Parmelin backs away from support for Swiss wine growers

Shortly before announcing his resignation from the Federal Council, Guy Parmelin met with representatives of the Swiss wine industry to announce that he was abandoning some of the support measures for the sector presented last spring.

The most contested decision concerns the abandonment of the rule under which only those who also buy and process Swiss grapes would have been allowed to keep importing low-priced foreign wine. Merchants without domestic production would have had to buy import quotas from Swiss producers, a mechanism designed to help wine growers who increasingly struggle to sell their grapes and wine.

Wine merchants opposed the measure, backed by a legal opinion according to which the change would have caused significant market distortions and a violation of economic freedom. Parmelin chose to step back.

An auction that changes nothing

As an alternative, the federal councillor proposes that, from 2027, import quotas for foreign wine be allocated through an auction. Industry associations consider the measure ineffective for Swiss wine growers: current quotas allow imports of up to 170 million litres a year at reduced cost, and since 2001 this threshold has never been exceeded. An auction, they note, would therefore have no deterrent effect on imports.

Wine growers say they feel let down by a federal councillor who is himself a wine grower. Several parliamentary motions in support of the sector remain pending.

The abandoned measure would have imposed an administrative burden on merchants in order to selectively support one category of producers, an approach the legal opinion judged to violate economic freedom. The auction solution, while less intrusive, leaves open the question of what problem it actually solves, if the quotas are never exhausted. It remains to be seen whether the sector will find more effective, competitiveness-based answers to the difficulties of selling Swiss grapes. The motions still pending in parliament suggest the debate is not over: the question for the next Federal Council will be whether new measures in favour of the wine industry can withstand scrutiny over economic freedom without burdening merchants and consumers.