Documents considered by the Committee on 19 January 2011 - European Scrutiny Committee Contents


13 Agricultural product quality

(a)

(32343)

17672/10

COM(10) 733


Draft Regulation on agricultural product schemes
(b)
(32344)

17677/10

COM(10) 738


Draft Regulation amending Council Regulation (EC) No 1234/2007 as regards marketing standards

Legal base(a) Articles 43(2) and 118 TFUE: co-decision; QMV

(b) Article 43(2) TFEU; co-decision; QMV

Documents originated10 December 2010
Deposited in Parliament16 December 2010
DepartmentEnvironment, Food & Rural Affairs
Basis of considerationEM of 11 January 2011
Previous Committee ReportNone but see footnote
To be discussed in CouncilNo date set
Committee's assessmentPolitically important
Committee's decisionCleared

Background

13.1 In October 2008, the Commission produced a Green Paper[52] on agricultural product quality. This pointed out that, because of globalisation, products from countries with low production costs were putting greater pressure on EU farmers, and it suggested that "quality" was the best way to tackle these new challenges, this being an area in which the EU had an advantage, given its very high standards of food safety and hygiene. It also noted the diverse requirements of the market, covering not only health and nutritional value, but also so-called "societal demands",[53] and believed that EU farmers should see this as something to be turned to their advantage.

13.2 In seeking views on how the policy and regulatory framework could best promote agricultural product quality, the Green Paper looked at a number of areas. These included:

EU farming requirements

13.3 The Commission noted that all food produced within the EU has to adhere to hygiene and safety standards, relating to the use of pesticides and fertilisers, the prevention of animal and plant diseases, animal welfare, and the protection of the environment. However, it also pointed out that many of these requirements do not necessarily apply to imported foodstuffs, and that, if this was better understood by consumers, it could become a potential marketing advantage.

Marketing standards

13.4 The Commission commented that these lay down definitions, minimum standards and labelling requirements for a significant number of agricultural products and some processed foods, and should enable farmers to deliver the quality expected by consumers. However, it added that some foods — notably arable crops — are not subject to Community-level marketing standards (though general consumer protection and labelling rules apply), and that some standards have proved controversial.

Specific Community quality schemes

13.5 The Commission identified certain specific Community quality schemes which give consumers the assurance regarding quality standards, whilst protecting farmers against imitation products. These include:

—  Geographical indications

These describe an agricultural product or foodstuff which owes its characteristic to the area from which it originates, and include both "Protected Designations of Origin (PDO)" and "Protected Geographical Indications (PGI)",[54] with the latter currently applying to three areas (agricultural products, spirit drinks and wine).

—  Traditional specialities guaranteed

These are the names of agricultural products or foodstuffs produced using traditional raw materials or methods of production, or which have traditional composition. However, since they were introduced in 1992, only 20 names have been registered, with another 30 awaiting registration, and most applicants for registration do so without reserving the product name. Also, few of the products concerned are significant in economic terms.

—  Organic food

There had been a steady growth of demand for organic foods, and controls by public authorities or certification bodies were important to maintain confidence and justify premium prices. Although the EU had since 1991 applied a standard laying down rules, the market had tended to be fragmented along national lines.

—  Other schemes

In addition to these quality schemes, there were a number of further areas, including products of high-nature value or from mountain areas, those involving welfare standards, and the possible extension of the Ecolabel scheme. The CAP "Health Check" had highlighted climate change, biodiversity conservation and water use as being among the highest priorities, and the Commission said that it would evaluate possible new schemes if further legislation was thought necessary.

Certification schemes

13.6 The Commission observed that there had been a substantial growth in private and national food quality certification schemes, but that this had given rise to concerns about their transparency and credibility. It therefore sought views on how effective these schemes had been, and the extent to which current EU oversight had been sufficient.

