Law-2005-No.02-L8

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THE WINE LAW No.02/L-8
This law regulates the production and the distribution of grapes used for the production of wine as well as the conditions for the distribution of wine and other products produced from the processing of grapes and wine, the protection of wine produced in a certain geographical region, distinguished by the characteristics of its climate, soil and other factors.

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5. 5 e) evaluation of grapes and wines and classifying wine and other products according to their quality (laboratory analyses and organoleptic evaluations); f) issuing decrees on evaluations for wine and other products. 4.3. The Municipalities shall maintain a cad astral register of the existing plots of vineyards and potential plots for vineyards in positions classified for cultivation of grapes. The Municipality shall submit to the Ministry one copy of the cadastral registers of the vineyard plots as well as later amendments made to them. TITLE II PRODUCTION OF GRAPES AND WINE Production Article 5 5.1. Production of wine comprises all tasks carried out in a vineyard, including the harvesting of grapes, the processing of grapes and all enological practices and processes. 5.2. Wine and other products may only be produced by persons who are entered in the register of grape and wine growers. 5.3. Grape growers are legal or natural persons growing grape for the production of wine or other products and who: a) own, rent or hold (use) in some other way a vineyard of 0,05 ha or larger in the territory of Kosova or a vineyard smaller than 0,05 ha, provided they put grape, wine or other products on the market; b) have permanent residence in Kosova and own or rent vineyards in the border regions of those countries adjoining Kosova, provided they transfer the grape, wine or other products into Kosova. 5.4. Wine and other products producers are persons who produce wine or other products from grapes they grow themselves or from purchased grapes. 5.5. Processors of wine or other products are persons who process own or purchased wine or other products into new products. Register of grape and wine growers Article 6 6.1. The Ministry shall hold records of persons who grow grapes, produce wines or produce other products, or process wine or other products. 6.2. The producers or processors of grape, wine and other products shall be registered with the Ministry.

6. 6 6.3. A record kept in the Register shall consist of the following data: a) for producers and processors: the name, surname and address, the standardized personal code number of a natural person, the name, address and code number of a legal person or an independent entrepreneur; b) for vineyards: the cadastral district, cadastral municipality and cadastral parcel number, cadastral ranking and the net and gross areas of the parcel; c) for vines: the number and spacing of vines, the variety, the roots, the year of planting; d) for yields: quantities of grape per variety, quantities of wine and other products of own production; e) for purchase: quantities of the grape, must or wine of each variety purchased, quantities of other products purc hased by type and origin; 6.4. A producer or processor of grape, wine or other products, who already works in this activity, must apply for entry in the Register. A producer or processor of grape, wine or other products requiring to commence this activity, shall apply for entry in register. The application must be carried out in the prescribed way, within the prescribed time limits, and must supply all the requisite document ation by the subsidia ry act issued by the Ministry. Register of vineyards Article 7 7.1. For the redaction of Register of Vineyards, the Ministry except the central Register utilizes other databases, which provides records of actual and potential vineyards. The register of vineyards shall be kept in conjunction with the cadastral register. 7.2. Only absolute viticulture positions ma y be registered as potential vineyards. An absolute viticulture position is an area of land on which growing grapes intended for wine production will result in qualitatively and qu antitatively optimal yields, and will be more profitable than the cultivation of any other agricultural crops. 7.3. In order to create and maintain the Register of Vineyards, the Ministry shall make use of the following data: a) for producers: from the Central Register of grape and wine growers. For natural persons it is admissible to obtain the name, surname, address and standardized personal code number from the Central Regist er of Citizens; in the case of a legal person it is admissible to obtain the name, address, code number and other publicly accessible data from the Register of Registry of Business Organizations in either case, it is also admissible to consult the Register of Territorial Units and the Record of House Numbers in order to obtain the requisite data. b) for the vineyard position: data in the cadastral register, topographical plans, maps, and databases that is taken from the municipalities. 7.4. Maintainers or owners of the data shall supply the data to the Ministry free of charge, however, they may charge the direct material costs for any additional copies required.

7. 7 Grapes Article 8 8.1. Grapes intended for production of wine may only be grown on registered viticulture positions, using only the recommended and authorized varieties of vine as prescribed for the particular viticulture territorial unit. 8.2. Grapes intended for production of wine must be cultivated with the technology appropriate for the anticipated quality class of wine. 8.3. In production of grapes and wines, the treatment of grapes, mash, must and wine has to preserve and develop all the natural qualit ative characteristics of grapes, resulting in wine suitable for consumption. 8.4. It is forbidden to produce wine from imported grapes, mash or must. This provision does not apply to grapes produced by grape growers on land parcels they own in the border regions of those countries adjoining the Kosova, provided they transfer it, in compliance with this law and with regulations issued there under, into the Kosova. 8.5. A harvest of grapes intended for production of a high-quality wine must be registered beforehand at the authorized organization. Prior to the harvest, the authorized organization examines the quantity and quality of grapes intended for production of high- quality wines.] 8.6. The import of concentrated grape must is allowed in exceptional cases, if its use is intended only for purifying the quality of wine in accordance with the requirements and procedures set in a special subsidiary act. Classifying of vine varieties Article 9 9.1. All classified varieties shall belong to the species Vitis vinifera or come from a cross between this species and other species of th e genus vitis. In an implementing regulation vine varieties for the production of wine shall be classified. 9.2. Only those vine varieties which are shown in the classification may be planted, replanted or grafted within the territory of the Kosova for the purpose of wine production. 9.3. Areas planted with vine varieties for the purpose of wine production not entered in the classification shall be grubbed up, save where the production of those areas is intended exclusively for the consumption of the wine producers ́ family. 9.4. Where varieties are deleted from the classification, grubbing-up shall take place within 15 years of their deletion. Wine Article 10 10.1. Notwithstanding the provisions of title VII the production of grape, wine and other grape and wine products must be carried out employing only the prescribed technological processes and allowed enological substances.

