30. 12. 89 Official Journal of the European Communities No C 329/15 
the 5,5 % in full as a suspended Community production 
reserve. Therefore, the proposed reduction of the sus­
pended quantities from 5,5% to 4,5% should be 
rejected. 
2.3. A wide variety of natural influences (e.g. cli­
matic factors, unforeseen changes in the size of dairy 
herds) make it impossible to control milk production 
precisely and so ensure that individual farms keep 
within the guaranteed quantities allocated. Hence com­
pensation, complete or partial, should not be refused 
Done at Brussels, 18 October 1989. 
1. Introduction 
1.1. This draft Regulation is to replace Regulation 
(EEC) No 355/77 insofar as it affected fisheries and 
aquaculture. It was required because of the changes in 
the Regulations affecting the Structural Funds. 
1.2. For the first time fisheries and aquaculture are 
dealt with separately from agriculture. 
1.3. The possibility of there being a gap between the 
new Regulation and Regulation (EEC) No 355/77 is 
avoided by their being transitional provisions until 
30 June 1991. 
1.4. An important change is that aid to the process­
ing industry in Member States will be based on compre­
hensive plants drawn up and submitted to the Com­
mission by those States and that day to day management if the guaranteed quantity is exceeded, especially as 
producers who oversupply are subject to levies which 
currently exceed their return on any extra milk pro­
duced. 
2.4. The Committee urges the Commission to put 
forward further proposals for greater flexibility in the 
application of the guaranteed quantities system. 
The Chairman 
of the Economic and Social Committee 
Alberto MASPRONE 
will be in the hands of a designated authority in each 
State which need not be governmental. 
1.5. The evolution of payments (in millions of 
ECU's) as calculated by the Commission is: 
Constant prices Inflation adjusted 
1990 33,9 33,9 
1991 37,0 38,4 
1992 40,1 43,1 
1993 43,2 48,2 
1.5.1. The annual rate of inflation has been estimated 
at 3,69%. Opinion on the proposal for a Council Regulation (EEC) on the improvement of the 
conditions under which fishery and aquaculture products are processed and marketed 
(89/C 329/07) 
On 5 June 1989, the Council decided to consult the Economic and Social Committee, 
under Article 198 of the Treaty establishing the European Economic Community, on the 
abovementioned proposal. 
The Section for Agriculture and Fisheries, which was responsible for preparing the Commit­
tee's work on the subject, adopted its Opinion on 5 October 1989. The Rapporteur was 
Mr Hancock. 
The Economic and Social Committee adopted the Opinion set out below by a unanimous 
vote at its 270th plenary session on 18 October 1989. 
No C 329/16 Official Journal of the European Communities 30. 12. 89 
1.6. Products whether derived from sea fish, fresh 
water fish or aquaculture are covered by this Regu­
lation. 
2. General remarks 
2.1. The fact that there is now a special Regulation 
for fisheries and aquaculture products seeing that these 
have quite distinct problems from agricultural products 
is welcomed and the general aim of it is approved. It 
is felt however that compared with Regulation (EEC) 
No 355/77 the general aims are insufficiently clearly 
stated and too many references made, without expla­
nation, to other Community legal instruments. This 
will tend to make its meaning insufficiently clear to 
potential beneficiaries. 
2.1.1. The proposed does not sufficiently underline 
the fact that it complements the 'Community measures 
to improve and adapt structures in the fisheries and 
aquaculture sector' (Council Regulation (EEC) No 
4028/86). It is of concern that it is not made clear 
that the investments which are to be promoted in the 
marketing sector should also help to improve the situ­
ation in the fisheries and aquaculture sector. 
2.2. Also, there.is a concern that the historic under-
funding of this sector is being continued and that inad­
equate allowance has been made for inflation. It is 
surely unrealistic to bring forward a Regulation when 
the available funding will clearly be insufficient to meet 
the applications for all suitable projects. 
2.2.1. Doubt must be expressed as to whether the 
Regulation fully accords with Article 39 of the Treaty 
in that so much fishing and aquaculture is carried out 
in rural and disadvantaged areas; it is desirable that 
processing be carried out where the raw material orig­
inates but, this would not in all cases receive equal 
assistance under its provisions. Also, as to whether it 
faithfully reflects the revised objectives of the Structural 
Funds. More specific comments in this regard are made 
in relation to Article 14. 
