[2] These regulations form a part of the Common Agricultural Policy (CAP) of EU, and regulate such things as the maximum vineyard surface allowed to individual EU member states, allowed winemaking practices and principles for wine classification and labelling.
In the early days of the CAP, the wine sector of the then-European Economic Community (EEC) was in reasonable equilibrium for a rather short period of time.
However, the early post-World War II saw the introduction of many technological innovations within viticulture, which soon led to increased production, while the demand stayed constant.
The answer from EEC was to intervene in the market to make some guarantee as to sales, while still keeping the freedom to plant new vineyards, which aggravated rather than solved the problem of overproduction.
From the 1980s, this has meant a marked reduction in the total demand, in terms of quantity, despite the fact that the wine-importing countries of northern Europe have increased their consumption.
A major revision was done in 1999, and it has been stated several times since then that the ambition is to phase out interventions such as emergency distillation, since they are "artificial outlets" for wine.
The aspects regulated by EU fall mainly into the categories winemaking practices, classification and labelling, wine-production potential, documentation of wine industry activities, imports from non-EU countries, and duties of enforcement agencies.
Some practices also depend on where within EU the grapes are grown, since typical challenges to winemakers in colder or hotter climates are somewhat different.
The defined European Union wine growing zones are used to regulate these practices, but some leeway is given for authorising deviations in vintages of exceptional climatic conditions.