Proposal for a COUNCIL REGULATION ( EEC ) establishing an integrated administration and control system for certain Community aid schemes
Date: 1991-12-13
Institutions: European Commission
Subjects: EU aid, aid system, aid to agriculture, animal production, area of holding, management information system

COMMISSION  OF  THE  EUROPEAN  COMMUNITIES 

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Proposal  for a 

COUNCIL REGULATION (EEC) 

eatabliahinf an integrated adainiatratioa and control aytt 
for certain CLI—unity aid achaawa 

(presented by the Commission) 

z 

EXPLANATORY  MEMORANDUM 

As  part  of  the  reform  of  the  common  agricultural  policy,  it  is proposed 
to  Introduce  a system  of  compensatory  aid  linked  directly  or  indirectly 
to  the  cultivated  area  or  the number  of  animals  kept  by  each  farmer. 

Experience  with  the administration  and monitoring  of  aid  of  this  type  has 
shown  that, unless  a  totally  new  approach  is adopted,  which  takes  account 
in particular  the  new  techniques which  exist  in the market,  that  such  aid 
engenders  would  be extremely  burdensome  for  the Member  States.  In this 
context,  account  must  also  be  taken of  the  cost  of  administrative 
verification  and  on-the-spot  checks,  In view of  the  large  number  of 
beneficiaries,  the uses  to which  the  cultivated  areas  can  be  put  and  the 
variety  and  number  of  animals;  for  the  reasons given  above,  the danger  of 
fraud  is also  great. 

Article  8 of  Council  Regulation  (EEC) NO  729/70 of  21 April  1970 on  the 
financing  of  the common  agricultural  policy,  stipuites  that  Member  States 
are  to  take  the measures  necessary  to satisfy  themselves  that 
transactions  financed  by  the  European  Agricultural  Guidance  and  Guarantee 
Fund  are  actually  carried  out  and  are executed  correctly  and  to  prevent 
and  deal  with  irregularities  (Article  23 of  Council  Regulation  (EEC) No 
4253.88  stipulates  the  same  as  regards  the  EAGGF  Guidance  Section.) 
However,  the Commission  considers  it necessary,  particularly  in the 
context  of  the  reform  of  the  common  agricultural  policy,  to propose  a 
common  framework  for  the  establishment  of  an  Integrated  administration 
and  control  system  In all  the Member  States  before  1 January  1993. 

This  system,  which  covers  all  the  compensatory  aid  provided  for  In the 
proposal  for  the  reform  of  the  common  agricultural  policy,  Includes  in 
particular  the creation  of  a computerized  data  base  listing  holdings, 
with  the eligible  parcels  and  animals on  each. This  requires  a  numerical 
Identification  system  for  parcels  and  animals.  Provision  is made  for 
annual  statements  for  the  purpose of  checking  the  producers,  parcels  and 
animals  concerned.  These  statements  are  supplemented  by more  specific  aid 
applications  required  for  the grant  of  the  aid. All  these  elements  should 
make  it possible  to develop  a harmonized  system  of  control  of  all  the 
measures  included  in the  system. 

The  Implementation  of  an  integrated  administration  and  control  system  for 
the  aid  may  represent  a high  additional  budgetary  burden  for  the  Member 
States.  Consequently, provision  should  be made  for  community 
part-financing. The  percentages  given  in the  draft  Regulation  are 
calculated  on  the basis of  an overall  amount  of  ECU  100 million  taken 
Into account  the number  of  farms  (50%),  livestock  numbers  (25%) and  the 
agricultural  area  (25%)* 

Although  the 

Commission  considers  that  the Community  contribution  should  be  at  least 
of  the order  of  ECU  100 million,  compliance  with  budgetary  discipline 
means  that  this  cannot  be mentioned  in the  proposed  Regulation. 

