Proposal for a Council Regulation (EC) on the common organization of the market in processed fruit and vegetables
Date: 1995-11-10
Institutions: European Commission
Subjects: common organisation of markets, fruit product, producer organisation, producer price, production aid, vegetable product

COMMISSION  OF  THE  EUROPEAN  COMMUNITIES 

Brussels,  04.10.1995 
COM(95) 434  final 

95/0247  (CNS) 
95/0248  (CNS) 

Proposal  for a 
COUNCIL REGULATION  ŒO 
on the common  organization  of the market in fruit and vegetables 

Proposal  for a 
COUNCIL REGULATION  (EC) 
on the common  organization  of  the market in processed fruit and vegetables 

(presented  by the  Commission) 

EXPLANATORY  MEMORANDUM 

In  July  1994  the  Commission  sent  the  Council  and  Parliament  a  communication  on 
the  development  and  future  of  Community  policy  in  the  fruit  and  vegetable  sector 
(COM(94)  360  final  of  27  July  1994). 

In this communication,  the Commission  analysed  the current  situation for  both fresh  and 
processed  fruit  and  vegetables  and  likely  trends  as  regarded  both  the  world  and 
Community  markets.  The  Commission  drew the  lessons  from  30 years  of  operating  the 
common market organization  and announced  its intentions as regards the reforms  needed 
to consolidate the positive aspects of the existing organization,  simplify  it and correct the 
perceived  weaknesses. 

This  communication  was  lengthily  and  thoroughly  discussed  in  the  Council,  Parliament 
and  the Economic  and  Social  Committee  and with  all  the  relevant  trade  organizations. 

The  Commission  is  now  forwarding  to  the  Council  two  proposals  for  Regulations.  The 
first  covers  fresh  products.  Essentially,  -it  puts  into  practice,  in  legal  terms,  the 
communication  of July  1994  and  its implications,  and  consolidates  in  one text  the large-
number  of  legislative  amendments  which  have  been  made  to  the  market  organization 
since  its  adoption  in  1972.  The  second  covers  processed  products  and  the  only  major 
change  it  contains  is  a  new  aid  system  for  tomato  processing.  In  both  cases  the  new 
arrangements  for  non-member  countries  established  by  the  Council  at  the  end  of  1994 
following  the Uruguay  Round  of  multilateral  negotiations  are almost  identical. 

I.  The new common  organization  of the market  in fresh  fruit  and vegetables  comprises 

seven  Titles  and  covers the  same  products  as at present  (Article  1). 

As regards the classification  of products listed  in Title I, the principle  of  compulsory 
standards  applicable  to  Community  or  imported  fruit  and  vegetables  is  included  as 
provided  for  in the  communication  of  July  1994,  and  has  not  been  contested  by  the 
operators  concerned.  In  order  to  cover  certain  special  circumstances,  provision  has 
been  made for  more wide-ranging  exceptions than  were included  in the previous text 
(traditional  local  consumption).  As a result, the only major  change is the fact  that the 
Community  will  adopt  the  standards  established  in  the  United  Nations  Economic 
Commission  for  Europe.  Standards  are  not  only  to  be  found 
in  Community 
legislation.  They  are  laid  down  by  international  bodies  in  which,  inter  alia,  all  the 
countries of geographical  Europe are represented, the objective being for  international 
trade in this sector to speak the same language. Since there are no differences,  or only 
differences  of  detail,  between  Community  standards,  so  called  because  they  are 
included in extenso in Community Regulations, and UN standards, it has been  decided 
to  adopt  the  latter  wholesale,  with  a legal  basis to  derogate  from  them  if  necessary. 

The  first  five  Articles  of  Title  II  on  producer  organizations  list  the  various  legal 
persons covered by the Regulation,  and lay down the requirements they  must meet  to 
be  eligible. 

Firstly  (Articles  11  and  12),  it  sets  out  a  more  powerful  model  for  producer 
organizations which will  be able to give the produce a sufficient  force on the market, 
as a result of the concentration of supply. The fruit and vegetables sector encompasses 
a wide range of highly perishable products, has a large proportion of small  producers 
and an output which varies depending on weather conditions. In these circumstances, 
beefing  up the producer organizations  should  make it possible,  through the training 
of  members,  reorganization  and production  rules, to  improve the quality  of  produce 
in line with consumers' expectations, to stabilize markets and to supply  consumers at 
reasonable prices.  In order to prevent organizations in name only which  do no more 
than make withdrawals, and to create collective structures which have an overview of 
all  their  members'  produce,  and  which  can  therefore  conduct  a  genuine  marketing 
policy, producers are required to be a member of one single organization and channel 
all  their  produce to  it,  without  prejudice to  certain  facilities  to  accommodate  well-
founded  needs or practices. 

Secondly,  account  is  taken  of  the  special  situation  of  those  organizations  already 
recognized  under  Regulation  (EEC)  No  1035/72  (Article  13)  and,  conversely, 
completely new organizations (Article  14), by the introduction of transitional  periods 
and ad-hoc funding  in both cases. 

In line with the communication of July  1994, the new feature of this Title (Articles  15 
and 16) is the creation of operational  funds financed  partly by producer contributions 
and partly by public (national  and Community) funds,  on the principle of one public 
ecu  for  every  private  ecu.  Although  these  funds  may  be  used  to  supplement 
Community intervention to a limited extent, decreasing over a transitional period, this 
is  on condition  that a sound  structural  programme  is  proposed  and  implemented  by 
the organization concerned.  There is a general  description  of what such programmes 
must contain. 

In  order  to  encourage  organizations, from  different  Member  States  or  interbranch 
organizations to implement all or part of an operational pro^amme, provision is made 
in  these  cases  for  the  public  contribution  to  the  actual  expenditure  incurred  to  be 
increased from 50% to 60%, not including withdrawal  operations. 

Furthermore, the Community's financial  contribution  increases in relation to national 
funding  in the case of  programmes implemented  in Objective  1 regions.  Finally,  as 
an  exception  to  the  rule,  the  operational  fund  may  be  used  by  those  producer 
organizations already recognized to invest and upgrade in order to obtain recognition 
under this Regulation. 

The  communication  of  July  1994  emphasized  that,  in  addition  to  the  general  aid 
mechanisms  implemented  as  mentioned  above,  provision  should  be  made  for  the 
possibility  of taking  small-scale  specific  measures,  in order to respond to  difficulties 
being experienced by one particular product or in one particular geographical  location 
in the Community.  The Commission  lays down the corresponding legal  basis for this 
in Article  17. 

Article  18 authorizes the extension  of the rules of producer organizations and Title III 
authorizes the recognition  by the Member  States of  interbranch  organizations and  the 
extension  of  their  rules.  Article  18  is  not  substantially  different  from  present 
provisions,  and  the  interbranch  organization  provisions  are  based  mainly  on  similar 
arrangements  in  the  common  organization  of the  market  in  wine  and  wine products. 
The  communication  states: 

"As in the case of the wine sector  reform  the Commission  holds the view, in line 
with  its  Communication  on  inter-branch  organizations  in  1990,  that  a  light 
Community framework for inter-branch arrangements in the fruit and vegetables 
sector  should  be offered  to  Member  States  so  wishing." 

This  is therefore  a new  feature  compared  with  the  present  COM. 

Title IV covers intervention  in general  and, more particularly, withdrawals for  which 
direct Community  financial  intervention  exists. Compared  with the present COM, the 
general  philosophy  remains  unchanged:  in  the  fresh  fruit  and  vegetable  sector, 
producers'  incomes  are  protected,  i.e.  market  prices  are  supported,  by  means  of 
quantitative  control  of  supply,  this  control  being  effected  by  the  producer 
organizations,  who  are  responsible  for  making  withdrawals.  The  communication  of 
1994  continues: 

"Short-term surpluses are an inherent feature of fruit and vegetable production. 
The  producer  organizations  should  be  free  to  decide  which  products  and 
quantities should be withdrawn as and when they see fit  For products at present 
eligible for Community support on withdrawal  (withdrawal  price), the producer 
would  receive compensation  in the form  of a Community withdrawal  indemnity 
set at a clearly unprofitable  level, Le. well  below the present withdrawal  price in 
most  cases." 

Accordingly,  the proposal  introduces the following  changes to the present  COM: 

The  concept  of  a  "withdrawal  price",  i.e.  the  market  price  below  which  the 
products  are  not  offered  for  sale,  formally  disappears:  withdrawals  are  decided 
on by the producer  organizations  "both  in quantities  and for  periods which they 
consider  appropriate"  (Article  22 (1)); 

The  list  of  products  for  withdrawals  of  which  the  Community  intervenes 
financially  by  granting  a  "Community  withdrawal  compensation"  remains 
unchanged  (Article 22 (3)  and Annex  H). However,  there is no longer  any  limit 
on  the time  for  which  that  compensation  may  be  granted; 

A quantitative limitation  is introduced for  each product  and PO, for  withdrawals 
eligible for Community withdrawal  compensation:  10% of the quantity  marketed 
under the normal  system  and, successively,  50%, 40%, 30% and 20% during the 
transitional period (special percentages for citrus fruit:  30%, 25%, 20% and 15%) 
(Article  22  (3)  and  (4)); 

Abolition  of the  "serious crisis" arrangements  (direct  Community  intervention  in 
favour  of all  producers whether members of an organization  or not), replaced by 
the  possibility  for  individual  producers  to  make  withdrawals through  a PO,  for 
which  they  receive  reduced  Community  compensation; 

The  Community  withdrawal  compensation  is  much  lower  than  the  present 
withdrawal  price  (Article  25); 

Abolition  of the intervention thresholds but maintenance of a legal basis making 
it  possible  for  them  to  be  reintroduced  (Article  26). 

Title  V concerns trade with  third  countries and  only  contains  one addition  compared 
with Regulation  (EEC) No 3290/94. For certain products entering the Community  for 
processing  accompanied  by  an invoice, Article  31(2) now  includes a further  possible 
procedure for  verifying  the  entry  price  in addition  to the  determination  of  a  flat-rate 
value  at  import. 

Title VI details the Member  States' obligations regarding  controls and  sets up a body 
of  Community  inspectors  for  the  markets  in  fruit  and  vegetables  with  the  task 
of  ensuring  that  the  market  rules  are  complied  with.  The  financial  statement 
concerning  this  vital  part  of  the  draft  Regulation  provides  for  three  posts  in  the 
Directorate-General  for  Agriculture  in  order  to  guarantee  a  sustained  and  efficient 
application of these controls. However, even with this new assignment of officials,  the 
controls can only  be effective  if the Commission  can,  on an ad hoc basis, call  on the 
services  of  national  officials  who  have received  relevant  training,  which  is  provided 
for  in  Article  39. 

Title  VII  contains  the  usual  final  provisions,  which  require  no  comment  except 
perhaps  for  Articles  48  and  49.  With  a  view  to  maintaining  discipline  and  equal 
treatment, they require the Member  States to take all the national  measures needed  to 
implement the new Regulation  and to notify  these to the Commission, as well  as any 
subsequent  amendments. 

II.  The  proposal  for  reforming  the  common  market  organization  in  processed  fruit  and 
following 

the  present  arrangements  and  makes 

the 

vegetables  consolidates 
adjustments. 

Formal  changes 

1.  Transfer  into  the  basic  Regulation  of  almost  all  the  provisions  contained  in  the 
present  Council  Regulations  setting  out  "general  implementing  rules".  These 
regulations  are  repealed. 

2.  Removal  from  the  text  of  provisions  now  void,  particularly  in  the  dried  grapes 
sector  (ending  of  the  transitional  period  for  applying  the  scheme  introduced  in. 
1990). 

3.  With  a view  to  simplification,  transfer  to  the  Commission  of  authority  to  fix 
"additional  sugar" levels for processed products when there is a shortage of sugar 
(Article 20). 

Substantive  changes 

1.  Processing aid to be restricted to processors entering into contracts with producer 
organizations,  with  a  requirement  to  sign  contracts  before  the  start  of  the 
marketing year (Article 2). The aim is to align the processed fruit and vegetable 
sector on the principle  of  "delivery  of  all  produce" applying  in the fresh sector 
and  to  ensure  that  processors  comply  with  the  minimum  price  to  be  paid  to 
producers. 

2.  With regard to processed tomatoes, introduction of a flexible quota system under 
which quantities allocated can change in line with actual performance (Article 6). 

3.  By analogy with the fresh fruit and vegetable sector, introduction of a legal basis 
for instituting special schemes - Article 10 (products significant locally which are 
faced with international  competition and for which the general  arrangements are 
insufficient). 

' 

4.  With regard to dried rapes and dried  figs,  alteration  of  the terms for  buying-in 

by  storage agencies  (Article 9(2)). 

