The European Commission has released its first opinion regarding the compatibility of a sustainability agreement in the French wine sector with competition rules. This opinion specifically addresses an agreement among wine producers in the Occitanie region who meet organic and Haute Valeur Environnementale (HVE) standards, aimed at setting indicative prices to guide bulk wine transactions.

The agreement comes in response to significant oversupply in the French wine market, shifting consumer preferences, and heightened price sensitivity due to inflation. Many producers of organic and HVE wines are struggling to remain profitable compared to conventional wine producers, leading to concerns that they may switch to conventional production or exit the market entirely.

To encourage sustainable production, the agreement proposes setting orientation prices that cover production costs under the sustainability standards, plus a profit margin of up to 20%. These prices will be reviewed annually for six grape varieties and will be effective for two years.

The Commission found that the agreement meets the conditions outlined in Article 210a of Regulation (EU) No 1308/2013, which allows for agreements that aim to achieve sustainability objectives while imposing necessary restrictions on competition. The opinion highlights that the agreement involves agricultural producers, pertains to agricultural products, and aims to meet higher sustainability standards than those mandated by law.

This positive opinion marks a significant step in supporting sustainability initiatives within the agricultural sector, providing legal certainty for producers to collaborate and invest in sustainable practices. The Commission encourages similar initiatives across other sectors to promote sustainability and economic viability.