Under Protocol 18 of the Treaty of Accession, the UK was authorised to import certain specified quantities of butter from New Zealand at a reduced duty. Following the Uruguay Round of negotiations, the quota was increased and became an EU current access quota. The rules for the administration of the quota are currently set out in Commission Regulation EC (No.) 2535/2001.
A judgment by the European Court of Justice on 11 July 2006, in case number 313/04 (Franz Egenberger GmbH Molkerei und Trockenwerk v. Bundesanstalt für Landwirtschaft und Ernährung), held some aspects of the administration of the quota discriminatory and therefore invalid. Following this judgment, the European Commission, under Commission Regulation EC (No.) 1118/2006, temporarily suspended the issuing of import licences for New Zealand butter imported under the current access quota. On 14 September, the Management Committee for Milk and Milk Products voted on a draft Regulation which will lift the temporary suspension and allow the remaining 14,294.6 tonnes of butter left under the 2006 quota to be imported before 31 December under a modified procedure. The Regulation is expected to be published shortly.
Discussions are ongoing between the European Commission and New Zealand on the changes necessary to Commission Regulation EC (No.) 2535/2001 for the 2007 quota year and beyond.