It  is  also  worth  mentioning  the  features  of  the  common  market  organization 
which are not changed by this proposed Regulation. 

1.  The principle of minimum prices to be paid to producers (by processors, in 
order to  be  eligible  for  Community  aid)  -  Article  3.  The  minimum  price 
level  determines  the  income  of  producers  of  all  products  eligible  for 
processing  aid  except  citrus fruit (peaches,  pears» tomatoes,  plums,  figs). 
This is not supplementary income, as is the case with the compensation paid 
for market withdrawals,  but basic income from selling in the marketplace. 
Producers  of  products  for  processing  draw their  main  earnings  from  their 
sales to the industry. 

Given  this circumstance,  it  seems right to  keep the  same  criteria as in the 
past for fixing the minimum price to producers (the system is unchanged for 
citrus  fruit,  which  in  effect  means  a  reduction  in  minimum  prices  to 
producers  in  order  to  align  on  Community  compensation  for  market 
withdrawals. 

2.  The  aid  scheme  for  growing  (i.e.  per-hectare  payments)  and storing  dried 

grapes (Articles  7 and 9). 

3.  The production  threshold for processed  peaches  and pears (Article 5). 

III. 

At the time of the last farm price review, the aid scheme for processing of citrus 
fruit was  amended  to  introduce  the  possibility  of  paying  the  Community  aid 
directly to producers. The Commission would like to reserve the right to propose 
further changes,  but prefers to watch the impact of  the recent  amendment  for a 
time before  deciding  what new proposals may  be necessary  in this sector. 

Proposal  for a 
COUNCIL  REGULATION  (EC) 
on the common  organization  of  the market  in fruit  and vegetables 

95/0247  (CNS) 

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 proposal from the Commission, 

Having  regard to the opinion  of the European Parliament, 

Having  regard to the opinion  of the Economic  and  Social  Committee, 

Whereas at the present time various changes are placing the fruit and vegetable sector in 
a new situation to which producers must adjust; whereas, accordingly,  a reorientation  of 
the basic  rules of  the market organization for the  sector is  warranted; whereas,  in  view 
of the numerous amendments made to Regulation  (EEC) No  1035/72 of the Council  of 
18 May  1972 on the common organization of the market! in fruit and vegetables(1), a new 
regulation  should,  for reasons of  clarity,  be adopted; 

Whereas  it  is  desirable  to  insert  in that  new regulation  the  main  provisions  of  Council 
Regulation  (EEC) No  3285/83  of  14 November  1983  laying  down general  rules for the 
extension  of  certain rules issued by  producers' organizations  in the fruit  and vegetables 
sector*2*, of Council Regulation (EEC) No  1319/85 of 23 May  1985 on the reinforcement 
of supervision of the application of Community rules on fruit and vegetables(3), of Council 
Regulation (EEC) No 2240/88  of  19 July  1988 fixing, for peaches, lemons and oranges, 
the  rules  for  applying  Article  16b  of  Regulation  (EEC)  No  1035/72  on  the  common 
organization  of  the  market  in  fruit  and  vegetables(4),  of  Council  Regulation  (EEC) 
No  1121/89 of 27 April  1989 on the introduction of an intervention threshold for apples 
and  cauliflowers(5),  and  of  Council  Regulation  (EEC)  No  1198/90  of  7  May  1990 
establishing  a  Community  register  of  citrus  cultivation(6);  whereas  these  Regulations 
should therefore  be repealed; 

(1)  OJ  No  L  118,  20.5.1972,  p.  1,  as  last  amended  by  Commission  Regulation  (EC) 

No  1363/95,  OJ No  L  132,  16.6.1995,  p. 8. 

(2)  OJ No  L  325,  22.11.1983,  p.  8,  as  last  amended  by  Regulation  (EEC)  No  220/92, 

OJ No L 24,  1.2.1992,  p.  1. 

(3)  OJ  No  L  137,  27.5.1985,  p.  39,  as  amended  by  Regulation  (EEC)  No  404/93, 

OJNoL47,  25.2.1993,  p.  1. 

(4)  OJ No  L  198,  26.7.1988,  p.  9,  as  last  amended  by  Regulation  (EC)  No  1327/95, 

OJ  N oL  128,  13.6.1995,  p.  8. 

(5)  OJ No L  118,  29.4.1989,  p. 21, as last  amended by  Regulation  (EC) No  1327/95. 
(6)  OJ No  L  119,  11.5.1990,  p.  59. 

8 

Whereas  classification  using  common  obligatory  standards  of  fruit  and vegetables  both 
marketed  within  the  Community  and  exported  to  third  countries  provides  a  reference 
framework  that  encourages  fair  trading  and  market  transparency  and  also  eliminates 
products  of  unsatisfactory  quality  from  the  market;  whereas  compliance  with  these 
standards thus also helps to improve the profitability  of production; 

Whereas  it  would  be  desirable,  for  reasons  of  simplicity,  to  adopt  as  the  standards 
applicable  under  the  Community's  market  organization  those  adopted  by  the 
United Nations Economic Commission for Europe in respect of products covered by that 
organization;  whereas  it  is  necessary  to  set  the  terms  on  which  these  international 
standards can be adjusted to the  specific  requirements  of  the Community; 

Whereas  standardization  cannot  be  fully  effective  unless  it  is  applied  at  all  marketing 
stages  and  on  departure  from  the  production  region;  whereas  exemption  may, 
nevertheless,  be  provided  for  in  the  case  of  certain  operations  which  either  are  very 
marginal  and specific  or take place at the start of the distribution chain, or in the case of 
products intended for processing; whereas account should also be taken of the possibility 
of  shortages; whereas consumer  requirements  as regards the  characteristics  of fruit and 
vegetables mean that the origin of products should be included in the labelling up to and 
including the final retail  stage; 

Whereas the production  and marketing  of fruit and vegetables  should take full  account 
of  environmental  concerns,  including  cultivation  practices,  the  management  of  waste 
materials  and  the  destruction  of  products  withdrawn  from  the  market,  in  particular  as 
regards the protection  of water quality,  the maintenance  of biodiversity  and the upkeep 
of the countryside; 

Whereas  producer  organizations  are the basic  elements  in  the  market  organization,  the 
decentralized  operation of which  they  ensure at their level;  whereas,  in the face  of ever 
greater concentration  of  demand,  the grouping  of  supply  through these  organizations  is 
more than ever an economic necessity  in order to strengthen the position of producers in 
the market; whereas such grouping must be effected  on a voluntary basis and must prove 
its utility  by  the scope  and efficiency  of  the  services offered  by  producer  organizations 
to their members; 

Whereas a producer  organization  cannot be  recognized  by  its  Member  State  as  able to 
contribute  to achievement  of  the  objectives  of  the  common  market organization unless 
its  articles  of  association  impose  certain  requirements  on  it  and  its  members;  whereas 
producer  groups wishing  to  acquire  the  status of  producer  organizations  in  accordance 
with this Regulation  should be allowed the benefit  of a transitional  period during which 
national  and Community  financial  support can be given  against certain commitments by 
the group; 

Whereas  a  transitional  period  should  be  allowed  to  producer  organizations  already 
recognized  under  Regulation  (EEC)  No  1035/72  which  cannot  immediately  meet  the 
requirements of this Regulation for recognition; whereas such organizations must be able 
to show themselves  able to make the necessary  changes; 

Whereas in order to give producer organizations greater responsibility  for their financial 
decisions  in  particular and to gear the  public resources  assigned  to them  towards future 
requirements, terms should be set for the use of these resources; whereas joint  financing 
of  operational  funds  set  up  by  producer  organizations  presents  itself  as  an appropriate 
solution; 

Whereas  the  establishment  and  proper  functioning  of  operational  funds  requires  that 
producer  organizations  should  take  charge  of  the  whole  of  the  fruit  and  vegetable 
production  of their members; 

Whereas, in order to further boost the impact of producer organizations and associations 
thereof and ensure the market as much stability  as is desirable, Member States should be 
allowed  on  certain  conditions  to  extend  to  non-member  producers  in  their  region  the 
rules, particularly on production, marketing and environmental protection, adopted for its 
members  by  the  organization  or  association  for  the  region  concerned;  whereas,  where 
proper justification  is given,  certain costs arising from  this extension  of the rules can be 
charged to the producers  concerned  since they will  benefit  from  the extension; 

Whereas  interbranch  organizations  set  up  on  the  initiative  of  individual  or  already 
grouped operators can, if they account for a significant proportion of the members of the 
various occupational  categories of the fruit and vegetable  sector,  contribute to behaviour 
taking  closer  account  of  market  realities  and facilitate  a commercial  approach that will 
improve  production  reporting,  that  is  to  say  the  organization  of  production,  product 
presentation  and  marketing;  whereas  since  the  work  of  these  organizations  is  able  to 
contribute  in  general  to  attaining  the  objectives  of  Article  39  of  the  Treaty  and  in 
particular to those of the market organization for fruit  and vegetables it should, once the 
relevant  forms  of  action  are  defined,  be  possible  to  grant  specific  recognition  to.those 
organizations which provide proof of a certain degree of representativeness and carry out 
practical  action  in  regard to the  abovementioned  objectives;  whereas  the  provisions  on 
extending  the  rules  adopted  by  producer  orgamzations  and  their  associations  and  on 
sharing  the  costs  resulting  from  such  extension  should,  given  the  similarity -of  the 
objectives pursued,  also apply  to interbranch organizations; 

Whereas to  stabilize  prices  it  is  desirable that producer  organizations  should  be able to 
intervene  on  the  market,  in  particular  by  deciding  not  to  put  up  for  sale  particular 
quantities at particular periods; whereas these withdrawal operations must not be regarded 
as an alternative outlet to the market itself; whereas Community financing of withdrawals 
should  therefore  be  restricted  to  a  set  percentage  of  production  and  the  Community 
compensation  granted  at  a  reduced  level,  though  use  of  the  operational  funds  for  this 
purpose should be permitted; whereas for simplicity Community compensation should be 
at a single flat  rate for each product; whereas, to achieve  a comparable reduction for all 
products,  certain differentiations  are required; 

Whereas  intervention  can  be  fully  effective  only  if  the  products  withdrawn  from  the 
market  are not  reintroduced  into the  normal  marketing  channel  again; whereas various 
alternative uses to which they  may be put should be specified  so that their destruction is 
avoided wherever possible; 

10 

Whereas this new way of managing withdrawals will  allow the provisions in force on the 
implications  of  threshold  overruns  to be  repealed  immediately;  whereas  it  is,  however, 
reasonable to retain the underlying principle of those  provisions for a transitional  period 
and to give  the Commission  authority  to take action  on the basis of that principle  if the 
need arises; 

Whereas by Regulation (EC) No  3290/94(7) the Council  has adopted the adjustments and 
transitional  arrangements  required  in  the  agricultural  sector  in  order  to  implement  the 
agreements  concluded  in  the  context  of  the  Uruguay  Round  of  multilateral  trade 
negotiations,  in particular the new trading arrangements with third countries  in the fruit 
and  vegetable  sector;  whereas  the  provisions  of  Regulation  (EEC)  No  1035/72,  as 
amended  by  Annex  XIII  to  Regulation  (EC)  No  3290/94  should  be  inserted  in  this 
Regulation;  whereas,  however,  where  products  are  imported  into  the  Community  for 
industrial processing, they are not sold on consignment; whereas verification  of the entry 
price can therefore  be made  on  other bases than a flat  rate value; whereas  the relevant 
provisions  should therefore  be  supplemented  in this regard; 

Whereas the rules of the  market organization  should  be  complied  with  by  all  operators 
to  whom  they  apply,  otherwise  their  impact  will  be  distorted  with  all  the  resulting 
consequences  in  terms  of  both  the  use  of  public  resources  and  the  interplay  of 
competition; whereas a special  corps of  Community inspectors  should be set up for this 
sector; whereas for both budget reasons and effectiveness  the corps should consist of both 
Commission  and national  officials; 

Whereas one  of the indispensable  elements  for the proper management  of  the common 
organization of the market is detailed knowledge of the market; whereas measures should 
therefore  be provided for to this end; 

Whereas the  granting  of  certain  aid would  compromise  the functioning  of  the internal; 
whereas,  therefore,  the provisions  of the Treaty  enabling  aid granted by  Member States 
to be  examined  and enabling  aid which is  incompatible  with  the common  market to be 
prohibited,  should be extended  to cover the fruit and vegetable  sector; 

Whereas the common organization of the market in fruit and vegetables must take proper 
and simultaneous account of the objectives  set out in Articles  39 and  110 of the Treaty; 

Whereas, to facilitate the implementation of the proposed measures, a procedure for close 
cooperation between the Member States and the Commission by means of a management 
committee  should be set up, 

(7)  OJ No  L 349,  31.12.1994,  p.  105. 

