Proposal for a Council Regulation (EC) amending Regulation (EEC) No 4045/89 of the Council on scrutiny by Member States of transactions forming part of the system of financing by the Guarantee Section of the European Agricultural Guidance and Guarantee Fund (94/C 175/06) COM(94) 159 final - 94/0119(CNS)

(Submitted by the Commission on 7 June 1994)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Article 43 thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Parliament,

Whereas Council Regulation (EEC) No 4045/89 (1) provides for the scrutiny by Member States of transactions forming part of the system of financing by the Guarantee Section of the European Agricultural Guidance and Guarantee Fund;

Whereas the rules for the selection of undertakings to be scrutinized laid down in Article 2 thereof should be modified to take account of developments in the use of risk analysis techniques in other control measures, and in order to give Member States greater flexibility in the selection of undertakings;

Whereas it is necessary to make clear that the commercial documents subject to scrutiny include records maintained in electronic data storage systems;

Whereas the powers of the Member States to take action in relation to inadequate commercial documents and documents located outside the territory of the Community should be specified;

Whereas the procedures for mutual assistance provided in Article 7 of the said Regulation should be strengthened;

Whereas for the fifth year of application of Regulation (EEC) No 4045/89 there is a need for greater flexibility in the allocation of the contribution by the Community to the additional expenditure foreseen pursuant to Articles 13, 14 and 15, provision should be made for the aggregation of the amounts available pursuant to Articles 13 and 14 and their allocation to the different types of expenditure without distinction;

Whereas, in the event that officials carrying out scrutinies are accompanied by officials of the Commission or of other Member States, it is necessary to make clear the status of the latter,

HAS ADOPTED THIS REGULATION:

Article 1

Regulation (EEC) No 4045/89 is hereby amended as follows:

1. Article 1 paragraph 2, is replaced by the following:

'2. For the purposes of this Regulation "commercial documents" means all books, registers, vouchers and supporting documents, accounts, production and quality records, and correspondence relating to the undertaking's business activity, as well as commercial data, in whatever form they may take, including electronically stored data, in so far as these documents or data relate directly or indirectly to the transactions referred to in paragraph 1.`

2. In Article 1 the following paragraph is added:

'3. In accordance with Article 19 the Commission shall establish a list of measures to which this Regulation shall not apply.`

3. In Article 2 paragraph 2, first subparagraph, the sum of 'ECU 60 000` is replaced by 'ECU 100 000`.

4. In Article 2 paragraph 2 the second and third subparagraphs are deleted.

5. In Article 2 paragraph 2 the following subparagraph shall be inserted after the first subparagraph:

'In relation to each scrutiny period, commencing with the 1994/95 scrutiny period, Member States shall, without prejudice to their obligations pursuant to Article 2 paragraph 1, select the undertakings to be scrutinized on the basis of risk analysis in the export refunds sector, and for all other measures where it is practicable to do so. The Member State shall submit to the Commission its proposal for the use of risk analysis, which shall include all relevant information concerning the approach to be followed, the techniques, the criteria and the method of implementation, not later than 1 December of the year prior to commencement of the scrutiny period for which it is to be applied. The Member State shall take account of the comments of the Commission on the proposal which shall be given within eight weeks of its receipt.

However the requirement to submit the abovementioned proposal shall not apply to the 1994/95 scrutiny period.

For measures where the use of risk analysis is not practicable, it shall be compulsory for undertakings the sum of whose receipts or payments amounted to more than ECU 300 000 and which were not scrutinized in accordance with this Regulation during either of the two preceding scrutiny periods, to be scrutinized.`

6. In the fourth subparagraph of Article 2 paragraph 2 the sum of 'ECU 10 000` is replaced by 'ECU 30 000`.

7. In Article 2 paragraph 5 the phrase 'Article 6 of Regulation (EEC) No 283/72 (2)` is replaced by 'Article 6 of Regulation (EEC) No 595/91 (3)`.

