# EUR-Lex - 32004R0004 - EN

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# 32004R0004

**Commission Regulation (EC) No 4/2004 of 23 December 2003 laying down detailed rules for the application of Council Regulation (EEC) No 4045/89 on scrutiny by Member States of transactions forming part of the system of financing by the Guarantee Section of the European Agricultural Guidance and Guarantee Fund **

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Official Journal L 002 , 06/01/2004 P. 0003 - 0020 *

Commission Regulation (EC) No 4/2004

of 23 December 2003

laying down detailed rules for the application of Council Regulation (EEC) No 4045/89 on scrutiny by Member States of transactions forming part of the system of financing by the Guarantee Section of the European Agricultural Guidance and Guarantee Fund

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community,

Having regard to Council Regulation (EEC) No 4045/89 of 21 December 1989 on scrutiny by Member States of transactions forming part of the system of financing by the Guarantee Section of the European Agricultural Guidance and Guarantee Fund and repealing Directive 77/435/EEC(1), as last amended by Regulation (EC) No 2154/2002(2), and in particular Article 19 thereof,

Whereas:

(1) In view of the deletion of the provisions of Regulation (EEC) No 4045/89 concerning the reimbursement by the Community of expenditure incurred by the Member States in the framework of the scrutinies provided for by that Regulation, the rules implementing those provisions in Commission Regulation (EEC) No 1863/90 of 29 June 1990 laying down detailed rules for the application of Council Regulation (EEC) No 4045/89 on scrutiny by Member States of transactions forming part of the system of financing by the Guarantee Section of the European Agricultural Guidance and Guarantee Fund and repealing Directive 77/435/EEC(3), as last amended by Regulation (EC) No 2278/96(4), serve no further purpose.

(2) It is further appropriate to lay down detailed rules concerning the procedure for the reduction of the minimum number of scrutinies as provided for in the third subparagraph of Article 7(1) of Regulation (EEC) No 4045/89 establishing a system of mutual assistance between Member States for the purpose of carrying out the scrutinies.

(3) Regulation (EEC) No 4045/89 requires Member States to send to the Commission a number of communications. As the standardisation of the form and content of such communications facilitates their use and ensures a uniformity of approach, it is appropriate to adopt detailed rules as to their form and content.

(4) Therefore, in view of the extent of the changes required and in the interest of clarity, Regulation (EEC) No 1863/90 should be replaced.

(5) The measures provided for in this Regulation are in accordance with the opinion of the Committee for the European Agricultural Guidance and Guarantee Fund,

HAS ADOPTED THIS REGULATION:

CHAPTER I SUBJECT MATTER

Article 1

This Regulation lays down detailed rules for the application of Regulation (EEC) No 4045/89.

CHAPTER II APPLICATION FOR REDUCTION OF THE MINIMUM NUMBER OF SCRUTINIES

Article 2

The request for a reduction of the number of scrutinies referred to in the third subparagraph of Article 7(1) of Regulation (EEC) No 4045/89 shall contain detailed information as set out in Annex I to this Regulation.

Article 3

The decision to grant a reduction of the minimum number of scrutinies as provided for in the third subparagraph of Article 7(1) of Regulation (EEC) No 4045/89 shall be based on an assessment of the benefits in respect of the protection of the Communities' financial interests and shall take into account the following criteria:

(a) the risks identified;

(b) the approach adopted;

(c) the rate of completion of the minimum number of scrutinies for the previous three scrutiny periods and the number and rate of timely completion of mutual assistance requests for the previous three scrutiny periods;

(d) the feasibility of the proposed approach and any particular scrutiny experience of the Member State(s) concerned with the approach or in the sector concerned;

(e) the extent to which scrutineers of one Member State may participate in the scrutinies under the joint exercise in the other Member State(s);

(f) the confirmation that the other Member State(s) participate, to the extent required, in the joint exercise, if that exercise is not included in the other Member State(s) programme handed in under Article 10(1) of Regulation (EEC) No 4045/89;

(g) the extent to which scrutiny in third countries is envisaged and considered feasible;

(h) any other information considered necessary to support the request.