11 

HAS  ADOPTED  THIS REGULATION. 

Article 1 

1.  This Regulation sets up a common organization of the market in fruit and vegetables. 

2.  The organization  shall  cover the following  products: 

CN Code 

Description 

0705 

0704 

0706 

ex 0802 

0702  00 
0703 

0707  00 
0708 
ex  0709 

Tomatoes, fresh or chilled 
Onions,  shallots,  garlic,  leeks  and other alliaceous  vegetables, 
fresh  or chilled 
Cabbages,  cauliflowers,  kohlrabi,  kale  and  similar  edible 
brassicas,  fresh  or chilled 
Lettuce {Lactuca sativa) and chicory {Cichohum spp), fresh or 
chilled 
Carrots,  turnips,  salad  beetroot,  salsify,  celeriac,  radishes and 
similar edible roots, fresh  or chilled 
Cucumbers  and gherkins, fresh or chilled 
Leguminous vegetables,  shelled  or unshelled,  fresh  or chilled 
Other  vegetables,  fresh  or  chilled,  excluding  vegetables  of 
subheadings 0709 60 91, 0709 60 95, 0709 60 99, 0709 90  31, 
0709  90  39  and 0709  90  60 
Other  nuts,  fresh  or  dried,  whether  or  not  shelled  or  peeled, 
excluding areca (or betel) and cola nuts of subheading 0802 90 
30 
0803  00  11 
Fresh plantains 
ex  0803  00  90  Dried  plantains 
0804  2010 
0804  30 00 
0804  40 
0804  50 00 
0805 
0806  10 21 
0806  10 29 
0806  10 30 
0806  10 40 
0806  10 50 
0806  10 61 
0806  10 69 
0807 
0808 
0809 

Figs, fresh 
Pineapples 
Avocados 
Guavas,  mangos and mangosteens 
Citrus fruit,  fresh  or dried 
Fresh table grapes 

Melons (including watermelons) and pawpaws (papayas), fresh 
Apples,  pears and quinces,  fresh 
Apricots,  cherries,  peaches  (including  nectarines),  plums  and 
sloes,  fresh 
Other fruit,  fresh 
Mixtures exclusively  of dried nuts of CN codes 0801  and 0802 

. 

0810 
0813  50 31 
0813  50 39 
1212  10  10 

Carobs 

12 

The marketing years  for  the products listed  in paragraph  2 shall be determined  in 
accordance  with  the  procedure  laid  down  in  Article 45. 

Title  I 

Classification  of  products 

Article  2 

1. 

2. 

Products to be  delivered  fresh  to the consumer  may  be  classified  by  reference  to 
a  set  of  standards. 

The  UN/ECE  standards  for  fresh  fruit  and  vegetables  recommended  by  the 
Economic  Commission  for  Europe's  Working  Party  on  Perishable  Product 
Standardization  and Quality Improvement that exist on the date of entry into force 
of  this  Regulation  shall  be  adopted  in  accordance  with  the  procedure  laid  down 
in  Article  45  for  the  purpose  of  implementing  the  market  organization  in  the 
products listed in Annex  I hereto. Until these standards are adopted, the standards 
defined  under Article  2 of Regulation  (EEC) No  1035/72 shall  continue to apply. 

2. 

Derogations  from  the  standards  adopted  pursuant  to  paragraph  1 which  prove 
necessary  in order to meet requirements  specific  to the market  organization  shall 
be  adopted  in  accordance  with  the  procedure  laid  down  in  Article 45. 

Article 3 

1.  Products  covered  by the  quality  standards adopted  may  not  be displayed  or  offered 
for sale, sold, delivered or marketed in any other manner within the Community than 
in  conformity  with  those  standards. 

However,  Member  States  may  exempt  the  following  from  the  requirement  of 
complying  with  the  quality  standards or with  some  of  their  provisions: 

(a) 

i 

products  displayed  or  offered  for  sale,  sold,  delivered  or  marketed  in  any 
other manner by the grower  on wholesale markets, in particular  on  producer 
markets,  situated  in  the  production  area; 

(b) 

products  shipped  from  those  wholesale  markets  to  preparation  and  packing 
stations  and  storage facilities  situated  in  the  same  production  area. 

Where the second  subparagraph  is applied, the Member  State concerned shall  inform 
the  Commission  and  shall  notify  it  of the measures  taken. 

2.  The  following  shall  not  be  required  to  conform  to  the  quality  standards  within  a 

given  production  area: 

(a)  products sold or delivered  by the grower to preparation  and packing stations or 

storage  facilities,  or  shipped  from  his  holding  to  such  stations; 

(b)  products  shipped  from  storage facilities  to  preparation  and  packaging  stations. 

13 

3.  The following  shall  not  be  required to conform  to the  quality  standards: 

(a)  products  shipped  to  processing  plants,  unless  minimum  quality  criteria  for 
products  intended  for  industrial  processing  are  set  in  accordance  with  the 
procedure  laid  down  in Article 45. 

Evidence  must be  supplied  that such products fulfil  the  conditions  laid down, 
in particular with  regard to their intended use; 

(b)  products  transferred  by  the  producer  on  his  holding  to  consumers  for  their 
personal  use  or  sold  at  retail  in  a  particular  region  as  products  traditionally 
consumed  locally. 

4.  Detailed rules for the application of this Article shall be adopted in accordance with 

the procedure laid down in Article 45. 

Article 4 

Where the supply of products conforming to the quality standards is insufficient  to meet 
consumer demand, measures derogating from their application for a limited period shall 
be adopted in accordance with the procedure laid  down in Article 45. 

Article 5 

1.  The information particulars required by the quality standards must be shown legibly 
in an obvious position on one side of the packaging, either indelibly printed directly 
onto the package  or on  a label  firmly  affixed  to the package. 

2.  For  goods  shipped  in  bulk  and  loaded  directly  onto  a  means  of  transport,  the 
particulars referred to in paragraph  1 shall be given in a document accompanying the 
goods  or  shown  on  a  notice  placed  in  an  obvious  position  inside  the  means 
ofransport. 

Article 6 

At  the  retail  stage,  where  products  are put up in  packages  or  prepackaging  within  the 
meaning of Council Directive  79/112/EEC(8), the information particulars required shall be 
legible  and conspicuous. 

Products may be presented unpackaged, provided that the retailer displays with the goods 
offered  for  sale  a  card  showing  prominently  and  legibly  the  information  particulars 
specified  in the quality  standards relating to: 

. 
variety, 
origin  of the product, 
quality class. 

(8)  OJNoL33,  8.2.1979,  p.  1. 

14 

Article 7 

To establish whether products covered by quality  standards conform  to the provisions of 
Articles  3  to  6,  checks  shall  be  made  by  sampling  at  all  marketing  stages  and  during 
transport by the authorities appointed by each Member State in accordance with Title VI. 

These checks shall preferably  be made prior to dispatch from production areas when the 
products are being packed  or loaded. 

Member States shall communicate to the other Member States and to the Commission the 
names of the authorities which  they  have appointed to be responsible  for  checking. 

Article 8 

1.  Products covered by  quality  standards shall be accepted for importation from third 
countries  only  if  they  conform  to  the  quality  standards  or  to  standards  at  least 
equivalent to them. 

2.  Articles  3  to  7  shall  apply  to  products  imported  into  the  Community,  after 
completion  of the import formalities  in accordance with  current Community rules. 

Article 9 

1.  Products covered by quality standards shall be accepted for export to third countries 

only  if they  conform  to the quality standards. 

Derogations may, however, be granted in accordance with the procedure laid down 
in Article 45 to  suit the requirements of the intended markets. 

2.  Products for export to third countries shall be subject to a quality control before they 

leave the customs territory  of the Community. 

Article  10 

Measures to  ensure uniform  application  of the provisions  of  this  Title  shall  be adopted 
in  accordance with the procedure laid down in Article 45. 

For products intended to be imported into the Community,  such measures may consist in 
approval  of the official  inspection  authorities of the exporting third country. 

15 

Title H 

Producer  organizations 

Article  11 

1.  For the purposes of this Regulation,  "producer organization" means any legal entity: 

(a)  which is formed on the own initiative of growers of the fruit and/or vegetables 

listed  in Article  1(2) in order,  in particular, 

(1) 

(2) 

to ensure that production is planned and adjusted to demand, particularly 
in terms of  quality  and quantity;  ^ 

to  promote  concentration  of  supply  by  placing  on  the  market  the 
products produced by  its members; 

(3) 

to reduce production  costs and stabilize prices; 

(4) 

to  promote  the use  of  cultivation  practices,  production  techniques  and 
waste-management  practices  that  are  environmentally  sound, 
in 
particular  to  protect  the  quality  of  water,  soil  and  landscape  and 
encourage biodiversity; 

(b)  whose  rules of  association  require its producer members,  in particular, 

(1) 

(2) 

(3) 

to  apply  the  rules  adopted  by  the  producer  organization  relating  to 
production reporting, production itself,  marketing and protection of the 
environment; 

to  belong  to  only  one  producer'organization  in  respect  of  a  given 
holding; 

to  market  their  entire  production  through  the  producer  organization. 
However,  where  the  producer  organization  so  authorizes  and  in 
compliance  with  the  terms  and  conditions  it  lays  down,  the  producer 
members may: 

sell not more than  10% of their production directly on their holding 
to consumers for their personal needs, 

and furthermore: 

market  themselves  or  through  another  producer  organization 
designated by their own organization, quantities of products which 
are  marginal  in  relation  to  the  volumes  marketable  by  their 
organization, 

16 

market  through  another  producer  organization  designated  by  their 
own  organization  products which,  because  of  their  characteristics, 
are  not  normally  covered  by  the  commercial  activities  of  the 
organization  concerned; 

(4) 

(5) 

to provide  the  information  requested  by  the  producer organization  for 
statistical  purposes,  in particular  on growing  areas, quantities cropped, 
yields,  and direct sales; 

to pay the contributions  provided for  in its rules of  association  for the 
establishment  and  replenishment  of  the  operational  guidance  fund 
provided  for in Article  15; 

(c)  whose rules of  association  provide for: 

(1) 

procedures for  determining,  adopting  and  amending  the rules  referred 
to in point  (1)  of (b), 

(2) 

the contributions  needed to finance  the producer organization, 

(3) 

(4) 

(5) 

rules enabling the producer members democratically  to scrutinize their 
organization  and its decisions, 

penalties for infringement  of obligations under the rules of association, 
particularly non-payment of contributions, and of the rules laid down by 
the producer organization, 

V. 

rules  on  the  admission  of  new  members,  particularly  a  minimum 
membership period; 

(d)  which  has  been  recognized  by  the  Member  State  concerned  pursuant  to 

paragraph 2. 

2.  Member  States  shall  recognize  as  producer  organizations  for  the  purposes  of  this 

Regulation  all  producer groups applying  for  such recognition,  on condition that: 

(a)  they meet the requirements laid down in paragraph  1 and provide the relevant 
evidence,  including  proof that they  have  a minimum  number of  members and 
cover  a  minimum  volume  of  marketable  production,  to  be  determined  in 
accordance with the procedure laid  down in Article 45; 

(b)  there is sufficient  evidence that they can carry out their activities properly, both 

over time and in terms of  effectiveness; 

(c)  they actually provide their producer members with technical  assistance in using 
environmentally  sound  cultivation  practices  and  for  storing,  packaging  and 
marketing  their produce and,  in  discharging  their allotted tasks,  ensure proper 
commercial  management  of  their  activities,  including  keeping  appropriate 
accounts. 

17 

1.  Member  States shall 

Article  12 

(a)  decide  whether  to  grant  recognition  to  a  producer  organization  within  three 
months of the lodging of an application with all relevant supporting documents; 

(b)  decide, where necessary, to withdraw recognition  on the basis of checks which 
they must carry out at frequent intervals to ascertain that producer organizations 
meet the terms and conditions for recognition,  and shall  adopt the penalties to 
apply to  such organizations in the event of their recognition being withdrawn; 

(c)  notify  the Commission,  within  two months,  of  every  decision  to grant,  refuse 

or withdraw recognition. 

2.  The  terms  and  conditions  on  which  the  Member  States  are  to  report  to  the 
Commission  on  the  activities  of  producer  organizations  shall  be  drawn  up  in 
accordance  with the procedure laid down in Article 45. 

The Commission shall check that Article  11 is complied with by carrying out checks 
in accordance with Title VI and shall, where appropriate,  call  on Member States to 
withdraw recognition. 

Article  13 

1.  Producer organizations recognized under Articles  13 and  13a of Regulation  (EEC) 
No  1035/72  up to 30 June  1995 which  are unable to qualify  for recognition under 
Article  11 of this Regulation without a transitional  period  may  continue to operate 
under the provisions of  Title  IV for two years  after  its  entry  into  force,  provided 
they remain in compliance with the requirements of the said Articles of Regulation 
(EEC) No  1035/72. 