8. In Article 3 paragraph 1 the words preceding the indents are replaced as follows:

'The accuracy of primary data under scrutiny shall be verified by the number of crosschecks appropriate to the degree of risk presented, including, inter alia:`.

9. In Article 3 paragraph 1 the second indent is replaced as follows:

'- physical checks, where appropriate, upon the quantity and nature of stocks, and`.

10. In Article 3 the following paragraph is added:

'3. In the selection of transactions to be checked, full account shall be taken of the degree of risk presented`.

11. In Article 5 paragraph 1 the following sentence is added:

'Electronically stored data shall be provided on an appropriate data support medium.`

12. In Article 5 the following paragraph is added:

'3. Where the commercial documents maintained by the undertaking are considered inadequate for scrutiny purposes, the undertaking shall be directed to maintain such records as required by the officials responsible for the scrutiny, without prejudice to obligations laid down in other Regulations relating to the sector concerned.

The Member States shall determine the delay within which such records shall be established.

Where all or part of the commercial documents required to be scrutinized under this Regulation are located outside the Community territory, the undertaking shall make available within a reasonable time these commercial documents to officials responsible for the scrutiny, at a place to be designated by the Member State responsible for carrying out the scrutiny.`

13. In Article 7 paragraph 2 the first subparagraph is replaced as follows:

'2. During the first quarter of the year following the year of payment, Member States shall send a list of the undertakings referred to in paragraph 1 to each Member State in which such an undertaking is established; the list shall contain all the details necessary to enable the Member State of destination to identify the undertakings and to undertake its scrutiny obligations. The Member State of destination shall be responsible for the scrutiny of such undertakings in accordance with Article 2. A copy of each list shall be sent to the Commission.`

14. In the second subparagraph of Article 7 paragraph 2 the following sentence is added:

'Such requests shall be acted upon, and the results communicated to the requesting Member State and the Commission within six months of the request being made.`

and in the English language version the word 'business` is replaced by 'undertaking`.

15. In Article 9 paragraph 5 the year '1991` is replaced by '1996`, and the second sentence is deleted.

16. In Article 10 paragraph 3 the word 'six` is replaced by 'eight`.

17. Article 10 paragraphe 6 is deleted.

18. In Article 16 a new paragraph 2 is inserted as follows:

'2. For the fifth year of application of this Regulation the amounts of the overall Community contribution referred to in Articles 13 and 14 shall be aggregated for each Member State. Within the limits of this aggregation the Community shall contribute without distinction, at a rate of 25 %, towards the expenditure incurred by the Member States as foreseen in Articles 13, 14 and 15.`

and the paragraphs shall be renumbered accordingly.

19. Article 21 is amended as follows: the existing paragraph is numbered paragraph 1, and the following sentence is added:

'They shall be provided upon request on an appropriate data support medium.`

The following paragraphs are added:

'2. Officials of the Commission may be present at the scrutinies referred to in Article 2. The scrutinies shall at all times be carried out by the officials of the national administration. The Commission officials may not, on their own initiative, exercise powers conferred on national officials.

3. In the case of scrutinies taking place under the provisions of Article 7, officials of the Member State in which the payment has or should have been made or received may be present at the scrutiny in the Member State in which the undertaking is established, and have access to the same premises and the same documents as the officials of that Member State.

Officials of the requesting Member State present at scrutinies in another Member State must at all times be able to furnish proof of their official capacity. The scrutiny shall at all times be carried out by officials of the requested Member State. Officials of the applicant Member State may not, on their own initiative, assume powers conferred on the officials of the requested Member State.`

Article 2

This Regulation shall enter into force on the third day following its publication in the Officials Journal of the European Communities.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

(1) OJ No L 388, 30. 12. 1989, p. 18.

(2) OJ No L 136, 10. 2. 1972, p. 1.

(3) OJ No L 67, 14. 3. 1991, p. 11.