8. 8 10.2. Improving of must and wine, and sugaring of grape, mash or must is not allowed, unless the Authorized institution issues a prescribed permit for sugaring of mash or must. The Authorized institution may issue the permit if the weather in a particular year is extremely unfavorable for the growing and development of vines, taking into account the viticulture territorial unit and the anticipated quality class of wine and the variety of grape. It is forbidden to issue a permit for sugaring if the mash or must are intended for production of a high-quality wine. 10.3. The permit referred to in the previous paragraph applies to all producers of grapes and wines of a particular variety in a specified viticulture territorial unit, and is issued as part of due official procedure. and one copy is sent to the appropriate inspectorate. Blending of grapes, mash, must and wine Article 11 11.1. Blending of grapes, mash, must or wine of particular quality classes of wine, different years and colors of grapes is only permissible within the limits set out in this law and in sub low based thereon. 11.2. It is forbidden to blend Kosovar and foreign wines. TITLE III PRODUCTION OF QUALIY WINE Article 12 The provisions of this law and implementing sub acts covering the production of quality wines shall be based on the following factors: a) demarcation of the area of production (specified region); b) classification of vine varieties suitable for quality wine; c) regulating of cultivatio n and wine making methods; d) determining a minimum natural alcoholic strength; e) determining a maximum yield per hectare; f) analysis and assessment of organoleptic characteristics. Specified region Article 13 13.1. “Specified region” shall mean a wine growing area or a combination of wine growing areas which produces wines with particular quality characteristics and which’s name is used to designate the quality wine. 13.2. Each specified region shall be precisely demarcated, as far as possible on the basis of the individual vineyard yard or vineyard yard plot. Such demarcation shall take into account the factors which contribute towards the quality of the wine produced in those regions, such as the nature of the soil, the climate and the situation of the individual vineyard yard or vineyard yard plot. 13.3. The geographical name designating a specified region must be sufficiently precise and familiarly linked to the area of production.

9. 9 13.4. The specified regions of the Kosova are demarcated in an subsidiary act or laid down direct in the law. Yield Article 14 14.1. The maximum yield per hectare is fixed for quality wine originating from Kosova shall be regulated by an Subsidiary act. 14.2. The use of the geographical origin is prohibited for the entire harvest, if the yield referred to in Paragraph 1 this article, is exceeded. Wine tests Article 15 15.1. For quality wines producers are obliged to perform the organoleptic and the analytical tests in an institution authorized by the Ministry. The appropriate inspectors shall take samples for the analysis. 15.2. The organoleptic test relates to color, clarity, smell and taste. 15.3. The analytical test shall enable the de termination of factors relating to the wine reaction, to a microbiological test and to a physical and chemical analysis. 15.4. The upper and lower limits for these factor s shall be laid down in an Subsidiary act. TITLE IV VITICULTURAL TERRITORIAL UNITS Division in territorial units Article 16 16.1. Taking into account the ecological circumstances (relief, climate, soil, agro biological factors and viticultural sciences), the principal organoleptic properties of wines, and historically traditional aspects of viticulture, the viticultural territory of the Kosova shall be divided into the following territorial units: viticultural regions, sub- regions, zones, and locations. 16.2. A viticultural region is a major viticultural territorial unit, with similar climatic and soil conditions, which, combined with agro biological factors, affect the principal organoleptic characteristics of the wine produ ced in the region. The viticultural regions are the Region of Dukagjini and the Kosova Plain. 16.3. A viticultural sub-region is the basic geographically-determined territory, with similar climatic and soil conditions, similar varieties of cultivated vine, and similar other agro biological factors, which together make it possible to produce grapes and wines possessing organoleptic properties which are ch aracteristic for the viticultural sub region. 16.4. Viticultural territorial units smaller than viticultura l sub-regions are viticultural zones and viticultural and viticultural locati ons. These are all geographically-determined

10. 10 parts with similar climatic, soil, elevation, and other environmental factors, and with specific varieties of cultivated vine, which all together enable production of grapes and wines different in quality an d organoleptic properties from grapes and wines produced in other viticultural territorial units of the same viticultural region. Viticultural sub regions, zones and locations shall be designated by an Subsidiary act. Vine selection Article 17 In individual viticultural zones it is permit ted the planting graps and production of wine only from determined vine varieties. TITLE V CLASSIFICATION AND EVALUATION Wine categories Article 18 18.1. According to this law, wines are: a) still wines, b) sparkling wines, c) aerated sparkling wines, d) semi-sparkling wines, e) aerated semi sparkling wines f) flavoured wines, g) liqueur wines, h) other special wines. 18.2. By the color wines are classified as white, rosé and red wines. 18.3. By the residual sugar content wines are classified as follows: a) still wines: dry, semi-dry, semi-sweet and sweet; b) sparkling, aerated sparkling, semi-sparkling and aerated semi sparkling wines are classified as very dry, dry, semi-dry, semi-sweet and sweet. 18.4. The criteria for wine classification according to sugar content: a) dry: wine that contains residual unfe rmented sugar not exceeding 4 grams per liter, b) medium dry: on condition that the wine concerned has a residual sugar content exceeding 4 c) medium sweet: on condition that the wine concerned has a residual sugar content exceeding 12 grams per liter but not exceeding 45 grams per liter, d) sweet: on condition that the wine concerned has a residual sugar at least 45 grams per liter. 18.5. Considering the provisions of title III, classification of wines into quality classes depends on the attained quality of grape, the yield per hectare, which must not exceed a

