The concept of ‘Community preference’ is a well-established feature of the Common Agricultural Policy (CAP), under which, by a system of import levies and export refunds, member states are encouraged to give preference to consumption of agricultural goods from within the Union over those from outside. Such practices run counter to the doctrine of free trade, tend to maintain the prices of CAP products at higher levels than would otherwise apply, and impose significant constraints on the import of agricultural products from developing countries, thus contradicting the European Union’s development policy.
The pursuit of Community preference gave rise to difficulties at the time of United Kingdom accession to the European Community, since the British government did not want to place imports from Commonwealth countries (such as butter from New Zealand) at a competitive disadvantage. More recently, it has been a significant problem during successive rounds of negotiations within the General Agreement on Tariffs and Trade (GATT) and its successor, the World Trade Organization (WTO).
Traditionally, Community preference has been vigorously supported by member states (such as France, Denmark and Ireland) with large agricultural sectors and substantial exporting capacity. This support could at one time be based on the Treaty of Rome: Article 44 EEC referred to the system of minimum prices under the CAP and added that they ‘shall not be applied so as to form an obstacle to the development of a natural preference between Member States’. However, in a 1994 ruling, the European Court of Justice (ECJ) confirmed that Community preference was not a principle of Community law (Greece v Council, Case C-353/92) and Article 44 was subsequently repealed by the 1997 Amsterdam Treaty.
Copyright: Anthony Teasdale, 2012
Citation: The Penguin Companion to European Union (2012), additional website entry