The European Commission has re-launched a bid to split the amount of European Union (EU) subsidies paid to EU cotton producers from the volume of cotton sent to market.

 

It follows an embarrassing court reversal for the commission from last September, when the European Court of Justice (ECJ) overturned a 2003 reform along these lines, because of weaknesses in an earlier impact study. It was later found that the report had ignored labour expenses and the potential effects on the European ginning industry.

 

Undeterred, Brussels plans to resubmit its subsidy reform to the European Parliament and the EU Council of Ministers, and does not want to repeat its legal mistake.

 

It has called for "the views of producers, consumers and taxpayers, with the intention of formulating a revised EU support scheme for cotton", asking for contributions by 22 June. Results will be published later this year.

 

When the Commission tables fresh reforms it is unlikely they will be less radical than its earlier scheme, which "decoupled" 65% of cotton aid from production levels, converting them into direct payments to reduce incentives to overproduce.

 

This was declared illegal by the court following a case brought by Spain, one of the EU's main cotton producers and an opponent of subsidy reform for the sector.

 

By Keith Nuthall.