11. 11 preset limit, the sugar content, the natural alcohol content and other ingredients of wine, and the organoleptic properties of the wine, as follows: a). table wines: • table wine, • table wines with geographical origin. b). quality wines of certified an d protected geographical origin • quality wine*, • high-quality wine, which is further classified with respect to the ripeness of the grapes and the method of harvesting or aging c). sparkling wines: • sparkling table wine, • regional sparkling wine, • quality sparkling wine. d). Semi-sparkling wines: • semi-sparkling table wine, • semi-quality sparkling wine. Evaluation of quality wine Article 19 19.1. Considering the provisions of title III, qua lity wine and must suitable for quality wines, which are destined for the market, have to be evaluated, observing a prescribed procedure, before they are put on the market. A quality wine destined for the market must not be altered once it has been officially evaluated. If a quality wine has changed for any reason whatever after the evaluation, it must be evaluated anew before it is put on the market. 19.2. Imported wines have to undergo an evaluation. 19.3. Imported wines are evaluated to dete rmine the compliance with the accompanying documentation and the certificate issued by the country of the exporter and their suitability for rendering into trade in the Kosova. 19.4. An appeal may be lodged, within eight days of receipt of the evaluation, at the Ministry. The results of this second evaluation are final. Control label Article 20 20.1. On the label of quality wine in trade a quality cont rol label must be featured. 20.2. The authorized organization shall issue a quality control label to wine producers on the basis of the quantity of wine which the producer has submitted for evaluation and which has passed the evaluation positively. 20.3. The authorized organization shall maintain the prescribed re cords on control labels issued.

12. 12 Tasting committee Article 21 21.1. The organoleptic evaluation of quality wines is carried out by a committee of at least five members, representing grape and wine growers, consumers and experts from the fields of viticulture and wine production. 21.2. In the case of the request of another evaluation, members of the original committee are excluded from the second evaluation. The second evaluation is carried out by an committee of nine members. 21.3. The tasters for organoleptic evaluation of wine and must are appointed by the Minister. 21.4. Prior to appointment, a taster must be examined for his tasting abilities, and knowledge of enology and regulations on viticulture and wine production. 21.5. If a taster is also a producer or employee of an subject that processes wine or must, his opinion is disregarded when wine or must evaluated are of his own production or are produced by the subject of which he/she is the employee. TITLE VI LABELING Article 22 22.1. “Labeling” means all descriptions and other references, symbols, illustrations or marks which serve to distinguish the product and which appear on the container, including the closure, or on the tags attached to the container. 22.2. The compulsory particulars, except the lot number, shall be grouped in the same visual field on the container, and presented in easily readable, indelible characters large enough to stand out clearly distinguishable from all other content of the labeling. 22.3. Prior to the placement on the market in a container the container shall be labeled. Such labeling shall be in accordance with the provisions of this law or the detail rules adopted by implementing Subsidiary act. Article 23 23.1. The terms on the label must not be incorrect or likely to mislead the consumer. 23.2. These terms must not particularly caus e confusion regarding the characteristics of the wine and other products for example their nature, composition, alcohol content, color, quality, vine variety or vintage year. The indication of persons who have been involved in the production or distribution, in particular the indication of the bottler.

13. 13 Compulsory particulars Article 24 Compulsory particulars for table wines, table wines with geographical indication and quality wines: a) the trade name terms; b) the geographical origin; c) the nominal volume; d) the actual alcoholic strength by volume; e) type of wine; f) the name of person and the address of the bottler or, for containers with a nominal volume of more than 60 liters, the consignor. g) the evaluation number, only for quality wines. Optional particulars Article 25 25.1. Optional particulars for table wines, table wines with geographical indication and quality wines: a) the name and address of the person(s) that took part in marketing; b) the type of the product; c) a particular color. 25.2. Optional particulars for table wines with geographical indication and quality wines: a) the vintage year; b) the name of one or more varieties; c) an award, medal or competition; d) indication for raw material concerning the means used to obtain or method used to manufacture the product; e) other traditional terms; f) a term indicating, that wi ne was bottled on the estate. 25.3. Optional particulars for quality wines: a) reference to a geographical area smaller or larger than the specified region; b) information to the effect, that bott ling took place in the specified region. 25.4. Labeling may be supplemented by other particulars, provided that they are true and not likely to cause mislead the consumer. Languages Article 26 26.1. The information on the label must be given in a language so that the final consumer can easily understand. 26.2. Notwithstanding the first paragraph geographical indications and traditional terms can be given only in the Kosova languages.