2.3. Taking account of the fact that Regulation 
(EEC) No 4028/86 applies to investment relating to 
the fleet, harbour facilities and promotional measures 
whilst this Regulation applies to the processing industry 
there could be situations of doubt as to which applied 
to a specific project. It is important that such situations 
are avoided, as far as is possible, by the drafting of 
appropriate implementing legislation and a better link­
age made between these two Regulations. to bring them into conformity with hygiene regulations 
and those relating to health and safety in the workplace. 
An additional problem now that there are separate 
Regulations for agriculture and fisheries is that some 
of them process both types of product. A flexible atti­
tude will have to be adopted when investment proposals 
for plants in this category are being considered. 
2.5. Investment encouraging the processing of fish 
produced by aquaculture may prove ineffective if the 
problems of the industry are not looked at as a whole. 
Already some species, notably salmon, are in oversup-
ply and prices are falling. As production of 1 kilo of 
farmed fishmeat requires 3 to 5 kilos of other fish as 
feed (in the form of fish flour and fish oil) the price of 
this feed is critical. Unless the problem of regulating 
the catching of fish for industrial purposes under very 
strict conditions to be laid down at Community level 
is addressed, so that proper supplies are available, 
encouragement of aquaculture will purely raise demand 
and the price of feed, so threatening the viability of 
many aquaculture projects and the processing facilities 
on which these are dependent. 
2.5.1. In view of the fact that the breeding, repro­
duction and raising of fish and other seafoods by means 
of aquaculture, in fresh and brackish waters, is an 
increasing activity it would be illogical for production 
facilities making use of raw material from these sources 
not to be accorded equal treatment under this Regu­
lation with that derived from seawater installations. All 
in all, this sector is so complex, with such a wide 
range of divergent problems, it is suggested that the 
Commission might usefully carry out a study into it. 
2.6. In point 5.4 of the explanatory memorandum it 
is made clear that one objective is to absorb into the 
processing industry those made redundant through the 
inevitable rationalisation of the fleet. It is felt that the 
Commission may have underestimated the problems of 
retraining and adaptation for those who have spent 
their whole working lives at sea and suggest that an 
urgent examination of this problem be carried out. 
Reference is made to the Committee Opinion on the 
'Social aspects of sea fishing'. 
2.7. The fact that the new Regulation will allow for 
the construction of new processing facilities in areas 
with surplus herring stocks, as called for in the Commit­
tee Opinion on the situation of the herring market, is 
welcomed, providing sufficient funds are available for 
such projects to benefit. 
2.4. In some southern Member States there are pro­
cessing facilities which require substantial investment 2.8. In the recitals reference is made to the role of 
the European Investment Bank (EIB). In that the funds 
30. 12. 89 Official Journal of the European Communities No C 329/17 
under this Regulation will almost certainly be insuf­
ficient to meet proper demands, it is suggested that the 
possibility of establishing a type of New Community 
Instrument (NCI) applicable to this sector be examined. 
This would be self-financing but allow for borrowing 
at lower rates of interest because of the borrowing 
powers of the EIB. 
2.9. Disappointment must be expressed at the lack of 
attention devoted to environmental pollution, notably 
discharges into the water, hygiene in general and the 
control of the spread of water-borne disease when 
considering the modernisation of production facilities. 
2.10. It is essential that, when considering appli­
cations for funding, both Member States and the Com­
mission pay proper regard to the provisions relating 
to working conditions generally so that Community 
standards are properly met. Once again reference must 
be made to the Committee Opinion on 'The social 
aspects of sea fishing'. 
3. Specific remarks 
3.1. Article 1 
3.1.1. It has to be pointed out that Regulation (EEC) 
No 2052/88 has no reference to the fisheries sector and 
the text needs clarifying accordingly or the aforemen­
tioned Regulation amended. 
3.1.2. 1 (b) should make clear that the reference is 
to objective 1 areas only and not those defined in 
Regulation (EEC) No 4028/86. This could lead to a 
lack of coherence in that the two measures cease to be 
complementary. 