2.  The period  of  two years referred to in paragraph  1 may  be extended  to four years 

provided the organization concerned, 

(a)  by  a  set  date  falling  before  the  end  of  the  two-year  period  referred  to  in 
paragraph  1, presents to the  relevant Member  State,  which  must either accept 
or  reject  it,  a  plan  of  action  with  a  view  to  attaining  recognition  under 
Article  11(2); 

(b)  can  show,  when  presenting  its  plan,  that  it  has  set  up  the  operational  fund 

referred  to in Article  15; 

(c)  undertakes,  on  pain  of  a  penalty  to  be  determined  by  the  Member  State, 
to complete  the  implementation  of  its  action  plan  before  the  end  of  the 
four-year period. 

18 

3.  Producer  organizations  which  no  longer  meet  the  conditions  laid  down  in 
paragraph 2, whatever the reason and at whatever moment,  shall  lose their status as 
such  on the terms  set  out  in  point (b)  of  Article  12(1). 

However,  the  first  subparagraph  shall  apply  without  prejudice  to  any  individual 
rights which  the  producer  organization  may  have  acquired  in  accordance  with 
Regulation  (EEC) No  1035/72. 

Article  14 

1.  New  producer  organizations  not  recognized  under  Regulation  (EEC)  No  1035/72 
may be allowed  a transitional  period of no more than four years in which  to  meet 
the conditions for recognition  laid  down in Article  11. 

In  order  to  qualify,  they  shall  present  a  phased  plan  of  action  to  the  relevant 
Member  State,  acceptance  of  which  shall  signal  the  start  of  the  four-year  period 
referred  to in the first subparagraph and shall  constitute  a preliminary  recognition. 

2.  During the four years following the date of preliminary recognition, Member States 

may grant to the producer organizations  referred to in paragraph  1 : 

(a)  aid to encourage their formation  and facilitate their administrative operation; 

(b)  aid, provided either directly or through credit institutions in the form of special 
loans, to cover part of the investments required to attain recognition and set out 
in the plan referred  to in the  second subparagraph of  paragraph 1. 

3.  The  aid  referred  to  in  paragraph  2  shall  be  reimbursed  by  the  Commission  in 

accordance with  Article  51(2). 

4.  Before  granting  preliminary  recognition,  Member  States  shall 
Commission  of their intentions  and the financial implications. 

inform  the 

5.  Presentation  of  a recognition  plan  by  a producer  organization  to  a Member  State 
shall entail a commitment by the organization to submit to national and Community 
checks in accordance with Title VI, in particular with regard to proper management 
of  public funds. 

6.  Member  States  shall  adopt  the  penalties  to apply  to  producer  organizations  which 

do not fulfil  their undertakings. 

Article  15 

1.  Financial  assistance shall be granted on the terms set out in this Article to producer 
organizations  setting up an operational  fund  maintained by  levies  on their member 
producers  directly  proportional 
to  the  quantities  of  fruit  and  vegetables 
actually  marketed  by  them.  This  financial  assistance  shall  be  additional  to  the 
operational  fund. 

19 

2.  Operational  funds  as indicated  in  paragraph  1 shall  be used 

(a)  to finance  both market withdrawals and processing  of  citrus fruit  on the terms 

set out in paragraph 3; 

(b)  to  finance  an  operational  programme  submitted  to  the  competent  national 

authorities and approved by  them under paragraph 6. 

Such funds may also be used in whole or in part to finance an action plan submitted 
by  a producer organization  as referred  to in Article  13. 

3.  Use  of  the operational  fund  to finance  withdrawals  and/or the processing  of  citrus 
fruit  shall  be  permissible  only  if  an operational  programme  has been  approved by 

_ 

the competent national  authorities. Financing shall take one of the following  forms: 

(a)  withdrawal  compensation  for products not listed in Annex H; 

(b)  a supplement to the Community  withdrawal  compensation; 
(c)  a  supplement  to  the  minimum  price  to  be  paid  to  producers  for  citrus  fruit 
delivered  for  processing  under  Council  Regulation  (EEC)  No  1035/77(9)  and 
Council  Regulation (EC) No  3119/93(10). 

Member States may set a maximum level to the compensation or supplements so decided, 
but  not  exceeding  the  maximum  level  of  withdrawal  prices  applying  in  the  1995/96 
marketing year in accordance with  Article  16(3a),  Article  16a, Article  16b and the first 
indent  of point  (a) of Article  18(1)  of Regulation  (EEC) No  1035/72. 

The  proportion  of the operational  fund  which  may be used to finance  withdrawals may 
not exceed 40% in the first year, 35% in the second, 30% in the third, 20% in the fourth 
and  10% from  the fifth year  onwards,  commencing  from  the  date  of  approval  by  the 
competent  national  authorities  of  the  first  operational  programme  submitted  by  the 
producer organization  and approved by them.  . 

4.  Operational  programmes  as indicated  in point (b) of paragraph 2  shall 

(a)  have as their objectives the improvement of product quality, boosting products' 
commercial  value,  promotion  of  the  products  targeted  on  consumers  and 
creation of  organic product lines; 

(b)  include  action to  develop  the use  of environmentally  sound  techniques by the 
producer members with regard to both cultivation practices and the management 
of waste materials; 

(9)  OJNoL  125,  19.5.1977,  p. 3. 
(10)  OJ No  L 279,  12.11.1993,  p.  17. 

20 

(c)  make  financial  provision  for  the  technical  and  human  resources  required  to 
ensure  compliance  with  plant-health  standards  and  rules,  and  maximum 
permitted  levels  of  residues. 

"Environmentally  sound  techniques"  shall  mean,  in  particular,  those  which  help 
to achieve  the  aims  of  Article  1(a),  (b)  and  (c)  of  Council  Regulation  (EEC) 
No  2078/92(11). 

5.  The financial  assistance  referred  to in paragraph  1 shall  be  equal  to the amount  of 
the  levies  indicated  in  that  paragraph  as  actually  paid  but  limited  to  50% of  the 
actual expenditure incurred under paragraph 2. This percentage shall be 60% where 
an operational  programme  or part of  an operational  programme is  submitted 

(a)  either  by  several  Community  producer  organizations  operating  in  different 
Member  States  on transnational  schemes,  except  for  operations  as  referred  to 
in point (a) of paragraph 2, 

(b)  or by  one or more producer organizations engaged in  schemes operated on an 

interbranch basis. 

6.  The  assistance  referred  to  in  paragraph  5  shall  be  financed  as  to  20%  by  the 

Member  States and as to  80% by the Community. 

However, financing shall  be as to  10% by the Member States and as to 90% by the 
Community in the case of producer organizations operating in "Objective 1" regions 
within the meaning  of  Council  Regulation  (EEC) No  2052/88(12>. 

Article 16~ 

1.  Operational  programmes  as  referred  to  in  point  (b)  of  Article  15(2)  shall  be 
submitted to the competent national authorities, who shall approve or reject them or 
request their modification  in line with the provisions  of this Regulation. 

Member  States  shall  establish  a  national framework for  drawing  up  the  general 
conditions  relating to the  measures referred to  in point (b)  of  Article  15(4).  They 
shall  submit  their  proposed  framework  to  the  Commission  which  may  request 
modifications  within  three  months  if  it finds that the proposal  does  not  enable the 
aims  set  out  in  Article  130r  of  the  Treaty  and  in  the  Community  programme  of 
policy  and  action  in  relation  to  the  environment  and  sustainable  development  to 
be attained. 

2.  By 31  January at the latest each year, producer organizations shall notify the volume 
of their operational fund to the Member State. The Member State shall in turn notify 
the organization  of the amount of financial  assistance in line with the limits set out 
in Article  15(5). 

(11)  OJ No L 215,  30.7.1992,  p. 85. 
(12)  OJNoL  185,  15.7.1988,  p. 9. 

21 

3.  An association of producer organizations recognized by a Member State may replace 
its members for the purposes of managing their operational fund within the meaning 
of  Article  15(1)  and  for  establishing,  implementing  and  submitting  operational 
programmes as referred to in point (b) of Article  15(2). In such cases the association 
shall  receive  the  financial  assistance  and  make  the  notification  referred  to  in 
paragraph  2  of  this Article. 

4.  Operational  programmes  and  their  private  and  public  financing  shall  have  a 

minimum  duration of three and a maximum  duration of five years. 

5. 

Submission  of  an  operational  programme  to  a  Member  State  by  a  producer 
organization or, if the option indicated in paragraph 3 is taken up, an association  of 
producer organizations, shall imply a commitment by the organization or association 
to  submit  to  national  and  Community  checks  in  accordance  with  Title VI,  in 
particular as regards proper management  of public resources. 

Article  17 

Should  the  general  instruments  of  the  common  organization  of  the  market  prove 
inadequate  or inappropriate  with regard to the products listed  in Article  1 which  are of 
major local or regional importance in economic or ecological terms and which face strong 
international  competition,  specific  measures  to  improve  the  competitiveness  of  these 
products and to promote them may be taken in accordance with the procedure laid down 
in Article 45. 

These measures may,  in particular,  include measures of the kind referred to in point (c) 
of  Article  19(1). 

Article  18 

1. 

In cases where a producer organization or an association of producer organizations 
which  have adopted  the  same rules, which  operates in  a specific  economic  area is 
considered,  in respect  of  a specific  product,  to be representative  of production and 
producers  in  that  area,  the  Member  State  concerned  may,  at  the  request  of  the 
organization  or  association,  make  the  following  rules  binding  on  producers 
established  in  the  area  who  do  not  belong  to  one  of  the  organizations  referred  to 
above: 

(a)  the rules referred  to in point (1)  of point  (b) of  Article  11(1), 

(b)  the  rules  adopted  by  the  organization  or  association  relating  to  market 

withdrawals, 

on condition that the rules 

have been in force  for  at least  one year, 

are included  in the exhaustive list in Annex  in, 

are made binding  for  no more than three marketing years. 

22 

2.  For  the  purposes  of  this  Article,  "economic  area"  means  a  zone  made  up  of 
adjoining  or  neighbouring  production  regions  in  which  production  and  marketing 
conditions  are homogeneous. 

3.  A  producer  organization  or  association  of  organizations  shall  be  deemed 
representative within the meaning of paragraph  1 where its members account for at 
least  two  thirds  of  the  producers  in  the  economic  area  in which  it  operates  and it 
covers at least two thirds of the production  of  that area. 

4.  The rules which  are made binding  on all producers in a specific  economic area 

(a)  must  not  cause  any  harm  to  other  producers  in  the  Member  State  or  in  the 

Community, 

(b)  shall  not  apply,  unless  they  expressly  cover  them,  to  products  delivered  for 
processing under a contract signed before the beginning of the marketing year, 
with the exception  of the rules on reporting production referred to in point (a) 
of  paragraph  1, 

x 

(c)  must not clash with Community  rules in force. 

5.  Member States shall  notify  the Commission forthwith of the rules which they have 

made binding on all  producers in a specific  economic area. 

The Commission  shall  decide that a Member State must repeal  an extension  of the 
rules decided on by that Member State: 

(a)  if  it  finds  that  the  extension  to  other  producers  excludes  competition  in  a 
substantial  part  of  the  internal  market  or jeopardizes  free  trade,  or  that  the 
objectives  of  Article  39 of the Treaty  are endangered, 

(b)  if it finds that Article  85(1) of the Treaty applies to the agreement, decision or 
practice  which  it  has  been  decided  to  extend  to  other  producers.  The 
Commission's decision with regard to that agreement, decision or practice shall 
apply  only  from  the date of  such a finding, 

(c)  where, following ex-post checks under Title VI, it finds that this Article has not 

been complied with. 

6.  Where paragraph  1 is applied, the Member State concerned may decide, on scrutiny 
of evidence presented, that non-member producers shall be liable to the organization, 
or where appropriate the association, for the part of the membership fees paid by the 
producer members,  in  so  far as these are used to cover: 

(a)  administrative costs resulting from applying the rules referred to in paragraph  1, 

(b)  the  cost  of  research,  market  studies  and  sales  promotion  undertaken  by  the 

organization  or association  and benefiting  all  producers in the area. 

23 

7.  Member  States shall  notify  a list  of  economic  areas as referred  to in  paragraph  2 to 
the  Commission.  Within  one  month  of  notification,  the  Commission  shall  approve 
the  list  or  shall,  after  consultation  with  the Member  State concerned,  decide  on  the 
amendments  which  the  latter  must  make to  it. 