14. 14 Brand names Article 27 27.1. Brand names on the label may not contain any words, parts of words, signs or illustrations, which are likely to cause confusion or mislead the consumer. 27.2. The labeling may not bear brand names containing words, parts of words signs or illustrations, which contain false information, particularly with regard to geographical origin, the vine variety, vintage year or a reference to a superior quality. Alcohol content Article 28 28.1. The actual alcoholic strength by volume shal l be indicated in perc entage units of half units. The strength shown may not differ by more than 0,5 % vol. from that given by analysis. 28.2. The figure shall be followed by “% vo l.” and may be preceded by “actual alcoholic strength”, “actual alcohol” or “alc.”. 28.3. The actual alcoholic strength shall be indicated on the label in characters at least 5 mm high if the nominal volume is over 100 cl, at least 3 mm high if it is equal to or less than 100 cl but more than 20 cl and 2 mm high if it is 20 cl or less. Bottler, packager Article 29 29.1. The indication of the bottler shall be supplemented by the words “bottler” or “bottled by”. In the case of contract bottli ng, the indication of the bottler shall be supplemented by the words “bot tler” or, when the bottling is done on behalf of the third party, should be supplemented by the words “bottled for....by....”. 29.2. This applies also to containers other than bottles. The words “packager” and “packaged by” shall replace the wo rds “bottler” and “bottled by”. 29.3. The closing devices for wines and other products as referred to in this law and implementing regulations may not be enclosed in lead based capsules or foil or other materials that are harmful for health. Indication of the activity Article 30 30.1. The indication of the bottler, the consignor or the person involved in marketing shall be accompanied by an indication showing their activity using expressions such as “wine-grower”, “harvested by”, “merchant”, distributed by” or similar expressions. 30.2. These optional particulars may be used only with the agreement of the person(s) concerned. 30.3. The criteria for the submission of the data in the label concerning the year of harvest, varieties of vitis the awards and traditional names, will be regulated by an subsidiary act.

15. 15 Geographical origins Article 31 31.1. Geographical origin may only be stated on wines of a certain quality class, produced in a certain viticultu ral territorial region, and posse ssing specific characteristics of that viticultural territorial unit. 31.2. Only the prescribed na mes of viticultural territorial units may be used for designating the geographical origin of wines. 31.3. The name of a viticultural region is used to designate a regional wine; the name of a viticultural zone or smaller viticultural territorial unit is used to designate a quality wine. 31.4. Designating a wine of a certain qua lity class with the name of a viticultural territorial unit precludes the use of the same name as designation for wines in any other quality class. 31.5. The designation of geographical origin must be the most prominent component of the label. 31.6. If the business name of an enterprise, involved in the marketing of the wine, contains a geographical reference, then this name may only be put on the label in less prominent letters and in a manner which is in no way misleading as to the geographical origin of the wine. 31.7. If the trademark of the wine contains an y explicit or implicit geographical allusion, then the trademark may be used only if the wine was produced in the territory explicitly or implicitly alluded to by the trademark. 31.8. In the case of identical geographical names, both geographical territories must be sufficiently precisely defined so that it is im possible to be misled about the geographical origin. TITLE VII ENOLOGICAL PRACTICES AND PROCESSES Article 32 32.1. For the production of products covered by this law authorized enological practices and processes are established by this law and implementing Subsidiary acts. They may only be used for the purpose of ensuring proper vinification, proper preservation and proper refinement of the product. 32.2. Only grapes belonging to varieties listen in the classification of Subsidiary act may be used for the manufacture of table wine, regional wine, quality wine, top quality wine and other products. 32.3. White wine must not be blended with red wine. 32.4. Raw materials used for the production of wine not originating from Kosova may not be turned into wine or added to wine in of Kosovo, except the cases permitted by the present law and in case when it is used as an addition jointly with the raw material from Kosovo for wine production. These products may not undergo alcoholic fermentation

16. 16 within the territory of Kosova. Blending Kosovo wine with wine not originating from Kosovo is prohibited in the Kosovo. 32.5. Wine and other products, whether imported or not, which have not undergone enological practices not authorized by this law or implementing regulations, are not of sound and fair merchantable quality, or do no t comply with the definitions or further conditions of this law or implementing subsidiary acts may not be offered or disposed of for direct human consumption. Sulphur dioxide content Article 33 33.1. The total sulphur dioxid e content of table wine, regional wine and quality wine, may, on their release to the market for direct human consumption, not exceed 160 mg per liter for red wines and 210 mg per liter for white and rosé wines. 33.2. Notwithstanding paragraph 1, the maximum sulphur dioxide content may not exceed 210 mg per liter for red wines and 260 mg per liter for white and rosé wines, as regards wines with a residual sugar content, expressed as invert sugar, of not less than 5 grams per liter. 33.3. For top quality wines with higher residual sugar content and for other products limits are prescribed in an implementing Subsidiary act . Volatile acid content Article 34 34.1. The maximum volatile acid content may not exceed 18 mill equivalents per liter for grape must in fermentation, 18 mill equivalents per liter for white and rosé wines, 20 mill equivalent for red wines. 34.2. For certain wines, in particular top quality wines, which have matured over a period of at least two years, or have been produced according special methods, and wines with a total alcoholic strength by volume of at le ast 13 % vol., exceptions to paragraph 1 may bee prescribed in an implementing Subsidiary act. Enrichment limits Article 35 35.1. When climatic conditions have made it necessary, the authorized institution may allow an increase in the natural alcoholic strength by volume of fresh grapes, grape must, grape must in fermentation and ne w wine still in fermentation. 35.2. An increase in natural alcoholic strength by volume may not be authorized in respect of the products referred to in paragraph 1 unless their minimum natural alcoholic strength by volume is 7,5 % vol. 35.3. The increase in natural alcoholic may not exceed 2 % vol.

