ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(74)50
Vol.1974/0012

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(74)50 final
Brussels ,18January 197^
Proposal for
REGULATION (EEC )N° /74OFTHECOUNCIL
oncertain measures tobetaken inagriculture forItaly
asaresult ofthefixing ,with effect from 28January ,1974 of
anewrepresentative rate for theItalian lire
Proposal for
REGULATION (EEC)N° OFTHECOUNCIL
Amending inparticular theRegulationonthe exchange rate applied inagriculture for the
Italian lire .
(submitted bytheCommission totheCouncil )
COM (7*0 50final

EXPLANATORY MEMORANDUM
1.Italy recently requested that therepresentative rate for the
Italian lira ,fixed byRegulation (EEC)NO295^/73(OJNoL303,
1.11.1973 ,p.l)andapplied since 1January 1974 ,hefurther devalued
toTaring itcloser rates ruling onthemarket .
Tothis end theCommission presents tothe Council aproposal toamend
that Regulation byadevaluation of5$.TheItalian request should
infact beacceded tobecause thefixing ofthis newrepresentative rate
for the conversion into lira ofamounts fixed inunits ofaccount within
theframework ofthecommon agricultural policy should mean ,intheory at
anyrate ,that prices andother amounts fixed inTtfiits ofaccount aji*d
expre'ssed inlira will beautomatically increased by5$«This would
represent animportant step towards there-establishment ofsingle prioee
within theCommunity . //
2.Itwas felt that ,with theapplication oftherepresentative rate for
thelira on1January 1974 ,the incidence ofthis rate should notbe
allowed toreflect immediately onItalian prices .Generally speaking ,
prices inItaly aretoremain attheir 31December 1973 level until the
beginning ofthe1974/73marketing year .Exceptions tothegeneral rule
aretobacco (tobacco prices arefixed foracrop rather than forayear )
andsugar (delivery contracts between beet growers andmanufacturers
hadalready been signed intheautumn )(cf.Regulation '(EEC )No3450/73.
»*»»
0JNoL353 ,22.12.1973 ,P»25).This rule prevents thenewrepresentative
rate from having repercussions atpresent onprice levels inItaly .
Information now tohand indicates however that itwould now be -desirable '
forthenew rate tohave immediate repercussions onItalian prices .The
general economic situation calls forarapid improvement inthe .position
offarmers ,inview ofthepotential repercussions onproduction .Provisional
action hasalready been taken under Article 10^oftheTreaty inrespect
ofbesef andveal which wasparticularly badly hit .
•¥P
This provisional measure must nowbeincorporated into theframework ofthe -•
common agricultural policy .

However ,anumber ofexceptions will have tobemade .For tobacco and
sugar ,thereaso^s^whi^h ^ledtoanexception being made on1January 1974
still hold good ,/olive oilmust beexcluded also ;price levels indicate
that present arrangements mayberetained until thebeginning ofthe
next marketing year .
3*'Although thepresent situation calls forafurther change inprice
levels ,itdoes notseem possible towaive therule ,introduced by
Regulation (EEC)Kb3450/73,whereby the price increase resulting
from theiapplication oftherepresentative rate applied from I.January 1974
isdefer ^ejiuntil thebeginning ofthefollowing "marketing year .*Iti^s
probafcle that transactions based 6nthe texts adopted tothis end are
.■*
already inhand ;they cannot be .jeopardized .Existing arrangements should ,
therefore continue toapply ,theincrease proposed forimmediate application
being Appropriate technical adjustments will benecessary .
» *
4*Prom thefinancial point ofview ,thealignment oftherepresentative
rate for the lira onits effective rate will mean :
(a)areduction in"monetary "compensatory amounts charged orgranted
inintra-Community trade ;
(b)areduction in"monetary "compensatory amounts charged orgranted
in£rade with third countries .Inview oftheprovisions ofArticle
"4aofRegulation (EEC)No974/71this would betranslated into an
Vincrease intherefunds andlevies /customs duties granted or
charged asthecase maybe.
(o)anincrease inlevies ,refunds andother expenditure under the
food aidprogramme -following theapplication ofanewrepresentative
'rate which ,inthis case ,will have theeffect ofincreasing prices
/expressed innational currency .
••" . . ■ ■»
The estimates below have been worked out asfollows :
• • •
(a)d'thequantitative estimates (based onthelatest available trade
•'-statistics )arethesame asthose used forthepreparatory work
.onthe1974 ^Budget andthepluriannual forecasts ;

