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Minister Židan: "An erroneous decision by the Commission in the case of Teran may influence the EU system of protected geographical indications"

Brussels, 23 January 2017 – Upon the request of Slovenia, the EU Agriculture and Fisheries Council discussed the issue of the European Commission powers in the case of the Teran wine to adopt delegated acts for exceptions from the rules on protected designations of origin for wines. Minister Židan pointed out that Slovenia opposed the Commission's intention to approve an exception, as doing so would substantially exceed the delegated powers of the legislator. Slovenia called on the EU Council to examine whether the adoption of such a delegated act, i.e. a tertiary act, would interfere with the legislative powers of the EU Council and with the sovereign rights of Member States as regards negotiations on the rights which concern them.

At the request of the Slovenian delegation, the EU Council meeting discussed the agenda item related to the case of the Teran wine: "Scope of the Commission's powers to adopt delegated acts for exceptions from the rules of protected designations of origin for wines". Minister Židan underlined that the Council should pay attention to the conduct of the Commission, as it would create a serious precedent based on which the Commission would be able to unilaterally interfere with all existing protected designations of origin, even with retroactive effect. "The issue here is the protection of wine at the European level; there are prescribed procedures in place which MS must follow in the pre-accession and international negotiations." The Minister also added that Slovenia expected the European Commission, as the guardian of the acquis, to respect the existing legal order, including the respect for existing procedures, and to act "in good faith" in relation to every Member State.

 

Minister Židan said that despite the opposition of Slovenia, which holds the protected designation of origin (PDO), the European Commission forwarded for reading a delegated act granting – five years after the conclusion of the accession negotiations on agriculture – an exception for labelling wines with the name of a protected designation of origin of another Member State. "It is interesting that the act is supposed to apply retroactively, thus legalising the current illicit market situation." The Commission reasoned its intention in light of the 53 exceptions already granted in favour of MS, including Slovenia in the case of Burgundy and Frankinja. "Slovenia does not deny this fact, but it should be stressed that in these cases the names of varieties were not exactly identical to the names of the protected designations of origin. In the case of Teran, the name is absolutely identical, and there is a substantial difference in the procedure for granting the exception. All aforementioned 53 exceptions were adopted within pre-accession or international negotiations and NOT by a delegated act, as the EC intends to do in the case of Teran."

 

Minister Židan then pointed to the question whether accession negotiations were needed at all. "Full attention must be paid to the method of exercising delegated powers. We believe that according to the applicable rules the question of protection of Teran should have been addressed in accession negotiations, as was the case with Tokaj and Prošek. The legal basis in the Tokaj case was perhaps different, but in terms of substance the cases are identical. Tokaj is a protected designation of origin in Hungary and in Slovakia. Prior to the accession to the EU, the variety Tokaj was grown on more than 220ha in Slovenia, which is comparable to the area of the vine variety Teran in Croatia. The Tokaj variety was included in the OIV list for Slovenia.  No exception was granted in accession negotiation for the use of the name Tokaj, despite such a request by Slovenia. Slovenia therefore substituted this vine variety name with its synonym Zeleni Sauvignon or Sauvignonasse." According to Minister Židan, granting of exceptions is not automatic; in addition to the existing labelling practices, the interests of the holders of the protected designation of origin, any possible misleading of consumers, and negative economic effects must also be considered. 

 

He underlined that Slovenia was not informed that the protection of Teran was a pending issue. "Upon the accession of the new Member State, the European Commission agreed upon all exceptions regarding the labelling of wine, and laid down a transitional period for other wines, including Teran, in the Implementing Regulation 753/2013/EU, adopted due to the accession of Croatia to the EU. This Regulation laid down the transitional period for clearance of wine stocks, including that of Teran, which ended in the middle of last year. This means that a compromise was reached on this issue upon the accession of the new MS." Minister Židan recalled April 2013 when the Commission officially communicated its position: "Teran is protected as a Slovenian wine on the EU market, wherefore no Croatian wine may be placed on the EU market under that name. It is now prohibited in Slovenia, as well as in other EU Member States, to sell wine not originating from Slovenia under the name Teran; after the accession of Croatia to the EU the prohibition will also apply on the Croatian market." Furthermore, a representative of the then Commissioner Dacian Cioloș clearly stated that Croatia did not object when Slovenia registered Teran as a protected designation of origin. Croatia could have done so even if it was not an EU Member State. It follows from the above that no designation of origin is safely protected if the EC decides to use legal means in the form of delegated act in respect of any protection and any period. Minister Židan pointed out that Slovenia opposed the Commission's intention to approve an exception as that would substantially exceeded the delegated powers of the legislator. "Slovenia therefore opposes the Commission's intention to grant a new exception through this procedure, as in doing so it would substantially exceed the delegated powers of the legislator."

 

Minister Židan called on the Ministers to have the highlighted procedural issues and the proposed delegated act and all their relevant aspects examined by their legal experts in the context of the powers conferred upon the legislator.

He also presented the distinct features of Teran and the economic consequences of granting labelling exception to the neighbouring country. Teran is a protected designation of origin for wine that has been produced for centuries form grapes of the Refošk variety grown on the Kras plateau. The Refošk vine variety is planted in as much as 75% of vineyards in the Kras region, therefore the protected designation of origin Teran is of exceptional historical, cultural and economic significance to this sensitive border area that has experienced its share of turmoil. 1 million litres of wine per year is produced on 450 hectares of vineyards; the production is of great importance to Slovenia because the Teran wine is part of Slovenia's identity and culture, a symbol of coping with difficult production conditions and opposing adverse natural conditions. In Slovenia, the Teran wine has always and only been wine produced on the Kras plateau. The Teran wine is a local specialty, produced according to specific requirements, with the required quality and specific characteristics, recognised in the past as having healing properties due to the high content of iron and minerals. Should farmers in the neighbouring country use the vine variety name Teran on their labels, consumers will not distinguish such wine from the genuine Slovenian Teran because of tradition, geographical proximity, and absolutely identical name. Moreover, other producers would not be limited by quality requirements and would be allowed to mix other grape varieties in the proportion allowed. Wine from the neighbouring country labelled with the name of the grape variety Teran would have nothing in common with the Teran wine of prescribed standardised quality produced in Slovenia. That wine would not only cause unfair competition for Slovenian wine producers and 900 families, but would also void the protection, making it weaker. Suddenly, customers would no longer know what to expect when buying Teran."

 

Minister Židan concluded his discussion by saying that he presented the substantive and political aspects in order to make other Member States understand the special importance of Teran to Slovenia. "I would like to call on you to consider how this procedure might affect your protected designations of origin and the entire system of geographical protection, and to consider the powers of the Commission under the Lisbon Treaty to only regulate non-essential and politically less important matters by means of delegated acts," concluded Minister Židan.