TRADE MINISTER WELCOMES EU SPREADABLE BUTTER MOVE

  • Dr Lockwood Smith
International Trade

New Zealand's spreadable butter exports to Europe can now resume following the introduction of new European Union (EU) legislation, Trade Minister Lockwood Smith announced today.

"It is good news for New Zealand dairy farmers that New Zealand can now resume its export of high-value spreadable butter," Dr Smith said.

The new EU Council Regulation overturned a 1996 decision that spreadable and ammix butters were not eligible for entry into the EU under New Zealand's country-specific tariff quota.

The Commission had argued that spreadable butter did not meet the relevant access criteria that required New Zealand butter to be "manufactured directly from milk or cream". This stance meant that spreadable butter could not benefit from concessional rates of duty, and New Zealand's exports of spreadable butter to the EU virtually stopped overnight.

New Zealand initiated a World Trade Organisation dispute settlement after bilateral consultations on the issue failed. The action was suspended in April following further negotiations with the EU.

"A huge amount of work has gone into this case by legal and policy officers from the Ministry of Foreign Affairs and Trade and the Ministry of Agriculture," Dr Smith said.

"The issue has been on the agenda in almost every meeting I have had with my counterparts in the European Commission for the past couple of years. It is very pleasing to have reached an amicable settlement in this trade dispute," Dr Smith concluded.