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Exhibit C

Imported vs. Domestic Wine Prices

A Survey of Prices

for the

National Association of Beverage Importers

March 1984

Steve L. Barsby & Associates, Inc.
Falls Church, Virginia

Imported vs. Domestic Wine Prices

Executive Summary

We compare prices of more than 200 popular domestic and Imported brands of wine over the course of 3 years in 5 geographIcally separated U.S. markets. Average prices for domestic versus Imported wines were calculated at the supplier, wholesaler and retall levels for both 750ml and 1.5L bottle sizes.

We found that average prices of Imported wines were higher than those of the domestic wines in every market, at each level of distribution, in each year, and for both sizes. The current retail price advantage of domestic wines across the five state markets in the 750ml size averages 31.6%. In the 1.5L size this advantage is 39.3%. Based on our research, we conclude that the leading domestic wines have a price advantage over the leading Imported wines.

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authorizing the offer or disposal for direct human consumption of certain
imported wines which may have undergone oenological processes not provided
for in Regulation (EEC) No 337/79

THE COUNCIL OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Economic Community,

Having regard to Council Regulation (EEC) No 337/79 of 5 February 1979 on the common organization of the market in wine ("), as last amended by Regulation (EEC) No 1208/84 (), and in particular Article 51 (1) thereof,

Having regard to the proposal from the Commission,

Whereas Article 50 (1) (a) of Regulation (EEC) No 337/79 lays down that the products referred to in Article 1 (2) (a) and (b) of that Regulation may be imported only if they are accompanied by a certificate attesting that they comply with the provisions gover. ning production, marketing and, should such be the case, supply for direct human consumption in the third countries in which they originate;

Whereas Article S1 (1) of Regulation (EEC) No 337/79 lays down that products imported from third countries and falling within heading No 2205 of the Common Customs Tariff which have undergone oenological practices not allowed by Community rules, or which do not conform either to the provisions of that Regu lation or to those adopted in implementation thereof, may not, except by way of derogation, be offered or disposed of for direct human consumption;~~~

Whereas Article 2 (2) of Council Regulation (EEC) No 354/79 of 5 February 1979 laying down general rules for the import of wines, grape juice and grape must() as last amended by the 1979 Act of Accession, exempts from the requirement to present the abovementioned certificate imports of wine originating in and coming from third countries whose annual exports to the Community are less than 1 000 hl; whereas, in view of the current level of exports of United States wines to the Community, an arrangement should be Introduced which is more appropriate to the situation;

Whereas, with the aim of fostering the harmonious development of trade in wine products between the Community and the United States of America, and in view of the effectiveness of the control system in force

OJ No L S4, S. 3. 1979, p. 1. No L 115, 1. 5. 1984, p. 77. No L 54, S. 3. 1979, p. 97.

in the United States and the particular extent to which compliance with provisions governing the production, marketing and disposal of wine for direct human consumption is thereby ensured, the import into the Community of United States wines which have undergone certain oenological processes not provided for by Community rules should be authorized if, in the present state of scientific knowledge, those processes have been shown to be identical or almost equivalent to oenological processes permitted in the Community; whereas other oenological processes in use in the United States which are not permitted in the Community necessitate further scientific research; whereas, therefore, authorization for the import into the Community of United States wines which have undergone such processes should be limited to a certain period; whereas, however, it should be made clear that Buch authorization may be reviewed at any time, after consultation with the United States authorities, in particular were it to be found that the use of certain Denological practices could present a public health risk:

Whereas, in a letter sent to the Government of the United States of America on 6 July 1983, the Community, represented by the Commission, expressed the intention of modifying Community provisions in respect of oenological processes with a view to encou raging trade in the wine sector; whereas the necessary provisions should therefore be incorporated in Community legislation in order to put those modifica. tions into effect; ..

Whereas the Government of the United States of America undertook in its letter dated 26 July 1983 to delete from the American provisions & large number of substances whose use has hitherto been permitted in the manufacture of wine, and to replace expressions having little meaning in such provisions with scientific terms, thus making identification easier; whereas the Government of the United States of America further undertook to ensure that geographical names referring to a Community wine growing area were no longer used as generic names unless such use was traditional; whereas the Government of the United States of America also undertook to work in constant collabora tion with the Community with the object of expanding scientific knowledge on certain oenological processes referred to in 1 (b) of the Annex to this -Regulation; whereas, moreover, the United States Government recognized the need to establish collabo ration between on the one hand, the competent autho

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1. By way of derogation from Article 51 (1) of Regulation (EEC) No 337/79, it shall be permitted to offer or dispose of for direct human consumption in the Community products falling withing heading No 22.05 of the Common Customs Tariff and derived from grapes harvested and vinified on the territory of the United States of America for which, in accordance with United States provisions, one or more of the oenological processes listed in I (a) and (b) of the Annex to this Regulation may have been used during manufacturing or storage operations.

However, this authorization shall only be valid, as regards use of the oenological processes listed in 1 (b) of the Annex, until 26 July 1988.

2. Member States may not prohibit the offer or supply for direct human consumption of wine derived from grapes harvested and vinified on the territory of the United States of America in accordance with the

No L 176/7

provisions in force in that country on the grounds that one or more of the oenological processes listed in 2 (2) and (b) of the Annex may have been used.

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Wines derived from grapes harvested and vinified on the territory of the United States of America which have been the subject of the addition of sugar in aqueous solution may not be offered or disposed of for direct human consumption in the Community.

Article 2

Producer Member States shall forward to the Govern ment of the United States of America the list of their protected geographical designations of wines in the Community which they wish to see protected by the United States in accordance with the commitment entered into by that country.

Article 3

The Commission shall ensure the publication in the Official Journal of the European Communities, "C series, of the value limits laid down by the provisions of the United States of America for the use of the substances listed in the Annex to this Regulation. It shall keep such publication up to date if changes are made to the American provisions.

Article 4

This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Luxembourg. 28 June 1984.

For the Council

The President

H. BOUCHARDEAU

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Official Journal of the Europesh Communities

1. Oenological processes permitted

(x) without any time limit:

ANNEX

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— substances composed of potassium ferrocyanide and aqueous ferrous sulphate, possibly combined with copper sulphate and active carbon,

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2. Oenological processes which are indentical to, or comparable with, those permitted in the Community

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- Calcium carbonate, possibly containing small quantities of double calcium salt of tartaric L (+) and malic L (—) acid;

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