3 

Proposal  for a 

Council Regulation  (EEC) N° 

/91 

of 
establishing  an integrated  administration  and control sytem 
for certain Community  aid  schemes 

THE COUNCIL OF THE EUROPEAN  COMMUNITIES 

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

Having  regard to the proposal  from the Commission (1), 

Having  regard  to the opinion of the European Parliament (2), 

Whereas, pursuant to Article 8 of Council Regulation  (EEC) No 729/70 of 
21 April  1970 on the  financing of the common agricultural policy  (3), as 
last amended  by Regulation  (EEC) No 2048/88  (4), Member  States must take 
the measures  necessary  to satisfy themselves that transactions  financed 
by the European Agricultural Guidance and Guarantee Fund  (EAGGF) are 
actually  carried  out and are executed  correctly, and prevent  and deal 
with  irregularities; whereas Article 23 of Council Regulation  (EEC) 
No 4253/88 of  19th December  1988 laying down provisions  for  implementing 
Regulation  (EEC) No 2052/88 as regards coordination of the activities of 
the different  structural  Funds between themselves and with the operations 
of the European  Investment  Bank and the other existing  financial 
instruments  (5) provides  for the same obligation with regard to the 
agricultural  structures policy; 

Whereas up to now the various aid  schemes have been administered  and 
controlled  by the Member  States under separate rules  for each scheme, as 
a  result of their heterogeneous  structure; whereas, however, in 
realigning  the existing market measures  a part of the reform of the 
common agricultural  policy, the Community  is opting, to a large extent, 
in both the crop and  livestock  sectors, for direct aid to producers; 

Whereas,  in order to adapt the administration  and control mechanisms to 
the new  situation  and  improve their effectiveness and usefulness, it is 
necessary  to set up a new integrated  administration  and control  system 
covering  the aid  schemes  for arable crops, beef  and veal,  sheepmeat, 
goatmeat and milk  and milk products, as well as specific measurees  for 
farming  in mountain, hill and certain  less-favoured  areas; whereas 
provision  should be made  for the possibility of  including, at a later 
date, other  aid  schemes  linked to cultivated  area; 

1 OJ No L 
2 OJ No L 
3 OJ No L 94, 28.4.1970, p. 13. 
4 OJ No L  185, 15.7.1988, p. 1. 
5 OJ No L 374, 31.12.1988, p. 1 

Whereas, the various components of the integrated system will potentially 
result in more effective administration and control in the case of 
Community schemes not covered by this Regulation; whereas the Member 
States should therefore be authorized to avail themselves of the system 
on condition they do not in any way act in opposition to the provision 
concerned; 

Whereas, given the complexity of such a system and the large number of 
aid applications to be processed, it is essential to use the appropriate 
technical resources and administration and control methods; whereas as a 
result, the integrated system should comprise, in each Member State, a 
computerized data base, a numerical identification system for 
agricultural parcels, annual statements by farmers, a harmonized control 
system and, in the livestock sector, a system for the identification and 
recording of animals; 

Whereas the administration of the data collected and their use for the 
verification of aid applications make it necessary to set up high-
performance computerized data bases allowing cross-checks in particular 
to be made; 

Whereas the identification of agricultural parcels is a key element in 
the correct application of schemes linked to surface area; whereas 
experience has shown that the existing methods have certain deficiencies; 
whereas, therefore, provision should be made for a numerical 
identification system set up initially, where necessary, with the aid of 
remote sensing; 

Whereas, in order to establish a general control programme for the entire 
calendar year, 'it is essential for information relating to the location 
and foreseeable utilization of agricultural areas to be made available to 
the competent authorities as early in the year as possible; whereas, in 
view of the dates for the lodging of aid applications, this objective 
would not be achieved by using the applications alone; whereas, against 
this background, provision should be made for the introduction of an 
annual statement made by farmers providing the information necessary for 
this purpose; whereas provision should be made for the receipt of aid to 
be made conditional upon submission of an annual statement; 

Whereas, in the livestock sector, effective control requires that animals 
be identified and recorded; whereas, to this end, Council Regulation 
(EEC) NO ..../91 on the identification and recording of animals lays down 
specific provisions in this respect; whereas recourse should therefore be 
had to that Regulation; 

vT 

Whereas the rules governing aid applications continue to be subject to 
the provisions of each sector; whereas, however, for the sake of 
simplification, Member States should be authorized to make provision for 
the submission of one single application for several aid schemes; 