(b)thecalculations havebeenbasedonanormalyear,i.e.onthe
assumptionthatworldpricesaresuchthat"monetary"compensatory'"V *
amountsarenotlimitedbytheleveloftheimportcharge.Thus,
therealdropinexpenditure andtherealincreasein^revenuewill
fallshortoftheseestimates;
(c)*tosimplifymatters,thecalculationsfor1974werebasedona5%
\alignmentoftherepresentative ratefortheli^aonitseffective
rateasfrom1February1974*Thissimplification shouldnot.
T *»
howeverhaveanygreateffect.ontheresult.Allowancewasmade
■■■-■rtv^«ina^'.■♦forthepeculiar*situationof/sugar,tobaccoandoliveoil.The
'calculations for1975?on"theotherhandwerebasedonatwelve-month
periodforallsectors.
Thetablebelowshows,for1974and197Svariationsinexpenditure and
receiptsresultingfromtheproposedchangeinthestatusquo.
.i.'
Variationsinreceiptsandexpenditure followinga55°alignmentofthe
representative ratefortheliraonits
effectiverate.
imillionu.a.
" '.■i_ ' .:
1974 1975
I.EXPENDITURE
-48"Monetary"compensatory amountscharged-48 -48orgrantedmintra-Community trade
Aidstoproduction +9 +25
Totalintervention expenditure -39 --23
*¥
Exportrefunds +3,2 +3,5
"Monetary"compensatory amountsaffecting
refunds -(-4,9)-(-5,3)
$*
Netvariation-refunds +8,1*+8,8
v
Totalvariation-EAGGP/Guarantee
Sectionexpenditure-30,9 -14,2

1974 1975
10
(-50)
tr 'Net variation -levies and customs duties *
-(own'resources ) * +55 +60
* ■*
Asmentioned earlier these estimates are "based onanormal year .i.e. onthe
assumption that world prices aresuch that "monetary "compensatory amounts
arenot limited bythe import charge .Thefact ishowever that this isnot
true ofanumber ofproducts atpresent .Ifthis situation persists ,the
factors making forreduced expenditure will beless significant ;bycontract
however ,theincrease inaidexpenditure would notchange .Inthis case the
increase inreceipts would also beler,s .Inview ofalltheinnonderables ,
itisvirtually impossible atthepresent time toforecast actual savings
in1974 and1975 : 7 •
* » •
5«Themeasures provided formthis Regulation should beadopted bythe
Council asearly aspossible toavoid prejudicing theItalian economy .Since
theEuropean Parliament must beconsulted -the proposal being based inter
alia onArticles 4° >and 235oftheTreaty -thefollowing timetable is
suggested :
Opinion oftheEuropean Parliament :Meeting ijr>beheld from 11-15 February
1974 . -
•*
Decision bythe Council :February .II.RECEIPTS
–Levies+9
-"Monetary "compensatory amounts affecting
levies andcustoms duties . •-(-46)

Propos alfor
REGULATION (EEC )N° /74OPTHE'COUITCIL
oncertain measures tobetaken inagriculture forItaly
asaresult ofthefixing ,with effect from 28January ,1974 of
anew representative rate for the Italian lire
THECOUNCIL OFTHEEUROPEAN COKKUIJITIES ,
Having regard totheTreaty establishing theEuropean Economic
Community ,andinparticular Articles 28,43,103and 235 ;
Having regard totheproposal frora theCommission ;'
sT
Having regard totheOpinion oftheEuropean Parliament ;
.Council *■' '1Whereas /Regulation (EEC )IT02958/73of31October 1973 ()onthe
exchange rate applied in .-agri culture for theItalian lire ,as
^ .. « « / . < » _. _ __amended byRegulation (EEC )N° /74(),fixed ,'with effect from
28 .January 1974 ,arepresentative rate which inprinciple should load
toacertain increase intheprices ofagricultural -products inItaly ;
whereas such aconsequence has been avoided ,except inthebeef and
veal sector ,bytheprovisions ofArticle 4(b)ofCouncil Regulation
(EEC)N°974/71of12Hay1971 (^).oncertain measures ofconjunctural
policy tobetaken inagriculture following thetemporary widening
ofthemargins of■fluctuation for thecurrencies ofcertain Llember
States ,aslastamended byRegulation (EEC)N°3450/73(^)»according
towhich prices areinprinciple tobemaintained atthelevel ,
applicable on31December 1973 ;whereas inthe case ofthebeef and
veal sector Regulation (EEC )N° /74provided forimmediate .
consenuen+ial effects invit3"o-P onr >inrc+nT-al
Whereas thereasons forwhich anexception wasnade forbeef andveal
arealso valid ,although less so,forother agricultural products ;
whereas asimilar solution istherefore necessary ;whereas inaddition
-*
theentire system should bebrought within thecommon agricultural
policy andArticle 2ofRegulation (EEC )N° '.fl-ishould herene^ied ,since
theprovisions thereof have been replaced with effect from^f~28 January
19747byidentical provisions contained inthepresent Regulation ;
(1)OJN°L303 ,1.11.1973 ,P. 1 ,
(2)OJN° '
(3)OJN°L106 ,12.5.1971 ,P.1
(4)OJN°L353 ,22.12.197 ^.p.25

