is the only method that ensures that its signatories will not question what was agreed at a later stage.

7.

RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS


Ex_post evaluations/fitness checks of existing legislation N ot a p pIi ca bIe. Stakeholder consultations

The R oadmap on the initiative on authorising the opening of negotiations on an agreement with the United States of A merica regarding the importation of high q u a I i ty beef from animals not treated with certain growth~promoting hormones was open for public consultation from 27 IVI arch to 24 Aprn 2018. I n totaI 37 contributions were submitted, 24 fro m EU citizens or enterprises or professional organisations, 13 from non- EU companies and governments.

Twelve submissions were from EU citizens (Belgium, Germany, Greece, Italy, Spain and Sweden), expressing supportfor an agriculture respectful ofthe environment, for animal welfare and healthy products, and highlighting the importance of producing meat without hormones and antibiotics. Some argued that meat consumption should be reduced.

Four submissions were from EU small and medium size companies (Greece, Italy and the UK), either in favour ofthe EU initiative, or requesting thatthe management system be revisited too, while another called for a wait~and~see approach. One s u g g ests consulting companies active in trade of beef meat and giving them time to adapt to the outcome. One expressed satisfaction with the current supply of beef under the quota.

The last eight contributions from insidethe EU were from professional organisations. EU"level, France, Germany, Italy and the UK. T hey recalled that in the EU horm ones are banned as growth promoters in animal husbandry, that standards of food safety and health that apply in the EU must be maintained. I wo stressed that negotiations should not increase the volume authorised to import under the quota. One flagged also that antibiotics are being used in substitution as growth promoters. One stressed that any agreement must be in line with WTO law. T wo argued for EU a uth oriti es to support the EU bovine meat sector, and two underlined the importance of finding a solution with the US to avoid any damageable trade war.

Thirteen nonTU contributions came mostly from Ar g entinian companies and professional organisations that advocate for Argentina being recognised as a party in the negotiations. A New Zea, ander meat organisation supported by its government stressed that while being a small supplier within the quota these expo rts are i m p o rta nt f o r New Zea, and economy and requested that New Zea, and be consul ted.

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The I a st two submissions are from the Australian and Uruguayan governments arguing for participating to the negotiations according to WTO , a w.

8.

Collection and use of expertise


N ot a p pIi ca bIe.

9.

I m p a ct assessment


Not applicable.

Regulatory fitness and simplification Not applicable Fundamental rights N ot a p pIi ca bIe.

1.

BUDGETARY IMPLICATIONS



None,

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10.

Reco m mendation for a


COUNCIL DECISION

authorising the opening of negotiations on an agreement with the United States of A merica Regarding the Importation of I ligh Q uality Beef from animals not treated with

certain gro wt h~promoting hormones

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Artie,es 207 and 218(3) and (4) thereof,

Having regard to the recommendation from the European Commission, W h e r e a s,

On 21 October 2013 the E uropean Union concluded the Revised M emorandum of

Under st anding with the United States of A merica Regarding the Importation of Beef f ro m /An i m a I s Not T reated with Certain Growth"Pro m oti ng Hormones and Increased Duties applied by the United States to C e rta in Products of the European Union (the

11.

revised


MOU).

The revised MOU was concluded following a WTO dispute settlement proceeding in DS26 EC - Mea sures concerning M eat and M eat Products (Hormones) and was notified to the WTO Dispute Settlement Body on 14 Aprn 2014.

Pursuanttothe original M OU and its revised version the EU opened an annual tariff rate quota for High Quality Beef.

The E uropean Union and the United State s of A merica conducted consultations regarding the operation of the revised MOU, a s foreseen in Article IV thereof.

The C om mission should therefore be authorised to open negotiation with the United States of A merica regarding the operation, including the countryal location, of the tariff rate quota opened pursuant to the revised MOU. The C om mission should also seek to obtain the accord of other substantial supplying countries with regard to the countryal location of the said tariff rate quota, in line with the applicable WTO rules, to the extent necessary.

OJ L 27, 30.1.2014 P. 2. OJ L 148, 8.6.2012 P. 9.

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12.

HAS ADOPTED THIS DECISION


Article 1

The Commission is hereby authorised to open negotiation on behalf of the European Union with the United States of A merica concerning the operation of the tariff rate quota opened pursuant to the Revised M emorandum of Under standing with the United States of A merica Regard i ng the I m portation of Beef fro m An i mals N ot T reated with Uertai n UrowthTromoting Hormones and Increased Duties applied by the United States to Certain Products of the European Union of 21 0 cto b e r 2013, including the countryallocation of the same tariff rate quota. The Commission is hereby also authorised to open negotiation on behalf of the European Union with other substantial supplying countries, to seek to obtain their accord as regards the countryal location of the same tariff rate quota, in line with the applicable WTO rules, to the extent necessary.

Article 2

The negotiations shall be conducted on the basis of the negotiating directives of the Council set out in the Annex.

Article 3

The Commission shall conduct negotiations in accordance with WTO rules and in consultation with [name of the special committeeto be inserted by the Council].

Article 4

This Decis ion is addressed to the Vvom mission. Done at Brussels,

Fa r the Council Th e President

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