Title  m 

Interbranch  organizations  and  agreements 

Article  19 

1.  For  the  purposes  of  this  Regulation,  "recognized  interbranch  organizations", 

hereinafter  referred  to  as  "interbranch  organizations",  means  legal  entities  which: 

(a)  are made up  of  representatives  of economic  activities  linked  to the  production 

and  processing  of  and  trade  in  the products  referred  to  in  Article  1(2); 

(b)  are  established  at  the  initiative  of  all  or  some  of  the  organizations  or 

associations  which  constitute  them; 

(c)  carry  out  several  of  the  following  measures  in  one  or  more  regions  of  the 
Community,  taking  account,  where relevant,  of  the interests  of  consumers: 

- 

improving  knowledge  and  the transparency  of  production  and  the  market, 

-  helping  to  coordinate  better  the way  fruit  and  vegetables  are placed  on  the 

market,  in  particular  by  means  of  research  and  market  studies, 

-  drawing  up  standard  forms  of  contract  compatible  with  Community  rules, 

-  exploiting  the  value  of  the fruit and  vegetables  produced, 

-  providing  the information  and carrying  out the research  necessary  to  adjust 
production  towards  products  more  suited  to  market  requirements  and 
consumer tastes and expectations, in particular with regard to product quality 
and  protection  of  the  environment, 

-  seeking ways of restricting the use of plant-health  products and  other inputs 

and  ensuring  product  quality  and  soil  and  water  conservation, 

-  developing  methods  and  instruments  for  improving  product  quality, 

-  exploiting  the  potential  of  and  protecting  organic  farming  as  well  as 
designations  of  origin,  quality  labels  and  geographical  denominations, 

- 

laying  down  rules,  as regards the production  and  marketing  rules  set out  in 
Annex  HI, which  are  stricter  than  Community  or  national  rules; 

24 

(d)  have  been  recognized  by the  Member  State  concerned  on the terms  set  out in 

paragraph 2. 

2.  Member  States  shall  recognize  as  interbranch  organizations  all  organizations 
established  on  their territory  which  make  an appropriate  application,  on  condition 
that: 

(a)  they  carry  out their activity  in one or more regions  in that territory; 

(b)  they  represent  a  significant  share  of  the  production  and  processing  of  and, 
where  relevant,  the trade in  fruit  and vegetables  and products  processed  from 
fruit and vegetables in the region or regions in question  and, where more than 
one  region 
level  of 
representativity  in each region for each of  the branches that they group; 

involved,  they  can  demonstrate  a  minimum 

is 

(c)  they  carry out  several  of the measures referred  to in point (c)  paragraph  1; 

(d)  they are not themselves engaged in the production or processing of,  or trade in, 

fruit and vegetables  or products processed  from fruit and vegetables. 

3.  Before  granting  recognition  Member  States  shall  notify  the  Commission  of  the 
interbranch organizations which have applied for recognition, providing all relevant 
information about their representativity and their various activities, together with all 
other information  needed  for an assessment. 

The  Commission  may  object  to  recognition  within  a  time  limit  of  60  days  after 
notification. 

4.  Member  States shall 

(a)  decide  whether to grant recognition  within  three months  of  the lodging  of an 

application,  with  all  relevant  supporting documents; 

(b)  decide, where necessary, to withdraw recognition on the basis of checks which 
they  must  carry  out  at  frequent  intervals  to  ascertain  that  interbranch 
organizations meet the terms and conditions for recognition, and shall adopt the 
penalties to apply to such organizations in the event of their recognition being 
withdrawn; 

(c)  notify  the Commission,  within two months, of  any decision to grant,  refuse or 

withdraw recognition. 

5.  The  terms  and  conditions  on  which  the  Member  States  are  to  report  to  the 
Commission  on  the  activities  of  interbranch  organizations  shall  be  drawn  up  in 
accordance with the procedure laid  down in  Article 45. 

The  Commission  shall  check  that  paragraph  2  is  complied  with  by  carrying  out 
checks  in  accordance  with  Title VI  and  may,  as  a  result  of  these  checks,  ask  a 
Member  State to withdraw  recognition. 

25 

6.  Recognition  shall  constitute  an  authorization  to  carry  out  the  measures  listed  in 

point  (c)  of  paragraph  1, consistent  with the terms of  this Regulation. 

Article  20 

1. 

In cases where an interbranch organization operating in a specific  region or regions 
is  considered  to  be  representative  of  the  production  and  processing  of  and, where 
relevant,  trade in a given  product, the Member State concerned  may,  at the request 
of the organization,  make some of the decisions or agreements agreed on within that 
organization binding for a limited period on other operators in the region or regions 
in question, whether individuals  or groups, who  do not belong to the organization. 

2.  An interbranch organization  shall  be deemed  representative  within  the meaning  of 
paragraph  1  where it accounts for at least two thirds of the production or processing 
of,  or trade in, fruit and vegetables  in the region  or regions  concerned.  Where the 
application for extension of its rules to other operators covers more than one region, 
the organization  must demonstrate a minimum  level  of  representativity  for each  of 
the branches it groups in  each  of the regions concerned. 

3.  The rules for which  extension to other operators may be requested: 

(a)  must concern  one  of  the following  aims: 

-  production  and market reporting, 

-  stricter production rules than any laid down in Community or national rules, 

-  rules on marketing, 

-  rules on protecting the environment, 

-  measures to  promote  and exploit the value  of products, 

-  measures to protect organic farming as well as designations of origin, quality 

labels and geographical  denominations. 

The rules referred  to in the second,  third and fourth  indents must not be other 
than those which  appear in Annex HI; 

(b)  must have been in force  for  at least one year; 

(c)  may be made binding  for no more than three years; 

(d)  must  not  cause  any  harm  to  other  operators  in  the  Member  State  or  the 

Community. 

26 

Article  21 

1.  Member  States  shall  notify  the  Commission  forthwith  of the rules which  they  have 

made  binding  on  all  operators  in  one  or  more  specific  regions. 

The  Commission  shall  decide that  a Member  State  must  repeal  an extension  of the 
rules  decided  on  by  that  Member  State  in  the  cases  referred  to  in  the  second 
subparagraph  of  Article  18(5). 

2.  Where rules  are made binding  under  this Article  on  operators  who do  ot belong  to 
an  interbranch  organization,  the  Member  State  concerned  may  decide,  on  scrutiny 
of  evidence  presented,  that  operators,  whether  or  not  individuals,  who  are  not 
members  shall  be  liable  to  the  organization fpr  all  or  part  of  the  membership  fees 
paid  by the  members. 

Title  IV 

Intervention  arrangements 

Article  22 

1.  Producer  organizations  and  their  associations  may  choose  not  to  put  up  for  sale 
products listed  in Article  1(2) contributed  by  their  members, both in quantities  and 
for  periods which  they  consider  appropriate. 

2.  The destination of  produas  withdrawn from the market  under paragraph  1 must be 
fixed by the producer organization  or association  in such a way as not to disturb the 
normal  disposal  of  the  products  in  question  and  must  respect  the  environment, 

v particularly  as regards  water  and  landscape  quality. 

3.  Where paragraph  1 is  applied  to  any  one of  the  products  listed  in  Annex  II  which 
meet the relevant  standards,  producer  organizations  and their  associations  shall  pay 
their  producer  members  the  Community  withdrawal  compensation  fixed  under 
Article  25, up to  a ceiling  of  10% of  marketed  production. 

The  10% limit  set in the  first  subparagraph  shall  apply  to the  marketed  production 
of  only  the  members  of  the  producer  organization  concerned,  or  of  another 
organization  in  cases of  application  of  the  second  and  third  indents  of  point  (3)  of 
point  (b)  of  Article  11(1),  withdrawals  under  Article  23  excluded. 

4.  The  10% ceiling referred  to in paragraph  3 shall apply from  the fifth marketing year 
following  the  date  of  entry  into  force  of  this  Regulation.  Withdrawals  carried  out 
during  the  transitional  period  covering  the  four  previous  marketing  years  may  not 
exceed  the following  percentages  of  marketed  production  as defined  in  accordance 
with  the  procedure  laid  down  in  Article 45:  50%  in  the  first  marketing  year,  40% 
in  the  second,  30% in  the third  and  20% in  the  fourth. 

27 

However,  in  the  case  of  citrus  fruit  these  percentages  shall  be:  30%  in  the first 
marketing  year,  25% in the  second,  20% in the third  and  15% in the fourth. 

The  second  subparagraph  of  paragraph  3 shall  apply  to this paragraph. 

Article 23 

In  connection  with  products  listed  in  Annex  II,  producer  organizations  shall  allow  the 
benefits of Article 22 to growers who are not members of any of the collective structures 
provided  for  in this Regulation,  if  they  so request. 

However, the Community withdrawal compensation shall be reduced by 10%. In addition, 
the amount paid shall take account, on scrutiny of the evidence, of the overall withdrawal 
costs borne by the members. The compensation may not be granted on a volume greater 
than  10% of the grower's marketed production. 

Article 24 

Producer  organizations  and  their  associations  shall  notify  full  details  concerning  the 
implementation  of  Articles  22  and  23,  and  in  particular  the  measures  taken  to  ensure 
environmentally  sound  practice  in  connection  with  withdrawals,  to  their  national 
authorities,  which  shall  forward  the information  to the Commission. 

The information to be notified  shall be determined,  as necessary, in accordance with the 
procedure laid down in Article  45. 

Member States shall establish a national framework for drawing up the general conditions 
relating to the measures referred to in point (b) of Article  15(4).  They shall submit their 
proposed  framework  to  the  Commission  which  may  request  modifications  wtihin 
three months if it finds that the proposal  does not enable the aims set out in Article  130r 
of the  Treaty  and in the  Community  programme  of policy  and action  in relation to the 
environment  and sustainable  development  to be attained. 

Article 25 

1.  For the first marketing  year  following  the  entry  into  force  of this Regulation,  the 
Community withdrawal compensation shall, for each product listed in Annex  II other 
than citrus fruit, be equal to the average monthly withdrawal price applicable for the 
1995/96  marketing  year  under  Articles  16(3a),  16a,  16b  and  the  first  indent  of 
point  (a) of Article  18(1)  of Regulation  (EEC) No  1035/72. 

From the fifth marketing year following  the entry into force  of this Regulation, the 
Community  withdrawal  compensation  shall  be  equal,  for  each  of  the  products  in 
question, to. 85% of the compensation fixed pursuant to the first subparagraph. 

The difference  between the compensation  referred to in the first subparagraph and 
that referred to in the second shall be absorbed in equal instalments from the second 
to the fifth marketing years  following  the entry  into force  of this Regulation. 

28 

2. 

In the  case  of  citrus  fruit,  the  Community  withdrawal  compensation  shall,  for the 
first marketing year following  the  entry  into force  of  this Regulation  and for  each 
product, except satsumas, be equal to the lowest withdrawal  price applicable for the 
1995/96  marketing year under Articles  16a,  16b and the first indent of  point (a)  of 
Article  18(1)  of  Regulation  (EEC)  No  1035/72,  and  for  satsumas  to  the  highest 
withdrawal  price. 

From the fifth marketing year following the entry into force  of this Regulation, the 
Community  withdrawal  compensation  shall  be  equal,  for  all  products,  to  the 
lowest withdrawal  price  for  clémentines  determined  in  accordance  with  the 
first subparagraph. 

The difference  between the compensation  referred  to in the first subparagraph and 
that referred to in the second shall be absorbed in equal instalments from the second 
to the fifth marketing years following  the entry  into force  of this Regulation. 

3.  The Community withdrawal compensation shall be a single amount valid throughout 

the Community. 

4.  The amounts referred to in this Article shall be set, where required, at the beginning 
of each of the marketing years referred to in paragraphs  1 and 2, in accordance with 
the procedure laid down  in Article 45. 

Article 26 

1. 

If the market in a product listed in Annex  II is suffering  or at risk of suffering from 
widespread structural  imbalances giving or liable to give rise to too large a volume 
of the withdrawals  referred  to in  Article 22,  an intervention  threshold  shall  be  set 
before the beginning  of the marketing year for that product in accordance with the 
procedure laid down in Article 45 and the consequences of any overrun, assessed for 
the  product  on  the  basis  of  withdrawals  made  during  a  marketing  year  or  an 
equivalent  period  or  of  the  average  of  the  volume  of  intervention  over  several 
marketing years,  shall  be borne financially  by the producers. 

An  overrun  of  the  intervention  threshold  shall  give  rise  to  a  reduction  in  the 
Community  withdrawal  compensation  in  the  following  marketing  year.  This 
reduction  shall  not be carried  over to subsequent marketing years. 

2.  The following  shall  be  determined  in accordance with the procedure  laid  down in 

Article 45: 

(a)  the implications  for  each product of an overrun of the threshold; 

(b)  where  necessary,  the  reduced  Community  withdrawal  compensation  and 

measures for the application  of this Article. 

