The EU Council of Ministers adopted in April 2008 a thorough reorganisation of the way the EU wine market is managed, in order to ensure EU wine production matches demand, eliminate wasteful public intervention in EU wine markets, and redirect spending to make European wine more competitive. In December 2013, the European parliament and the Council adopted a reform that harmonises, streamlines and simplifies the provisions of the CAP. For the wine sector, it mostly renews the measures and approaches initiated during the 2008 wine reform. As from 2016, in the wine sector, the planting rights system will be replaced by a dynamic planting-authorisation management mechanism.
Since the introduction of the common market organisation (CMO), the wine market has developed considerably.
In brief, it has been characterised by:
a very short initial period of equilibrium, followed by
a very marked increase in production against a constant level of demand,
and finally, a continuous decline and a very noticeable qualitative change in demand from the 1980s.
These changes have been dealt with by significantly developing the CMO:
It started out very open, with no curbs on plantings and very few market regulation instruments (the aim being to confront the annual variations in production).
It then restrained freedom on plantings, coupling it with the virtually guaranteed sales, thus generating serious structural surplus.
From 1976-1978 it became very interventionist with the ban on planting and the obligation to distil the surplus.
Towards the end of the 80s financial incentives for giving up vineyards were reinforced.
The 1999 reform of the CMO for wine strengthened the goal of achieving a better balance between supply and demand on the Community market, giving producers the chance to bring production into line with a market demanding higher quality and to allow the sector to become competitive in the long term – especially in the face of increased global competition following GATT – by financing the restructuring of a large part of present vineyards.
This reform proved insufficient to reduce wine surpluses and considerable sums still had to be spent on disposing of them. A new reform of the wine market was needed.
The reform adopted by the EU in 2008 has the following goals:
making EU wine producers even more competitive – enhancing the reputation of European wines and regaining market share both in the EU and outside
making the market-management rules simpler, clearer and more effective – to achieve a better balance between supply and demand
preserving the best traditions of European wine growing and boosting its social and environmental role in rural areas.
The reform adopted by the EU in 2013 aimed at harmonising, streamlining and simplifying the provisions of the CAP adopted in the course of the previous reforms.
The impact of 2013 CAP reform on the EU wine sector
The CAP reform adopted in December 2013 by the European Parliament and the Council of Ministers mostly renews the measures and approaches initiated during the 2008 wine reform which reorganised the way the EU wine market was managed, in order to ensure EU wine production matches demand, eliminate wasteful public intervention in EU wine markets, and redirect spending to make European wine more competitive.