ARCHIVESHISTORIQUES
DELACOMMISSION
COLLECTION RELIEEDES
DOCUMENTS "COM"
COM(77)482
Vol.1977/0151

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COMMISSION OFTHEEUROPEAN COMMUNITIES
COM(77)482final.
Brussels,31October1977
Proposalfora
COUNCILREGULATION(EEC)
relatingtothefixingofrepresentative conversion
,ratesinagriculture
(submittedtotheCouncilbytheCommission)
CCM(77)482final.

EXPLANATORY MEMORANDUM
1.Inautumn 1976 ,theCommission presented totheCouncil adraft regulation
relating tothecontinuous adjustment ofrepresentative rates andthegradual
dismantling ofmonetary compensatory amounts .
TheCouncil could notcome toagreement onthat proposal ,which isreplaced
bythepresent one .AttheCouncil meeting of11May 1977 theCommission
announced that anewproposal would beprepared .
2.Themain principle ofthenewproposal resides indismantling those MCAs in
existence atthetime ofadoption oftheproposal onadifferent basis from
that applied toanyMCAs created after that date inresponse tocurrency
changes .Further ,this proposal drops theintroduction ofaceiling on
MCAs that would call for anautomatic adjustment oftherepresentative rate
ofthecurrency concerned .
seven
3.Theproposal sets a/-year period fordismantling existing MCAs .Inview
ofthe size ofexisting differences this seems thebest waytoavoid too
great animpact onproduction orconsumption .Tothis end,thegreen rates
ofcurrencies with high MCAs would beadjusted annually sothat theMCAs
existing atthetime theregulation came into force would berundown atthe
seven
latest bytheendofthe7-year period .
Existing monetary compensatory amounts would thus bedivided byseven .
thTheMCAs would have tobereduced byone-seven each year .Thereduction
would beachieved byadevaluation orrevaluation ofthegreen currency
concerned .TheMCAs would bereduced ontheday onwhich theprices for
thenewmarketing year came into effect .
4.Given thepresent monetary differences ,theadjustment procedure laid down
intheproposal would lead intwoyears toadifference ofonepoint inthe
case oftheBenelux countries .Theapplication oftheMCAs inquestion would
then nolonger beappropriate because oftheir very slight effect ,andthe
Commission would automatically abolish them .
5«AnyMCAs introduced inthefuture ,inaddition totheamounts existing
onthedate indicated inparagraph 3would ,subject tothecut-off point
(para *6),beeliminated annually atthetime ofthenewprice fixing .

-2-
6.However ,toavoid excessive changes innational currency terms inprices
andother amounts fixed inunits ofaccount ,anannual cut-off point should
beprovided for .This would have theeffect oflimiting forthemarketing
year inquestion theautomatic devaluation andrevaluation ofthegreen
currencies concerned ,resulting from thereduction ofboth theold and
new CICAs ,toamaximum of5%which could ,however ,beexceeded atthe
request oftheMember State concerned .Incases where ,asaresult of
application ofthecut-off point ,the "new"part oftheMCAs could not
befully eliminated ,thebacklog thus created would inprinciple be
cleared thefollowing year ,subject ofcourse again toapplication ofthe
cut-off point .
7.Inanycase this system should only beregarded asaminimum programme ,
asmore rapid dismantling would always bepossible .
8.TheCommission considers that theproposed system would make itpossible
torestore thesingle market inagricultural products intheCommunity
inthe long term ,account being taken ofparallel progress towards economic
and monetary union .Theproposed method would not have toogreat an
impact onproduction orconsumption ofagricultural products ,noronthe
economy ingeneral .
9»This proposal ,which ispresented attherequest oftheCounoil ,does
not take account oftheprospects forintroducing theEUA inagriculture .
That matter isdealt with inseparate communication totheCounoil
(Doc.COM(77 )880final )*

Propo8alforCounoilRegulation(EEC)NO
of
relatingtothefixingofrepresentative conversion
ratesinagriculture
THECOUNCILOPTHEEUROPEANCOMMUNITIES,
HavingregardtotheTreatyestablishingtheEuropeanCommunity,andinparticu­
larArticles28,43and235thereof, ~ :";
HavingregardtotheproposalfromtheCommission,
HavingregardtotheopinionoftheEuropeanParliament,
HavingregardtotheopinionoftheMonetaryCommittee,
WhereasCouncilRegulation No129onthevalueoftheunitofaccountandthe
exchangeratesto"beappliedforthepurposesofthecommonagriculturalpolicy(l),
aslastamended "byRegulation(EEC)No2542/73(2),fixedthevalueoftheagri­
culturalunitofaccountandtheconversionratesto"beappliedforthepurposes
ofthecommonagricultural policybetweenthisunitofaccountandthenational
currencies,ontheonehand,and"betweenthenationalcurrenciesthemselves,on
theotherjwhereasArtiole3ofthatRegulationenablesderogationstobemade
fromtherulesoriginallyestablishedtomeetoasesofexceptionalmonetaryprac­
tises;whereas,sincetheutilizationoffloatingratesbysomeMemberStateB,this
provisionhasbeenresortedtoonnumerousoocasionsforthepurposeofintrodu­
cingandmodifyingtherepresentative rates;
Whereas,since1975,theserateshavebeenappliedbyalltheMemberStates;where­
astheyservetoharmonizetheratesusedinoonnectionwiththeagricultural poli­
cywithmarketrates;whereastheythuscontributeparticularly toadiminutionof
themonetarycompensatory amountsintroducedbyCouncilRegulation(EEC)No974/71
of12May1971oncertainmeasuresofoonjunctural policytobetakeninagricultu­
refollowingthetemporarywideningofthemarginsoffluctuationforthecurren­
ciesofoertainMemberStates(3),aslastamendedbyRegulation(EEC)No557/76
(4);
WhereasmovementsinthecurrenciesofcertainMemberStateshaveseveraltimesled
tomonetarycompensatory amountssuohastodefeattheoriginalpurposeofthesys–
(1)OJNo106,30.10.1962,p.2553/62.
(2)OJNoL263,19.9.1973,p.1.
(3)OJNoL106,12.5.1971|p.1.
(4)OJNoL67,15.3.1975,P.1. 1

