Amended proposal for a COUNCIL REGULATION amending Regulation (EC) No 723/97 on the implementation of Member States' action programmes on control of EAGGF Guarantee Section expenditure

(presented by the Commission pursuant to Article 250 (2) of the EC Treaty)

EXPLANATORY MEMORANDUM

In April 1999 the Commission adopted a proposal for a Council Regulation amending Regulation (EC) No 723/97 on the implementation of Member States' action programmes on control of EAGGF Guarantee Section expenditure (COM(1999)169 final - 1999/0091 (CNS)).

The proposal aimed at improving controls of EAGGF Guarantee Section expenditure by allowing the Community to contribute towards the cost incurred by Member States in particular cases where the Commission asks them to carry out a number of controls considerably above the minimum rate laid down in other Regulations.

The European Parliament gave a favourable opinion on this proposal during its Plenary Session on 13 April 2000 and voted also on two amendments to the Commission proposal:

The first amendment relating to the changing of the legal basis of the proposed Regulation from Article 37 to Article 280 of the Treaty cannot be accepted by the Commission. It considers that the amendment to Regulation (EC) No 723/97 is only concerned with a better functioning of the control system for agricultural expenditure and that, therefore, the legal basis for its proposal should be Article 37 of the Treaty.

The second amendment relating to the new proposed Article 5a aimed

(a) to make this Article more clear in the sense that the co-financing concerns additional cost incurred by the Member State

and

(b) to provide that additional cost incurred by the Commission to administer the scheme shall also be covered by this co-financing.

The Commission accepts the first part of the second amendment, given under point (a) above, but cannot accept the second part of this amendment, point (b) above, as this confuses budgetary operational costs and administrative costs.

The amended proposal further includes two technical modifications relating to the renumbering of the Articles of the Treaty following the entry into force of the Amsterdam Treaty and to the replacement of Regulation (EEC) No 729/70 by Regulation (EC) No 1258/1999.

1999/0091 (CNS)

Amended proposal for a COUNCIL REGULATION amending Regulation (EC) No 723/97 on the implementation of Member States' action programmes on control of EAGGF Guarantee Section expenditure

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 37 thereof,

Having regard to the proposal from the Commission [1],

[1] OJ C 137, 18.5.1999, p. 8.

Having regard to the opinion of the European Parliament [2],

[2] OJ C

Whereas:

(1) Article 8 of Council Regulation (EC) No 1258/1999 of 17 May 1999 on the financing of the common agricultural policy [3] lays down that the Member States are to take the measures necessary to satisfy themselves that transactions financed by the European Agricultural Guidance and Guarantee Fund (EAGGF), are actually carried out and are executed correctly, to prevent and deal with irregularities and to recover sums lost as a result of irregularities or negligence.

[3] OJ L 160, 26.6.1999, p. 103.

(2) Article 1 of Council Regulation (EC) No 723/97 [4] lays down that the Community is to contribute towards the costs incurred by Member States in implementing new action programmes, arising out of new Community obligations, approved by the Commission and aimed at improving the structures or effectiveness of EAGGF Guarantee Section expenditure controls.

[4] 4 OJ L 108, 25.4.1997, p. 6.

(3) In order to improve controls of EAGGF Guarantee Section expenditure, provision should be made for Community financing in particular cases where the Commission asks Member States to carry out a number of controls in certain sectors considerably above the minimum rate laid down in other Regulations,

HAS ADOPTED THIS REGULATION:

Article 1

Regulation (EC) No 723/97 is amended as follows.

The following Article 5a is added:

«Article 5a

Within the limits of the financial resources available the Commission may, under this Regulation, provide part-financing of 50% of the additional expenditure incurred by Member States in particular cases whereby the Commission asks them to carry out a number of controls in certain sectors considerably above the minimum rate laid down in other Regulations.

The expenditure in question may not cover staff costs or costs normally incurred under Article 1(4) of Regulation (EC) No 1258/1999.»

Article 2

This Regulation shall enter into force on the third day following that of 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