Whereas one of the main advantages of the new system is the introduction 
of a harmonized control system in each Member State avoiding any 
duplication of sectoral checks of the same type; whereas, as a result, 
the total number of checks can be reduced considerably; whereas aid 
applications submitted must be subjected to a thorough administrative 
check carried out with the aid of computerized data bases; whereas, up to 
now, administrative checks have been supplemented systematically by 
checks on the spot; whereas, to a large extent, on-the-spot checks on 
areas may be replaced by remote sensing; 

Whereas the expenditure involved in introducing the integrated system may 
represent a high additional budgetary burden for Member States; whereas, 
consequently, provision should be made for part-financing for a certain 
period; whereas the diversity of existing production structures in the 
Member States must be taken into account; whereas, as a result, provision 
should be made for sharing out the financial contribution in a way which 
takes into account in particular the number of agricultural holdings, 
livestock numbers and the agricultural area in the Member States, 

HAS ADOPTED THIS REGULATION : 

Article 1 

Each Member State shall set up before 1 January 1993 an 
integrated administration and control system applying to : 

(a) in the crop sector : 

the aid scheme for certain large-scale crop 
producers established by Regulation (EEC) 
NO.../91 and 

(b) in the livestock sector : 

/91 

the special premium for beef producers and the 
premium for maintaining suckler cows introduced 
by Regulation  (EEC) NO 805/68, 
the dairy-cow premium introduced by regulation 
(EEC) NO 
the premium for sheepmeat producers introduced 
by Regulation  (EEC) NO 3013/91, 
the specific measures for farming in mountain, 
hill and certain less-favoured areas introduced 
by Regulation  (EEC) NO 2328/91 concerning 
compensatory allowances for cattle, sheep, goats 
and equidae, hereinafter called "Community 
schemes". 

c 

2.  The Commission may, in accordance with the procedure laid down in 
Article 13 of Regulation  (EEC) NO 729/70, provide that the integrated 
system shall apply to other aid schemes. 

3. For the purposes of applying Community aid schemes not covered by this 
Regulation and not with standing the specific provisions specified under 
such schemes, notably with regard to the terms under which aid may the 
granted, the Member States may incorporate in their administration and 
control mechanisms one or more of the administrative, technical or data-
processing components of the integrated system. 

Before availing themselves of this possibility, the Member States shall 
inform the Commission in good time of their intention. 

The Commission shall ensure that such action by the Member States does 
not prejudice compliance with the provisions of the sectoral Regulations 
or of this Regulation. 

The integrated system shall comprise the following elements : 

Article 2 

(a) 
(b) 

(c) 

(d) 
(e) 
(f) 

a computerized data base; 
a numerical identification system for agricultural 
parcels; 
a numerical system for the identification and recording 
of animals; 
an annual statement; 
the aid applications; 
a harmonized control system. 

Article 3 

The computerized data base shall record, within a time limit to 
be fixed and for each agricultural holding, the information 
given in the annual statement and the data obtained from aid 
applications submitted under a Community scheme.  This data base 
must in particular make it possible for the bodies responsible 
for checking to have real-time access to the data relating to at 
least three consecutive calendar years and three consecutive 
marketing years. 

The Commission may authorize Member States to set up 
decentralized data bases on condition that these, and the 
administrative procedures for the recording of and access to 
data, are designed homogeneously throughout the territory of the 
Member state and that they are compatible with one another. 

Article 4 

The numerical identification system for agricultural parcels shall be 
established on the basis of land register maps or other cartographic 
reference or aerial photographs or satellite pictures. 

\ 

Article 5 

The system  for the  identification and recording of animals  shall 
include : 

- 

identification by means of marking  of  animals eligible  for aid 
governed  by this Regulation  and 
the keeping  of a permanent  record by each  farmer, in which  the 
identification of each animal  is entered  and, where applicable, 
all other necessary  information. 

Subject to specific provisions, this system  shall be established  in 
accordance with Regulation  (EEC) N°  ..../91. 

Article 6 

1. 

In order to be eligible under  a Community  scheme governed by 
this Regulation, each  farmer  shall submit, for each  calendar 
year  and by a date to be  fixed, an annual  statement  indicating  : 

the utilized  agricultural  areas,  including areas under 
forage crops, broken down by agricultural parcel  and the 
use to which he plans to put them during the year; 

- 

the agricultural parcels covered by a set-aside measure 
for arable  land and those  laid  fallow; 

the number  and  species of animal  for which he intends to 
apply  for aid under a Community  scheme, and 

- 

where applicable, any other necessary  information. 

