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( 1 ) OJ N L 46 , 20 . 2 . 1975 , P . 1 .

( 2 ) SEE PAGE 12 OF THIS OFFICIAL JOURNAL .

( 3 ) OJ N L 341 , 20 . 12 . 1974 , P . 51 .

( 4 ) OJ N L 330 , 24 . 12 . 1975 , P . 48 .

COUNCIL DECISION

OF 15 MARCH 1976

FIXING THE ECONOMIC POLICY CONDITIONS TO BE OBSERVED BY THE ITALIAN REPUBLIC

( 76/324/EEC )

THE COUNCIL OF THE EUROPEAN COMMUNITIES ,

HAVING REGARD TO THE TREATY ESTABLISHING THE EUROPEAN ECONOMIC COMMUNITY ,

HAVING REGARD TO COUNCIL REGULATION ( EEC ) N 397/75 OF 17 FEBRUARY 1975 RELATING TO COMMUNITY LOANS ( 1 ) , AND IN PARTICULAR ARTICLE 3 THEREOF ,

HAVING REGARD TO THE PROPOSAL SUBMITTED BY THE COMMISSION WHICH HAS FOR THIS PURPOSE CONSULTED THE MONETARY COMMITTEE ,

WHEREAS BY DECISION 76/322/EEC ( 2 ) , THE COUNCIL AUTHORIZED THE COMMISSION TO CONCLUDE FOUR BORROWING OPERATIONS UNDER REGULATION ( EEC ) N 397/75 , THE AMOUNT OF WHICH IS INTENDED FOR LOANS GRANTED UNDER THAT DECISION TO TWO MEMBER STATES ONE OF WHICH IS THE ITALIAN REPUBLIC ;

WHEREAS IN ACCORDANCE WITH ARTICLE 3 OF REGULATION ( EEC ) N 397/75 THE LOAN TO THE ITALIAN REPUBLIC MUST BE SUBJECT TO ECONOMIC POLICY CONDITIONS PERMITTING AN IMPROVEMENT IN THE BALANCE OF PAYMENTS OF THAT MEMBER STATE ;

WHEREAS SINCE MONETARY AND BUDGETARY POLICY CANNOT ALONE ENSURE THE RETURN TO INTERNAL AND EXTERNAL EQUILIBRIUM , THESE SHOULD BE ACCOMPANIED BY A MODERATION IN THE RATE OF INCREASE OF INCOMES ;

WHEREAS THE ITALIAN AUTHORITIES HAVE DECLARED THAT THEY WILL NOT , UNILATERALLY , TAKE ANY MEASURE OF A COMMERCIAL OR FINANCIAL NATURE TO RESTRICT IMPORT OR SUBSIDIZE EXPORTS ,

HAS ADOPTED THIS DECISION :

ARTICLE 1

THE LOAN GRANTED TO THE ITALIAN REPUBLIC BY DECISION 76/322/EEC SHALL BE SUBJECT TO THE FOLLOWING CONDITIONS CONCERNING THE ECONOMIC POLICY MEASURES TO BE TAKEN BY THAT MEMBER STATE .

ARTICLE 2

1 . THE FOLLOWING CONDITIONS SHALL BE OBSERVED DURING 1976 :

( A ) TOTAL CENTRAL GOVERNMENT EXPENDITURE MUST BE LIMITED TO LIT 39 700 000 MILLION IN THE 1976 CALENDAR YEAR ;

( B ) THE DEFICIT ON TREASURY TRANSACTIONS , AS DEFINED IN ARTICLE 6 ( 3 ) OF DIRECTIVE 74/637/EEC ( 3 ) , MUST NOT EXCEED LIT 13 800 000 MILLION , THROUGH AN INCREASE IN TAXATION , IF NECESSARY ;

( C ) THE FINANCING OF THE DEFICIT ON TREASURY TRANSACTIONS BY THE MONETARY AUTHORITIES MUST BE LIMITED , IF NECESSARY BY LEGISLATIVE MEANS , TO LIT 5 700 000 MILLION IN THE 1976 CALENDAR YEAR ;

( D ) THE GROWTH IN TOTAL LENDING , AS DEFINED IN ARTICLE 6 ( 1 ) OF DIRECTIVE 74/637/EEC , MUST NOT EXCEED LIT 29 500 000 MILLION IN THE 1976 CALENDAR YEAR .

2 . THE COUNCIL , ACTING ON A PROPOSAL FROM THE COMMISSION , SHALL IN GOOD TIME FIX THE CONDITIONS TO BE OBSERVED FOR THE SUBSEQUENT YEARS OF THE LOAN PERIOD .

ARTICLE 3

THE ITALIAN GOVERNMENT SHALL MAKE ALL POSSIBLE EFFORTS TO KEEP THE RISE IN INCOMES WITHIN LIMITS COMPATIBLE WITH THE INTERNAL AND EXTERNAL EQUILIBRIUM OF THE ECONOMY .

ARTICLE 4

THE CONDITIONS FIXED IN ARTICLE 2 SHALL AMEND , TO THE EXTENT THAT THEY DIFFER FROM , THE CONDITIONS PROVIDED FOR IN DIRECTIVE 75/784/EEC ( 4 ) .

ARTICLE 5

BEFORE THE END OF APRIL 1976 INTERMEDIATE OBJECTIVES SHALL BE ESTABLISHED BY AGREEMENT BETWEEN THE ITALIAN AUTHORITIES AND THE COMMISSION IN RELATION TO THE MEASURES LAID DOWN IN ARTICLE 2 , EXCEPT FOR THAT SET OUT IN ARTICLE 2 ( 1 ) ( B ) .

ARTICLE 6

THIS DECISION IS ADDRESSED TO THE ITALIAN REPUBLIC .

DONE AT BRUSSELS , 15 MARCH 1976 .

FOR THE COUNCIL

THE PRESIDENT

R . VOUEL