WRITTEN QUESTION E-1059/97 by Jesús Cabezón Alonso (PSE) to the Commission (19 March 1997)

Subject: Olive oil and fraud

In which countries of the Union does the Commission consider there to be the greatest amount of fraud relating to olive oil aid?

What are the most common types of fraud which the Commission has detected in this sector?

Answer given by Mrs Gradin on behalf of the Commission (16 May 1997)

In order to evaluate the phenomenon of fraud and irregularities in the Member States concerning olive oil, the Commission takes account of two prime elements.

Firstly the Member States forward communications 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 organisation of an information system in this field and repealing Regulation (EEC) No 283/72. This legal obligation covers all cases involving more than ECU 4 000 detected by the control bodies within the Member States, such as the olive oil agencies.

The Member States have communicated to the Commission from 1973 until September 1996 in the olive oil sector 1796 cases involving 294.5 MECU. The major fraud and irregularities cases concern Italy with 1 067 cases involving 268.6 MECU. Greece (458 cases), Spain (99 cases) and Portugal (157 cases) represent respectively 6%, 1.6% and 1% of the total amount. Belgium, Denmark, Germany, France, the Netherlands and the United Kingdom have each communicated less than 10 cases involving minor amounts.

These cases are related to the consumption aid (94% of the amounts and 55% of the number of cases), to the production aid (2.2% of the amounts and 42% of the number of cases) as well as to export refunds (3.5% of the amounts and 2.2% of the number of cases). Storage measures do not represent significant cases and amounts.

Secondly the Commission also carries out enquiries together with the Member States ((Selected enquiries are contained in the last annual reports on the fight against fraud presented by the Commission; COM(94) 94 final, COM(95) 98 final and COM(96) 173 final. )). The most common types of fraud concern the claiming of aid for quantities of oil which are non-existant, or mixed with oils other than olive oil.

Moreover, the Commission would add that, when examining the effectiveness of national control systems, where deficiencies are identified, financial corrections may be decided in the framework of the clearance of accounts procedure. Such deficiencies have been identified by the Commission in its controls for the clearance of accounts with regard to 1993, concerning both production aid (the absence of basic regulatory instruments - register and files - and the weakness of the control procedures in force mean that the risk of fraud is high and consumption aid (checks are lax).

This situation shows the need to improve the protection of the financial interests of the Community in this sector. To this end, the Commission has already presented a note to the Council and the Parliament emphasising the necessity to amend the olive oil common market organisation ((COM(97) 57 final. )).