ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(77)538
Vol.1977/0172

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(77)538final
Brussels.31October1977
X
t.-'f!
I
<%T^1
Proposalfora
COUNCILREGULATION
ontheexchangeratestobeappliedforthe
purposesoftheagricultural structurespolicy
(submittedtotheCouncil "bytheCommission)
CQM(77)538final

EXPLANATORY MEMORANDUM
1.Inconnectionwiththeimplementation ofcommonmeasuresfinancedbythe
EAGGFGuidanceSection,theamountsspecifiedinunitsofaccountinthe
agricultural instrumentshaveto"beconvertedattherepresentative rates
fixedbytheCouncilpursuanttoArticle2(2)ofRegulationNo129*Asthe
annexedtableshows,theseratesforconvertingagriculturalunitsof
accountintonationalcurrencieshavebeenalteredonseveraloccasions
inrecentyears,oftenconcurrently withthedecisionsonagricultural
pricesforthepurposeofpreservingtheunityofmarketsandreducing *
thecompensatory amounts.
2.Althoughmotivatedbytherequirementsofthepricespolicy,thechanges
intheconversionratesalsoapplytothestructurespolicyandpursuant
totherulesinforce(articles4and6ofRegulation(EEC)No1134/68)
Communityaidmustbeconvertedintonationalcurrenciesattherepresen­
tativerateswhichobtainedonthedatewhentheconditionsforgranting
the-aidarefulfilled.
Thismeansthattheconversionratetobeusedtocalculatetheamount
ofaidinnationalcurrencyisdeterminedbytherepresentative rate
operativeatthetimeaidisgranted.Itisthetimewhenthebeneficiary
acquiresan"enforceableright",thegrantingofwhichhecanrequestonce
alltheconditionsforpaymentarefulfilled.
WhenpaymentofaidbytheMemberStateisspreadoutoverseveralyears
andwhenparticularconditionsarenotlaiddownforthepaymentofthe
differentinstalments ,theseinstalmentsaredeterminedonthebasisof
therepresentative rateoperativeatthetimeaidisgranted. ^
Pfovltion.l»ddr.«:«„•de««LOI200,B-1049Bru...»-T,l90hon.7350040/7353040-T.^r.ph^"COMEORBru..*.Telex:"21877COMEUfi"-AGRÊC25670/22037

2
3#Although itisrecognized that therepresentative rates also need to "be
"brought into line with economic reality forthepurposes ofthestructures
policy ,thefact remains that thedates onwhich adjustments tothese rates
aremade andtheir frequency aredetermined onthe "basis oftherequire­
ments oftheprices policy andarenotparticularly well suited tothe
requirements ofthestructures policy .Theconsequences ofrepeated
adjustments totherates within onecalendar year andonarbitrary dates
are asfollows :
-during onecalendar year different amounts ofaidaregranted forthe
same measure ,which constitutes unjustified discrimination between
recipients ;
-thetask ofthenational authorities responsible fortheadministration
ofaidandthedetermination ofeligible expenditure ismade more
difficult ;this goes against thewishes expressed onmany occasions
forasimplification oftheprocedures currently inforce ;
-and,consequently ,thetask ofsupervision bytheCommission becomes
more difficult .
Ontheother hand recipients ofaid,thepayment ofwhich isspread out
over several years ,must beprotected against areduction inthereal
value oftheaidduetoadevaluation oftherepresentative rate fora
national currency occurring between thetime when aidisgranted andthe
time when theinstalments arepayable .
4*Toavoid thedrawbacks resulting from frequent changes intheconversion
rates ,while bearing inmind that thesuccess ofthemeasures introduced with a
view toimproving agricultural structures depends onthelevel oftheaid
provided forintheagricultural instruments being maintained atitsreal
-value intheevent ofpayment being spread outover several years ,itis
proposed that :
(l)forthepurposes ofthestructures policy therepresentative rates should
bebrought into line with economic reality once ayear .Since the
accounting year foreligible expenditure under theEAGGP Guidance Section
coincides with thecalendar year ,thedate ofentry into force ofthe
newrepresentative rates should be1January ofthefollowing year ;

(2)wherepaymentoftheaidisspreadoveranumberofyears-either
"becauseitispayableinseveralinstalments,orbecauseitispayable
foranumberofyears-theequivalentinnationalcurrencyofthe
amountdueandtheamountofexpenditureeligibleforassistancefrom
theFundshouldbedetermined,intheeventofdevaluationofthe
representative rateforanationalcurrencyonthebasisofthe•
•representative rateinforceon1Januaryoftheyearduringwhich
theinstalmentinquestionispayable*

COUNCILREGULATION ONTHEEXCHANGERATES
TOBEAPPLIEDFORTHEPURPOSESOPTHEAGRICULTURAL STRUCTURES POLICY
THECOUNCILOPTHEEUROPEANCOMMUNITIES.
«
HavingregardtotheTreatyestablishingtheEuropeanEconomicCommunity,
andinparticularArticle43thereof,
HavingregardtotheproposalfromtheCommission,
HavingregardtotheopinionoftheEuropeanParliament,
Whereas,Articles4and6ofCouncilRegulation(EEC)No1134/68
of30July1968layingdownrulesfortheimplementation ofRegulation(EEC)
No653/68onconditionsforalterationstothevalueoftheunitofaccount
usedforthecommonagriculturalpolicy(l),'providethattheamountsfixedinunits
ofaccountintheagricultural instrumentsaretobeconvertedattherepresentative
rateobtainingonthedatewhentheconditionsforgrantingtheaidarefulfilled;
whereasthisprovisionconsequently appliestoaidsfixedinunitsofaccount~
intheinstrumentsconcerningtheimprovementofagriculturalstructures;
Whereasthemainpurposeoftheadjustmentstotherepresentative ratesisto
preservetheunityofthemarketsandtoreducethecompensatory amounts;
whereasthedatesofentryintoforceofthenewratesarenotwellstatedto
therequirementsofthestructurespolicy,particularly whererepeatedadjustments
aremadeduringasinglecalendaryear;
Whereasthesuccessofmeasurestoimproveagricultural structuresisthreatened
by~ .short-termadjustmentstoconversionrateswhichtakeeffectorTdates
whichareunrelatedtothesemeasures;whereastheirsuccessdependson
-thelevelofaidasprovidedforintheCommunityrules;and
-themaintenanceoftheaidatitsrealexchangevaluewhenunder
Communitylegislation paymentoftheaidisspreadoverseveralyears;
(1)0JNoL188,1.8.1968,p.l.
«

