Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 2075/92 and fixing the premiums and guarantee thresholds for leaf tobacco by variety group and Member State for the 1999, 2000 and 2001 harvests

(presented by the Commission)

EXPLANATORY MEMORANDUM

1. On 22 June 1998 the Council decided to raise the supplementary amount granted for tobaccos grown in Austria, Belgium, France and Germany from 50% to 65% in relation to the 1992 harvest. This increase is to be calculated on the basis of the difference between the premium granted for the 1998 harvest and the premium applicable to the 1992 harvest for the tobaccos in question.

Since Article 3(2) of Regulation (EEC) No 2075/92 calculates the supplementary amount on the basis of the difference between the premium granted for the 1999 harvest and not the 1998 harvest, it is proposed that the text be amended.

2. It is for the sake of maintaining stability in the sector and coherence with the fixing of guarantee thresholds that the premium has been fixed for the 1999, 2000 and 2001 harvests.

3. The amount of the premium is to be increased by 10% compared with 1998 and this increase corresponds to the specific aid which henceforth is to be included in the premium from the 1999 harvest.

4. The supplementary amounts for the northern countries are increased to 65% of the difference between the premium granted in 1998 and the premium applicable to the 1992 harvest, as provided for in Article 3(2) of Regulation (EEC) No 2075/92.

5. For 1999, 2000 and 2001, the guarantee thresholds are reduced for group II by 375 tonnes for Germany, 9 tonnes for Belgium, 24 tonnes for Austria, and for group III by 842 tonnes for France and 38 tonnes for Belgium while maintaining budgetary neutrality as a result of the increased supplementary amount.

6. In the case of Italy a transfer of 3 400 tonnes from group V (sun-cured) is to be carried out over two years to group I (flue-cured) - 500 tonnes, group II (light air-cured) - 500 tonnes, group IV (fire-cured) - 65 tonnes and to group VII (Katerini), which has just been introduced into that country. The reduction in group V is as a result of the national improvement scheme. The varietal groups whose guarantee thresholds have been increased are in demand on the market.7.

The reduction in group V corresponds to the total transfer of the Tsebelia and Mavra varieties, with only the non-classic Kaba Koulak keeping the quota. These varieties are not much appreciated by the market, are difficult to process and are up against competition from "oriental" cigarettes produced in eastern Europe and the former Soviet Union.

The transfer favours the varietal groups which are in greater demand, in line with the local characteristics of the regions concerned (Agrinio and Naplio).

Proposal for a

COUNCIL REGULATION (EC) No ..../..

amending Regulation (EEC) No 2075/92 and fixing the premiums and guarantee thresholds for leaf tobacco by variety group and Member State for the 1999, 2000 and 2001 harvests

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Articles 42 and 43 thereof,

Having regard to Council Regulation (EEC) No 2075/92 of 30 June 1992 on the common organisation of the market in raw tobacco (1), as last amended by Regulation (EC) No 1636/98 (2), and in particular Articles 4(1), 8 and 9(2) thereof,

(1) OJ L 215, 30.7.1992, p. 70.

(2) OJ L 210, 20.7.1998, p. 23.

Having regard to the proposal from the Commission (3),

Having regard to the opinion of the European Parliament (4),

Having regard to the opinion of the Economic and Social Committee (5),

(3) (4) (5) OJ

Whereas a supplementary amount is granted for flue-cured, light air-cured and dark air-cured tobaccos grown in Austria, Belgium, France and Germany; whereas the Council decided to raise that amount from 50% to 65% of the difference on the basis of the 1992 harvest; whereas this increase is to be calculated on the basis of the difference between the premium granted for those tobaccos for the 1998 harvest and the premium applicable to the 1992 harvest; whereas Article 3(2) of Regulation (EEC) No 2075/92 is not consistent with this; whereas Article 3(2) of Regulation (EEC) No 2075/92 should therefore be amended;

Whereas the level of premiums should be fixed having regard to the objectives of the common agricultural policy and in particular to ensure a fair standard of living for the farming community; whereas the premium amounts should reflect past and foreseeable market outlets for the various tobaccos under normal conditions of competition; whereas the level of the premiums should be fixed for three consecutive harvests and be linked to the guarantee thresholds established for the three harvests in 1999, 2000 and 2001 in order to ensure that the stability of the sector is maintained;

Whereas the second paragraph of Article 8 and Article 9(2) of Regulation (EEC) No 2075/92 provide for the allocation among producer Member States of guarantee thresholds for each variety group for three harvests as from the 1999 harvest;

Whereas the level of those thresholds for the three harvests in 1999, 2000 and 2001 should be fixed having regard, in particular, to market conditions and socio-economic and agricultural conditions obtaining in the production zones concerned; whereas such fixing should be done in good time to allow producers to plan their production for the said harvests;

Whereas, as a result of the increase in supplementary amounts for flue-cured, light air-cured and dark air-cured tobaccos grown in Austria, Belgium, France and Germany, the guarantee thresholds of these Member States should be reduced in order to ensure the maintenance of budget neutrality;

Whereas, while maintaining production potential and the allocation of quotas by Member State, quotas for varieties which have sure outlets and attract high market prices should be increased progressively to the detriment of quotas for varieties which are difficult to sell and attract low market prices;

Whereas the measures in question should be introduced as soon as possible,

HAS ADOPTED THIS REGULATION:

Article 1

Article 3(2) of Regulation (EEC) No 2075/92 is replaced by the following:

"2. A supplementary amount shall, however, be granted on flue-cured, light air-cured and dark air-cured tobaccos grown in Austria, Belgium, France and Germany. That amount shall be equal to 65% of the difference between the premium applicable to the 1998 harvest and the premium applicable to the 1992 harvest for those tobaccos."

Article 2

For the 1999, 2000 and 2001 harvests, the premium amounts for each of the groups of raw tobacco and the supplementary amounts specified in Article 3 of Regulation (EEC) No 2075/92 shall be as shown in Annex I to this Regulation.

Article 3

For the 1999, 2000 and 2001 harvests, the guarantee thresholds referred to in Articles 8 and 9 of Regulation (EEC) No 2075/92 by variety group and by Member State shall be as set out in Annex II to this Regulation.

Article 4

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

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

Done at Brussels,

For the Council

The President

ANNEX I

PREMIUMS FOR LEAF TOBACCO FOR THE 1999, 2000 et 2001 HARVESTS

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SUPPLEMENTARY AMOUNTS

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ANNEX II

GUARANTEE THRESHOLDS FOR 1999

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GUARANTEE THRESHOLDS FOR 2000

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GUARANTEE THRESHOLDS FOR 2001

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A N N E X

Expenditure for a standard harvest: 1005,9 x 1,006 (DR) = ECU 1011,9 million

of which: specific aid to producer groups ECU 19,7 million

(2% of the premiums exclusive of supplementary amounts)

direct premiums for producers ECU 992,2 million

Expected schedule of payments for the three harvests concerned:

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(1) These amounts are supplemented by expenditure on previous harvests.

(2) These amounts will be supplementd by expenditure on future harvests.