17. 17 35.4. The increase in natural alcoholic strength by volume may only be effected in respect of fresh grapes, grape must in fermentation and new wine still in fermentation by adding [sucrose], concentrated grape must or rectified concentrated grape must, and in respect of grape must by adding [sucrose], concentrated grape must or rectified concentrated grape must, or by partial concentration. 35.5. In no case shall the above-mentioned processes have the effect of raising the total alcoholic strength more than 13,5 % vol. Acidification and deacidification Article 36 36.1. Fresh grapes, grape must, grape must in fermentation and wine may be subject to [acidification and deacidification]. 36.2. Acidification of that products, other than wine, may be carried out only up to a limit of 1,5 gram per liter expressed as tartaric acid, or 20 mill equivalent per liter. Acidification of wine may be carried out only up to a limit of 2,5 gram per liter expressed as tartaric acid, or 33 mill equivalent per liter. 36.3. Deacidification of wine may be carried out only up to a limit of 1,0 gram per liter expressed as tartaric acid, or 13,3 mill equivalent per liter. 36.4. Grape must, intended for concentration ma be partially deacidified. 36.5. Acidification and enrichment and acidification and deacidification of one and the same product shall be mutually exclusive processes. Further conditions Article 37 37.1. Enrichment, acidification, deacidification and sweetening of wines shall be reported to the Ministry. This also applies for the used amounts of sucrose, concentrated grape must and rectified concentrated grape, and this shall be done by the producers, bottlers, processors, and merchants at the same time and same place where they report issues on grape must and fermented grape must or huge quantities of wine in bulk. 37.2. Enrichment, acidification, deacidification and sweetening shall be registered and relevant documents shall be issued to show that the products have undergone the process and may be distributed. 37.3. Enrichment and sweetening, reduced as a result of exeptional climatic conditions, can be carried out only before 1. January an d only for products of the grape harvested immediately preceding those dates.

18. 18 TITLE VIII SALE Article 38 38.1. The commercial sale and circulation is prohibited: a) wine produced from classic hybrids, and other products containing alcohol from such grapes, b) spoiled or defective wine, c) quality wine which was not officially evaluated, d) wine with characteristics or geographical origin not corresponding to that which is declared and e) wine which is a blend of Kosovo and foreign wine. 38.2. Wine producers and others engaging in the sale of wines are obliged to distinctly mark any containers holding spoiled wine and to immediately report all quantities of such wine to the competent authorities – appropriate inspectors. Legal bottling and labeling Article 39 39.1. Wines may only be supplied to the fina l consumer legal bottled and labeled. Wines are legal bottled and labeled if they are filled in prescribed packaging and labeled as defined by this Law and Subsidiary act. 39.2. Notwithstanding paragraph 1, wines that are not legal bottled and labeled may be supplied to final consumers: a) by registered producers or grapes and wines, if they offer wines or must of their own production in their own cellars or within close vicinity, and have for this activity a license from th e authorized institution. 39.3. Legal bottled and labeled wines and other products may be marketed by those legal persons and independent entrepreneurs that are registered for this activity, satisfy the prescribed conditions for it and have a prescribed permit for carrying out the activity. Accompanying documents Article 40 40.1. The products, covered by this law, may be put into circulation within Kosova and exported only with an officially checked accompanying document. 40.2. The largest quantity of not legal bottled and labeled wine which is allowed to be transported without accompanying documents must not exceed [20 liters], except for the transport of own-produced wine from the own cellar to the permanent residence of the producer. 40.3. Persons or groups of persons who hold products covered by this law in the exercise of their trade, in particular producers, bottlers, and processors or merchants are obliged to keep goods inwards and outwards registers in respect of those products.

19. 19 40.4. These registers must reveal the essential data about quality and quantity and the geographical origin of must and wines in th e cellar. Data about the wine intended for private consumption have also to be kept. 40.5. Detailed rules for the accompanying documents and the inward and outward register are laid down by an implementing Subsidiary act. Processing areas for quality wine Article 41 41.1. Quality wine may be produced only by processing grapes into grape must and by processing the must thus obtained into wine within the specified region where the grapes were harvested. 41.2. Notwithstanding the provisions of paragraph 1, the Minister for agriculture may, upon the request of a producer of grapes or wines, exceptionally permit, for a specified quantity of wine, producing the quality wine in an area in immediate proximity to the specified region in which the grapes were grown if: a) it is objectively impossible to produce or package the wine in wine cellars within the specified region where the grapes were grown, or b) the grape grower grows grapes in two or more adjacent specified regions. Time limits Article 42 Quality wines may be put on the market afte r 15 December of the year, in which the grapes were harvested. Top quality and special wines may be put on the market after 31 January of the next year. Import Article 43 43.1. Wines and other products, imported for sale within the Kosova, must comply, with regard to quality and labeling, to this law an d to the Subsidiary acts issued there under and must be accompanied with a certificate from the exporting country inclusively an analytic evaluation from an authorized institution of the exporting country. If a particular product from grapes or wine is not covered by laws or regulations of the Kosova, the product must comply with the regulations effective in the exporting country. 43.2. A wine that is imported in bulk must be bottled before it is marketed to the final consumer. 43.3. The certificate of the exporting country or the analytical evaluation of the authorized institution of the exporting countr y must provide: the name of the exporting country, eventual designation of geographical origin, quality designation in compliance with the quality level, analytic and organoleptic notes.

