Proposal for a COUNCIL REGULATION (EC) establishing the possibility of national aid being granted in compensation for losses of agricultural income caused by monetary movements in other Member States
Date: 1995-07-12
Institutions: European Commission
Subjects: State aid, agri-monetary policy, common agricultural policy, farm income, financial loss

COMMISSION  OF THE EUROPEAN  COMMUNITIES 

.  -'•*'.'.is: 

Brussels,  12.07.1995 
COM(95) 343  final 

95/0197  (CNS) 

Proposal  for a 

COUNCIL REGULATION (EC) 

establishing the possibility of national aid being granted in compensation for losses of 
agricultural  income caused by monetary movements  in other. Member States 

(presented by the Commission) 

EXPLANATORY  MEMORANDUM 

Currency  movements  directly  affect  the common  agricultural  policy and affect  many  products 
via  the  agrimonetary  system  provided  for  by  Council  Regulation  (EEC)  No  3813/92  (OJ  No 
L  387,  31.12.1992,  p.  1),  as  last  amended  by  Regulation  (EC)  No  150/95  (OJ  No  L  22, 
31.01.1995,  p.  1). 

The  agrimonetary  system provides  for  the  possibility of granting  compensatory  aid  for  losses 
of  income  caused  by  falls  in  the  agricultural  conversion  rate  following  a  revaluation. 
However,  other  losses  of  income  caused  by  currency  movements  may  occur. 

At  its  meeting  of  19  to  22  June  1995,  the  Council  adopted  the  policy  guideline  that  the 
granting  of  national  aid  should  also  be  allowed  to  compensate  for  losses  of  income  caused 
by  currency  movements  in  other  Member  States. 

That  aid  must  be justified  on  the  basis of  facts  and  may  not  be  granted  in  a way  that  favours 
production  within  one  sector.  It  must  be  reduced  progressively  over  a  maximum  period  of 
three  years  and  be  authorized  by  the  Commission  under  the  procedural  rules  of  Article  93  of 
the  Treaty. 

The  measures  to  be  taken  concern  the  Community  as  a  whole  since  they  have  the  general 
objective  of  achieving  coherent  application  of  the  common  agricultural  policy. 

Proposal  for 

COUNCIL  REGULATION  (EC)  No 

of 

establishing the possibility  of  national  aid  being  granted  in  compensation  for  losses  of 
agricultural  income  caused  by  monetary  movements  in other  Member  States 

THE  COUNCIL  OF THE  EUROPEAN  UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 

Articles  42  and 43  thereof, 

Having  regard  to  the  Commission  proposal  , 

Having  regard  to  the  opinion  of  the  European  Parliament2, 

Whereas  monetary  movements  have  influenced  the agricultural  market  particularly  in the  first 

half  of  1995; whereas  certain  producers  may  have  suffered  from  losses  of  income  caused  by 

significant  monetary  movements  in Member  States  other  than  the  one  in which  they  produce; 

Whereas,  where  such  losses  of  income  are  objectively  established,  temporary  national  aid 

which  does  not  favour  a particular  type  of  production  may  be  granted  to  compensate  for  the 

loss  actually  established;  whereas  it  is  necessary  for  the  Community  to  take  measures  to 

enable  the  common  agricultural  policy  to  be  coherently  implemented; 

Whereas  these exceptional  measures are justified  solely on the basis of the  specific  objectives, 

circumstances  and  features  of  the  common  agricultural  policy; 

3 

HAS  ADOPTED  THIS  REGULATION: 

Article 

Where  it can  be justified  on the  basis  of  facts  that  agricultural  producers  of given  production 

sectors have  suffered  considerable  losses of revenue  in a Member  State  because  of  significant 

monetary  movements  which  have occurred  in other  Member  States  since the  beginning  of  the 

1994/95  marketing  year  and  no  later  than  31  December  1995,  flat-rate  compensatory  aid, 

reducing  over  three  years,  may  be  granted  to  the  producers  in  question  on  the  basis  of 

national  financing. 

The  compensatory  aid  shall  at  the  most  be  equal  to  the  aforementioned  loss  of  income  and 

may  not  be  granted  in  the  form  of  an  amount  linked  to  production  other  than  that  of  a  fixed 

period  corresponding  to  that  in  which  the  income  was  lost.  It  may  not  be  so  directed  as  to 

favour  a particular  type  of production  in the sector  concerned  nor  be dependent  on  production 

subsequent  to  that  fixed  period. 

Member  States  shall  determine  the  amounts  and  detailed  rules  of  this  aid  and  notify  them  to 

the  Commission  for  approval.  The  procedural  provisions  of  Article  93  of  the  Treaty  shall 

apply  without  taking  account  of  the  criteria  in  Article  92. 

Article  2 

This  Regulation  shall  enter  into  force  on  the  seventh  day  following  its  publication  in the 

Official  Journal of the European Communities. 

A Member State may not notify  an aid project under this Regulation after  30 June 1996. 

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

Done at Brussels, 

For the Council 

FINANCIAL  STATEMENT 

BUDGET  HEADING:  -

APPROPRIATIONS: 

TITLE: 
Proposal  for  a  Council  Regulation  (EC)  No 
granted  in  compensation  for  losses  of  agricultural  incqmc  caused  by  currency  movements  in  other  Member  States. 

establishing  the  possibility  of  national  aid  being 

/95 of 

3. 

4. 

LEGAL  BASIS: 
Articles  42  and  43  of  the  Treaty. 

AIMS: 
To  give  Member  States  the  right  to  grant  national  aid  compensating  for  losses  of  income  caused  by  currency 
movements  in  other  Member  States. 

5. 

FINANCIAL  IMPLICATIONS: 

5.0. 

EXPENDITURE 
-  CHARGED  TO  THE  EC  BUDGET 

(REFUNDS/INTERVENTION) 

-  NATIONAL  AUTHORITIES 

OTHER 

5.1. 

REVENUE 

OWN  RESOURCES  OF  THE  EC 
(LEVIES/CUSTOMS  DUTIES) 
NATIONAL 

5.0.1. 
5.1.1. 

ESTIMATED  EXPENDITURE 
ESTIMATED  REVENUE 

5.2. 

METHOD  OF  CALCULATION: 

PERIOD  OF  12 
MONTHS 

CURRENT 
FINANCIAL 
YEAR 
(95) 

FOLLOWING 
FINANCIAL 
YEAR 
(96) 

1997 

1998 

1999 

2000 

6.0. 

6.1. 

6.: 

6.3. 

CAN  THE  PROJECT  BE  FINANCED  FROM  APPROPRIATIONS  ENTERED  IN  THE  RELEVANT 
CHAPTER  OF  THE  CURRENT  BUDGET? 

CAN  THE  PROJECT  BE  FINANCED  BY  TRANSFER  BETWEEN  CHAPTERS  OF  THE  CURRENT 
BUDGET? 

WILL  A  SUPPLEMENTARY  BUDGET  BE  NECESSARY? 

WILL  FUTURE  BUDGET  APPROPRIATIONS  BE  NECESSARY? 

YES/NO 

YES/NO 

YES/NO 

¥£S/NO 

OBSERVATIONS 

The  costs  of  this  measure  can  be  calculated  when  the  Member  State  concerned  submits  the  amount  of  the 
aid  to  the  Commission  for  approval. 

ISSN 0254-1475 

COM(95) 343  final 

DOCUMENTS 

EN 

02  03  12 

Catalogue number  :  CB-CO-95-402-EN-C 

ISBN 92-77-92189-7 

Office for Official Publications of the European Communities 

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