Proposal for a COUNCIL DECISION establishing the Community position with respect to the prolongation of the International Agreement on Olive Oil and Table Olives, 1986

(presented by the Commission)

EXPLANATORY MEMORANDUM

1. The International Agreement on Olive Oil and Table Olives of 1986, of which the Community is a member, entered into force on 1 July 1986. It was amended in 1993 and its application prolonged to 1998. It has been extended for further periods until 31 December 2004, when. it will expire. However, under Article 61 of the International Agreement on Olive Oil and Table Olives of 1986 and Article 9 of the Protocol amending and extending the Agreement, the International Olive Oil Council (IOOC) may decide either to prolong the Agreement for successive periods not exceeding two years on each occasion or to put an end to that Agreement.

2. The IOOC members are now negotiating a new Agreement. However, it is not yet clear if consensus of all current IOOC members on the new text will be achieved before expiry of the existing Agreement. On the other hand, there is not yet consensus of IOOC members on the adoption of a package of measures proposed by the EC and intended to finally solve management problems identified at the Secretariat of this organization. A decision in the course of its 91st session to either prolong the Agreement for a further period of one year, until 31 December 2005, or to put an end to this Agreement will have therefore to take place in December 2004.

3. The budgetary implications are as follows:

The European Community participation share pertaining to the IOOC Administrative Budget amounts to 750/1000, i.e. 75 %, which is paid under budget-item 05 06 01. The Community share of the IOOC-budget for 2004 as foreseen in the Draft General Budget of the European Commission for the financial year 2004 has been estimated at EUR 3 923 000. Starting from the assumption of an increase of a maximum of 4 % for the year 2005 the Community share could, at the most, increase to EUR 4 080 000 for that financial year.

Moreover, the Agreement foresees an obligatory contribution of EUR 500 000/year to the Promotion Fund to be paid under budget line 05 08 05. The European Community share is 802.8/1000, i.e. 80.28 % and, therefore, amounts to EUR 401 400/year. This amount is fixed and will stay the same for the years 2004 and 2005.

4. The purpose of this proposal is to authorise the Commission on behalf of the Community to either vote in favour of the prolongation of the Agreement until 31 December 2005 if IOOC Members achieve consensus on the need to sufficiently improve the functioning of the IOOC Secretariat or to reject further extensions of the current Agreement, pending the results of ongoing negotiations on both a new Agreement and a package of management measures proposed by the EC. The Commission does, however, reserve the right to alter this proposal once these results are available.

2004/0236 (ACC)

Proposal for a COUNCIL DECISION establishing the Community position with respect to the prolongation of the International Agreement on Olive Oil and Table Olives, 1986

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 133, in conjunction with the second subparagraph of Article 300(2) thereof,

Having regard to the proposal from the Commission,

Whereas:

(1) The International Agreement on Olive Oil and Table Olives, 1986, (hereafter: the Agreement), was concluded by the Community by Council Decision 87/401/EEC [1], amendments thereof were approved in 1993 by Council Decision 93/622/EC [2]. It was prolonged thereafter for additional periods of two years and remains in force until 31 December 2004 unless the International Olive Oil Council (hereafter: IOOC) decides on a prolongation for a further period or a new Agreement is adopted before that date.

[1] OJ L 214, 4.8.1987, p. 1.

[2] OJ L 298, 3.12.1993, p. 36.

(2) The main objectives of the Agreement are to promote international co-operation in the field of olive oil and table olives, to promote consumption of olive products in third countries and to harmonise quality standards of olive products amongst its members. The prolongation of the Agreement or the adoption of a new Agreement can, therefore, be in the interest of the Community if, as a result of ongoing negotiations, a sound management of the IOOC Secretariat can be ensured.

(3) IOOC members are currently negotiating the text of a new Agreement which should replace the existing Agreement and, at the same time, the adoption of various measures intended to ensure a sound functioning of the IOOC Executive Secretariat.

(4) Whilst both the negotiations on the new Agreement and the measures aimed at ensuring a sound functioning of the Executive Secretariat are being conducted in parallel, the situation could emerge in which only the latter measures would be ripe for adoption whilst the negotiations on the new Agreement would still have to be carried on beyond the expiry of the current Agreement.

(5) The Commission, representing the Community in the IOOC, should, therefore, be authorised either to be in favour of a prolongation or to reject a further extension of the current Agreement,

HAS DECIDED AS FOLLOWS:

Sole Article

The Commission, depending on the results of ongoing negotiations between the members of the International Olive Oil Council as established by the Agreement, shall hereby be authorised to express the following positions representing the European Community:

(a) either to be in favour of the prolongation of the Agreement for a period of one year until 31 December 2005 taking into account the prospects of improvement of the organisation and management of the Secretariat,

(b) or to be against a further prolongation of the Agreement.