20. 20 43.4. Every shipment of imported wines, except bottled wines up to the quantity which an individual can import free of duty in compliance with customs regulations, must be officially sampled by an [agricultural inspector], who submits the sample to the authorized organization, unless otherwise de termined by interna tional agreements. The authorized organization evaluates the imported wine within four working days of the samples receipt, except when otherwise stipulated by international treaties. 43.5. The importer must not commence the domestic commercial sale of the imported wine prior to receipt of the evaluation. 43.6. If the results of the wine evaluation ca rried out by the authorized organization are not in agreement with the qualit y or the geographical origin stated in the certificate from the exporting country, the importer may opt to a) return the wine, or b) equip the wine with appropriate certificates and analytic evaluation from the exporting country, or c) use the wine for production of other pr oducts, provided it satisfies the requisite conditions. 43.7. If the evaluation reveals that the quality of wine does not fulfill the criteria as set out in the laws and regulations of the Kosova, the importer may: a) return the wine, or b) use the wine in production of other products, provided it satisfies the requisite conditions, or allow it to be safely destroyed. The evaluation of imported wines follows the same procedure set out in this law and in regulations issued there under applicable to wine produced in the Kosova. 43.8. Detailed rules for imported wine are laid down by an implementing subsidiary act. Export Article 44 44.1. Wines destined for export must pass all criteria set out in this law and in Subsidiary acts issued there under, and all the criteria imposed by the law of the importing country. 44.2. Every shipment of wine for export shall be accompanied with a certificate upon which the authorized organization confirms the evaluated quality and the indicated geographical origin. 44.3. Notwithstanding the previo us paragraph, small quantities of wine, up to 100 liters of the same wine, but altogether not more than 500 liters, intended for presentations, may be exported without the evaluation. 44.4. Quality wine shall only be exported legally bottled and labeled.

4. 4 Geographical origin Article 3 3.1. The geographical origin of wine and other products shall be designated according to the geographical territory in which the grape is produced and where wine or other products have acquired certain special characteristics from natural causes or human activities. 3.2. Designations of the geographical origin of wine are of the following types: a) a small locality or group of such localities; b) a local administrative area or part therefore; c) a wine growing sub-region or part therefore; d) a region; e) a “specified region” 3.3. A designation of geographical origin is a collective right and may be used for wine and other products by those recorded in the Register of Grape and Wine Growers, provided that grape, wine and other products have been produced in the indicated territory and meet other prescribed criteria. 3.4. To protect and control the geographical origin of wine and other products, in compliance with this law, a list of geographical designations of wines and other products shall be kept. For this purpose, the viticulture territory of the Kosova is divided in two viticulture territorial areas. Competent authorities Article 4 4.1. The Ministry shall, di rectly or through its entities (Authorized In stitutions) a) maintain the register of vineyards; b) maintain the Register of Grape and Wine Growers; c) prescribe the recommended and authorized varieties of vines and varieties of vine roots; d) monitor the ripening of grapes and determine the time of harvest; e) limit the per hectare maximum yields of grapes, regardless from variety and destination; f) evaluate and designate wine and other products. 4.2. The following professional, administrative, promotional and analytical tasks in viticulture and wine production, defined by this law and by the regulations issued in accordance with this law, shall be carried out by authorized organizations: a) consultation with, education and training of and knowledge transfer to grape growers and wine producers in technological, economic, ecological and other fields important for the development of viticulture and wine production; b) selection of vines; c) breeding and securing a sufficient supply of basic material for vines; d) monitoring of the prescribed technologies and methods of grape and wine production;

21. 21 TITLE IX INSPECTION Inspectors Article 45 45.1. Supervision and implementation of the provisions of this law and of the Subsidiary acts issued there under shall be carried out by appropriate inspection services of the Ministry. 45.2. A appropriate inspector, in addition to the conditions set out in on inspection, this law and Subsidiary acts, shall also have relative education, work experience and training in the field of wine production Authorizations Article 46 46.1. Inspectors are authorized to examine: a) vineyards; b) processing premises, such as cellars or filling stations etc; c) storehouses used for storing grape, wine or other products; d) working premises where grape, wine, must, other products and enological substances, destined for the market, are produced, processed or stored; e) import, customs warehouses in the presence of a customs officer; f) premises where grape, wine or mu st are sold to the final consumer; g) the equipment for produc tion, processing, tending, bottling and storing grape, must, wine and other products; h) grape, mash, must and wine and othe r products at production facilities, in transportation vehicles, and at places where they are sold to the final consumers; i) enological substances; j) labels; k) accompanying documents and cellar records; l) the register of grape and wine growers and the register of vineyards; m) other documentations about grape, wine and other products held by producers, processors, caterers and traders. 46.2. Inspectors are authorized to take the following measures: a) to order the complete elimination of all vine stocks on a plot planted with not classified varieties (grubbing-up);

22. 22 b) to prohibit temporarily the commercial sale wine or other products until an evaluation is obtained, if it is suspected that the wine or other products do not meet the prescribed criteria; c) to prohibit the sale of wine and other prod ucts that do not meet the criteria set out in this law, in Subsidiary acts issued ther e under or under international agreements; d) to confiscate spoiled or falsified or defective wine or other products and to order their destruction; e) to order the reclassification of wine into a lower quality class, if the wine does not meet the criteria for the declared quality clas s as set out in this law, or if the wine was blended in a cellar contrary to the legal provisions for the protection of geographical origin; f) to prohibit the sale of wine that was put on the market accompanied by documentation that does not correspond to the actual characteristics of the wine; g) to prohibit the sale of wine and other products not legally labeled; h) to set a time limit for re-establishing the legal status of wine and other products; i) to prohibit the continuation of further activity, if the working premises or the equipment of a producer, a processor of grape and wine, a caterer, a trader, a packer or a tender do not go conform with the conditions set out in this law and subsidiary acts issued there under; j) to prohibit the import or the export of wine or other products if they do not go conform with the criteria set out in this law and subsidiary act issued there under; k) to propose the initiation of a procedure for a misdemeanor for a criminal offence; l) take samples in case where there is a doubt that wine, must or other products do not meet the criteria set out in this law and in the Subsidiary acts issued subsequently, which are sent for an analysis in the authorized institution. 46.3. Producers, processors, bottlers, traders a nd caterers, with regard to the provisions of the present law, are obliged to facilitate th e work of the inspector and to provide the necessary data and information related to their work Analyses of samples Article 47 47.1. The owner of the products or equipment form which samples have been taken must provide the packaging and pay for the costs of the analysis if it is observed that the products or the equipment form which samples have been taken do not meet the conditions set out in the Law. 47.2. If the results of the anal ysis show that the samples meet the criteria, the cost of the analysis shall be paid by the entity who’s inspector sent the samples for analysis and results.

