Proposal for a Council Regulation adjusting, for the fifth time, the system of aid for cotton introduced by Protocol 4 annexed to the Act of Accession of Greece

(95/C 94/05)

COM(95) 35 final - 95/0061(CNS)

(Submitted by the Commission on 3 March 1995)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community,

Having regard to the Act of Accession of Greece, and in particular paragraph 11 of Protocol 4 on cotton, as last amended by Regulation (EEC) No 2052/92 (1),

Having regard to Council Regulation (EEC) No 2052/92 of 30 June 1992 adjusting, for the second time, the system of aid for cotton introduced by Protocol 4 annexed to the Act of Accession of Greece, and in particular Article 5 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Parliament,

Having regard to the opinion of the Economic and Social Committee,

Whereas a review of the operation of the system established by Protocol 4 as referred to in Article 5 of Regulation (EEC) No 2052/92 has shown that the system needs to be adjusted;

Whereas a study on the impact of cotton growing in the regions where it is practised points to a potential for increasing production in those areas of the Community most suitable for this crop, taking into account the Community's demand for cotton fibre; whereas the guaranteed maximum quantity should accordingly be increased;

Whereas, on the other hand, to ensure that production of this crop does not expand in those regions less suited to it and to avoid an increase in expenditure, the guide price should be reduced in proportion to the increase in the guaranteed maximum quantity and no limit should be placed on the reduction in aid should the guaranteed maximum quantity be exceeded; whereas, in fixing the guide price, account must be taken of the adjustment to the price in ecus laid down in Council Regulation (EC) No 150/95 of 23 January 1995 amending Regulation (EEC) No 3813/92 on the unit of account and the conversion rates to be applied for the purposes of the common agricultural policy (2).

Whereas, with a view to facilitating budgetary arithmetic and fairness among operators, any deferral of the reduction in aid should be disallowed;

Whereas the diverging production trends in the producer Member States have produced inequitable effects in the operation of the system of stabilizers; whereas, with a view to establishing a fairer system, provision should be made so that, where the guaranteed maximum quantity is exceeded by no more than 10 %, the aid should be reduced equally in the producer Member States and, where the guaranteed maximum quantity is exceeded by more than 10 %, the Member States responsible should be subjected to a further reduction; whereas, however, provision should be made whereby Member States which are potential cotton producers can start to grow cotton by setting production at a level at which the system of stabilizers does not apply;

Whereas, to enable operators to run longer production and processing programmes, the guide price and the minimum price payable to the producer to ensure the benefits from the aid should no longer be fixed annually;

Whereas experience may show that other adjustments to the system provided for in the abovementioned Protocol are necessary; whereas a procedure allowing the Council to adjust the system should accordingly be laid down,

HAS ADOPTED THIS REGULATION:

Article 1

This Regulation provides for adjustments to the system of aid for the production of cotton provided for in paragraphs 3, 8, 9 and 11 of Protocol 4 annexed to the Act of Accession of Greece and adjusted by Council Regulation (EEC) No 1964/87 (1), as last amended by Regulation (EC) No 2760/94 (2).

Article 2

Article 2 of Regulation (EEC) No 1964/87 is replaced by the following:

'Article 2

1. A guaranteed maximum quantity (GMQ) is hereby established for which the aid referred to in point 3 of Protocol 4 on cotton shall be granted.

This quantity shall be fixed for each marketing year at 947 000 tonnes of unginned cotton.

2. The GMQ shall be allocated as follows among the Member States (guaranteed national quantity - GNQ):

Spain: 249 000 tonnes

Greece: 698 000 tonnes.

3. Paragraph 4 notwithstanding, if during a marketing year actual production exceeds the GMQ, the guide price for that year shall be adjusted as follows:

- where the GMQ is exceeded by up to 10 %, the guide price shall be reduced by a percentage equal to half the percentage excess,

- where the GMQ is exceeded by more than 10 %, an additional reduction shall be made to the guide price in every Member State where production exceeds the GNQ plus 10 %. The additional reduction shall be calculated taking account of the extent to which the GMQ was exceeded and shall be proportional to the difference between the actual quantity produced by each Member State and its GNQ.

The reductions applicable shall be fixed in accordance with the procedure laid down in Article 12 of Council Regulation (EEC) No 1308/70(*), as last amended by the Act of Accession of Austria, Finland and Sweden to the European Union.

4. Paragraph 3 shall not apply to Member States in which the actual quantity of unginned cotton produced does not exceed 1 500 tonnes in the marketing year.

(*) OJ No L 146, 4. 7. 1970, p. 1.`

Article 3

Paragraph 8 of Protocol 4 is replaced by the following:

'8. The guide price shall be set at ECU 110,73/100 kg of unginned cotton.

This price shall relate to cotton:

- of fair, sound and merchantable quality,

- having a 10 % moisture content and 3 % impurity content,

- having the necessary characteristics to produce, after ginning, 32 % grade 5 fibres (white middling) of 28 mm length (1 to 3/32″).`

Article 4

The following paragraph is inserted in Protocol 4:

'8a. Production aid shall be granted only to those undertakings which buy unginned cotton at a price at least equal to a minimum price. The minimum price shall be set at ECU 105,19/100 kg of unginned cotton for the quality selected for the guide price at the farm gate.`

Article 5

Point (a) in the second subparagraph of paragraph 9 of Protocol 4 is deleted.

Article 6

Paragraph 11 of Protocol 4 is replaced by the following:

'11. Before the start of the 1999/2000 marketing year at the latest, the Commission shall send the Council a report on the operation of the system of aid for cotton.

If the report shows it to be necessary, the Council, acting by qualified majority on a proposal from the Commission and having consulted Parliament, shall decide on any adjustments to the system, account being taken of the experience acquired in operating both this system and the system of support for arable crops.`

Article 7

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

It shall apply from the 1995/96 marketing year.

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

(1) OJ No L 215, 30. 7. 1992, p. 10.

(2) OJ No L 22, 31. 1. 1995, p. 1.

(1) OJ No L 184, 3. 7. 1987, p. 14.

(2) OJ No L 294, 15. 11. 1994, p. 1.