For each of the agricultural parcels declared,  farmers  shall 
indicate the area  in hectares  and  in acres and  its location by 
reference to the  identification number  allocated to  it in the 
numerical  system  for  identification of  agricultural parcels. 

Agricultural  parcels not  indicated  in the annual  statement  shall 
not be considered  for the grant of a financial benefit under a 
Community  scheme.  Statements may be corrected  before a date to 
be  fixed. 

Farmers applying  only  for aid under  a scheme not directly  linked 
to agricultural  area may be exempted  from the requirement  to 
submit  an annual  statement. 

2. 

3. 

4. 

Article 7 

In order  to be eligible under  a Community  scheme, each  farmer  shall 
present  an aid application  to the competent authority  by a date or during 
certain periods to be  laid down. 

-? 

Where aid applications must be accompanied by additional documents, the 
latter shall be considered to be part of the application. 

Member States may adopt provisions allowing a single application to cover 
several Community schemes. 

Article 8 

The harmonized system shall cover all aid applications submitted, in 
particular as regards administrative checks, on-the-spot checks and 
verification by aerial or satellite remote sensing. 

Article 9 

1. 

2. 

3. 

4. 

Member states shall carry out administrative checks to verify 
the accuracy and truthfulness of aid applications. 

Administrative checks shall be complemented by on-the-spot 
checks covering a sample of agricultural holdings.  For all 
these checks, Member States shall draw up a sampling plan on the 
basis of the annual statements. 

Each Member State shall designate an authority responsible for 
coordinating and monitoring the checks for each of the sectors 
concerned. 

National authorities may, under conditions to be laid down, use 
remote sensing to determine the area of agricultural parcels, 
identify crops and verify their status.  They may delegate part 
of this work to specialized agencies and/or firms on condition 
that they retain control over and responsibility for the work 
carried out. 

Member States shall take the necessary measures to ensure the protection 
of the data collected. 

Article 10 

Article 11 

The Community shall contribute to the expenditure incurred by 
Member States pursuant to this Regulation for the introduction 
of the computerized and checking structures and for the 
acquisition of aerial photographs or satellite pictures and 
analysis thereof.  Expenditure on the updating of land register 
maps and geographical maps shall not be part-financed by the 
Community. 

3 

2. 

The financial contribution shall be granted for a period of  \ 
three years from 1 January 1992 within the limits of the 
appropriations allocated for this purpose. 
The total amount shall be shared between the Member States as 
follows : 

Belgium 
Denmark 
Germany 
Greece 
Spain 
France 
Ireland 
Italy 
Luxembourg 
Netherlands 
Portugal 
United Kingdom 

2.3 % 
2.4 % 
10.1 % 
8.7 % 
18.1 % 
14.6 % 
4.5 % 
20.1 % 
0.6 % 
3.0 % 
5.7 % 
9.9 % 

The Community's financial contribution shall not be greater than 50 % of 
the payments made by the Member States concerned in respect of the budget 
year and relating to the eligible expenditure within the meaning of 
paragraph 1. 

Article 12 

Commission shall be informed at regular intervals of the 
progress of work on the implementation of the integrated system. 

Commission agents may carry out checks, in particular at the 
specialized agencies and firms referred to in Article 9(4), on 
all the measures taken to implement this Regulation and on the 
eligibility of the expenditure declared for Community part-
financing. 

Where necessary, the Commission shall take the measures needed 
to ensure that the integrated system is implemented in 
accordance with this regulation. 

Notwithstanding the responsibilities of the Member States for 
the proper implementation and application of the integrated 
system, the Commission may, in order to facilitate the 
establishment, monitoring and utilization of checks by remote 
sensing, in particular with a view to providing the competent 
authorities of the Member States with technical advice, seek the 
assistance of specialized bodies or persons. 

1 o 

Article 13 

1. 

