Distillers welcome EU-Canada deal

25 Oct 2013

EU-Canada trade deal welcomed by distillers

When news emerged last week that Canada's Prime Minister was making an unscheduled visit to Brussels, it was clear that negotiators had finally managed to secure a trade deal between the European Union and Canada.

Political agreement on a comprehensive economic & trade agreement (CETA) is an important step towards a level playing field for spirits in a major market for Scotch Whisky.

Provincial liquor boards still control the import, sale and distribution of spirit drinks in Canada.  Whilst the selection in stores can be impressive, the industry faces a variety of trade barriers and our aim has been to ensure CETA supports fair competition in the spirits market.  

Liquor boards continue, for example, to apply complex fees to cover costs such as customs clearance.  That in itself is not a problem.  However, these 'cost of service' charges are often higher on EU spirits than competitors, with domestic products benefiting from preferential treatment.   Whilst details of what has been agreed are still to be released, the hope is that CETA introduces non-discriminatory arrangements, backed by regular audits.  

Removal of archaic restrictions on bulk imports would be welcome, as would integration of the 2004 EU-Canada wine and spirits agreement into CETA so that it is subject to new dispute settlement rules.  This would make it easier to enforce earlier sectoral commitments, supporting fair competition in the market.  

Scotch Whisky shipments to Canada are over £60m a year and represent around 20% of all Scottish exports to the market.   With Scotch consistently one of the UK's top twenty exports to Canada, this is an important deal for UK distillers.

Building on last week's momentum, let's hope the remaining technical issues are ironed out quickly and CETA is ratified and implemented as soon as possible.

David Williamson is SWA deputy director of international affairs