tern 5whereas thess amounts were introduced toprevent short–term changes
inexchange rates from having immediate repercussions onagricultural prices
expressed innational currency ,whereas maintaining them permanently has a
disturbing effect ontheunity oftheagricultural market anddistorts compe­
tition ;
Whereas ,inaddition ,this reasoning isequally valid inrespect ofthedifferen­
tial amounts introduced "byCouncil Regulation (EEC)No1569/72of20July 1972
laying down special measures forcolza andrape seed (5)9aslast amended "byRe­
gulation (EEC)No3477/73(6);
Whereas ,inthese circumstances ,thesystem atpresent inforce should "bealtered
"bytheintroduction ofmeasures that will have adirect effect onrepresentative
rates andhence onthelevel ofcompensatory amounts anddifferential amounts ;
whereas thenewsystem should operate "bycontinuous adjustment ofthese rates ;
whereas thelatter should beamended regularly byreference tochanges inthemar­
ketrates ofthecurrencies concerned ,taking into account onthe onehand moneta­
rycompensatory amounts already ineffect and ,ontheother ,anyamounts that may
beintroduced inthe future ;whereas provision should bemade that inprinciple
thelatter aretobeabolished each year ,while theformer could berundown gra­
dually ;
Whereas ,however ,theimpact ofthese measures should belimited ,particularly as
regards their effect onproducer and consumer prices ;whereas tothis endasuf­
ficiently long dismantling period should beset ;whereas ,further ,representative
rates should bechanged 6nly within reasonable limits andprovided existing diffe­
rences between prices arenotinoreased ornewones introduced ,
HAS ADOPTED THIS REGULATION 1
25)0JNoL167 ,25.7.1972 ,p.9.
6)0JNoL357 .28.12.1973 ,p.6.

Article 1
1.Theprovisions ofthis Regulation shall supplement those ofRegulation
No129 .
2.Theprovisions ofArticle 3ofRegulation No129maynotbeapplied in
such awayastointroduce orincrease monetary compensatory amounts .
Article 2
1.Therepresentative rate ofacurrency shall beadjusted once ayear in
accordance with thefollowing provisions .
2.Tfe^re6nraters shall beadjusted sothatthemonetary compensatory amounts
are reduced each year :
seven
(a)firstly ,over aperiod of years ;
–by points inBelgium .Luxembourg andtheNetherlands *
*
-by points inGermany
-by points inFrance
-by points inIreland *
-by points inItaly * #
-by points intheUnited Kingdom
(b)andsecondly ,bytheamount they have increased fortheMember State
concerned sin® the last annual fixing ofrepresentative rates .
3.However ,therepresentative rate must notbeadjusted ,astheresult ofthe
application ofparagraph 2,bymore than 5%peryear .
Where ,duetothe 5%limit ,theadjustment isless than that resulting
représentât ivefrom paragraph 2,the rate ofthecurrency inquestion shall be
adjusted thefollowing year insuch awayastoreduce themonetary amounts
bythenumber ofpoints bywhich theadjustment could notbemade thepre­
vious year .However ,innocase maytherepresentative amount beadjusted
bymore than 5%.
^ S0
One ofthemonetary compensatory
Regulation comes into effect .amounts applicable atthetime the

4.Theadjustments shall take effect atthebeginning ofthemarketing year
fortheproducts inquestion or,intheabsence ofamarketing year ,on
dates tobedetermined .
5.Theprevious paragraphs maybederogated from ,inthat monetary compensatory
amounts may bedesmantled more quickly .
Article 3
1.TheCouncil ,acting byaqualified majority onaproposal from theCommission ,
shall adopt theadjustments totherepresentative rates .
2.Any implementing rules shall beadopted inaccordance with theprocedure
laiddown inArticle 26ofRegulation (EEC)No 2727/75^,aslastamended
8byRegulation (EEC)No1143 /76,or,depending onthecase ,inthecorrespon­
ding Article oftheother agricultural Regulations .
Article 4
Forthepurposes ofthis Regulation ,the representative rate means the
conversion rate tobeused when theoperations tobecarried outpursuant
totheacts relating tothecommon agricultural policy orthe specific
regulations adopted under Article 235ofthe Treaty require sums expressed
inthecurrency ofoneMember State orinunits ofaccount tobeexpressed '
inthecurrency ofanother Member State ,andvice versa .
Article 5
This Regulation shall enter into force onthethird dayfollowing its
publication intheOfficial Journal ofthe European Communities .
This Regulation shall bebinding initsentirety anddirectly applicable
inall Member States .
Done atBrussels , p°rtheCouncil ,
The President
70JNoL281,1.11.1975 ,p.1
80JNoL130,19.5.1976 ,p.1