RESTRICTED
WORLD TRADE G/STR/N/1/CHE
8December 1995
ORGANIZATION(95-3969)
Original: French Working Party onState Trading Enterprises
STATE TRADING
Notification Pursuant toArticle XVII:4(a) oftheGATT andParagraph 1
oftheUnderstanding ontheInterpretation ofArticle XVII
SWITZERLAND
Thefollowing communication, dated 16November 1995, hasbeenreceived fromthePermanent
Mission ofSwitzerland.
_______________
Thisnotification concerns products which arethesubject ofstatetrading within themeaning
ofArticle XVII:4(a) oftheGATT 1994 orofparagraph 1oftheUnderstanding ontheInterpretation
ofArticle XVII. Thefollowing products arecovered: butter, alcohol andbread flour.
1. Enumeration ofstatetrading enterprises
1.1 BUTYRA, Swiss Butter Supply Board
1.2 Federal Alcohol Administration; Federal Department ofFinance
1.3 Federal Office ofAgriculture; Federal Department ofthePublic Economy
2. Reason andpurpose forintroducing andmaintaining statetrading enterprises
Thestatetrading enterprises wereestablished andaremaintained infurtherance ofthegeneral
objectives ofSwiss policy withrespect topublic health, agriculture andsupplies. They engage inthe
import, marketing and,ifnecessary, production oftheproducts concerned.
2.1 Butter
TheSwiss Butter Supply Board (BUTYRA) wasestablished under theFederal Assembly Decree
of29September 1953 onmilk, dairy products andedible fats(milk decree), onthebasis ofthe
Agriculture Lawof3October 1951. Itspurpose istoensure thecountry 'sregular butter supply and
thepurchase ofdomestic butter ataprice corresponding tothebaseprice formilk, andtofacilitate
disposal oftheproduct. TheBoard associates bodies andfirms regularly engaged inwholesale trade
inbutter.
2.2 Alcohol
TheAlcohol Monopoly, which isconcerned withthemanufacture, rectification andimport
ofdistilled beverages, wasestablished inSwitzerland forpublic health reasons.G/STR/N/1/CHE
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Itisbased onArticle 32bisoftheFederal Constitution, which gives theFederation thesole
right tolegislate inthisfield. Pursuant tothatArticle oftheConstitution, theFederal Assembly
promulgated theFederal LawonAlcohol of21June1932. Thislegislation aims atreducing the
production andconsumption ofbrandy, inparticular, byencouraging theutilization ofdistillable matter
forpurposes other thanthemanufacture ofalcoholic beverages.
TheFederal Alcohol Administration hasresponsibility forimplementing thatlaw.
2.3 Bread flour
Theexclusive right oftheConfederation toimport bread flour wasinstituted toensure the
security ofitssupply, andtoprotect thedomestic milling industry. Itisbased onArticle 23,first
indent oftheFederal Lawof20March 1959 onthenational wheat supply. TheFederal Office of
Agriculture hasresponsibility foritsimplementation.
3. Function ofthestatetrading enterprises
3.1 Butter
BUTYRA isrequired totakeover(andstock) domestic butter thatcould notbesolddirectly
inthemarket. Theproduct istaken overatapricecorresponding tothebasepriceformilk. Inaddition,
BUTYRA holds themonopoly forimports ofbutter within atariffquota (thetariffquota covers many
dairy products, including butter, butBUTYRA 'simport monopoly islimited tobutter). Imports at
ratesoutside thequota arepermitted without restriction andwithout passing through BUTYRA, which
purchases abroad totheextent necessary tomeetdomestic requirements. BUTYRA isobliged todispose
oftheimported butter atprices adapted tothewholesale priceofdomestic butter asfixedbytheFederal
Council.
BUTYRA doesnotenter intolong-term contracts.
3.2 Alcohol
TheConfederation hastheexclusive righttoimport distilled beverages. However, theexercise
ofthisrightisgranted totheprivate sector oncertain conditions. Accordingly, thelatter canimport
without restriction orwithout anypermit brandies containing notmore than75percentofpurealcohol.
Forbrandies withanalcohol content ofmore than75percent(butnotmore than80percent), permits
areissued without quantitative limitation. Inbothcases, themonopoly duties fixed bytheFederal
Council havetobepaid. Thisalsoapplies todomestic production.
