The EU-SA wine and spirits agreement : implications for South Africa

Van Wyk, J. T. (Jacobus Tertius) (2002-03)

Thesis (MBA)--Stellenbosch University, 2002.

Thesis

ENGLISH ABSTRACT: During the negotiating stages of the TOCA, the EU and South Africa could not reach an agreement on the use of certain EU geographical indications related to wine products. The geographical indication issue threatened the signing of the entire TOCA. At the request of the EU, South Africa agreed to negotiate a separate Wine and Spirits Agreement, in order to finalise the TOCA. The EU-SA Wine and Spirits Agreement was eventually negotiated and came into effect on 1 January 2002. The initial issue relating to the geographical indications remained controversial throughout the negotiations and matters were made worst when the initial contentious denominations of Port and Sherry were expanded by the EU to include Grappa, Ouzo, Korn, Kornbrand, Jagertee, Jaqertee, Jagatee and Pacharan. South Africa eventually agreed to phase out the use of these denominations over specified time periods. The current wording of the agreement will also result in South Africa having to yield a variety of well known trade marks such as Nederburg and Roodeberg. Article 7(8) of the Wine Agreement implies that in the case of conflict between a South African wine trade mark and an EU geographical indication for wine, the South African trade mark will always have to yield to the EU geographical indication. The entire geographical indication matter is being contested by South Africa and is still under negotiation. South Africa and the EU agreed to allocate reciprocal duty free tariff quotas to wine products. These tariff quotas will remain effective until the FTA has been established, following the transitional periods as agreed upon in the TOGA. The duty free funds will however not have such a direct impact on the wine industry as have been envisaged initially, because the funds are in the hands of the EU importers. Various business plans are being implemented to allow the South African wine industry to benefit from these and any future funds. The EU offered financial assistance to the value of €15 million for the restructuring of the South African wine industry as well as for the marketing of the South African wine and spirits products. To date none of these funds have been allocated and various proposals have been made to the South African government in order to obtain these funds from the EU. The EU-SA Wine and Spirits Agreement is a continuous evolving agreement, where both parties are allowed to modify the existing agreement with the consent of the other party. Such modifications are allowed with the premise that it would contribute to the facilitation and promotion of trade in wine and spirits products between South Africa and the EU. South Africa must take cognisance of the implications of the EU-SA Wine and Spirits Agreement and ensure that they do not end up losing more than what they are gaining.

AFRIKAANSE OPSOMMING: Sien volteks vir opsomming

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