WRITTEN QUESTION E-3387/96 by Salvador Jové Peres (GUE/NGL) to the Commission (5 December 1996)

Subject: Operation of the aid regime for olive oil

Under Council Regulation (EC) 2261/84 ((OJ L 208, 3.8.1984, p. 3. )), the Commission was required to submit, by 1 January 1995, a report on the operation of the aid regime in the olive oil sector. This has not been done. On 25 October 1996 Parliament adopted a resolution (B4-1180/96) calling on the Commission to submit a report.

1. Does the Commission intend to submit this report? If so, when? Before or after submitting the proposal for reform of the common organization of the market?

In recent statements concerning the future reform of the COM in olive oil, Commissioner Fischler referred to the existence of fraud.

2. In what countries is fraud occurring, what form does it take and what sums are involved? Does the Commission not consider that the report on the operation of the aid regime in the olive oil sector would allow any fraud constituting a major problem to be accurately assessed?

It appears that the Commission intends, in its proposal for reform, to set the future support levels for the sector in proportion to the economic support received in the past.

3. Does the Commission not consider that this approach could end up legitimizing fraud where it has existed in the past?

A large number of jobs depend on olive oil in regions heavily affected by unemployment, and certain changes to the aid system could remove cultivation incentives and thus reduce the number of people employed.

4. Does the Commission consider that it has sufficient assessment and research evidence for embarking on a proposal for reform which could have an adverse impact on employment?

Answer given by Mr Fischler on behalf of the Commission (17 December 1996)

As indicated in its answer to written questions E-2684/96, E-2685/96 and P-2946/96 ((See page 22. )), by Mr Valverde Lopez and Mr Papayannakis, the Commission will soon be presenting a document on the olive oil sector, including an analysis of the weaknesses of the current common market organization and options for its reform. This will be followed, after a three month reflection period, by a proposal for reforms.

In accordance with the provisions of Regulation (EEC) No 595/91 ((OJ L 67, 14.3.1991. )) concerning irregularities and the recovery of sums wrongly paid in connection with the financing of the common agricultural policy and the organization of an information system in this field, 10 Member States ((Belgium, Denmark, Germany, Greece, Spain, France, Italy, the Netherlands, Portugal, United Kingdom. )) communicated, from mid 1991 to mid 1996, 1 377 cases of irregularities in the olive oil sector for a total amount of 181 MECU. Italy represents 49% of these cases but 85% of the amounts involved. Greece represents 10% of the amounts involved and Spain and Portugal less than 2% each. 90% of these amounts involve irregularities concerning consumption aid and 6.5% involve export refunds. Inquiries carried out by the Commission have resulted in the discovery of further fraud cases (30 MECU), particularly fraud on traditional own resources (in addition to communications from the Member States on the basis of Regulation (EEC, EURATOM No 1552/89 on the system of Communities own resources ((OJ L 155, 7.6.1989. ))). Control measures have not properly ensured the protection of the financial interests of the Community, in particular in the case of production aid. Fraud against consumers also occurs when, for example, mixtures of olive oil and seed oil are traded as olive oil (without necessarily applying for consumption aid).

The Commission cannot comment at this stage on the nature or content of the reform proposal as this would prejudice the discussion on the options document which, of course, will be available to the Community institutions and other interested parties. However, the Commission would re-affirm that the new regime should be simple and therefore easier to control.