[pic] | COMMISSION OF THE EUROPEAN COMMUNITIES |

Brussels, 5.9.2007

COM(2007) 499 final

2007/0179 (ACC)

Proposal for a

COUNCIL DECISION

regarding the position to be taken by the Community within the International Cocoa Council on the extension of the International Cocoa Agreement, 2001

(presented by the Commission)

EXPLANATORY MEMORANDUM

The International Cocoa Agreement of 2001 was concluded for the European Community by Council Decision 2002/970/EC of 18 November 2002. The Agreement entered into force provisionally on 1 October 2003 and definitively on 2 November 2005. It is due to expire on 30 September 2008 unless it is extended.

At the meeting of the International Cocoa Council scheduled to take place in London in September 2007 members may be requested, under the provisions of Article 63(3) of the Agreement, to adopt a resolution providing for the extension of the current Agreement of 2001 for one or two periods not exceeding two cocoa years each, in order to allow sufficient time for the negotiation of amendments or a successor Agreement.

The European Community's, participation in the Agreement is in accordance with its exclusive competence. Under the legal basis, the proposed decision does not change the European Community’s contribution to the administrative budget of the International Cocoa Organisation, which remains due for every cocoa year.

The purpose of this proposal is to authorise the European Community to vote in favour of extending the Agreement.

The Commission therefore suggests that the Council adopt the attached decision.

2007/0179 (ACC)

Proposal for a

COUNCIL DECISION

regarding the position to be taken by the Community within the International Cocoa Council on the extension of the International Cocoa Agreement, 2001

THE COUNCIL OF THE EUROPEAN UNION,

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

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

Whereas:

(1) The International Cocoa Agreement a of 2001 was signed and concluded on behalf of the European Community on 18 November 2002 by Council Decision 2002/970/EC[2].

(2) Under the provisions of Article 63 (1) and (3), the International Cocoa Agreement of 2001 is due to expire on 30 September 2008 unless it is extended beyond that date by decision of the International Cocoa Council for one or two periods not exceeding four years in total.

(3) The extension of that Agreement is in the interest of the European Community.

(4) The European Community’s position in the International Cocoa Council should be determined,

HAS DECIDED AS FOLLOWS:

Sole Article

The European Community’s position within the International Cocoa Council shall be to vote in favour of extending the International Cocoa Agreement, 2001, for one or two periods not exceeding four years in total and to notify this extension to the United Nations Secretary-General.

Done at Brussels,

For the Council

The President

LEGISLATIVE FINANCIAL STATEMENT

This document is intended to accompany and complement the Explanatory Memorandum. As such, when completing this Legislative Financial Statement, and without prejudice to its legibility, an attempt should be made to avoid repeating information contained in the Explanatory Memorandum. Before filling in this template, please refer to the specific Guidelines that have been drafted to provide guidance and clarification for the items below.

1. NAME OF THE PROPOSAL:

Proposal for a Council Decision r egarding the position to be taken by the Community within the International Cocoa Council on the extension of the International Cocoa Agreement of 2001

2. ABM / ABB FRAMEWORK

Policy Area(s) concerned and associated Activity/Activities:

External Relations, Development and relations with ACP countries. Obligations vis-à-vis the International Commodities organisations

3. BUDGET LINES

3.1 Budget lines (operational lines and related technical and administrative assistance lines (ex- B..A lines)) including headings:

21 07 04 Commodities agreements

3.2 Duration of the action and of the financial impact:

Maximum Six years unless the Agreement is renegotiated in the meantime

3.3 Budgetary characteristics ( add rows if necessary ) :

Budget line | Type of expenditure | New | EFTA contribution | Contributions from applicant countries | Heading in financial perspective |

Comp | Diff[3]/ | NO | NO | NO | No [ 4 ] |

4. SUMMARY OF RESOURCES

4.1 Financial Resources

4.1.1 Summary of commitment appropriations (CA) and payment appropriations (PA)

EUR million (to 3 decimal places)

Expenditure type | Section no. | Year n | n + 1 | n + 2 | n + 3 | n + 4 | n + 5 and later | Total |