23. 23 TITLE X ADMINISTRATIVE SANCTIONS Sanctions Article 48 48.1. Legal and natural persons shall be fined with the amount of 500 up to 30.000 Euro for the commission of any of the following offences by acting in contravention of provisions foreseen in this law or in subsidiary acts: a) producing grapes or wine, processing wi ne, producing other products, tending or bottling wine whilst not registered or not supplying data for the Register in a prescribed way and within set time limits; b) producing wine or other products whilst not satisfying all the prescribed conditions; c) the sale of wine, produced from grapes that at harvest time has not attained the required sugar content; d) processing grapes with unsuitable technology; e) producing wine from imported grapes, mash or must in contradiction with effective legislation; f) producing grapes, wine or other product s employing illegal methods or enological substances; g) blending grapes, mash, must or wine in an illegal manner; h) cultivating vines that are not classified for a particular viticultural district; i) marketing or selling unevaluated quality wine; j) labeling wine or other products contrary to this Law or subsidiary acts; k) marketing or commercial sale of wine or other products that are prohibited for sale; l) failing to store spoiled wine in separate, distinctly mark ed containers, or to report spoiled wine to a cellar inspector; m) the commercial sale, transporting or storing of wine in a way that does not preserve the organoleptic and characteristic physical-chemical properties; n) transporting more than 20 liters of wine that is not legally bott led and labeled or is not accompanied by the prescribed documentation; o) dispatching or accepting wine lacking the requisite documentation; p) failing to keep a prescribed cellar record; q) marketing or selling wine prior to a prescribed time limit; r) the commercial sale of imported wine which was not evaluated as required by the law and subsidiary acts issued there under; s) not respecting the directions and decisions of the inspector; and

24. 24 t) obstructing the inspector in taki ng samples and performing the checks. 48.2. The responsible person the organization of unified labor or of the legal person shall be fined between 500 and 2.000 Euro for offences from paragraph 1 of this Article. Article 49 Financial means from fine punishments shall be deposited in Kosovo Consolidated Budget. TITLE XI PROVISIONAL AND FINAL PROVISIONS Provisional provisions Article 50 50.1. Producers of grapes, wine or other produc ts must be registered no later than 6 month after the entry into force of this law. 50.2. The register of actual and potential vineyards shall be established no later than 1 years after the entry into force of this law. 50.3. Wine produced from grapes grown in vineyards already existing at the time when this law entries in force on not classified viticultural positions, may until the cessation of the fertility of the vineyards, but not exceeding 5 years after this law takes effect, only be designated as wine without geographical indication irrespective of the actual quality of the wine while, after the expiration of the time limit, it will be forbidden to market such wine. Article 51 On the day this law enters into force, it shal l supersede the provisions of the laws that are contrary to it. Entry into Force Article 52 The present law shall enter into force after adoption by the Assembly of Kosova on the date of its promulgation by the Special Representative of the Secretary-General. Law No. 02/L-8 23 February 2005 President of the Assembly _____________________ Academic Nexhat Daci

1. PROVISIONAL INSTITUTIONS OF SELF GOVERNMENT _________________________________________________________________ LAW No.02/L-8 THE WINE LAW The Assembly of Kosova, Based on UNMIK Regulation No.2001/9 of May 15, 2001 on Constitutional Framework for Provisional Self -governing in Kosova, Chapters 9.1.26 (a) and 5.1. (n) With the aim of regulating production and distribution of grapes and the production of wine, the production and the distribution of wine and other products produced from the processing of grapes and wine: Adopts the following: THE WINE LAW TITLE I GENERAL PROVISIONS Article 1 This law regulates the production and the distribution of grapes used for the production of wine as well as the conditions for the distribution of wine and other products produced from the processing of grapes and wine, the protection of wine produced in a certain geographical region, distinguished by the characteristics of its climate, soil and other factors. Definition Article 2 The terms used in law have the following meanings: 1) Wine : the product obtained exclusively from the total or partial alcoholic fermentation of fresh grapes, whether or not crushed, or grape must. 2) Kosovar wine : wine produced in the Kosova and derived exclusively from vine varieties, classified for the wine production. The minimum natural alcoholic strength by volume is [ 7,5 % vol. ]. The actual alcoholic strength by volume is not less than [ 8,5 % vol.]. The total acidity content, expressed as tartaric acid, is not less than [ 3,5 grams per liter ] or [ 46,6 mill equivalents per liter ]. UNITED NATIONS United Nations Interim Administration Mission in Kosovo UNMIK NATIONS UNIES Mission d’Administration Intérimaire des Nations Unies au Kosovo

