/Economic Sustainability
Economic Sustainability2018-07-26T09:40:43+00:00

Economic Sustainability

FIVS plays an important role in addressing emerging trade impediments and in seeking to open up markets by advocating for the dismantling of unjustified trade barriers.

FIVS Working Group Co-Chairs

Ignacio Sánchez Recarte

Ignacio Sánchez Recarte is the Secretary General of Comité Européen des Entreprises Vins (CEEV), the organisation representing the European wine industry and trade.

Steve Guy

Steve_Guy-Wine_Australia

Steve Guy is the General Manager, Compliance and Trade for Wine Australia, which is the Australian Government’s statutory authority responsible for ensuring that wine producers, traders, and exporters comply with relevant legislation.

FIVS Economic Sustainability Initiatives

FIVS-Abridge

FIVS-Abridge is a database of national regulations and international agreements for markets around the world, covering topics such as certification, composition, labelling, marketing, packaging, production, promotion, tariffs, taxation and transportation. This service is a resource for those interested in the legal aspects of the international alcohol beverage industry, particularly for those trading or intending to trade their products internationally.

FIVS-22

FIVS-22 is a long-standing customs initiative where FIVS has regularly stressed the need for logical and understandable rules in interventions with national governments and international organisations. For example, FIVS offered one of the major detailed analyses describing considerations to be taken into account in properly classifying alcohol beverage products subjected to novel production techniques.

There has been a long-standing debate over the proper Customs classification of certain types of alcohol beverages within the World Customs Organisation’s (WCO) approach to classifying products — the Harmonised System (HS). HS Chapter 22 covers the categorisation of alcohol beverages. HS Chapter 22 was set up so that fermented alcohol beverages, whether subject to further filtration processes or supplemented with alcohol, retained their customs classifications as fermented products. An emerging question has revolved around whether the “essential character” of fermented products has been so altered in the production process that they should be reclassified as “distilled.” This question has led to inconsistent classifications of the same product by different countries, as well as by European Union member states which are in the same customs territory. The impetus for reclassification has had its roots in the fact that fiscal treatment of alcohol beverage products in the EU and other countries is based on customs classifications; fiscal rates for distilled products are normally higher than those for fermented ones. Despite some inconsistent classification decisions, the current situation based on a bright line distinction between distilled and fermented products has historically proven workable for the trade. The reclassification by some countries of fermented products as distilled under the theory that they were akin to distilled has however blurred the generally clear demarcation between fermented and distilled products.

Recent Developments

At its 2010 Autumn meeting, the WCO’s Harmonised System Committee (HSC) considered the proper classification of three “test” products and possible revisions to relevant Explanatory Notes in Chapter 22. In 2011, the HSC considered and classified certain fermented products that had undergone purification techniques (e.g., reverse osmosis, ultra-filtration, etc.) under headings that had hitherto been exclusively reserved for distilled beverages. The following industry report, including some particular annexes, describes the high degree of uncertainty such re-classifications would (and now will) have for the trade. This legal examination suggests how these decisions are inconsistent with the long-standing architecture of this customs chapter. The legal analysis (both in summary and complete forms) is still germane, despite having been written before the HSC classification determinations in 2011. In the Spring of 2012, the HSC made changes to the HS definition of “ethyl alcohol” in order to bring its explanatory notes in line with its classification decisions of the test products.

Contribution to National Economies

FIVS members have conducted studies to demonstrate how different segments of the alcohol beverage industry contribute to national economies. One study, completed in January of 2007, uses a standard methodology which includes direct, indirect, and induced economic effects in order to present a complete picture of the economic impact of the grape, wine, grape juice, table grape and raisin industries in terms of employment, product revenues, taxes, and many other indices. In 2013, there was a study of the contribution that Canadian Industry has made to that country. Also in 2013, the Alcohol Beverage Federation of Ireland produced a video demonstrating the multifaceted importance of the Irish Drinks Industry to the Irish economy. A report issued in February 2014 and based on 2012 data shows that New York’s grape and wine industry contributed $4.8 billion to that state’s economy. Please review the reports below for additional information.

FIVS-Inform

This initiative actively promotes the development of symbols and pictogrammes on wine labels. This effort requires consultation with key organisations dealing with specific concerns, as well as with the European Commission, the International Organisation of the Vine and Wine (OIV), the International Wine Law Association (AIDV), the World Wine Trade Group (WWTG) and the Codex Alimentarius Commission. Ultimately, this area may greatly benefit from the development of an ISO standard.