Article 4

The decision referred to in Article 3 shall fix the rate and number of the reduction on the minimum number of scrutinies required under Article 2(2) of Regulation (EEC) No 4045/89.

CHAPTER III THE CONTENT OF DOCUMENTS

Article 5

1. The annual report referred to in Article 9(1) of Regulation (EEC) No 4045/89 shall include detailed information on each of the aspects of the application of Regulation (EEC) No 4045/89 listed in Annex II to this Regulation, set out in clearly identified sections under the headings referred to.

2. The annual programme of scrutinies referred to in Article 10 of Regulation (EEC) No 4045/89 shall be drawn up in accordance with the specimen form shown in Annex III to this Regulation.

3. The list of undertakings referred to in Article 7(2) of Regulation (EEC) No 4045/89 shall be drawn up in accordance with the specimen form shown in Annex IV to this Regulation.

4. The list of undertakings referred to in Article 7(3) of Regulation (EEC) No 4045/89 shall be drawn up in accordance with the specimen form shown in Annex V to this Regulation.

5. A request by a Member State for a priority inspection of an undertaking in another Member State, as referred to in Article 7(2) and (4) of Regulation (EEC) No 4045/89, shall be drawn up in accordance with the specimen form shown in Annex VI to this Regulation.

6. The information on the results of the scrutinies referred to in Article 7(2) and (4) of Regulation (EEC) No 4045/89 shall be drawn up in accordance with the specimen form shown in Annex VII to this Regulation.

7. The information on the requests and the results of the scrutinies referred to in Article 7(2) and (4) of Regulation (EEC) No 4045/89, to be communicated to the Commission in quarterly reports as provided for in the second subparagraph of Article 7(4) of that Regulation, shall be drawn up in accordance with the specimen form shown in Annex VIII to this Regulation.

Article 6

The information to be submitted under Article 5 may be communicated in paper form or in electronic form, in a format to be agreed between the sender and the recipient.

Transaction data under Article 7 of Regulation (EEC) No 4045/89 shall be communicated in electronic form in the format provided for in Annex II point 2 of Commission Regulation (EC) No 2390/1999(5).

CHAPTER IV JOINT ACTIONS

Article 7

1. The Commission, acting on its own initiative or on the basis of a proposal by a Member State, and with the agreement of the Member States concerned, may decide to coordinate joint actions involving mutual assistance between two or more Member States, as provided for in Article 7(1) of Regulation (EEC) No 4045/89.

For its decision the Commission shall take into account the following points, in particular:

(a) the level of risk involved;

(b) the extent of operations, in particular the frequency of intra- and extra-Community trade, and their financial scale;

(c) the need to achieve a uniform approach.

2. In agreement with the Member States concerned, a Member State shall be designated to be responsible for the management of the joint action.

However, each Member State shall remain responsible for carrying out the scrutinies required by Regulation (EEC) No 4045/89.

3. Each Member State concerned shall:

(a) designate those persons or services responsible for carrying out the joint action on its behalf;

(b) ensure that a sufficient number of adequately experienced officials is made available for the conduct of the joint action;

(c) ensure that within set time limits the scrutiny is carried out and the report finalised and made available to all participating Member States and to the Commission.

CHAPTER V FINAL RULES

Article 8

Regulation (EEC) No 1863/90 is repealed.

Article 9

This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, 23 December 2003.

For the Commission

Franz Fischler

Member of the Commission

(1) OJ L 388, 30.12.1989, p. 18.

(2) OJ L 328, 5.12.2002, p. 4.

(3) OJ L 170, 3.7.1990, p. 23.

(4) OJ L 308, 29.11.1996, p. 30.

(5) OJ L 295, 16.11.1999, p. 1.

