WRITTEN QUESTION E-3023/02

by Mariotto Segni (UEN) to the Commission

(23 October 2002)

Subject: Regional aid to combat blue tongue

By the decision published in the Official Journal(1), the Commission announced that it was initiating a formal investigation procedure concerning the aid which the Sardinian regional authorities were proposing to grant following an outbreak of blue tongue disease on the island (aid N 775/2000, now C 5/2001).

However, it endorsed Article 4 of the law relating to the aid, whereby compensation was to be paid to sheep and cattle farmers (the latter animals are healthy carriers) for the additional cost incurred in the purchase of fodder, since animals could not be taken to pasture.

In its decision the Commission took the view that the two aid measures provided for (to offset income lost owing to the slaughter of animals and higher feed costs for stockbreeders) could fall under the definition of losses within the meaning of point 11.4 of the guidelines for State aid in the agriculture sector and thus be considered compatible with the Treaty.

The regional authorities later notified a further provision confined to cattle farmers (aid N 662/2001), the purpose of which was to offset the additional cost of feeding and tending animals resulting from the movement ban.

In response to this new notification, the Commission has stated that compensation for producers can make reasonable provision to offset the loss entailed in the difficulty of replacing stock. It follows that aid may be granted if, and only if, stock is slaughtered and subsequently replaced, whereas it is no longer deemed admissible to compensate cattle farmers for higher rearing costs.

Given that the guidelines were not altered in the time between the adoption of the decision concerning aid N 775/2000 and the notification of aid N 662/2001, could the Commission explain its change of attitude, especially bearing in mind that its decisions are legally binding?

(1) OJ C 327, 22.11.2001, p. 5.

Answer given by Mr Fischler on behalf of the Commission

(3 December 2002)

By letter SG (2001) D/285817 of 2 February 2001, the Commission has approved a compensation for farmers who were prohibited, following a public order, from moving sheep, goats, bovine animals and buffalo from holdings until epidemiological conditions, due to the spreading of the Blue Tongue disease, would improve (article 4 of the Regional Law of 25 October 2000). The aid was part of a comprehensive plan for the eradication and prevention of the spreading of the Blue Tongue disease, following the restrictions of animal movement in the Region, adopted after the publication of the Ministerial Decree of 28 August 2000.

The sudden spreading of the Blue Tongue disease and its impact on the animal population had caused serious damages to the farmers who were facing a difficult situation, resulting also from the almost concomitant drought. The aid to compensate for extra feeding and maintenance costs for the bovine and the ovine sectors, referred to a period of one year and of limited amount, was considered acceptable by the Commission, as part of a more general aid scheme to compensate for the damages that the unexpected spreading of the epidemics had determined on the animal breeding sector.

The Regional Decree 29/10 of 4 September 2001, proposing an aid to compensate for the extra costs of food and animal maintenance, generated by the retention in the farms of calves normally sent to the north of Italy to be fed and slaughtered, does not seem to be justifiable on the basis of point 11.4 of the Community Guidelines for state aid in the agricultural sector(1). The condition for granting compensation under said point, i.e. the slaughtering of the animals and the consequent re-stocking of the farms, is, in fact, not met. The aid, providing for a substantial increase in the budget for extra feeding and maintenance costs concerns only the bovine sector, in which no direct losses, due to the slaughtering of animals following the implementation of a public order, has occurred.

The regional authorities have not indicated, up to now, under which other legal basis they assume this aid could be assessed. On the basis of the information provided, the Commission has raised doubts on the compatibility of the aid in question with the Community rules on competition. No final decision has been taken by the Commission.

(1) OJ C 28, 1.2.2000, as modified by OJ C 232, 12.8.2000.