3.  This Article  shall  apply  during  the first four  marketing years following  entry  into 

force  of this Regulation. 

29 

Article  27 

1.  Member  States shall  notify  the  Commission  on each marketing  day  during each  of 
the relevant marketing years of the prices recorded on their representative producer 
markets for  certain  products  of  defined  commercial  characteristics  such  as variety 
or type,  quality  class,  size  and packaging. 

2.  A  list of the markets and products referred  to in paragraph  1 shall  be drawn up in 

accordance with the procedure  laid  down in  Article 45. 

Markets  in Member  States  on  which  a substantial  part of  the  national  output  of  a 
given  product  is  marketed  throughout  the  marketing  year  or  during  one  of  the 
periods into which the year is divided shall be-regarded as representative within the 
meaning of paragraph  1. 

Article 28 

1.  Member  States  shall  pay  the  Community  withdrawal  compensation  fixed  in 
Article 25  to  producer  organizations  or their  associations  which  have  carried  out 
withdrawals  under  the  terms  of  Articles 22  and  23  and  are  required  to  pay  the 
compensation to their members or to non-member growers. 

Payments  and  advances  thereof  shall  be  made  in  a  manner  to  be  determined  in 
accordance with the procedure laid down in Article 45. 

2.  The  Community  withdrawal  compensation  shall  be  paid  without  prejudice  to  the 
financial  implications  resulting from any overrun of  an intervention threshold. 

The  compensation  shall,  in  addition,  be  reduced  by  the  net  receipts  earned  by 
producer organizations and their associations from the products withdrawn from the 
market. 

3.  Where producer organizations and their associations are unable to direct products to 
one  of  the  destinations  referred  to  in  Article  29(1),  the  Community  withdrawal^ 
compensation  shall  be granted only  if the products are used in accordance with the 
instructions issued  by the Member  State under Article 29(2),  (3)  and (4). 

Article 29 

1.  Products withdrawn from the market under Article  22(3) which remain unsold shall 

be disposed  of  as follows: 

(a)  all  products: 

- 

free distribution to charitable organizations and foundations, approved to that 
effect  by  the  Member  States,  for  use  in  their  activities  to  assist  persons 
whose right to public  assistance is recognized  in national  law,  in particular 
because they  lack the necessary  means of  subsistence, 

30 

- 

- 

free  distribution  to penal  institutions and to children's holiday  camps as well 
as  to  hospitals  and  old-people's  homes  designated  by  the  Member  States, 
which  shall  take  all  necessary  steps  to  ensure  that  the  quantities  thus 
distributed  are  additional  to  the  quantities  normally  bought  in  by  such 
establishments; 

free  distribution  outside  the  Community,  through  charitable  organizations 
approved  to  that  effect  by  the  Member  States,  to  the  populations  of  third 
countries  in  need, 

and,  secondarily, 

-  use for  non-food  purposes, 

-  use  in  animal  feed,  either  fresh  or  after  processing  by  the  feedingstuffs 

industry; 

(b)  fruit: free  distribution to school children,  other than as part of the meals served 

in  school  canteens; 

(c)  apples,  pears,  peaches  and  nectarines: processing  into  alcohol  of  a  strength 

of  more than  80" by  direct  distillation  of the  product, 

(d)  all products: disposal  of certain classes of  product  to the  processing  industry 
on  condition  that  there  is  no  resulting  distortion  of  competition  for  the 
industries  concerned  within  the  Community  or  for  imported  products.  The 
implementation  of  this  provision  shall  be  decided  in  accordance  with  the 
procedure laid  down  in  Article 45. 

It  shall  be  the  responsibility  of  Member  States  to  organize  the  free  distribution 
provided  for in the first, second  and third indents of point  (a) of paragraph  1 and in 
point  (b) of  paragraph  1. 

However,  with  regard  to  the  free  distribution  of  fruit  to  school  children,  the 
Commission  may  take  the  initiative  of  and  responsibility  for  implementing  local 
pilot  projects  within  the  framework  of  research  and  promotion  measures. 

Member  States  shall  organize  the  contacts  between  producer  organizations  and 
charitable organizations and other bodies which may be interested  in using  products 
withdrawn  from  the  market  within  their  territory,  with  a  view  to  one of  the  forms 
of  free  distribution  referred  to  in  points  (a)  and  (b)  of  paragraph  1. 

The  disposal  of  products  to  the  feedingstuffs  industry  shall  be  carried  out  by 
tendering  procedure  by  an  agency  designated  by  the Member  State  concerned. 

31 

The  distillation  referred  to  in  point  (c)  of  paragraph  1  shall  be  carried  out  by 
distilleries  either  on  their  own  account  or  on  behalf  of  a  body  designated  by  the 
Member  State concerned.  In the first case this body  shall  dispose of the products  to 
distilleries  by  tendering  procedure.  In  the  second  case  it  shall  award  distilling 
operations  by  tendering  procedure. 

5.  The  Community  shall  defray,  on  terms  and  conditions  to  be  determined  in 
accordance with the procedure laid down in Article  13 of Council Regulation  (EEC) 
No  729/70(13), transport  costs in connection  with  free  distribution  as provided  for  in 
point  (a)  of  paragraph  1 and  sorting  and  packaging  costs  in  connection  with  free 
distribution  of apples and  citrus fruit  where the latter is staggered under  contractual 
agreements  concluded  between  producer  organizations  and  charitable  organizations 
or  establishments  referred  to in  paragraph  3. 

6.  Detailed  rules for  the application of this Article, particularly  the criteria applying to 
tendering procedures,  shall be adopt in  accordance with the procedure laid  down in 
Article  45. 

Title  V 

Trade with  third  countries 

Article  30 

1. 

Imports into the  Community,  or exports therefrom,  of  any  of the products  listed  in 
Article  1(2) may  be  subject  to  presentation  of  an  import  or  export  licence. 

Licences shall be issued by Member  States to any applicant, irrespective of his place 
of establishment  in the Community  and without prejudice  to measures taken for the 
application  of  Articles  35  and  36. 

Import  and export  licences  shall be valid throughout  the Community.  The issue of 
such  licences  may  be  subject  to  the  lodging  of  a  security  guaranteeing  that  the 
products are imported  or exported  during the term  of validity  of the licence;  except 
in cases of force majeure,  the security  shall be forfeited  in whole or in part if import 
or  export  is not  carried  out,  or  is carried  out  only  partially,  within  that  period. 

2.  The term  of validity  of  licences  and  other  detailed  rules for  the application  of  this 
Article  shall  be  adopted  in  accordance  with  the procedure  laid  down  in  Article 45. 

(13)  OJ No  L  94,  28.4.1970,  p.  13. 

32 

Article 31 

1.  Save as otherwise provided for in this Regulation,  the rates of duty  in the common 

customs tariff  shall  apply  to the products listed  in  Article  1(2). 

2. 

Should application of the common customs tariff duty rate depend on the entry price 
of the imported consignment,  the veracity of this price shall be checked using a flat-
rate import value  calculated  by the  Commission,  by  product  and by  origin,  on the 
basis  of  the  weighted  average  of  prices  for  the  product  on  Member  States' 
representative  import  markets  or  on  other  markets,  where  appropriate.  Specific 
provisions  may,  however,  be  adopted  for  verifying  the  entry  price  of  products 
imported  primarily  for  processing,  in  accordance  with the  procedure  laid  down in 
Article 45. 

3.  Where  the  declared  entry  price  of  the  consignment  in  question  is  higher than the 
flat-rate  import  value,  increased  by  a margin  set  in  accordance  with  paragraph  5 
which  may  not  exceed  the  flat-rate  value  by  more  than  10%,  the  lodging  of  a 
security  equal  to  the  import  duty  determined  on  the  basis  of  the  flat-rate  import 
value  shall  be required. 

4. 

If  the  entry  price  of  the  consignment  in  question  is  not  declared  at  the  time  of 
customs clearance, the common customs tariff duty rate applied shall depend on the 
flat-rate  import  value  or  be  arrived  at  by  application  of  the  relevant  customs 
legislation  provisions  under  conditions  to  be  determined  in  accordance  with 
paragraph 5. 

5.  Detailed rules for the application of this Article shall be adopted in accordance with 

the procedure laid  down in  Article 45. 

Article  32 

1. 

In order to prevent  or counteract  adverse  effects  on the  market in the  Community 
which may result from imports of certain products listed in Article  1(2), imports of 
one or more of such products at the rate of duty laid down in the common customs 
tariff  shall  be  subject to payment  of  an additional  import duty if the conditions  set 
out  in  Article  5  of  the  Agreement  on  Agriculture  concluded  in  accordance  with 
Article  228  of  the  Treaty  in  the  framework  of  the Uruguay  Round  of  multilateral 
trade negotiations have been fulfilled,  unless the imports are unlikely to disturb the 
Community  market,  or  the  effects  would  be  disproportionate  to  the  intended 
objective. 

2.  The trigger prices below  which  an additional  duty  may  be imposed  shall  be those 

notified  by the Community to the World Trade Organization. 

The  trigger  volumes  to  be  exceeded  in  order  to  have  the  additional  import  duty 
imposed  shall  be  determined  in  particular  on  the  basis  of  imports  into  the 
Community  in  the  three  years  preceding  the  year  in  which  the  adverse  effects 
referred to in paragraph  1 arise or are likely  to arise. 

33 

3.  The  import  prices  to be taken  into  consideration  for  imposing  an  additional  import 
duty  shall  be  determined  on  the  basis  of  the  cif  import  prices  of  the  consignment 
concerned. 

The cif import prices shall  be verified  for this purpose on the basis of representative 
prices for the product  in question  on the world  market or on the Community  import 
market  for  the  product. 

4.  Detailed rules for the application  of this Article shall be adopted in accordance with 
the procedure laid down in Article 45.  Such detailed rules shall specify  in particular: 

(a)  the products to which  additional  import  duties  may  be  applied  under  Article 5 

of the  Agreement  on  Agriculture; 

(b)  the  other  criteria  necessary  for  application  of  paragraph  1 in  accordance  with 

Article  5 of  the  Agreement  on  Agriculture. 

Article  33 

1.  Tariff  quotas  for  the  products  listed  in  Article  1(2)  resulting  from  agreements 
concluded in the framework  of the Uruguay Round  of multilateral trade negotiations 
shall  be  opened  and  administered  in  accordance  with  detailed  rules  adopted  in 
accordance  with  the  procedure  laid  down  in  Article 45. 

2.  Quotas  may  be  administered  by  applying  one  of  the  following  methods  or  a 

combination  thereof: 

a  method  based  on  the  chronological  order  in  which  applications  are  lodged 
("first  come,  first  served"  basis); 

a  method  of  allocating  quotas  in  proportion  to  quantities  requested  when 
applications  are  lodged  (using  the  "simultaneous  examination"  method), 

a  method  based  on  taking  traditional  trade  flows  into  account  (using  the 
"traditional  importers/new  arrivals"  method). 

Other  appropriate  methods  may  be  adopted. 

They  must  avoid  any  discrimination  between  the  operators  concerned. 

3.  The method  of administration  adopted  shall, where appropriate,  take account of the 
supply  needs  of  the  Community  market  and  the  need  to  safeguard  the  equilibrium 
of  that  market,  whilst  at  the  same  time  drawing  on  methods  applied  in  the  past  to 
quotas corresponding to those referred  to in paragraph  1, without prejudice to rights 
arising from  agreements concluded in the framework  of the Uruguay Round of trade 
negotiations. 

34 

4.  The detailed rules referred to in paragraph  1  shall provide for annual quotas, suitably 
phased  over  the  year,  shall  determine  the  administrative  method  to  be  used  and, 
where appropriate,  shall  include: 

(a)  guarantees covering  the  nature,  provenance  and origin  of the product; 

(b)  recognition of the document used for verifying the guarantees referred to in (a); 

and 

(c)  the conditions under which import licences are issued and their term of validity. 

Article  34 

v 

1.  To the extent necessary to enable economically  significant quantities of the products 
listed in Article  1(2) to be exported  on the basis of  the prices of these products in 
international  trade  but  within  the  limits  resulting  from  agreements  concluded  in 
accordance with Article 228  of the Treaty, the difference  between those prices and 
prices in the Community  may be covered by  export refunds. 

2.  The  method to be  adopted  for  allocation  of  the  quantities which  may be exported 

with a refund  shall  be the method which: 

(a)  is  most  suited to the nature of  the product  and the  situation  on the  market in 
question,  allows the most efficient  possible use of  the resources  available and 
takes  due  account  of  the  efficiency  and  structure  of  Community  exports, 
without,  however,  creating discrimination  between large and small  operators; 

(b)  is least cumbersome administratively for operators, administration  requirements 

taken into account; 

(c)  avoids any discrimination  between the operators concerned. 