3.1.3. 1 (f). More weight should be given to the 
improvement of hygiene and, in consequence, consumer 
protection. The existing text should be amended to 
read 'and contribute', not 'or contribute'. The improve­
ment of standards of hygiene should be one of the 
principal priorities in that it will, whilst not distorting 
competition, improve consumer confidence. 
3.1.4. 1 (g) should include under the criteria the 
encouragement of the export of the products derived 
from new or underexploited species. 
3.1.5. 1 (j) is very imprecise and should be redrafted 
so that the Commission's intentions are clarified. 3.1.6. A new objective 1 (k) is required related to the 
improvement of working conditions. 
3.2. Article 3 
3.2.1. Article 3 (1) asks for 'a description of the 
history'. It would be preferable to ask for 'a description 
of the background over a period of x years'. 
3.2.2. Article 3 (5) relates to the required information 
to be included in plans, as set out in the Annex. It is 
felt that it would be impractical to obtain some of the 
information requested therein and it should be made 
clear that this is purely a suggested and not a mandatory 
format. Nevertheless a minimum level of information 
should be required for each project even when part of 
a sectoral or global plan. This should be related to 
criteria to be laid down by the Commission. 
3.3. Article 4 
3.3.1. Point 4 (a) should be amended so as to make 
clear that what is significant is the nationality of the 
funding and not its source whether governmental, insti­
tutional or private, once the government of the Member 
State has made its required contribution. 
3.4. Article 5 
3.4.1. It is felt that the deadline of 31 March 1990 
for the submission of initial sectoral plan may be unre­
alistic. 
3.5. Article 6 
3.5.1. If the operational programmes mentioned in 
the first indent are the same as those defined in Article 
5 (5) of Regulation (EEC) No 2052/88 a series of consist­
ent multiannual measures which may be implemented 
through recourse to one or more funds, to one or more 
of the existing financial instruments, there is a worry 
that the procedures could be more cumbersome than 
those now in operation and even interfere with the 
sensible planning decisions of individual enterprises. 
3.5.2. The system of the provision of global grants 
also has the potential danger of complicating the imple­
menting arrangements. 
3.5.3. The question arises as to who is going to 
bear the additional costs resulting from the use of 
'an intermediary designated by the Member State in 
agreement with the Commission' (Annex 5.(2)(c) of 
Regulation (EEC) No 2052/88) ? 
No C 329/18 Official Journal of the European Communities 30. 12. 89 
3.6. Article 7 
3.6.1. The funding is clearly inadequate to meet the 
objectives. 
3.6.2. If that this situation is likely to persist and 
there is no scope for diverting funds from other parts 
of the programme the criteria for any projects funded 
under this Article must be very tighly drawn so that 
only those directly related to short-term and concrete 
improvements in the sector qualify. The encouragement 
of pilot projects involving the production of crustaceous 
and molluscs by means of aquaculture and their pro­
cessing would clearly meet such criteria. 
3.7. Article 8 
3.7.1. The legality of the use of Article 8 of Regu­
lation (EEC) No 4253/88 has to be questioned as this 
only relates to agriculture. This Regulation may also 
require consequent amendment. 
3.8. Article 9 
3.8.1. It is stressed that the list of possible invest­
ments should be clearly stated as being illustrative 
rather than exclusive as otherwise perfectly good pro­
jects might be excluded and the Article should be 
redrafted accordingly. It should be made clear that this 
Regulation only covers land-based operations, includ­
ing the use of aquaculture products. 
3.9. Article 10 
3.9.1. Article 10 (1) should be modified to take 
account of the remarks made relative to Article 9. The 
first indent of 10 (2) should, therefore, be deleted. 
3.9.2. The words 'the lasting economic effect' in the 
second indent should be deleted as, in the sense used, 
the point is already fully covered by the third indent. 
3.9.3. The requirement in indent 3 of 10 (2) that 
projects should 'offer adequate assurances of technical 
and economic viability' is too imprecise and should be 
clarified. 
3.9.4. Whilst preference for the use of Community 
fish stocks in producing plants should remain an absol­
ute requirement, to say in the fourth indent that the 
bulk of the raw materials be of Community origin may 
be unrealistic taking account of the State of Community 
fish stocks and 'in so far as is practicable' should be 
added. Also what is meant by 'bulk of the raw materials' should be defined. It should be made clear that 'Com­
munity origin' includes fish, wherever caught, providing 
the vessel concerned is flying the flag of a Member 
State. 