Whereas morder' toavoid hindering .thetransactions already entered
into onthebasis oftheprovisions ofArticle 4(b)ofRegulation
(EEC )N°97^/71»thesystem resulting from that Article should be
maintained ,while applying theeffects ofthepresent Regulation on
theprices resulting from thesaid Article 4(b);whereas the
special situations regarding •sugar ,forwhich supnly contracts havewine and
already been concluded ,andregards /olive oil ,make itdesirable to
maintain thelevel ofprices currently applicable ,
HAS 'ADOPTED THIS REGULATION :
Article 1
• - . •_
1*Theintervention and t>urchases prices annli cable in.Italy shall ,with-wine - 0 ■■ ' »
theexceptions those for/olive oil ,su^rar andtobaccor "beincreased
by_5^_ '
-with effect from 28January -1974 inthebeef andveal sector
-with effect from 15February 1974 intheother agricultural
sectors . / ,„ •
 *
2.Article 4(b )ofRegulation (EEC )N°974/71shall beapplicable ,
taking into ac-count theprovisions of <paragraph 1.
Article 2
This Regulation shall enter into force onthe third dayfollowing
itspublication in -the Official Journal oftheEuropean Communities .
*' •
»•
Asfrom 21January 1974 itshall replace Article 2ofRegulation
(EEC )N° /74.
This Regulation shall bebinding initsentirety and directly
applicable inallMember States .
■•
••
Done at'Brussels , FortheCouncil
The President

Explanatory Memorandum
Italyrecentlyrequestedthattherepresentative ratefortheItalian
lira,fixed"byRegulation(EEC)NO.2958/73(O.J.No.L303,1.11.1973,
p.l)andappliedfrom1January,1974bebroughtclosertotherates
rulingonthemarket.
Thefixingofarepresentative ratefurtherdevaluedby5%forconverting
theliraparticularly theamountsfixedinunitsofaccountwithinthe
frameworkoftheagricultural policy,mustinprinciplehavetheautomatic
effectofraisingpricesandotheramountsfixedinunitsofaccountand
expressedinliraby5$*However,Regulation(EEC)No.3450/73(O.J.No.L
353,22.12.1973,t>.25)laiddownthatthenrices^ineffectinItalyon
31December1973must,asageneralrule,beapplieduntilthebeginning
of*the1974/75marketingyear.
/
Itishoweverdesirablethattheinfluenceofthenewrepresentative rate
fortheliraisfeltimmediately onthepricelevels'in'thebeefmeatsector.
Themarketsituationischaracterised bylowprices,large-scale
slaughterings havingentailedasizabledecreaseinthestockofcattle,which
inthelong-termcouldharmtheequilibriumofthisbranchofproduction
andhaverepercussions onthewholeeconomy,particularly thebalanceof
payments.Tothisend,recoursetoArticle103oftheTreatyappears
justifiedinordertotakeaprovisional measurewhichhowevershouldbe
integratedintothecommonagricultural policy.
* m
Giventheurgencyofthesituation,itisnecessarythattheCounciladopts
thisRegulationatitsmeetingon21January1974«

