Agreement Smooths Over Rough Spots in Wine Trade Between America and Europe
Wine can flow more smoothly between countries, but U.S. vintners may keep using terms such as Chablis and Burgundy on existing brands
Daniel Sogg
Posted: September 16, 2005
After 22 years, wine trade talks between the United States and Europe seem to have finally borne some fruit, with the announcement of a tentative agreement on a number of complex issues.
Among the long-standing sticking points addressed in the deal, which still requires official approval by the respective governments, are American vintners' use of European appellation names, such as Chablis and Burgundy, on their wines. The negotiators agreed that U.S. vintners can continue to use these so-called semi-generic names on existing brands (accompanied by the true appellation of origin), but are prohibited from using them on any new brands.
The compromise primarily benefits large producers of inexpensive wine, who will not have to change brands that have a long-established identity. Semi-generics, such as Gallo Hearty Burgundy, constituted about 40 percent of the U.S. market as of 2000, according to the San Francisco-based Wine Institute. But sales of these wines will continue to be forbidden in European countries that restrict use of those terms.
In addition, American wineries will now have an easier path to the European market. Until now, European Union policy had required U.S. wine exporters to submit official certification of their production practices. Under the new agreement, all currently legal U.S. winemaking practices will be accepted by the EU, which also simplified its certification process.
At least one aspect of the negotiations does benefit American consumers: EU wines are exempted from U.S. certification procedures. That has been a source of concern to U.S. importers since October 2002, when the House of Representatives passed a bill that would have required imported wines from Europe to be accompanied by a certification form and laboratory analysis. Importers who purchase wines on the secondary market (or so-called gray market), which is a major source for many of the finest European wines, would likely be unable to obtain that certification. Although the bill died in committee, the wine provisions were still in play.
"This is wonderful news. We've been working on this for more than two years," said Mannie Berk, president of the Rare Wine Company in Sonoma, Calif. "Without this agreement, [Alcohol and Tobacco Tax and Trade Bureau rules released in August addressing imports] would have made the bureaucracy of importing wines much more difficult."
Not everyone is happy, though. The Center for Wine Origins, an organization representing producers in Port, Champagne and Jerez, issued a statement that "…the agreement marks a real missed opportunity to make progress on one of the largest issues--including the protection of many famous winemaking locations and putting consumers first. Instead of ensuring that consumers have the true facts about the contents of their wine, the agreement requires further talks on these important issues."
Though the agreement marks progress on a number of fronts, it's a drop in the bucket in ongoing negotiations about agriculture trade. Issues yet to be resolved, which could have a major impact on European and U.S. wine producers, include tariff disputes, government subsidies and export credits.