13.7 This Green Paper was followed in May 2009 by a Commission Communication which summarised the responses it had received, and which suggested that the EU strategic approach in this area should involve:

  • improving communication between farmers, buyers and consumers about agricultural product qualities;
  • increasing the coherence of EU agricultural product quality instruments;
  • reducing complexity to make it easier for farmers, producers and consumers to use and understand the various schemes and labelling terms.

The current proposals

13.8 In these two documents, the Commission summarises the further responses to its 2009 Communication, and proposes draft regulations relating (a) to agricultural product schemes and (b) to marketing standards.

13.9 It says that there was a general welcome for the principal thrust of the Communication, the main views expressed being:

  • opposition to a merging of the PDO and PGI instruments, although (with the exception of the wine and spirits sectors) most respondents favoured merging the three PGI schemes: in addition, there was general support for simplifying, clarifying and streamlining the systems, and for enhancing their international recognition;
  • almost unanimous support for continuation of the traditional specialities guaranteed scheme, but with some calls for it to be simplified, notably by discontinuing the possibility of registering a name without reserving it;
  • a general welcome for simplifying marketing standards, farm labelling, and the further development of optional quality terms;
  • recognition of the need to address the problems of those small-scale producers who found the existing schemes too burdensome.

13.10 The Commission says that it then carried out impact assessments of various options as regards the PDO and PGI schemes on the one hand, and traditional specialities guaranteed on the other. It says that these showed strong justification for an EU level geographical indications scheme, albeit with considerable scope for reducing complexity and facilitating enforcement by merging the scheme for agricultural products and foodstuffs with those for alcoholic drinks; that producer returns from PDOs and PGIs are higher than for non-designated products, with PDO labels commanding the largest premium; but that this added value would diminish if the PDO and PGI instruments were to be merged. In the case of traditional specialities guaranteed, it says, although data was limited by the low uptake, the assessment nevertheless showed the scheme had economic and social benefits, and that there was support for its retention: however, it concluded that there was little or no such benefit in the case of non-protected names, as experience had shown that the function could be taken up successfully by national or regional schemes. At the same time, the Commission notes the limited extent to which either the PDO or PGI schemes had attracted participation by small-scale producers, despite their association with traditional methods and local marketing, and it says that further study will be undertaken of this problem.

DOCUMENT (A) — AGRICULTURAL PRODUCT QUALITY SCHEMES

13.11 This draft Regulation would repeal the two legislative measures[55] currently applicable in this area, and replace them by a single regulatory structure, overseen by a single product quality committee. In the case of PDOs and PGIs, it would maintain and reinforce the scheme for agricultural products and foodstuffs, but, in view of the relatively recent reforms of wines and spirits legislation, the schemes for those products would remain distinct. More specifically, the proposal would:

  • recognise the roles and responsibilities for monitoring, promotion and communication of groups applying for the registration of names;
  • reinforce and clarify the level of protection for registered names and the common Union symbols;
  • shorten the procedure for registering names;
  • clarify the respective roles of Member States and groups applying for registration as regards enforcing the protection of registered names throughout the EU;
  • align the definitions of origin and geographical indication more closely with international usage.

In addition, certain legal issues would be clarified, and minimum common rules laid down on official controls to ensure that a product follows the specification and that correct labelling is applied.

13.12 In the case of traditional specialities guaranteed, the proposal maintains the scheme for the reservation of names guaranteed across the EU, but discontinues the option of registering names without reservation, on the grounds that giving publicity, but not protection, is best achieved at national level. In addition, the new EU scheme would simplify the registration process and align procedures with those for PDOs and PGIs, and target it in certain respects; extend the criterion of tradition from 25 to 50 years, in order to reinforce the credibility of the scheme; restrict it to prepared meals and processed products; and simplify the definitions and procedural requirements. The Commission also proposes that, since optional quality terms (such as "free range") have much in common with the other quality schemes, they should be brought into the current regulation, thus adapting them to the legislative framework of the Treaty, but without amending their content.

