Explanatory Memorandum to COM(2022)117 - Conclusion of the amendments to the International Sugar Agreement, 1992 - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | COM(2022)117 - Conclusion of the amendments to the International Sugar Agreement, 1992. |
|---|---|
| source | COM(2022)117  |
| date | 21-03-2022 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
The Union is a party to the International Sugar Agreement 11 (‘the Agreement’) and a Member of the International Sugar Organisation (‘ISO’). By Council Decision (EU) 2017/2242 of 30 November 2017 22 and Council Decision (EU) 2019/2136 33 the Commission was authorised by the Council to open negotiations with the other parties to the Agreement, with a view to modernise the Agreement, in particular as regards the discrepancies between the number of votes and financial contributions of Members and their relative position in the global sugar market.
The amendment of the Agreement was negotiated in consultation with the Working Party on Commodities (PROBA) and duly reflects the negotiating directives issued by the Council. Changes concern the following three areas: the administrative budget and contributions of Members under Article 25; the broadening of the objectives, studies, evaluations and the research activities, allowing for the inclusion of other sugar related products (in particular bioethanol) in the scope of Articles 1, 32, 33 and 34; and the rules for the appointment of the Executive Director under Article 23.
During the 59th meeting of the International Sugar Council on 26 November 2021, the International Sugar Council (‘ISC’) voted unanimously in favour of recommending the Members of ISO to amend the Agreement, in accordance with the outcome of the negotiations.
The objective of this Council Decision is to approve the amendments and designate the person(s) empowered to deposit, on behalf of the Union, the notification of acceptance of the amendment at the designated location.
2. LEGAL BASIS
In accordance with Articles 207 i and 218(6) point (a)(v) of the TFEU, the Commission as the negotiator of the amendments to the Agreement should make a proposal to the Council to conclude, after the consent of the European Parliament, the amendments to the Agreement.
3. BUDGETARY IMPLICATIONS
Under current rules on financial contributions to the ISO, the Union’s share of the financial contribution has remained practically the same since 1992, although the global sugar market, and in particular the Union’s relative position in it, has substantially changed since then. As a result, the Union has assumed a disproportionately large share of the budgetary costs 44.
With the approval of the amendment of Article 25 of the Agreement, which governs the adoption of the administrative budget and contributions of Members, the calculation for distribution of votes will be better aligned with the current world sugar market. A transition period of maximum ten years is provided for, in which the annual change in the number of votes is limited to 15% in the first five years and 20% for the remaining part of the transition period. The change in the calculation method will lower the amount of votes for budgetary purposes distributed to the EU, which in turn will reduce the contribution of the EU to the ISO.
4. OTHER ELEMENTS
• Detailed explanation of the specific provisions of the proposal
In accordance with Article 44 i of the Agreement, each Member shall notify the depositary of its acceptance of the amendment within the time fixed by the ISC. Following the timetable as agreed by the ISC, Members have until 25 November 2022 to obtain approval for the amendments in accordance with their constitutional procedures. After the approval is obtained, Members have to provide a depositary notification of acceptance of the amendments at the United Nations Secretary-General in New York before 30 June 2023.