Whereas ,inorder tohave thesame basis ofcalculation forallaidgranted during
acalendar year ,itisnecessary toprovide forasingle change once ayear inthe
representative rates to "beapplied under theagricultural structures policy ;whereas for
accounting andadministrative reasons therepres entative
rate valid on1January oftheyear inquestion should beapplied ;
Whereas where payment ofaidisspread over several years ,provision should "be
made for theannual instalments ,intheevent ofdevaluation ofthe
representative rate foranational currency ,tohe"determined onthe "basis ofthe
representative rate obtaining on1January oftheyear during which the
instalment becomes payable ;
Whereas themeasures provided forinthis Regulation mayneed tobeamended when
theEuropean Unit ofAccount isintroduced into theCommon Agricultural ;
Policy ,
HASADOPTED THIS REGULATION :
Article 1
Theamounts ofaidexpressed inunits ofaccount intheagricultural instru­
ments relating tothecommon agricultural structures policy ,theCommunity
financing ofwhich isundertaken exclusively bytheEAGGF Guidance Section ,
shall beconverted into national currencies attherepresentative rates obtaining
on1January oftheyear during which thedecision togrant aidistaken .
Where under Community legislation payment ofaidisspread over several years ,the
annual instalments shall ,intheevent ofdevaluation oftherepresentative rate for
anational currency ,beestablished onthebasis oftherepresentative rate
obtaining on1January oftheyear during which theinstalment oftheaidbecomes
payable .
Article 2
This Regulation shall enter into force onthethird dayfollowing itspublica­
tion intheOfficial Journal oftheEuropean Communities .Itshall apply to
decisions togrant aidtaken onandafter 1January 1978 hyMember States .
This Regulation ",shall bebinding initsentirety anddirectly applicable in
allMember States .
Done atBrussels .For the Council
The President .»

Ratestobeusedfor-theconversionofstandardrateaidfinancedtytheEACGF-
GuidanceSection(equivalentof1u.a.)AfJTTEX

\
RatestobeusedfortheconversionofstandardrateaidfinancedbytheSAGGF-»
GuidanceSection(equivalent'oflcu.a.)ANNEXI

FINANC8AL STATEMENT
date «6.10„1977
1.BUDGETLINSCOÎICLTCFIÏD » Tltle 8
2.ACTION ,Toestablish theexchange rate tobeapplied forconverting into nationalcurrencies theamounts ofaidexpressed inunits ofaccount intheaoriculturalinstruments concerning thecommon policy onagricultural structures ,"theCommunityT*1 ^^"V /"I ♦ tIn^^n ^ 1 y*M4*nLA– I I ■I IMAAA ^ k . / -,,,T;'" V/..AY.IVUHUI AI.suu^tureb ;xne tornfinancing ofwhich isundertaken exclusively bytheEAGGF .Guidance Section
3.LEGALBASISJ
Article 43oftheTreaty establishing theEuropean Economic Community
4.OBJECTIVES 8Toensure that recipients ofaidaretreated onanequal basis ;to
protect recipients against ,.areduction inthereal value oftheaidwhenpayment
isspread outover several years ;tosimplify theadmini strat'ion ofexpenditure
inorder tobeable tomanage andcheck itbetter .
YEAH
5.0.1 PLURI ANNUAL PATTERN OFEXPENDITURE
5.1.1 PLURI ANNUAL PATTERN OPRECEIPTS1979 J.?7.8 YEAR ..1979
NIL See under 5.2
NOT APPLICABLEYEAR ..1?8Q
See under 5.2
5.2hiETnODOFCALCULATION Astheentry into force oftheproposed Regulation isenvisaaedwith effect from 1978expenditure under Title 8oftheCommunity Budget cannot §e
affected before 1979 .Thefinancial consequences oftheproposal which will occur
from 1979 aredependent on
lu6 t'ielmP'-e,nentation ofthemeasures concerned ontheonehand in *
theMember States inwhich therepresentative rate ofitscurrency devalues
andontheother inthose inwhich this rate revalues ,and
2.theamount oftherate ofdevaluation orrevaluation
Asthese factors areunknown atthepresent time thefinancial consequencescannot bedetermined .
6.0FINANCING POSSIBLE WITH CREDITS INSCRIBED INRELEVANT CHAPTER OFCURiiENT BUDCET ? YFS/l&XYES/WCK
6«1FINANCING POSSIBLE BYTRANSFER BST/'iiEWCHAPTERS OFCUH^IiVT BUDGET ?
6.2NECfUSITY FORASUPPLEMENTARY BUDGET ?YS5/5CK
KBSXN0
6.3CREDITS TOBEWRITTEN INTO FUTURE BUjDGETS ?TES/N0
COMŒWiS 1