2. 2 3) Fresh grapes : the fruit of the vine use in making wine, technically ripe and even slightly raisin, which may be crushed or pressed by normal wine cellar means and which may spontaneously produce alcoholic fermentation. 4) Grape must : the liquid product obtained naturally or by physical processes from fresh grapes. An actual alcoholic strength by volume of the grape must of not more than 1% vol. is permissible. 5) Grape must in fermentation : the product, obtained from the fermentation of grape must and with an actual alcoholic strength by volume of more than 1% vol. but less than three fifth of its total alcoholic strength by volume. 6) Concentrated grape must : uncaramelised grape must which is obtained by partial dehydration of grape must carried out by an authorized method other than by direct heat in such a way that the figure indicated by the refractometer at a temperature of 20° Celsius is not less than 50,9 %. Concentrated grape must has to derive exclusively from grapes, classified for the wine production in the Kosova. An alcoholic strength by volume of the concentrated grape must of not more than 1% vol. is permissible. 7) Rectified concentrated grape must : the liquid uncaramelised product which is obtained by partial dehydration of grape must carried out by an authorized method other than by direct heat in such a way that the figure indicated by the refractometer at a temperature of 20° Celsius is not less than 61,7 %. It has undergone authorized treatment for deacidification and elimination of constituents other than sugar. An alcoholic strength by volume of the concentrated grape must of not more than 1% vol. is permissible. 8) Grape juice : the unfermented but fermentable liquid product obtained by appropriate treatment rendering it fit for consumption as it is. It may be obtained from fresh grapes or from grape must, or by reconstitution from concentrated grape must or from concentrated grape juice. An actual alcoholic strength by volume of the grape juice of not more than 1% vol. is permissible. 9) Concentrated grape juice : uncaramelised grape juice obtained by partial dehydration of grape juice carried out by an authorized method other than by direct heat in such a way that the figure indicated by the refractometer at a temperature of 20° Celsius is not less than 50,9 %. An alcoholic strength by volume of the concentrated grape juice of not more than 1% vol. is permissible. 10) New wine still in fermentation : wine, in which alcoholic fermentation is not yet complete and which is not yet separated from its lees. 11) Sparkling wine : the product which is obtained by the first or the second alcoholic fermentation of fresh grapes, grape must or wine, which, when the container is opened, releases carbon dioxide derived exclusively from fermentation and which has an excess pressure, due to carbon dioxide in solution, of not less then 3 bar when kept at a temperature of 20° Celsius in closed containers. 12) Aerated sparkling wine : the product which is obtained from wine, releases, when the container is opened, carbon dioxide derived wholly or partially from an addition of that gas and which has an excess pressure, due to carbon dioxide in solution, of not less then 3 bar when kept at a temperature of 20° Celsius in closed containers.

3. 3 13) Semi-sparkling wine : the product which is obtained from wine with a total alcoholic strength of not less than 9% vol.; it has a total alcoholic strength of not less than 7% vol. and an excess pressure, due to endogenous carbon dioxide in solution, of not less then 1 bar and not more than 2,5 bar when kept at a temperature of 20° Celsius in closed containers. It is put in containers of 60 liters or less. 14) Aerated semi-sparkling wine : the product which is obtain ed from wine; it has an actual alcoholic strength of not less than 7% vo l., a total alcoholic strength by volume of not less than 9% vol. and an excess pressure of not less then 1 bar and not more than 2,5 bar when kept at a temperature of 20° Celsius in closed containers due to carbon dioxide in solution which has been wholly or partially added. It is put in c ontainers of 60 liters or less. 15) Wine vinegar : vinegar, which is obtained exclusively by acetous fermentation of wine and has a total acidity of not less than 60 grams per liter expressed as acetic acid. 16) Liqueur wine : the product having an actual alcoholic strength by volume of not less than 15% vol. and not more than 22% vol. and an overall alcoholic strength by volume of not less than 17,5%vol.. It is obtained from grape must in fermentation or wine or a combination of these products by addition individually or in combination of neutral alcohol of vine origin and wine or dried gr ape distillate, having an actual alcoholic strength by volume of not less than 52% vol. and not more than 86% vol.. Concentrated grape must can be added. 17) Wine lees : the residue accumulating in vessels containing wine after fermentation, during storage or after authorized treatment and the residue obtained from filtering or centrifuging this product. 18) Grape marc : the residue from the pressing of fresh grapes, whether or not fermented. 19) Grape marc wine (piquette): The product obtained by the fermentation of untreated grape marc macerated in water or by leaching fermented grape marc with water. 20) Wine fortified for distillation : the product which has an actual alcoholic strength by volume of not less than 18% vol. and not more than 24% vol., is obtained exclusively by the addition to wine containing no residual sugar of an unrectified product derived from the distillation of wine and having a maximum actual alcoholic strength by volume of 86% vol. and a maximum volatile acidity of 1,5grams per liter, expressed as acetic acid. 21). Quality wines : wine produced in viticultural district, which is a specified region for production of quality wines. 22). Regional wines : wine produced in the area cultivating regional wines. 23). Ministry : is Ministry of Agriculture, Fo restry and Rural Development. 24. Person : is any legal and physical person. 25) Packaging: means filling and closing the wine and other products as bottles, containers, wooden barrels or other material for the purpose of storing, preservation of physical, chemical and organoleptic characteristics. 26) “ Bottler ” means a person carrying out bottling or having carried out on their behalf. 27 “ Bottling ” means putting the product concerned up for commercial purposes in containers of a capacity not exceeding 60 liters.

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