US/EC Wine Agreement Q&A’s
- Does the Agreement address all wine trade issues between the U.S. and the EU?
No. This Agreement is the first phase and while it does address a number of issues between the two parties other important issues remain and will be addressed in future negotiations.
- What are the major provisions of this Agreement?
- The U.S. will seek legislative changes to limit the use of 16 semi-generic names, such as Chablis and Sherry, to wine that originates in the EU. Existing uses of these names on non-EU wine will be permitted to continue (Industry Circular 2006–1).
- Once the changes are made, the EU will accept all current U.S. winemaking practices, including those that are not currently approved for use in the EU and those for which they have been granting temporary derogations. The Agreement also establishes a process for both parties to approve new winemaking practices.
- What are some of the current U.S. winemaking practices that were previously not accepted by the EU?
- Lactic acid
- Malic acid
- Reverse osmosis for alcohol reduction
- Reverse osmosis for removal of off flavors
- Ion-exchange
- Spinning Cone Column
- Fluid milk
- Half and Half
- What are the semi-generic names (Industry Circular 2006–1)?
- Burgundy
- Chablis
- Champagne
- Chianti
- Claret
- Haut Sauterne
- Hock
- Madeira
- Malaga
- Marsala
- Moselle
- Port
- Rhine
- Sauterne
- Sherry
- Tokay
- Under the terms of the Agreement the rules that apply to the semi-generic names will also apply to Retsina.
- How will the U.S. wine industry benefit from the Agreement?
- The Agreement provides a more stable environment in wine trade.
- The EU will accept all existing U.S. wine making practices.
- A process for accepting future U.S. wine making practices is established.
- U.S. wineries may continue to use semi-generic names on labels bearing a brand name or a brand name and a fanciful name that appears on a label that was approved before March 10, 2006 (effective date of the Agreement).
- The EU will recognize all requested U.S. names of origin.
- U.S. wine sold in the EU may be labeled with certain terms that are sometimes referred to as “Traditional Expressions.”
- The EU import certification form (VI1) will be simplified, including self-certification and electronic submission of the form (where possible).
- The U.S. will gain the ability to export to the EU wines over 15% alcohol.
- How will the EU benefit from the Agreement?
- The U.S. will accept all EU winemaking practices.
- EU wines will be exempt from U.S. wine import certification requirements.
- There will be no new uses of the semi-generic names (Industry Circular 2006–1) on non-EU wine in the U.S. market.
- The U.S. will recognize all requested EU names of origin.
- With the signing of the Agreement on March 10, 2006, are all of its provisions now in effect?
No. Two provisions are not yet in effect. EU acceptance of U.S. winemaking practices and U.S. limitation of use of semi-generic names (Industry Circular 2006–1) will not take effect until the U.S. enacts legislation to change the legal status of the semi-generic names.
- If EU acceptance of U.S. winemaking practices is contingent upon a U.S. legislative change in the status of semi-generic names (Industry Circular 2006–1), what happens in the interim?
The interim period is covered by the Bridge Agreement that was negotiated and signed on November 23, 2005, to address the time between the signing of the main Agreement and U.S. Congressional enactment of legislation to change the legal status of the semi-generic names (Industry Circular 2006–1). The Bridge Agreement extended prior EU derogations for U.S. winemaking practices for up to five years. Also under the Bridge Agreement, EU natural grape wine containing 0.5 to 22 percent alcohol by volume was exempted from the U.S. wine certification requirements for the same period.
- What are the labeling terms sometimes referred to as “Traditional Expressions” that the U.S. will be able to use on wine sold in the EU?
The terms are: Chateau, classic, clos, cream, crusted/crusting, fine, late bottled vintage, noble, ruby, superior, sur lie, tawny, vintage and vintage character.
- What are the conditions for use of “Traditional Expressions”?
- Under the Agreement, when their use is restricted by EU regulations, a U.S. winery may use them on wine in the EU provided the term has been approved for use on a Certificate of Label Approval in the U.S. (subject to EU trademark law).
- These conditions shall apply for a period of three years and will be extended for successive two year periods. During this time further talks will be held to resolve differences.
- How will the grandfathering of the semi-generic names and Retsina (Industry Circular 2006–1) work?
- Current U.S. law allows the semi-generic names to be used on non-EU wine so long as the true place of origin appears together with the semi-generic name, for example “New York Champagne.”
- As a result of this Agreement the U.S. will seek to change that law to restrict the use of the 16 semi-generic names, plus Retsina (Industry Circular 2006–1), to wine originating in the EU.
- The exception will be that brands of non-EU wine that used the semi-generic name on a label appearing on a Certificate of Label Approval that was approved prior to March 10, 2006, may continue to use the semi-generic name or Retsina (Industry Circular 2006–1).
- The grandfathering is tied to a brand name (or brand name together with a fanciful name), and NOT to a brand holder. Thus if the brand is sold, any subsequent owner may continue to use the semi-generic name or Retsina so long as the brand name does not change.
- The semi-generic name or Retsina may or may not be a part of either the brand name or fanciful name. This is not the determining factor for whether or not a brand will be grandfathered.
NOTE: For a more detailed discussion of this issue, see Industry Circular 2006–1.
- What is Retsina?
- U.S. regulations define Retsina as grape wine fermented or flavored with resin and do not place any restriction on its use based on the origin of the wine.
- Under the terms of the Agreement, the U.S. will take action to restrict the use of the name Retsina to wine that originates in Greece.
- As with the semi-generic names current uses of Retsina will be grandfathered.
NOTE: For a more detailed discussion of this issue, see Industry Circular 2006–1.
- What is a brand name, and what is a fanciful name?
- A brand name is the name under which the wine is marketed.
- A fanciful name is a name used in addition to the brand name to market the wine. An example is “Johnson - Bountiful Harvest” where Johnson is the brand name and Bountiful Harvest is the fanciful name. Frequently several fanciful names are associated with a single brand name.
- When will the next phase of negotiations begin? What will be covered?
- Phase Two negotiations are expected to begin Summer, 2006.
- Topics that could be discussed in the next phase of negotiations include:
- Use of the semi-generic names.
- The process for acceptance of new wine-making practices.
- Certification requirements.
- Names of origin.
- What is the U.S. wine import certification law?
- Is EU wine subject to the U.S. wine certification requirements?
No. Section 2002 of the Miscellaneous Trade and Technical Corrections Act of 2004, states that natural wine imported from a country that has an agreement with the U.S. or that is a party to a multilateral agreement in which the U.S. is a party is exempt from the certification, so long as the U.S. accepts that country’s winemaking practices. Even before the signing of the main Agreement on March 10, 2006, with the signing of the Bridge Agreement on November 23, 2005, EU natural grape wine containing 0.5 to 22 percent alcohol by volume was exempted from the U.S. wine certification requirements.
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