3.9.5. The sixth indent regarding the ineligibility of 
the retail sector is regretted, although it is appreciated 
that severe financial constraints apply. It is hoped, 
however, that this exclusion will not apply to the fund­
ing of the improvement of processor's marketing oper­
ations. This particularly applies to small producer 
groups and cooperatives in the disadvantaged and per­
ipheral areas. 
3.9.6. The submission of applications for grants are 
likely in practice to be made only annually or half 
yearly. The requirement that work cannot begin on a 
project before the date of receipt by the Commission 
of the application for assistance could involve delays 
of several months in certain instances. This will surely 
erect a barrier to enterprise and to efficient and cost-
effective investment in a sector where it is badly 
required. 
3.9.6.1. In any case the system lacks logic as the mere 
receipt by the Commission of an application does not 
guarantee its acceptance. The whole system needs re­
examination, in particular it should be made clear that 
the carrying-out of the necessary preparatory work for 
a project, such as the drawing-up of plans and the 
obtaining of planning consents and the carrying out of 
physical works required by the planning authorities, 
would not lead to its being disqualified. 
3.9.7. It should be made clear that Article 10(3) is 
included purely for the purposes of clarification and 
does not constitute an exclusive list. 
3.10. Article 11 
3.10.1. The objectives are approved but the fifth 
indent should surely speak of 'free and fair international 
competition'. In the interests of even-handedness 
'associations of small and medium-sized enterprises 
(SME's)' should be included in the last indent. 
3.10.2. An additional priority should be the adap­
tation of enterprises to changing market conditions of 
a semi-permanent or permanent nature. 
3.10.3. The fifth indent should be so altered as to 
include semi-conserves. 
3.10.4. For the sake of precision the seventh indent 
relating to quality and hygiene should make specific 
reference to Community hygiene Regulations relating 
to fish, crustaceans and molluscs. 
3.10.5. An additional priority should relate to 
environmental considerations, particularly the treat-
30. 12. 89 Official Journal of the European Communities No C 329/19 
ment and discharge of waste water, which necessitates 
the installation of expensive equipment. 
3.10.6. It is stressed that only universally accepted 
technologies should be eligible. 
3.11. Article 14 
3.11.1. It is clearly unfair that the setting of the 
maximum level of grants at 50 % rather than the 75 % 
in the basic Structural Fund Regulations has been dic­
tated by the inadequacy of funds rather than the needs 
of the sector. 
3.11.2. It should be made clear that interest-rate 
subsidies are one of the instruments falling within the 
scope of this Article. Provision should be made for a 
grant-in-aid in respect of prior loans, in lieu of an 
interest rate subsidy, in cases where this is more appro­
priate. 
3.11.3. Questions arise as to whether the objectives 
of the revised Structural Funds are met by the provisions 
of Article 14(l)(a) and 14(4)(a) in that objective 2 and 
5b regions are excluded from the higher level of grant 
despite the importance of fisheries, aquaculture and 
associated marketing and production facilities in both 
island regions and those in industrial decline. 
3.11.4. An error seems to have occurred in those 
areas defined as falling under objective No 1 in the 
Done at Brussels, 18 October 1989. Annex to Regulation (EEC) No 2052/88 as it includes 
the Canary Islands, Ceuta and Melilla and none of 
these territories fall within the scope of the Community 
fisheries policy. 
3.11.5. In reference to the same annex certain terri­
tories are rightly regarded as being objective 1 for 
agricultural purposes. In terms of fisheries, however, 
they are highly developed and to allow them access to 
the higher level of grant can only distort competition. 
Principally for this reason certain Community associ­
ations of fish processors are against the Regulation as 
it is presently worded. 
4. Concluding remarks 
4.1. It is extremely difficult for proper Opinions to 
be presented to the Council if: 
a) text and amendments to the original text are not 
provided promptly; and 
b) when so much of the detailed application of a Regu­
lation will be through implementing regulations 
issued at a later date. 
4.2. The Regulation might have been less open to 
detailed criticism if proper consultation had been under­
taken with interested parties before it was issued. 
The Chairman 
of the Economic and Social Committee 
Alberto MASPRONE