DOCUMENT (B) — MARKETING STANDARDS

13.13 The Commission says it is clear that marketing standards can contribute to improving the economic conditions for production, marketing and quality. It points out that market management measures already contain a minimum requirement for produce to be "sound, fair and marketable", and proposes that these requirements should be extended to products not covered by specific standards as a means of reassuring consumers. The new framework would also introduce for all sectors a legal basis for compulsory labelling of place of farming, allowing the Commission — following impact assessments, and on a case by case basis — to adopt delegated acts at the appropriate geographical level. It says that the dairy sector will be one of the first to be examined, but that, for those sectors (such as olive oil and eggs) where mandatory indication of origin already exists, this will be maintained.

13.14 The package also includes two Commission Communications — published in the Official Journal[56] on 16 December 2010 — which provide respectively best practice guidance for voluntary certification schemes and on the labelling of foodstuffs using PROs and PGIs as ingredients.

The Government's view

13.15 In his Explanatory Memorandum of 11 January 2011, the Minister of State for Agriculture and Food at the Department for Environment, Food & Rural Affairs (Mr Jim Paice) says that the proposals in question are justified in accordance with the principle of subsidiarity, as set out in Article 5 TFEU. In particular, he notes that, in the case of document (a), the Commission takes the view that, if the terms and names under the quality schemes enjoyed different levels of protection in each Member State, this could mislead consumers and impede intra-Union trade, and that the determination of such rights, and the recognition of scheme symbols, across the EU can only be achieved effectively and efficiently at EU level. However, the Minister points out that the Commission has recognised that the processing and analysis of applications can be done more efficiently at national level, that it is unnecessary at EU level to continue the option to register traditional specialities guaranteed names which are not protected, and that controls and enforcement should be primarily for national competent authorities, with supervision at EU level. In the case of document (b), he agrees with the Commission's view that, in order to guarantee a uniform application of marketing standards, it is appropriate that these are provided for at EU level, but with Member States being responsible for controls.

13.16 As regards the policy implications, the Minister says that the UK broadly welcomes the purpose of this package, and will play an active part in the detailed discussions which will now follow. He adds that the Government is now studying the details of the two legislative proposals, including whether the provisions related to powers of the Commission to adopt delegated and implementing acts are appropriate. He says that UK impact assessments will be required if domestic legislation is needed, and, in the meantime, comments that the Government is strongly opposed to extending the criterion for traditional specialities guaranteed from 25 to 50 years, and restricting eligibility to processed foods. He also points out that, although none of the EU schemes has budgetary implications, the Commission is proposing that it should take a more active role in order to protect the names of the quality schemes and the Union symbols, particularly in third countries, and that consequently the financial statement to document (a) shows the additional budgetary resources needed (though the sums involved are relatively small, rising from €110,000 in 2012 to €150,000 for 2013-15, subject to the availability of appropriations in 2014 and 2015).

Conclusion

13.17 These two proposals seek to give legislative effect to many of the changes which the Commission suggested in the Green Paper it produced in 2008, and, as such, they largely reflect the views it received in response to that document, and in terms which are broadly acceptable to the UK. Consequently, although the proposals deal with an area of some interest to consumers, they do not appear to us to raise any new issues, or ones sufficiently significant to require further consideration by the House. We are therefore clearing them.


52   (30059) 14358/08: see HC 19-viii (2008-09), chapter 12 (25 February 2009). Back

53   Including, for example, environmental, ethical and social considerations. Back

54   In order to qualify as a PDO, all production steps must take place in the area, whereas in the case of a PGI, this is required of only one such step. Back

55   Regulation (EC) No 509/2006 on agricultural products and foodstuffs as traditional specialities guaranteed (OJ No. L93, 31.3.2006, p.1), and Regulation (EC) No 510/2006 on the protection of geographical indications and designations of origin for agricultural products and foodstuffs (OJ No. L93, 31.3.2006, p.12). Back

56   OJ No C.341, 16.12.10, p.3. Back


 
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