The Commission shall adopt detailed rules for the application of 
this Regulation in accordance with the procedure laid down in 
Article 13 of Regulation  (EEC) N° 729/70.  These detailed rules 
shall cover in particular : 

(a) 

(b) 

(c) 

(d) 

(e) 

(f) 

(g) 

(h) 

(i) 

(j) 

(k) 

the necessary adjustments in the event that the scope of 
the integrated system is extended; 
the creation of computerized data bases, their updating, 
computerized checks and access to recorded data; 
the creation of the numerical identification system for 
agricultural parcels; 
the dates laid down for the lodging of the annual 
statement, for any amendments thereto and exemption from 
the requirement to submit an annual statement; 
the minimum amount of information to be included in the 
annual statements and aid applications; 
the administrative and on-the-spot checks and the checks 
by remote sensing; 
the definition of the terms farmer, agricultural 
holding, utilized agricultural area and agricultural 
parcel; 
the establishment of an advance payment scheme in the 
framework of Community part-financing; 
the protection of data collected and used in the 
integrated system; 
measures necessary to ensure the proper implementation 
of the integrated system; 
transitional provisions for the start-up period of the 
system. 

Article 14 

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

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

Done at Brussels, 

For the Council, 

FINANCIAL  STATEMENT 

A A 

DATE: 

1.  BUDGET HEADING: 

ARTICLE B1-360 

APPROPRIATIONS:  15 MIO ECU 

2.  TITLE:  PROPOSED  COUNCIL REGULATION  FOR ESTABLISHING AN INTEGRAL SYSTEM  FOR THE 

MANAGEMENT AND CONTROL RELATING TO CERTAIN AID SCHEMES. 

3.  LEGAL BASIS: 

ARTICLE 43 OF THE EEC TREATY. 

4.  AIMS OF PROJECT: 

FINANCIAL PARTICIPATION BY THE COMMUNITY IN THE EXPENSES  INCURRED IN CERTAIN TYPES 
OF CONTROL BY MEMBER  STATES WITHIN THE FRAMEWORK OF THE REFORM OF THE CAP. 
TECHNICAL SUPPORT PARTICULARILY  IN THE FRAMEWORK OF EFFECTING CONTROL BY TELEDETECTION 
BY THE MEMBER STATES AUTHORITIES BY-ORGANISATIONS OR PERSONS ACTING  FOR THE COMMISSIOII 

5.  FINANCIAL  IMPLICATIONS 

5.0  EXPENDITURE 

- CHARGED TO THE EEC BUDGET 
(REFUNDS/INTERVENTIONS) 
- NATIONAL  ADMINISTRATION 
- OTHER 

5.1  RECEIPTS 

- OWN RESSOURCES OF THE EEC 
(LEVIES/CUSTOMS DUTIES) 

-  NATIONAL 

5.0.1  ESTIMATED  EXPENDITURE 
5.1.1  ESTIMATED  RECEIPTS 

5.2  METHOD OF CALCULATION: 

PERIOD OF 
12 MONTHS 
Mio ECU 

CURRENT FINAN 
CIAL YEAR  (91) 
Mio ECU 

FOLLOWING FINAN 
CIAL YEAR (92) 
Mio ECU 

15 

1993 

5© 

1994 
So 

1995 

1996 

THE MAXIMUM AMOUNT AUTHORISED BY THE EAGGF GUARANTEE  FUND , DIVIDED BETWEEN THE DIFFERJEN 
PHASES OF INTRODUCTION OF THE SYSTEM. 

6.0  CAN THE PROJECT BE FINANCED FROM APPROBIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE 

CURRENT BUDGET? 

6.1  CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT 

BUDGET? 

6.2  IS A SUPPLEMENTARY BUDGET NECESSARY? 

6.3  WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? 

OBSERVATIONS: 

(1) ESTIMATED EXPENDITURE  : 5 EXPERTS AT 100 000 ECU X 3 YEARS = 1.5 MIO ECU 
THIS EXPENDITURE IS INCLUDED IN POINTS 5.0 AND 5.0.1. BELOW. 

(2) THIS EXPENDITURE  IS COVERED BY THE CREDITS WRITTEN IN CHAPTERS 30 TO 40. 

YES/Mb 

YES>N> 

IHJVNO 

YES JÊËË 

4-e, 

ISSN 0254-1475 

COM(91) 533 final 

DOCUMENTS 

EN 

03 

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ISBN 92-77-78773-2 

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