Asregards alcohol proper, imports areeffected bytheFederal Alcohol Administration. Imports
bytheprivate sector arepossible onlyinexceptional cases, thatistosay,forspecial varieties and
subject topriorauthorization bytheAlcohol Administration. Inside thecountry, alcohol isnotproduced
bytheAlcohol Administration itself but,within thelimits ofquotas, byindustrial distilleries which
havebeengranted aconcession forthatpurpose. Aconcession mustalsobeobtained bythose wishing
todistil brandies (whether professional oragricultural producers).
Industrial distilleries arerequired todeliver theiralcohol totheAlcohol Administration. On
theother hand, brandy producers areallowed tomarket theirproducts directly subject topayment of
thestatutory taxes. Thistrade issubject toauthorization.
ThepricesforalcoholdeliveredtoorsoldbytheAlcoholAdministrationarefixedbytheFederal
Council. Theselling price includes atax(monopoly duty). Theselling prices ofalcohol intendedG/STR/N/1/CHE
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forthemanufacture ofpharmaceutical products, perfumery andcosmetics istaxed onlymoderately,
inviewoftheirintended use.Alcohol intended forindustrial useissoldbytheAlcohol Administration
atthecostprice ofthevarious qualities imported.
3.3 Bread flour
TheConfederation hastheexclusive righttoimport bread flour. According toArticle 23of
theLawonthenational wheat supply (Wheat Law), thatsupply maybeusedonlyintroubled times,
when thesupply isjeopardized, orincaseofwar.
TheFederal Office ofAgriculture automatically grants import permits uponpayment ofcustom
duties which arefixedbycustoms legislation. Imports arenotrestricted attheserates. Import permits
maybegranted atareduced customs dutyrateiftheflour isusedfortechnical purposes, forthe
production ofpasta orforexport products. Theconditions forthegranting ofsuchpermits areset
bytheFederal Office ofAgriculture.
Pursuant toArticle 35,thirdindent oftheWheat Law, ifdomestic bread flourisoverpriced,
theFederal Office ofAgriculture willensure thesupply offlour atafairprice byimporting bread
flour, onitsownaccount, orbyauthorizing theimportation ofbread flouratareduced rateofduty.
4. Imports, exports anddomestic production
SeeAnnex.
5. Reasons whynoforeign trade hastaken place intheproducts concerned
None.
6. Additional information
None.ANNEXG/STR/N/1/CHE
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Tariff heading No. Description ofproducts Imports Exports Domestic production
Tonnes 1,000 Fr. Tonnes 1,000 Fr
0405.0010
0405.0090Butter
Fresh butter, unsalted 1992
1993
1994
Salted butter, resolidified
butter, etc. 1992
1993
19944,948
6,246
3,070
51
13
1512,126
14,079
7,079
235
50
580
1
1
1
0
013
24
8
8
2
9Butter, total(tonnes)
1992 38,091
1993 37,612
1994 40,050
1,000 l1,000 Fr. 1,000 l1,000 Fr.
2207.1000Alcohol
Undenatured ethyl alcohol ofan
alcoholic strength byvolume of
80%volume orhigher: 1992
1993
199437
172
1,156305
541
1,52914
9
7167
141
101Production ofpip-fruit brandies
andspecialities hl/100%
1991/92 25,548
1992/93 49,786
1993/94 33,296
1,000 l1,000 Fr. 1,000 l1,000 Fr.
2207.2000 Ethyl alcohol, denatured orintended
fordenaturing (imported bythe
Alcohol Administration 1992
1993
199417,018
20,726
19,71017,770
21,721
19,16310
12
6138
280
209hl/100%
1991/92 100,143
1992/93 103,996
1993/94 99,929Tariff heading No. Description ofproducts Imports Exports Domestic production
Tonnes 1,000 Fr. Tonnes 1,000 Fr
2208.9010 Undenatured ethyl alcohol ofan
alcoholic strength byvolume ofless
than80%volume: -Other
1992
1993
1994-
-
0-
-
1-
1
0-
34
1
1101.0019
1103.1190Bread flour 1992
1993
1994
Durum wheat meal 1992
1993
199425
21
43
89
78
13723
24
51
77
66
11211
73
217
22
27
10821
129
231
38
51
188Baking flour
1992: 360,400 t
1993: 357,200 t
1994: 359,900 t
Durum wheat meal
1992: 73,900 t
1993: 76,000 t
1994: 75,700 tG/STR/N/1/CHE
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