PURPOSE: to approve the conclusion of the Agreement in the form of an exchange of letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

NON-LEGISLATIVE ACT: Council Decision (EU) 2019/2145 on the conclusion, on behalf of the Union, of the Agreement in the form of an Exchange of Letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

CONTENT: the Council approved, on behalf of the European Union, the Agreement in the form of an Exchange of Letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

The Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part entered into force on 1 September 2017. Negotiations to find a solution by amending trade preferences were successfully concluded on 19 March 2019. The Agreement in the form of an exchange of letters was signed on 30 July 2019, subject to the conclusion of the said Agreement in the form of an Exchange of Letters.

As a reminder, a new type of poultry cut consists of a traditional breast cap with the humerus bones of the wings attached and can, after minimal transformation in the Union, be marketed in the Union as poultry breast. Unlimited imports of those cuts, of which imports from Ukraine reached 55 500 tons in 2018, therefore risk undermining the conditions under which traditional poultry breast cuts may be imported into the Union under the Association Agreement, in particular the quantitative restrictions in the form of a tariff rate quota.

The new poultry regime will handle boneless and bony chicken breasts on a single tariff line, and will raise the amounts that Ukraine is able to export to the EU without tariffs. Once Ukrainian exporters have exhausted the duty-free quota, they will have to pay duties on additional exports to the EU.

ENTRY INTO FORCE: 05/12/2019.

The European Parliament adopted by 444 votes to 128, with 74 abstentions, a legislative resolution on the draft Council decision on conclusion, on behalf of the Union, of the Agreement in the form of an exchange of letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

The European Parliament gave its consent to the conclusion of the Agreement.

The purpose of the Agreement in the form of an Exchange of Letters is to amend the trade preferences provided for in the Association Agreement between the European Union and Ukraine in respect of poultrymeat and poultrymeat preparations. It aims to find a solution to the rapid increase in duty free imports of this particular poultry cut, which was neither existent nor foreseeable during the negotiations of the Association Agreement.

PURPOSE: to conclude, on behalf of the Union, the Agreement in the form of an exchange of letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

PROPOSED ACT: Council Decision.

ROLE OF THE EUROPEAN PARLIAMENT: Council may adopt the act only if Parliament has given its consent to the act.

BACKGROUND: the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part, entered into force on 1 September 2017.

A new type of poultry cut consists of a traditional breast cap with the humerus bones of the wings attached and can, after minimal transformation in the Union, be marketed in the Union as poultry breast. Unlimited imports of those cuts, of which imports from Ukraine reached 55 500 tons in 2018, therefore risk undermining the conditions under which traditional poultry breast cuts may be imported into the Union under the Association Agreement, in particular the quantitative restrictions in the form of a tariff rate quota.

On 20 December 2018, the Council authorised the Commission to open negotiations with Ukraine with a view to finding a solution by amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement. Those negotiations were successfully concluded on 19 March 2019.

CONTENT: the purpose of the draft Council Decision is to approve, on behalf of the Union, the Agreement in the form of an exchange of letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

AGREEMENT in the form of an exchange of letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

Negotiations between the European Union and Ukraine on trade preferences for poultrymeat and poultrymeat preparations were concluded on 19 March 2019.

The agreement consists of integrating the two tariff lines CN 0207 13 70 and 0207 14 70 into the existing tariff rate quota (TRQ) of currently 18 400 tons and increasing to 20 000 tons in 2021 (Order Number 09.4273) while the size of the TRQ will be increased by 50 000 tons. Imports under tariff lines CN 0207 13 70 and 0207 14 70 exceeding the TRQ would then become subject to Most Favoured Nation duty rate of EUR 100.8/100 kg net weight.

Pending its entry into force, the Agreement shall be applied provisionally from the first day of the month following the date of receipt by the Depositary of: (i) the Union's notification on the completion of the procedures necessary for this purpose; and (ii) Ukraine’s notification of the completion of ratification in accordance with its procedures and applicable legislation, whichever is later, pending its entry into force.

PURPOSE: to conclude, on behalf of the Union, the Agreement in the form of an exchange of letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

PROPOSED ACT: Council Decision.

ROLE OF THE EUROPEAN PARLIAMENT: Council may adopt the act only if Parliament has given its consent to the act.

BACKGROUND: the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part, entered into force on 1 September 2017.

A new type of poultry cut consists of a traditional breast cap with the humerus bones of the wings attached and can, after minimal transformation in the Union, be marketed in the Union as poultry breast. Unlimited imports of those cuts, of which imports from Ukraine reached 55 500 tons in 2018, therefore risk undermining the conditions under which traditional poultry breast cuts may be imported into the Union under the Association Agreement, in particular the quantitative restrictions in the form of a tariff rate quota.

On 20 December 2018, the Council authorised the Commission to open negotiations with Ukraine with a view to finding a solution by amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement. Those negotiations were successfully concluded on 19 March 2019.

CONTENT: the purpose of the draft Council Decision is to approve, on behalf of the Union, the Agreement in the form of an exchange of letters between the European Union and Ukraine amending the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part.

PURPOSE: signature, on behalf of the European Union, and provisional application of the Agreement in the form of an Exchange of Letters between the European Union and Ukraine amending the trade preferences for poultrymeat and poultrymeat preparations provided for by the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part

PROPOSED ACT: Council Decision.

BACKGROUND: the Association Agreement between the European Union and the European Atomic Energy Community and their Member States, of the one part, and Ukraine, of the other part, entered into force on 1 September 2017.

From mid-2016, a new type of poultry cut started to be imported from the Ukraine to the EU in increasing quantities. This novel cut consists of a traditional breast cap with the humerus bones of the wings attached, the latter making up for a very small part of the total weight of the cut. After a minimal transformation, this cut can be marketed in the EU as poultry breast.

As such imports are not subject to quantitative restrictions they have the potential, if their trade regime remains unchanged, to undermine the protection provided for poultry breast in the form of TRQs under the Association Agreement and consequently to disrupt the delicate balance in the poultry meat market of the EU. It is therefore urgent to find a solution to this situation. The Commission has received numerous written questions from Members of the European Parliament and the European poultry meat sector asking for action in order to find a solution.

On 20 December 2018, the Council authorised the Commission to open negotiations with Ukraine with a view to amend the trade preferences for poultry meat and poultry meat preparations provided for by the Association Agreement. The negotiations were successfully concluded on 19 March 2019.

CONTENT: the Commission proposes that the Council decide to authorise, on behalf of the Union, the signature of the Agreement in the form of an Exchange of Letters between the European Union and Ukraine amending the trade preferences for poultrymeat and poultrymeat preparations provided for in the Association Agreement, subject to its conclusion.

The value of imports into the EU under the two tariff lines CN 0207 13 70 and 0207 14 70 in the last full calendar years 2016 and 2017 reached a combined import value of EUR 43.9 million. This is 23.9% of total EU poultry meat imports from Ukraine in 2016 and 2017 and represents 1.1% of total EU poultry meat imports from all third countries in those two calendar years. In 2018 the import value reached EUR 91.4 million.

The Agreement consists of integrating the two tariff lines CN 0207 13 70 and 0207 14 70 into the existing tariff rate quota (TRQ) of currently 18 400 tons and increasing to 20 000 tons in 2021 (Order Number 09.4273) while the size of the TRQ will be increased by 50 000 tons. Imports under tariff lines CN 0207 13 70 and 0207 14 70 exceeding the TRQ would then become subject to Most Favoured Nation duty rate of EUR 100.8/100 kg net weight.

In order to rapidly eliminate the risk of potentially unlimited duty free imports of these poultry cuts the Agreement should be applied provisionally.