The South African government, through the Department of Agriculture, Forestry and Fisheries (DAFF), has this week acceded to the agreements on mutual acceptance of oenological practices and the requirements for wine labelling of the World Wine Group whose objective is to facilitate trade among the signatory parties – and to reduce transaction costs.
The World Wine Trade Group (WWTG) is an informal grouping of wine producing countries. The Group was founded in 1998 and aims to share information, collaborates on a variety of international issues and endeavours to create an environment for the free trade in wine.
The regular participating countries of the WWTG include Argentina, Australia, Canada, Chile, Georgia, New Zealand, the USA and South Africa. China participated during the last two meetings of the group and expressed a wish to become a regular participant.
The Agreement on Mutual Acceptance of Oenological Practices (MAA) recognises the wine making-practices of signatories as being in compliance with their own wine-making practices. The labelling agreement accepts common labelling information and minimises unnecessary labelling-related trade barriers. This significantly improves trade flows amongst signatory parties, thereby reducing transaction costs.
In a short period of time the World Wine Trade Group has proven to be an important force in influencing the regulation of the international wine trade. Beginning with a shared vision and a commitment to open international trade, participating countries have begun to reshape the regulatory environment in which the international wine business operates.
The MAA and the Agreement on Requirements for Wine Labelling (Labelling Agreement) are at the core of this group. Both agreements are enabling agreements with the objective to facilitate trade amongst signatory parties.
The MAA recognises the wine making-practices of signatories as being in compliance with their own wine-making practices. The labelling agreement accepts common labelling information and minimises unnecessary labelling-related trade barriers.
The Liquor Products Act, Act 60 of 1989, had to be slightly amended to provide for South Africa’s accession to the two WWTG agreements. With the ratification by Parliament of the two agreements in September 2010, South Africa has complied with all the legal requirements to accede to the agreements. The Instrument of Accession to the agreements, signed by the Minister of International Relations and Cooperation, has been submitted to the Depository of the WWTG on 12 July 2011.
South Africa’s accession to the two wine agreements will considerably lessen the administrative burden related with the trade in wine. This is especially the case with the lucrative United States of America (USA) wine market where certain certification requirements will fall away, thus saving considerable costs to the wine industry and the relevant regulatory authority of the Department of Agriculture, Forestry and Fisheries.
The World Wine Trade Group is continuing with its work in addressing barriers in the international wine trade and has now embarked on the development of a second phase labelling agreement. This agreement will address issues such as environmental labelling and labelling for allergens. Again, the WWTG is taking the lead in a field that could create substantial barriers to trade in future.
Further, the WWTG has embarked on an out-reach programme to improve cooperation with major wine importing countries in South-East Asia. This initiative will support the efforts of the South African industry to diversify its exports to the growing markets of this region.
The Director-General of the Department of Agriculture, Forestry and Fisheries, Langa Zita, expressed appreciation on the position taken by the government to accede to the agreements saying it is not only good news for the prosperity of the wine industry in the country, but for the growth of the economy as well.
For further information contact:
Steve Galane
Tel: 012 319 7960
Cell: 083 635 7346
E-mail: DAIS@daff.gov.za