Done at Brussels,

For the Council

The President

LEGISLATIVE FINANCIAL STATEMENT

Policy areas: Agriculture and Rural Development

Activities: External Relations (05 06 01 - ex B 7-8210) and Policy Strategy and Coordination of Policy area "Agriculture" (05 08 05 - ex B 1-3811)

Title of action: International Agreement on olive oil and table olives, 1986 (05 06 01 -ex B 7-8210); Promotion Measures (05 08 05 - ex B 1-3811)

1. BUDGET LINES + HEADINGS

05 06 01 (ex B 7-8210): International Agricultural Agreements

05 08 05 (ex B 1-3811): Promotion measures/Direct payment by the European Community

2. OVERALL FIGURES

2.1. Total allocation for action (Part B): EUR million for commitment

a) 2004:

EUR 3.923 (budget-line 05 06 01 -ex B 7-8210)

EUR 0.401 (budget-line 05 08 05 -ex B 1-3811)

b) 2005:

EUR 4.320 (budget-line 05 06 01 -ex B 7-8210)

EUR 0.401 (budget-line 05 08 05 -ex B 1-3811)

2.2. Period of application

Calendar year 2005

2.3. Overall multi-annual estimate of expenditure

(a) Schedule of commitment appropriations/payment appropriations (financial intervention)

EUR million (to three decimal places)

>TABLE POSITION>

(b) Technical and administrative assistance and support expenditure

>TABLE POSITION>

2.4. Compatibility with financial programming and financial perspective

X Proposal is compatible with existing financial programming.

3. BUDGET CHARACTERISTICS (with regard to budget-line 05 06 01)

>TABLE POSITION>

BUDGET CHARACTERISTICS (with regard to budget-line 05 08 05)

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4. LEGAL BASIS

Article 133 in conjunction with the second paragraph of Article 300(2) of the Treaty establishing the European Community

5. DESCRIPTION AND GROUNDS

5.1. Need for Community intervention

5.1.1. Objectives pursued

Due to its economic importance in the agricultural sector the Community should be represented in international agricultural organisations. Being a member of the International Olive Oil Council, in particular, enables the Community to pursue the developments of the markets for olive oil and table olives and, thus, to defend its interest with regard to these products. The International Agreement on Olive Oil and Table Olives 1986 supports international co-operation and contributes to the development and the stability of the markets for these products.

5.1.2. Measures taken in connection with ex ante evaluation

N/A

5.1.3. Measures taken following ex post evaluation

N/A

5.2. Action envisaged and budget intervention arrangements

The Community pays its annual membership contribution as fixed in accordance with the International Agreement and the obligatory contribution to the Promotion Fund of the IOOC as fixed in the International Agreement. These obligations continue as long as the Community is a signatory of the International Agreement.

The Commission, representing the Community, as well as the other members of the IOOC participates actively in the IOOC-activities and profits fully of the advantages of being a member of the IOOC.

6. FINANCIAL IMPACT

6.1. Total financial impact on Part B - (over the entire programming period)

6.1.1. Financial intervention

Commitments (in EUR million to three decimal places)

>TABLE POSITION>

7. IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE

7.1. Impact on human resources

>TABLE POSITION>

7.2. Overall financial impact of human resources

>TABLE POSITION>

The amounts are total expenditure for twelve months.

7.3. Other administrative expenditure deriving from the action

>TABLE POSITION>

The amounts are total expenditure for twelve months.

I. Annual total (7.2 + 7.3)

II. Duration of action // 1 year (2005)

III. Total cost of action (I x II)

8. FOLLOW-UP AND EVALUATION

8.1. Follow-up arrangements

The IOOC-activities are closely followed by its members and there are regular meetings which are attended by Commission staff.

8.2. Arrangements and schedule for the planned evaluation

Activity reports are regularly distributed by the IOOC which allows an evaluation of the activities. Commission staff reports back to the PROBA-group of the Council and the IOOC activities are followed up in that context, too.

9. ANTI-FRAUD MEASURES

Article 17(10) and 24 of the International Agreement on Olive Oil and Table Olives 1986 and Article 28, lit d) of the Internal Rules of the IOOC provide for control and audit mechanisms. The accounts have to be certified by an independent account commissioner.

With regard to the contributions to the Promotion Fund the Commission carries out controls of the accounts by own staff, as the case may be, on-the spot, and monitors the contracts.

Moreover, the IOOC-members have recently agreed upon an in-depth reform of the overall financial management of the IOOC.