**Avis juridique important**

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# 52003PC0701

**Proposal for a Council Regulation amending Regulation (EC) No 1673/2000 on the common organisation of the markets in flax and hemp grown for fibre  /* COM/2003/0701 final - CNS 2003/0275 */****

Proposal for a COUNCIL REGULATION amending Regulation (EC) No 1673/2000 on the common organisation of the markets in flax and hemp grown for fibre

(presented by the Commission)

EXPLANATORY MEMORANDUM

Article 15(1) of Council Regulation (CE) No 1673/2000 of 27 July 2000 on the common organisation of the markets in flax and hemp grown for fibre lays down that:

"Not later than 31 December 2003, the Commission shall submit a report to the European Parliament and the Council, if necessary accompanied by proposals, on production trends in the various Member States and the impact of the reform of the common organisation of the market on the outlets and economic viability of the sector. It shall also examine the maximum content of impurities and shives applicable to short flax fibre and hemp fibre.

Should the need arise, the report shall serve as a basis for a re-apportionment of, and possible increase in, the national guaranteed quantities. In particular, the Commission shall take account of the level of production, processing capacity and outlets on the market."

Article 15 also provides for a second report, to be submitted in 2005, on the operation of the system of processing aid for flax and hemp grown for fibre introduced by Regulation (EC) No 1673/2000.

The data currently available do not allow for a detailed analysis of production trends in the Member States or of whether or not the NGQs have been set at the correct level. However, on the basis of the information gathered, it can be concluded that the arrangements have had clear positive effects on the sector.

Under these circumstances, no amendments should be made to the existing mode of operation of the system of aid before the more complete analysis to be carried out for the report planned for 2005 is available.

However, the second subparagraph of Article 2(3)(b) of Regulation (EC) No 1673/2000 lays down that the Member States may, until the 2003/04 marketing year, derogate from the limit of 7.5% impurities and shives and grant aid for short flax fibre and hemp fibre containing a percentage of impurities and shives of less than 15% and 25% respectively. Regulation (EC) No 1673/2000 should therefore be amended to extend the possibility of making a derogation for two years, to the 2005/06 marketing year, which should consolidate the positive development the sector is experiencing.

As regards the countries that will accede to the European Union on 1 May 2004, six of them produce long flax and short flax fibre and three produce hemp fibre. The extension of the derogation from the 7.5% limit being proposed for two marketing years will give the new Member States the same opportunity as the existing Member States to adjust to the important changes the sector is undergoing.

2003/0275 (CNS)

Proposal for a COUNCIL REGULATION amending Regulation (EC) No 1673/2000 on the common organisation of the markets in flax and hemp grown for fibre

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular the third subparagraph of Article 37(2) thereof,

Having regard to the proposal from the Commission [1],

[1]  OJ C ..., ..., p. ...

Having regard to the opinion of the European Parliament [2],

[2]  OJ C ..., ..., p. ...

Having regard to the opinion of the European Economic and Social Committee [3],

[3]  OJ C ..., ..., p. ...

Having regard to the opinion of the Committee of the Regions [4],

[4]  OJ C ..., ..., p. ...

Whereas:

(1) The second subparagraph of Article 2(3)(b) of Council Regulation (EC) No 1673/2000 [5] lays down that the Member States may derogate from the limit of 7.5% impurities and shives and grant processing aid for short flax fibre containing a percentage of impurities and shives of between 7.5% and 15% and for hemp fibre containing a percentage of impurities and shives of between 7.5% and 25%. However, advantage may be taken of this possibility only until the 2003/04 marketing year.

[5]  OJ L 193, 29.7.2000, p.16. Regulation amended by Commission Regulation (EC) No 651/2002 (OJ L 101, 17.4.2002, p. 3).

(2) At the present time, the percentage of impurities and shives in most short flax fibre and hemp fibre obtained during primary processing exceeds the limit of 7.5%. In order to consolidate the positive development the sector is experiencing and to allow for further improvements in competitiveness, the possibility of Member States to derogate from that limit should be extended for two marketing years.

(3) Regulation (EC) No 1673/2000 should be amended accordingly,

HAS ADOPTED THIS REGULATION:

Article 1

In the second subparagraph of Article 2(3)(b) of Regulation (EC) No 1673/2000, "2001/2002 to 2003/2004" is replaced by "2001/02 to 2005/06".

Article 2

This Regulation shall enter into force on the day following 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, on

For the Council

The President

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