Operational expenditure[4] |

Commitment Appropriations (CA) | 8.1 | a | 1,258 | 1,321 | 1,387 | 1,456 | 1,528 | 1,604 | 8,554* |

Payment Appropriations (PA) | b | 1,258 | 1,321 | 1,387 | 1,456 | 1,528 | 1,604 | * 8,554* |

* The calculation takes into account an annual average of increase equal to 5%. Administrative expenditure within reference amount[5] |

Technical & administrative assistance (NDA) * | 8.2.4 | c |

* No need for technical and administrative assistance TOTAL REFERENCE AMOUNT |

Commitment Appropriations | a+c | 1,258 | 1,321 | 1,387 | 1,456 | 1,528 | 1,604 | 8,554* |

Payment Appropriations | b+c | 1,258 | 1,321 | 1,387 | 1,456 | 1,528 | 1,604 | * 8,554* |

Administrative expenditure not included in reference amount[6] * No need for technical and administrative assistance |

Human resources and associated expenditure (NDA) | 8.2.5 | d |

Administrative costs, other than human resources and associated costs, not included in reference amount (NDA) | 8.2.6 | e |

Total indicative financial cost of intervention

TOTAL CA including cost of Human Resources | a+c+d+e | 1,258 | 1,321 | 1,387 | 1,56 | 1,528 | 1,604 | 8,554* |

TOTAL PA including cost of Human Resources | b+c+d+e | 1,258 | 1,321 | 1,387 | 1,456 | 1,528 | 1,604 | 8,554 |

Co-financing details

No co-financing

4.1.2. Compatibility with Financial Programming

X Proposal is compatible with existing financial programming.

( Proposal will entail reprogramming of the relevant heading in the financial perspective.

( Proposal may require application of the provisions of the Interinstitutional Agreement[7] (i.e. flexibility instrument or revision of the financial perspective)

4.1.3. Financial impact on Revenue

X Proposal has no financial implications for revenue

( Proposal has financial impact – the effect on revenue is as follows:

4.2. Human Resources FTE (including officials, temporary and external staff) – see detail under point 8.2.1.

The needs in terms of human and administrative resources shall be covered by the allocation granted to the managing DG in the framework of the annual allocation procedure.

5. CHARACTERISTICS AND OBJECTIVES

Details of the context of the proposal are required in the Explanatory Memorandum. This section of the Legislative Financial Statement should include the following specific complementary information:

5.1. Need to be met in the short or long term.

Mandatory obligation to be party to the Cocoa Agreement by virtue of a Council Decision.

5.2. Added-Value of Community involvement and coherence of the proposal with other financial instruments and possible synergy.

The present membership of the Cocoa Organisation derives from the broader approach always followed by the Community in signing and concluding international commodity agreements once negotiated, as a tool for facilitating exchanges and trade relations among importers and exporters. This facilitates development and responds to the mandate of DG DEV to contribute to policy formulation in several Community policies such as trade, environment, agriculture and sustainable development as well as other policies with an external dimension. In the particular case of the present international agreement, the Council has also recognised the exclusive competence of the Commission on the basis of Art.133. The main objectives of the agreement are: promote international cooperation in cocoa matters; provide a forum for intergovernmental consultations; seek ways to achieve a reasonable balance between supply and demand of cocoa at fair prices to consumers and remunerative to producers; facilitate expansion and transparency of the international trade in cocoa; encourage members to develop a sustainable cocoa economy. The nature of the present agreement is political, administrative and economic. We consider that a clear positive indicator to measure the achievement of these targets is the unanimous desire of the members to continue the international cooperation through the present agreement and consequently agree on its extension and possible renegotiation.

The proposal is consistent with other financial instruments ensuring the EC participation in international organisations. No synergies possible at the present stage.

5.3. Objectives, expected results and related indicators of the proposal in the context of the ABM framework

Within the ABM framework, the present proposal responds to the objective of developing the Commission’s role as an intellectual focal point for development and ensures effective participation in the international policy debate.

The main output indicator could be considered as the EU positions for major international initiatives, Conventions, fora and platforms agreed with MS. The impact indicator may be considered as the reflection of the EU positions in international partnerships and funds as well as international fora.

