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On 02/07/2019, European leaders formally nominated the German candidate, Defence Minister Ursula von der Leyen, as President of the European Commission. Thus, von der Leyen is likely to succeed Jean-Claude Juncker, the current President of the European Commission. Leyen was born in Brussels, where she lived until she was 13 years old. Then she and her family moved to Hanover, Germany. Leyen is the only minister who holds the office for the entire period of Angela Merkel functioning as Chancellor. The European Parliament will vote on the approval of Ursula von der Leyen during the second EP plenary session on 15-18 / 07/2019. The candidate for the President of the European Council after Donald Tusk is Belgian Prime Minister Charles Michel.

Finland took over the Presidency of the EU Council from Romania in early July; FI will chair the Council until the end of this year, and then will be replaced by Croatia from January onwards. Finnish Agriculture Minister Jari Leppä said that Finland would try to get as far as possible in the negotiations on the Common Agricultural Policy, but no specific targets and dates for reaching an agreement were set. According to Leppä, many factors are currently influencing the debate on the CAP, bringing a number of uncertainties to the negotiations - in particular the ongoing negotiations on the post-2020 Multiannual Financial Framework, which is the Union's 2021-2027 budget, and the ongoing negotiations on the UK leaving the EU. In addition, the Presidency will also be affected by changes in the European institutions, namely the European Parliament elections in May 2019, which led to the replacement of more than 65% of MEPs, and the changes of Commissioners and Commission President, which are now being discussed. According to Leppä, Finland should focus on the issue of new green architecture, setting of eco-schemes (climate and environment regimes in the I. CAP pillar) and the new policy implementation mechanism. Finland is also ready to start discussing the rules for the transitional period in case the CAP negotiations are extended. According to Finland, the Multiannual Financial Framework could be negotiated by the end of 2019, according to a document from the Finnish Presidency; Finland could in this case seek to reach a general agreement on the CAP also by the end of the year.
Finnish Presidency document available here.

The EP Committee on Agriculture and Rural Development (COMAGRI) adopted an opinion on the CAP Strategic Plans in April 2019 but the opinion was not approved by the EP plenary. However, after the European elections and the new COMAGRI composition, the fate of the April opinion is unclear. The position of the current COMAGRI could be even more fragmented than it was in 2014-2019, given the strengthening of environmentally-minded and nationalist factions. According to initial information, the EP's Greens political group will seek to revise the April opinion, followed by a vote in COMAGRI and then in the plenary where new amendments should be put to the vote. A similar position as the Greens is also supported by the second-largest faction of EP S&D. In the opinion from April, the Greens and S&D most criticize the lack of ambition of the parties to strengthen the environment and climate protection, but also the overly mild wording of the proposal for parties to the mandatory capping of direct payments per hectare. To date, the third largest faction Renew Europe (RE) has not yet decided whether the report from April should be adopted, or whether it should be revised - an internal negotiation within the RE should take place for this matter. RE is however likely to try to reach an agreement with the other three largest factions, the EPP, the S&D and the Greens.

On 28/06/2019, after twenty years of negotiations, the European Union reached a bilateral trade agreement with Mercosur. The agreement will affect 773 million people, thanks to which the European Union will save over EUR 4 billion per year on customs duties. The agreement also covers food safety and environmental rules, and includes commitments on labour rights and environmental protection (including the Paris Climate Agreement). Agriculture and Rural Development Commissioner Phil Hogan said there was a need for compromises in the negotiations, but sensitive EU commodities should be protected. In the event of market disruption caused by opening the border for the Mercosur goods, a EUR 1 billion will be allocated to support EU farmers' incomes.

The European Union has granted tariff quotas for beef, poultry, ethanol, rice, eggs and egg products, garlic, and pork, while improving the already existing sugar quota. All this on condition that Mercosur offers a satisfactory offer for European dairy products, wine, spirits and high-quality products with a protected geographical indication. Over time, the agreement should guarantee the abolition of customs duties on 91% of EU exports to Mercosur and the elimination of 92% of customs for Mercosur.

The EU offered a quota of 99,000 tonnes of beef with a 55/45 split between fresh/frozen products at a custom rate of 7.5%; furthermore, 650,000 tonnes for ethanol, of which 450,000 tonnes for the chemical industry alone. It is also provided: 180,000 tonnes for sugar without customs duties, 180,000 tonnes for poultry sector with 50/50 split between bone-free meat/with a bone, 3,000 tonnes for egg albumin and 3,000 tonnes for egg yolks, and 25,000 tonnes for ractopamine-free pork (protein synthesis stimulant) with a customs duty of 83 EUR/t. Rice was listed as a custom-free raw material with a quota of 60,000 tonnes, and 45,000 tonnes was allocated for honey. Mercosur has granted 30,000 tonnes of European cheese quota and will reduce customs duties on butter, wine & spirits, chocolate and biscuits. Over the years, the fees for olive oil, apples, pears and frozen potatoes will be abolished.

Copa and Cogeca, Europe's largest agricultural organization, said the agreement with Mercosur will bring double standards on the EU market and unfair competition for some key European products, disagreeing with the quota for beef and poultry meat. Ireland also disagrees with the agreement and plans to vote against the approval of the trade agreement because it threatens Irish beef production. Environmental organizations have highlighted the potential risk of extending deforestation of the Amazon forest due to increased agricultural production. Sugar producers also have objections due to the increase in existing quotas.

Both sides will review the approved text in the coming weeks. In the European Union, the agreement will be translated into all European languages and submitted to the European Parliament and the Council for approval.

European Commission press release available here.

The Polish government has responded to the May decision of the EU Court of Justice that previously introduced progressive taxes on retail chains in Poland were not contrary to the EU law, as the European Commission thought, by immediate reintroduction of retail chain taxes. Poland introduced progressive taxes in 2016, but in 2017 the Commission stopped tax enforcement for non-compliance with the EU law. Poland exempted from the tax companies with a turnover of less than EUR 4 million, companies with a turnover of between EUR 4 million and EUR 40 million had to pay a tax of 0.8%, and for companies with a turnover of over EUR 40 million Poland introduced a tax rate of 1.4%. The Commission has identified the tax as discriminatory, but according to the EU Court of Justice the introduction of a tax is in line with EU law. Poland has therefore stated that it will introduce a progressive tax on retail chains again, and that it should apply from September 2019.
More information is available here.