ANNEX I

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ANNEX II

Information to be contained in the annual report provided for in Article 9(1) of Regulation (EEC) No 4045/89

1. Administration of Regulation (EEC) No 4045/89

Information shall be provided concerning the administration of Regulation (EEC) No 4045/89, including changes to the organisations responsible for controls and to the special department responsible for monitoring the application of that Regulation, as referred to in Article 11 thereof, and to the competences of those organisations.

2. Legislative changes

Information shall be provided regarding any national legislative changes relevant to the application of Regulation (EEC) No 4045/89 that have intervened since the previous annual report.

3. Amendments to the scrutiny programme

A description shall be provided of any amendments or modifications that were made to the scrutiny programme submitted to the Commission under Article 10(2) of Regulation (EEC) No 4045/89 since the date of submission of that programme.

4. Execution of the scrutiny programme covered by the present report

Information shall be provided on the execution of the programme of scrutinies for the period ending on 30 June preceding the closing date for submission of the report, as referred to in Article 9(1) of Regulation (EEC) No 4045/89, including the following points, both in total and broken down by control body (where more than one carries out controls under that Regulation):

(a) the number of scrutinies carried out and the number of undertakings subject to these scrutinies;

(b) the number of scrutinies still in the course of being carried out and the number of undertakings subject to these scrutinies;

(c) the number of scrutinies planned for the period in question that were not carried out and the number of undertakings that were not subject to scrutiny as a result of the non-execution of these scrutinies;

(d) the reasons why the scrutinies referred to in point (c) were not carried out;

(e) the breakdown, by amounts received by or paid to, and by measure, of the scrutinies referred to in points (a), (b), and (c);

(f) the results of the scrutinies referred to in point (a), including:

(i) the number of scrutinies for which irregularities were discovered, and the number of undertakings involved,

(ii) the nature of these irregularities,

(iii) the measure concerned where an irregularity was discovered,

(iv) the estimated financial consequence of each irregularity;

(g) an indication of the average duration of scrutinies in person/days, indicating, where practicable, the time spent on planning, preparation, execution of controls, and reporting.

5. Execution of the scrutiny programmes preceding the one covered by the present programme

The report shall contain the results of the scrutinies carried out in respect of previous scrutiny periods, for which the results were not available at the time of the submission of the reports for those scrutiny periods, including:

(a) the number of scrutinies through which irregularities were discovered, and the number of undertakings involved;

(b) the nature of these irregularities;

(c) the measure concerned where an irregularity was discovered;

(d) the estimated financial consequence of each irregularity.

The results of the scrutinies pursuant to the third subparagraph of Article 7(1) of Regulation (EEC) No 4045/89 shall be presented as such.

6. Mutual assistance

Mutual assistance requests made and received under Article 7 of Regulation (EEC) No 4045/89 shall be communicated, including the results of scrutinies carried out as a matter of priority under Article 7(2) and (4) of that Regulation, and a summary of the lists both sent and received under Article 7(2) and (3) of that Regulation.

7. Resources

Details on the resources available for the carrying out of the scrutinies under Regulation (EEC) No 4045/89 shall be transmitted, including:

(a) the number of staff, expressed in person/years, allocated to scrutinies under Regulation (EEC) No 4045/89, by control body, and, where appropriate, region;

(b) training received by staff working on scrutinies under Regulation (EEC) No 4045/89, with an indication of the proportion of the staff referred to in point (a) who have received such training, and the nature of the training itself; and,

(c) computer equipment and tools at the disposal of staff working on scrutinies under Regulation (EEC) No 4045/89.

8. Difficulties in applying Regulation (EEC) No 4045/89

Information shall be provided on any difficulties encountered in the application of the Regulation, and the measures taken to overcome them or proposals to this end.

9. Suggestions for improvement

Where appropriate, suggestions shall be made for the improvement, either of the application of Regulation (EEC) No 4045/89, or of that Regulation itself.

ANNEX III

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ANNEX IV

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ANNEX V

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ANNEX VI

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ANNEX VII

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ANNEX VIII

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