3.  Refunds  shall be the  same for the whole  Community. 

Where  the  international  trade  situation  or  the  specific  requirements  of  certain 
markets make this necessary,  the refund for a given  product may vary according to 
the destination of the product. 

Refunds  shall  be  fixed  in  accordance  with  the procedure  laid  down  in  Article 45. 
Refunds  shall be fixed periodically. 

Refunds fixed periodically  may, where necessary,  be adjusted in the interval by the 
Commission  at the request of  a Member  State or on its own  initiative. 

35 

4.  The following  shall  be taken  into account  when  refunds  are being fixed: 

(a)  the existing  situation  and likely  trends with  regard to: 

-  prices and availability  of  fruit  and vegetables  on the Community  market, 

-  prices for fruit  and vegetables  in international  trade; 

(b)  marketing  costs  and minimum  transport  charges from Community  markets to 
ports and other Community  export points, and forwarding  costs to the country 
of destination; 

(c)  the economic  aspect of the proposed exports; 

(d)  the limits resulting from agreements concluded in accordance with Article 228 

of the Treaty. 

5.  The Community market prices referred to in paragraph  1 shall be determined using 

the prices which  are most favourable  from the exportation  point of view. 

The world market prices referred  to in paragraph  I  shall  be determined using: 

(a)  prices recorded on third-country markets; 

(b)  the  most  favourable  prices  in  third  countries  for  imports  from  other  third 

countries; 

(c)  producer prices recorded in exporting third countries; 

(d) free-at-Community-frontier offer prices. 

6.  Refunds  shall  be  granted  only  on  application  and  on  presentation  of  the  relevant 

export licence. 

7.  The  refund  applicable  to  exports  of  products  listed  in  Article  1(2)  shall  be  that 
applicable  on  the  day  of  application  for  the  licence  and,  in  the  case  of  a 
differentiated  refund,  that applicable  on the same day: 

(a)  for the destination indicated  on the licence; or 

(b)  for  the  actual  destination  if  it  differs  from  the  destination  indicated  on  the 
licence.  In  that  case,  the  amount  applicable  may  not  exceed  the  amount 
applicable  for the destination  indicated  on the licence. 

Appropriate measures may be taken to prevent abuse of the flexibility  provided for 
in this paragraph. 

36 

8.  Paragraphs 6 and 7 may be waived  in the case  of  products listed in Article  1(2) on 
which refunds are paid under food-aid  operations,  in accordance with the procedure 
laid  down in Article 45. 

9.  The refund  shall  be paid upon proof: 

that the products have been exported  from  the  Community, 

are of Community  origin, and 

in the case of a differentiated  refund, have reached the destination indicated on 
the  licence  or  another  destination  for  which  a  refund  was  fixed,  without 
prejudice to point  (b)  of  paragraph  7.  Exceptions  may  be made to this  rule in 
accordance with the procedure laid down in Article 45, provided conditions are 
laid down which  offer  equivalent guarantees. 

10.  Compliance  with  the  limits  on  volumes  arising  from  agreements  concluded  in 
accordance with Article 228 of the Treaty shall be ensured on the basis of the export 
certificates issued for the reference periods provided for therein and applicable to the 
products  concerned.  With  regard to  compliance  with  the  obligations  arising under 
the Agreement on Agriculture concluded in the Uruguay  Round trade negotiations, 
the ending  of a reference  period  shall  not affect  the validity  of  export licences. 

11.  Detailed^ rules  for  the  application  of  this  Article,  including  provisions  for  the 
redistribution  of  unallocated  or unused  exportable  quantities,  shall  be  adopted  in 
accordance with the procedure laid down in Article  45. 

Article 35 

1.  Save as otherwise provided for in this Regulation  or in provisions adopted pursuant 
thereto,  the  following  shall  be  prohibited  when  importing  products  listed  in 
Article  1(2) from third countries: 

the levying  of  any  charge having  equivalent  effect  to a customs duty, 

the  application  of  any  quantitative  restriction  or  measure  having  equivalent 
effect. 

2.  The  general  rules  for  the  interpretation  of  the  Combined  Nomenclature  and  the 
special  rules for its application  shall  apply to the classification  of products covered 
by  this  Regulation;  the  tariff  nomenclature  resulting  from  the  application  of  this 
Regulation  shall  be incorporated in the common customs tariff. 

Article  36 

1.  Appropriate measures may be taken when trading with third countries if,  by reason 
of imports or exports, the Community market in one or more of the products listed 
in  Article  1(2)  is  affected  by,  or  is  threatened  with,  serious  disturbance  likely  to 
jeopardize achievement  of the objectives set out in Article  39 of the Treaty. 

37 

Such measures may  be applied  only until,  depending  on the case, the disturbance or 
threat  of  disturbance  has  ceased  or  the  quantities  withdrawn  or  bought  in  have 
diminished  appreciably. 

The  Council,  acting  on  a  proposal  from  the  Commission  in  accordance  with  the 
voting procedure  laid  down  in  Article 43(2) of the Treaty,  shall  adopt  general  rules 
for  application  of  this  paragraph  and  shall  define  in  what  cases  and  within  what 
limits Member  States  may  take  protective  measures. 

2. 

If the situation referred  to in paragraph  1  arises, the Commission  shall, at the request 
of a Member  State or on its own initiative, decide upon the necessary  measures; the 
Member  States  shall  be  notified  of these and  they  shall  be  immediately  applicable. 
If the Commission  receives a request  from  a Member  State, it  shall  take a decision 
thereon  within  three  working  days following  receipt  of the  request. 

3.  Measures decided  upon by  the  Commission  may be  referred  to  the Council by any 
Member  State within  three  working  days  of  the  day  on  which  they  were  notified. 
The Council  shall meet without delay. It may, acting by a qualified  majority,  amend 
or  annul the measure in  question. 

4.  This  Article  shall  be  applied  having  regard  to  the  obligations  arising  from 
international  agreements concluded  in accordance with Article 228(2) of the Treaty. 

Title  VI 

National  and  Community  checks 

Article  37 

1.  Member  States  shall  take  the  necessary  measures  to  ensure  compliance  with 
Community rules in the fruit  and vegetables sector, particularly  in the fields referred 
to in  Annex  IV. 

2.  Checks  shall  be  carried  out  either  systematically  or  by  sampling.  In  the  case  of 
sampling,  Member  States  shall  ensure,  by  their  nature  and  frequency  and  on  the 
basis of risk analysis, that the checks are appropriate to the measure concerned both 
in  terms  of  their  territory  as  a  whole  and  in  terms  of  the  volume  of  fruit  and 
vegetable  sector  products  marketed  or  held  with  a view  to  marketing. 

The utilization  of public funds  must be systematically  checked, without prejudice  to 
the  implementation  of  systematic  checks in  other  fields. 

3.  Member  States shall  ensure that the competent  authorities  have  a sufficient  number 
of  suitably  qualified  and  experienced  staff  to  carry  out  the  checks  effectively, 
particularly  in the  fields  referred  to  in  Annex  IV. 

38 

Article 38 

1.  Without prejudice  to the  checks  carried  out by  the  national  authorities  pursuant to 
Article  37, the Commission  shall, in collaboration with the competent authorities of 
the  Member  State  concerned,  carry  out  on-the-spot  checks  or  cause  them  to  be 
carried out  in order to ensure  uniform  application  of  Community  rules  in the  fruit 
and vegetable  sector,  particularly  in the fields referred  to in Annex  IV. 

2.  The Commission  shall inform the relevant Member State in advance and in writing 
about the subject, purpose and location of the checks it envisages, the date on which 
they  are to commence  and the identity  and status of  its inspectors. 

Article 39 

1.  The  Commission  shall  establish  a  special  corps  of  inspectors  in  the  fruit  and 
vegetable  sector  consisting  partly  of  Commission 
inspectors  with  suitable 
qualifications,  technical  knowledge  and  experience  and  partly  of  Member  States' 
staff  as indicated in  Article 37(3). 

2.  The  special  corps  of  inspectors  shall,  under the  Commission's  direction,  discharge 

the following tasks: 

(a)  collaborate on the checks planned and carried out by the competent  authorities 

of the Member States; 

(b)  carry  out  checks  at the  Commission's  initiative,  in  which  the  officials  of  the 

Member  State may participate; 

(c)  assess  the  national  verification  arrangements  set  up,  the  procedures  followed 

and the results obtained; 

(d)  ascertain the measures, legal  and otherwise, taken by the competent authorities 
to improve compliance with Community rules in the fruit and vegetable sector; 

(e)  develop collaboration  and the exchange of information  between the competent 
bodies of the Member  States in order to contribute to the uniform  application 
of the rules in the fruit and vegetable sector and facilitate free movement of the 
products of the sector. 

3.  With  regard  to  the  checks  to  be  carried  out  under  point  (b)  of  paragraph 2,  the 
Commission shall, in good time before the start of operations, inform the competent 
authority of the Member State on whose territory these operations are to take place. 

4.  The  Commission  shall  itself  determine the most  appropriate  places  for  the  checks 
to be carried out and shall  determine the practical  arrangements pertaining to them. 

39 

Article 40 

1. 

In  carrying  out  their  duties  the  Commission's  corps  of  inspectors  shall,  without 
prejudice  to  the  limits  imposed  by  the  Member  States  on  their  own  officials  in 
carrying out the checks concerned,  have the following rights and powers: 

(a)  access to all  premises, warehouses,  land,  installations  and  means of transport 

which may be connected with the checks, 

(b)  the right to call  on any  operator  concerned  to provide  an explanation  of any 

m  aft*»r 
matter, 

(c)  access  to  all  legal  and  accounting  data  or  documents  and  other  documents 

relevant to the checks and the right to take copies or extracts. 

The  Commission's  inspectors  shall,  in  the  course  of  checks,  adopt  an  attitude 
compatible with the rules and professional  practices which officials  of the Member 
State must follow.  They  shall observe professional  confidentiality. 

2.  The Commission  shall establish appropriate links with the competent authorities of 
the Member  States in order to draw up joint  control  programmes. Member  States 
shall cooperate with the Commission to facilitate  its accomplishment  of this task. 

3.  The Commission shall communicate the results of the visits made by its inspectors 
to the competent authority of the Member State concerned as soon as possible. That 
communication shall record any difficulties  encountered and infringements  noted of 
the rules in force. 

4.  The Member  State concerned  shall  inform  the Commission  as soon as possible of 
the steps it has taken to put an end to the difficulties  or infringements  in question. 

Article 41 

Findings reported to a Member State under Article 40(3) may be treated as those referred 
to in Article 5 of Regulation  (EEC) No 729/70. 

Title VH 

General  provisions 

Article 42 

Save as otherwise provided in this Regulation, Articles 92, 93 and 94 of the Treaty shall 
apply to the production  of and trade in the products referred  to in Article 1. 

40 

Article 43 

1.  Member States and the Commission shall communicate to each other the information 
necessary  for  applying .this  Regulation.  The  data  to  be  communicated  shall  be 
determined in accordance with the procedure laid down in Article 45. Rules for the 
communication and distribution of such information  shall be adopted in accordance 
with the same procedure. 

2.  Without  prejudice  to  Articles  11  and  19,  the  information  on  cultivated  areas  and 
quantities harvested,  marketed  or not put on  sale under  Article 20 which  producer 
organizations shall collect from their members, and also the terms and conditions on 
which  this  information  shall  be  collected  by  one  or  more  producer  organizations 
designated by the Member State in question irom  individual  producers who do not 
'belong to any  of the collective  structures  provided  for  in this Régulation,  shall  be 

determined  in accordance with the procedure laid  down in Article 45. 

3.  Member  States  shall  ensure  the  statistical  processing  of  the  data  referred  to  in 
paragraph 2. They shall adopt all the control measures needed to verify the accuracy 
of the data. They  shall  inform  the Commission  of those measures. 

Article 44 

A  Management  Committee  for  Fresh  Fruit  and  Vegetables,  hereinafter  referred  to  as 
"the Committee", shall be set up, consisting of representatives of the Member States and 
chaired by  a representative  of the Commission. 

Article 45 

1.  Where reference  is  made to the procedure  laid  down  in  this  Article,  the  chairman 
shall  refer  the  matter  to  the  Committee  either  on  his/her  own  initiative  or  at the 
request of the representative  of  a Member State. 

2.  The representative  of the Commission  shall  submit to the Committee a draft of the 
measures to be taken.  The Committee  shall  deliver its  opinion  on the draft  within 
a  time  limit  which  the  chairman  may  lay  down  according  to  the  urgency  of  the 
matter. The opinion  shall be  delivered by the majority  laid down in  Article  148(2) 
of the Treaty in the  case  of  decisions  which the Council  is  required to adopt on a 
proposal  from  the  Commission.  The  votes  of  the  representatives  of  the 
Member  States within the Committee shall be weighted in the manner set out in that 
Article.  The chairman  shall  not vote. 