Proposalfor
REGULATION (EEC)N°OPTHECOUÎTCIL
Amending inparticular theReflation
ontheexchange rate applied inagriculture for the
Italian lire .
TIESCOUNCILOFTHEEUROPEANC0I3SUNITIES ,
Having regard totheTreaty establishing theEuropean Economic
Community ,andinparticular Article 103thereof ;
Having regard toCouncil Regulation 11°129(^)onthevalue ofthe
unit ofaccount and theexchange rate^to beapplied for thepurposes
ofthecommon agricultural policy ,aslast amended"'by Regulation
(EEC)N°2543/73(2)>andinparticular Artfcie 3thereof :**
^ -ψ · * ·
Having -regavd totheproposal from theCommission ;
Whereas Article 1ofCouncil Regulation (EEC )N°2958/73 ()of
31October 1373 ontheexchange rate applied inagriculture for the
Italian lire ,asamended byRegulation (EEC)N°2996/73(^)provided
for theapplication ofrepresentative rates for the Italian lire
with effect from 1November 1973 nnd 1January 1974 respectively ;
Whereas the economic situation inItaly necessitates taking another
step towards uniformity ofagricultural prices intheCommunity by
fixing another -"mere realistic representative rate ;
V/hereas theMonetary Committee will beconsulted and ,inview ofthe
urgency ofthematter ,themeasures envisaged should beadopted under
theconditions laid down inArticle 3(2)ofRegulation N°129 ;
Whereas thefixing ofsuch arepresentative rate results inachange
inthelevel ofprices foragricultural products in.I^aly ;v/hereas
this consequence complies with thefundamental principle ofuniformity
ofprices intheCommunity ;whereas this .principle and theconsequence
thereof have led tothefixing ofprecise rules ,in'particular in
Council Regulation (EEC )N°1134/68
(1)OJN°106 ,30.10.'1962 ,p.2553/62
(2)OJN°L263 ,19,9.1973 ,P. 1
(3)OJN°L303 ,1.11 .1973 ,P.1
(4)OJN°L305,1.11.1973 ,P.7

of30July 1968 (3)laying down rules fortheimplementation of
• • iRegulation (EEC)N°653/68onconditions foralterations tothevalue ,
oftheunit ofaccount used forthecommon agricultural policy ; j
whereas these provisions cover only thecase ofachange inthepari t
ofacurrency ;v/hereas their application isalso justified inthe
case inquestion ;whereas thenew representative rate should therefor
beincluded inRegulation (EEC )N°2958/73,theother provisions of
which remain applicable ;'
Whereas Article 4'(b)ofCouncil Regulation (EEC )N°974/71of
12May1971 (^)oncertain measures ofconjunctural policy tobe
taken inagriculture following thetemporary widening ofthemargins
offluctuation for thecurrencies ofcertain Member States ,asla?t
amended byRegulation (EEC)N°3450/730)provided thatinprinciple
theintervention andpurchase prices applicable inItaly shall be
fixed ,until theendof.the1973/74marketing year ,atthelevel
resulting from the .application oTtheprovisions inforce on .
31December 1973 »expressed inItalian lire ;,whereas this concerns
thebeef andveal sector inparticular ;
Whereas inview oftherepercussions which thesituation onthe
beef and veal market inItaly isalready having onthelevel of
production andwhich itmay therefore have onthegeneral balance
oftheeconomy itisnecessary that this new representative rate be
applied immediately inthebeef andveal sector ;whereas thebasis
fordetermining theincidence ofthepresent Regulation should bethe
price level currently applicable inItaly , .
Φ '
HASADOPTED $HIS REGULATION : ..v"■J"
Article 1
Thefollowing isadded toArticle 1(2)ofRegulation (EEC )N°2958/7
*
"(c)with effect from 28January 1974
. -,;100Italian lire = 0,14©449 units ofaccount V
■■-• Article 2
•1.With effect from 28January 1974 theintervention price forbeef
¥
andveal inItaly shall beincreased by5$.
(5)OJN°L188 ,1.8.1968 ,p.1
.(ôy.OJ N°L106,12.-5.1971 ,p.1
(7),0JN°L353,22.12.1973 ,P.25

mthis sector
Article 4(b)ofRegulation (ESC)N°974/71shall beapplicabi^'
taking into account theprovisions ofparagraph 1.
.J-7
Article 3
fA.*'-:' - '"V
This Regulation shall enter into force onthedayofitspublication
in'the Official Journal oftheEuropean Communities .
.. -yvy&t.. ' *
This Regulation shall bebinding mitsentirety anddirectly
applicable inallMember States .
.*•. '.VF*#
'P>-
Done atBrussels , For*£he Council
.$■■■<.> ■r"".-
k. ** ThePresident