WRITTEN QUESTION E-0128/02

by Alexandros Alavanos (GUE/NGL) to the Commission

(1 February 2002)

Subject: Withholding of EAGGF subsidies

Producers in Greece have no option but to collect their EAGGF subsidies from the Agricultural Bank of Greece (ATE). The bank asks producers for authorisation to withhold part of their subsidies to cover any amounts that may be due to the bank or the farming cooperatives.

Although it appears that the aid is withheld with the consent of the beneficiaries, producers and their trade unions have both made numerous complaints that consent is obtained essentially through coercion owing to the beneficiaries' financial dependence on the ATE and the farming cooperatives.

Both the Commission and the Court of Auditors have in fact decided on numerous occasions that no amount of EAGGF aid may be withheld.

The Commission:

1. Does it consider that such indirect withholding of aid from producers by the ATE is consistent with its decisions concerning payment in full of that aid? What action will it taken on this matter?

2. Are producers within their rights to refuse to sign the authorisation to withhold aid against current and/or future debts?

Answer given by Mr Fischler on behalf of the Commission

(14 March 2002)

1. In respect of deductions of the European Agricultural Guidance and Guarantee Fund (EAGGF) subsidies operated by the Agricultural Bank of Greece (ATE) to cover amounts due to the bank it should be borne in mind that in case C-132/95(1) the Court of Justice maintained the view that although it is true that under Article 15(3) of Council Regulation (EEC) No 1765/92 of 30 June 1992 establishing a support system for producers of certain arable crops(2), the compensatory payments referred to therein are to be paid over to the beneficiaries in their entirety, set-off between compensatory payment made under the above-mentioned Regulation and outstanding debts payable to a Member State does not have the effect of reducing the amount of the aid.

As regards deductions of EAGGF subsidies operated by the ATE to cover amounts due to the farming cooperatives, the Commission is of the view that if Greek producers are not coerced by the Greek public authorities into consenting that part of the EAGGF subsidies are withheld by the ATE for the purpose mentioned, there is no conflict with Community law. In this connection it should be noted that the Commission was informed by the Greek authorities that the deductions are made by the producer organisations to their members following a decision of their general assemblies i.e. the deductions result from a private relationship.

Moreover, in an EAGGF audit report of 12 November 2001 (Enquiry number: FA/20a/GR) following a mission to Greece from 5 to 8 November 2001 it is stated that a Joint Ministerial Circular of 22 October 2001 requires that beneficiaries are to receive full payment in their bank account. For 2001 campaigns/harvests beneficiaries were asked to provide their bank account details. The mission team was informed that from 1 January 2002 claims were not to be accepted unless they included a bank account number. Assurances were given that beneficiaries could freely choose their bank. Further EAGGF missions to follow up this and other matters are planned.

2. The answer to the second question posed by the Honourable Member must be in the affirmative.

(1) Bent Jensen and Korn- og Foderstofkompagniet A/S v. landbrugsministeriet EF Direktoraded. Case C-132/95 ECR 1998 page I-2975.

(2) OJ L 181, 1.7.1992.