Smarter Regulation: Wine Reforms Consultation

Overview

Leaving the European Union has given us a once-in-a-generation opportunity to review how we make and shape Great Britain's regulatory framework for food and drink. The current 400-page rulebook for wine is overly complex and bureaucratic. It blocks innovation in the wine sector, including banning practices that could help us reduce carbon emissions, increases production costs and reduces consumer choice. 

We want to make changes that ensure England and Wales continue to have a thriving wine sector, able to invest and innovate to meet existing and emerging consumer demands and trends.

This consultation forms part of the Smarter Regulation programme of regulatory reform announcements that began this month with the publication of Smarter Regulation to Grow the Economy. Through this consultation and further regulatory reform updates, the Government will take action to reduce the burdens on business, reduce the cost of living, deliver choice to consumers, turbocharge science and innovation and drive infrastructure development.

The reforms we are proposing in this consultation will provide our wine producers and traders the tools to kick-start investment in our world-class vineyards, wine import and bottling operations. We want to stimulate increased competition in the domestic marketplace, broadening choice and driving down prices for hard-pressed consumers.

The new legal framework will bring environmental benefits by encouraging more bulk movements of wine to GB for bottling. It will support our glass recycling targets and help producers to squeeze every drop of value from their harvests.

We estimate our new rulebook will be a fraction of its current size, making it simpler for businesses to navigate whilst retaining the standards and qualities necessary to ensure that wine keeps its unique character. 

Policy Objectives:

1. Frictionless trade. Increasing the sector’s export capability by removing regulatory barriers to trade.
2. Consumer confidence. Ensuring labelling and marketing rules continue to give consumers confidence that the products they are buying are safe, authentic, and meet their quality expectations.
3. Sustainable growth. Ensuring our regulatory framework promotes long-term investment and growth in the sector.
4. Environmental impact. Introducing regulatory changes that promote sustainable industry practices and are in line with the government’s net zero ambitions.
5. Removing burdens. Reducing red tape and costs for businesses.

Background

The UK is a world-leading player in the international wine trade. It is home to a diverse and dynamic wine sector and is one of the largest importers of wine in the world by both value and volume. In 2022, off-trade sales of still, sparkling, and fortified wine via supermarkets, convenience stores, and specialist off-licences in the UK were worth around £7.6 billion, while on-trade sales through hospitality outlets were worth an estimated £3.5 billion.

The GB wine industry comprises different areas of business operations, varying from vineyards to large-scale bottling plants. Large volumes of wine are imported, bottled and exported across the world. We are currently the 11^th largest exporter of wine globally. The domestic winemaking sector in England and Wales is rapidly growing and developing a global reputation for quality. Production reports for 2022 show a 36% increase in production. There has been a 70% growth in hectarage of vines between 2015 and 2020 and a quadrupling in hectarage since 2000. The UK is also the historical hub for the global trade in fine and rare wines, and London boasts a major wine futures market for such investments.  

Following the UK’s departure from the European Union, the UK incorporated the existing framework of EU wine law into domestic law. That law applies in Great Britain and under the Windsor Framework UK standards will apply to goods moved from Great Britain to Northern Ireland. This highly complex legislative framework contains a significant number of restrictions on how wine can be produced and marketed. Both Defra and the wine industry have identified many of these restrictions as barriers to growth and competitiveness in the wine sector, stopping consumers from benefitting from the latest innovation.

The government has worked closely with the wine sector to identify possible changes to retained EU law to support growth and competitiveness. We will consider relevant World Trade Organization (WTO) and free trade agreement (FTA) obligations in proposing these changes. Defra has incorporated stakeholder views into our policy development process and identified areas to take forward in the form of legislative change.