Looking to the proposal, its objective is to allow the Commission, acting on behalf of the Community, to express the will for an extension of the cocoa agreement thereby , ensuring the continuation of the agreement for a period not exceeding four years, after its expiry on 30 September 2008.. The purpose of extending the period of validity, will give time for undertaking negotiations for amending the current agreement or renegotiating a new legal instrument before the end of its duration. The Commission therefore has an interest, within its own competencies, in proposing the present decision in conformity with the mandate received by the Member States.

5.4. Method of Implementation (indicative)

Show below the method(s)[8] chosen for the implementation of the action.

ٱ Centralised Management |

X Directly by the Commission |

ٱ Indirectly by delegation to: |

ٱ Executive Agencies |

ٱ Bodies set up by the Communities as referred to in art. 185 of the Financial Regulation |

ٱ National public-sector bodies/bodies with public-service mission |

ٱ Shared or decentralised management |

ٱ With Member States |

ٱ With third countries |

ٱ Joint management with international organisations (please specify) |

Relevant comments:

6. MONITORING AND EVALUATION

6.1 Monitoring system

The Commission Services attend regularly the Council sessions as well as the Executive Committee of the International Cocoa Organisation. These two bodies are mandated to propose and approve the administrative budget and the inherent contributions. The administrative budget, its utilisation, the financial status of the expenditure and accounts of the International Cocoa Organisation are at the disposal of the members.

6.2. Evaluation

6.2.1 Ex-ante evaluation

Evaluation of the compatibility of the annual proposal with our financial policy

6.2.2 Measures taken following an intermediate/ex-post evaluation (lessons learned from similar experiences in the past)

This exercise is carried out, if necessary, at the time of a renegotiation. It must be pointed out that a recent study commissioned by the Commission assessing the major Commodity Organisations concludes by stressing the interest of the EC in participating in all these fora with an increased level of involvement, in exclusive competence whenever possible.

6.2.3 Terms and frequency of future evaluation

7. ANTI-FRAUD MEASURES

The Commission will ensure constant monitoring of the administrative management of the financial resources of the International Cocoa Organisation.

If so required by the Commission, the International Cocoa Organisation is willing to grant the access to its records and books to OLAF as well as to all other financial and audit services.

8. DETAILS OF RESOURCES

8.1. Objectives of the proposal in terms of their financial cost

Commitment appropriations in EUR million (to 3 decimal places)

8.2.2 Description of tasks deriving from the action

Attendance at meetings, study of documents, discussion with Member States in Council and finally negotiations within the International Cocoa Organisation.

8.2.3 Sources of human resources (statutory)

(When more than one source is stated, please indicate the number of posts originating from each of the sources)

( Posts currently allocated to the management of the programme to be replaced or extended

( Posts pre-allocated within the APS/PDB exercise for year n

( Posts to be requested in the next APS/PDB procedure

( Posts to be redeployed using existing resources within the managing service (internal redeployment)

( Posts required for year n although not foreseen in the APS/PDB exercise of the year in question

8.2.4 Other administrative expenditure included in reference amount (XX 01 04/05 – Expenditure on administrative management)

No need

8.2.5 Financial cost of human resources and associated costs not included in the reference amount.

The needs in terms of human and administrative resources shall be covered by the allocation granted to the managing DG in the framework of the annual allocation procedure. The staff and the administrative expenditure are included in the normal allocation of the DG.

[1] OJ C …

[2] OJ L 342, 17.12.2002,p. 1

[3] Differentiated appropriations

[4] Expenditure that does not fall under Chapter xx 01 of the Title xx concerned.

[5] Expenditure within article xx 01 04 of Title xx.

[6] Expenditure within chapter xx 01 other than articles xx 01 04 or xx 01 05.

[7] See points 19 and 24 of the Interinstitutional agreement.

[8] If more than one method is indicated please provide additional details in the "Relevant comments" section of this point

[9] As described under Section 5.3

[10] Cost of which is NOT covered by the reference amount

[11] Cost of which is NOT covered by the reference amount

[12] Cost of which is included within the reference amount