3.  The Commission  shall  adopt measures which  shall  apply immediately.  However,  if 
these measures are not in accordance with the opinion of the Committee, they  shall 
be  communicated  by  the  Commission  to the  Council  forthwith.  In that  event  the 
Commission may defer application of the measures which it has decided for a period 
of  not more than one month from the date of  such  communication. 

The Council,  acting by qualified  majority,  may take a different  decision within one 
month. 

41 

Article  46 

The  Committee  may  consider  any  other  question  referred  to it by  its chairman  either on 
his/her  own  initiative  or  at  the  request  of  the  representative  of  a Member  State. 

Article  47 

The rules for  the application  of this Regulation,  and  in particular  of Titles II, III and VI, 
shall  be  adopted  in  accordance  with  the  procedure  laid  down  in  Article 45. 

Article  48 

This Regulation  shall  be  so  applied  that  appropriate  account  is  simultaneously  taken  of 
the  objectives  set  out  in  Articles  39 and  110 of the  Treaty. 

Article  49 

Member  States  shall  take  all  appropriate  measures  to  penalize  infringements  of  the 
provisions  of this Regulation  and to forestall  and  bring  to  an  end  any  fraud. 

Article  50 

The  laws,  regulations  and  administrative  provisions  adopted  by  Member  States  for  the 
application or in application of this Regulation shall be communicated to the Commission 
no  later  than  one month  after  their  adoption.  The  same  shall  apply  to  any  modification 
of  the  said  provisions. 

Article  51 

1.  Expenditure relating to the payment of the Community withdrawal  compensation and 
to  Community  financing  of  the  operational  fund,  the  specific  measures  referred  to 
in Article  17 and the checks referred  to in Articles  38 and 39 shall be deemed  to be 
intervention  to  stabilize the agricultural  markets within the meaning of point  (b) of 
Article  1(2) of  Regulation  (EEC) No  729/70. 

2.  The  aid  granted  by  the  Member  States  in  accordance  with  Article  14  shall 
the  meaning  of  Article  2(1)  of 
be  considered  a  common  measure  within 
Council  Regulation  (EEC)  No  4256/88(14).  It  shall  be  covered  by  the  annual 
expenditure  forecasts  referred  to  in  Article  31(1)  of  Council  Regulation  (EEC) 
No  2328/91(15). 

Article  1(3) of Regulation  (EEC) No 2328/91  shall  apply  to the aid provided  for  in 
this  paragraph. 

(14)  OJ No  L  374,  31.12.1988,  p. 25. 
(15)  OJ No L  218,  6.8.1991, p.  1. 

42 

3.  Aid  shall  be  paid  in  accordance  with  Article  21  of  Council  Regulation  (EEC) 
No  4253/88(16). However, payment of the balance or reimbursement  shall, in addition 
to  the  requirements  specified  in  paragraph  4  of  that  Article,  be  based  on: 

(a)  a  declaration  of  the  expenditure  incurred  by  the  Member  States  during  the 

calendar  year,  and 

(b)  a report on the application  of the measures during the calendar year  concerned, 

drawn  up  in  accordance  with  Article  25(4)  of  that  Regulation, 

to  be  presented  to the  Commission  before  1 July  of  the  following  year. 

4.  The Commission  shall  adopt  rules  for  the application  of  paragraphs  2 and  3 of this 
Article after  consulting the committee refened  to in Article  29 of Regulation  (EEC) 
No 4253/88. 

5.  The  provisions  of  Title  VI  shall  apply  without  prejudice 

Council  Regulation  (EEC)  No  4045/89(17). 

to  application  of 

Article  52 

By  31 December  2000 the Commission  shall  send the Council  a report  on the  operation 
of  this Regulation,  accompanied  by  any  proposals that  may  be  required. 

Article  53 

Regulations  (EEC) Nos  1035/72,  3285/83,  1319/85, 2240/88,  1121/89  and  1198/90  are 
hereby  repealed. 

References  to those Regulations  shall be understood  as references  to this Regulation  and 
are to be  read  in conjunction  with  the  correspondence  tables  in  Annex  V. 

This  Regulation  shall  enter  into  force  on  1 January  1996. 

Article  54 

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

Done  at  Brussels, 

For  the  Council 
The  President 

(,6)  OJ No L  374,  31.12.1988,  p.  1. 
(17)  OJ  No L  388, 30.12.1989,  p.  18. 

43 

ANNEX  I 

UN/ECE standards, for  fresh  fruit  and vegetable  recommended  by 
the Working  Group for Perishable Product  Standardization  and Quality  Improvement 
(United  Nations,  New  York,  1991) 

PRODUCT 

APPLICABLE  STANDARD 

DF-05 
FFV-01 
FFV-~02 
FFV-03 
FFV-04 
FFV-05 
FFV-06 
FFV-08 
TFV-09 
FFV-10 
FFV-11 
FFV-12 
FFV-13 
FFV-14 
FFV-41 
FFV-15 
FFV-18 
DF-03 
FFV-46 
FFV-21 
FFV-22 
FFV-23 
FFV-25 
FFV-26 
FFV-27 
FFV-29 
FFV-34 
FFV-35 
FFV-28 
FFV-19 
FFV-36 
DF-01 
FFV-38 

Almonds  (not bitter) in shell 
Apples  and pears 
Apricots 
Artichokes 
Asparagus 
Aubergines 
Beans 
Brussels sprouts 
Cabbage 
Carrots 
Cauliflowers 
Celery 
Cherries 
Citrus fruit 
Courgettes 
Cucumbers 
Garlic 
Hazelnuts in shell 
Kiwis 
Leeks 
Lettuce,  curiy  and escarole  chicory 
Melons 
Onions 
Peaches  and nectarines 
Peas for  shelling 
Plums 
Spinach 
Strawberries 
Sweet  peppers 
Table grapes 
Tomatoes 
Walnuts in shell 
Witloof  chicory . 

44 

ANNEX  H 

List  of  products eligible  for  Community  withdrawal  compensation  under Article  20(2) 

Cauliflowers 
Tomatoes 
Aubergines 
Apricots 
Peaches 
Nectarines 
Lemons 
Pears (other than perry  pears) 
Table grapes 
Apples (other than cider apples) 
Satsumas 
Mandarins 
Clementines 
Oranges 

45 

ANNEX  m 

Exhaustive  list  of  rules applied  by  producer organizations  that may be extended  to 
non-member  producers (Article  18(1)) 

1.  Rules on production  information 

(a)  notification  of  growing  intentions, by product  and where appropriate variety 
(b)  notification  of  sowings  and plantings 
(c)  notification  of total  areas grown, by product and if  possible variety 
(d)  notification of anticipated tonnages and probable cropping dates by product and 

if possible variety 

(e)  periodic notification  of  quantities cropped  and available  stocks, by variety 
(f) 

information  on  storage capacities 

2.  Production  rules 

(a) 

(b) 

choice  of  seed  to  be  used  according  to  intended  destination  (fresh 
market/industrial  processing) 
thinning in orchards 

3.  Marketing rules 

specified  dates for  commencement  of cropping;  staggering  of marketing 

(a) 
(b)  minimum  quality  and size requirements 
(c)  preparation,  presentation, packaging  and marking  at first marketing  stage 
(d) 

indication  of  product origin 

4.  Protection  of  environment 

(a)  use  of  fertilizer  and manure 
(b)  use  of  plant-health  products and other crop protection  methods 
(c)  maximum residue content in fruit and vegetables of plant-health  products and 

fertilizers 
rules on disposal  of by-products  and used material 
rules on destruction  of  products withdrawn from the market 

(d) 
(e) 

5.  Withdrawals 

rules adopted under Article 20 in accordance with the terms of  Article 22. 

46 

ANNEX  IV 

National  and Community  inspection:  non-exhaustive  list  of matters 
that may be covered 

Articles  7 and 8 

conformity  with product standards 

Article  12 

compliance  with terms of recognition  of  producer  organizations 

Article  13 

implementation  of  action plan 

Article  14 

implementation  of  recognition  plan and utilization  of aid 

Article  15 

Article  18 

management of operational  fund and implementation  of operational 
programme  (in particular close  scrutiny  of use of  public  funds) 

compliance  with  terms  governing  the  extension  of  rules  to  non-
producers 

Articles  19 and 20  compliance  with  terms  governing  interbranch  organizations  and 

agreements  and extension  of rules 

Articles  22  et seq 

withdrawal  operations 

Article 28 

proper payment of  Community  withdrawal  compensation 

Article  29 

disposal  of products withdrawn from market 

Article  30 et seq 

application  of  rules on trade with third countries. 

47 

ANNEX  V 

Correspondence tables 

7) 

48 

Proposal  for  a 
COUNCIL  REGULATION  (EC) 
on  the  common  organization  of  the  market  in  processed  fruit  and  vegetables 

95/0248  (CNS) 

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 proposal  from  the  Commission, 

Having  regard  to the  opinion  of  the European  Parliament, 

Having  regard  to the  opinion  of  the Economic  and  Social  Committee, 

Whereas the fruit  and vegetable sector in general  is subject  to various changes which the 
Community  must  take  into  account  by  adapting  the  basic  rules  in  the  relevant  market 
organizations;  whereas,  as  regards  certain  processed  products,  account  should  also  be 
taken  of  the  effects  of  international  competition;  whereas,  in  view  of  the  numerous 
amendments  made to Council  Regulation  (EEC) No 426/86  of 24 February  1986 on  the 
common  organization  of  the  market  in  products  processed  from  fruit  and  vegetables(1), 
a  new  regulation  should,  for  reasons  of  clarity,  be  adopted; 

Whereas  it  is  desirable  to  insert  in  that  new  regulation  the  main  provisions  of  Council 
Regulation  (EEC) No 2245/88 of  19 July  1988 introducing  a guarantee threshold  system 
for  peaches  in  syrup(2),  of  Council  Regulation  (EEC) No  1206/90  of  7 May  1990  laying 
down  general  rules for  the system  of production  aid for  processed fruit  and vegetables(3), 
and  of  Council  Regulation  (EEC) No  668/93  of  17 March  1993 on the introduction  of a 
limit  to  the  granting  of  production  aid  for  processed  tomato  products(4);  whereas  these 
Regulations  should  therefore  be  repealed; 

Whereas  certain  processed  products  are  of  particular  importance  in  the  Meditenanean 
regions  of  the  Community  where  producer  prices  are  considerably  higher  than  in  third 
countries;  whereas  the  system  of  production  aid  based  on  the  signing  of  contracts 
guaranteeing  a  regular  supply  to  the  industry  against  payment  of  a  minimum  price  to 
producers,  as applied  in the past, has proved  successful  and  should be pursued; whereas, 
at  the  same  time  as for  fresh  products,  the role  of  the  producer  organizations  should  be 

(1)  OJ  No  L  49,  27.2.1986,  p.  1,  as  last  amended  by  Commission  Regulation  (EC) 

No  2314/95,  OJ No L  233, 30.9.1995, p. 69. 

(2)  OJ  No  L  198,  26.7.1988,  p.  18, as  last  amended  by  Commission  Regulation  (EC) 

No  1032/95, OJ No L  105, 9.5.1995,  p. 3. 

(3)  OJ  No L  119,  11.5.1990, p. 74, as last amended  by Regulation  (EEC) No 2202/90, 

O J N o L 2 0 1,  31.7.1990,  p. 4. 
O J N o L 7 2,  25.3.1993, p.  1. 

(4) 

49 

strengthened  in order to ensure a greater concentration  of supply, to manage supply  along 
more  rational  lines  and  to  facilitate  the  monitoring  of  compliance  with  minimum 
producer  prices; 

Whereas, in view  of the link  between  prices for  products  intended  to be  consumed  fresh 
and prices for  products  intended  for  processing,  provision  should  be made for  minimum 
producer  prices to be  determined  taking  into account  the movement  of  market  prices  in 
the  fruit  and  vegetable  sector  and  the  need  to maintain  a  sufficient  balance  between  the 
various  market  outlets  for  fresh  products; 

Whereas the amount of aid  should  compensate for the difference  between the prices paid 
to producers within the Community  and those paid in third  countries; whereas,  therefore, 
provision  should  be  made  for  a  calculation  which  takes  account  in  particular  of  that 
difference  and of the effect  of changes in the minimum price, without prejudice to certain 
technical  elements being  applied; 

Whereas, because of the abundant supply of raw materials and the elasticity of processing 
capacity, granting production  aid could, in certain cases, encourage production to expand 
considerably;  whereas,  in  order  to  avoid  any  difficulties  in  selling  processed  products, 
provision  should be made for  limits to the granting of aid in the form,  depending  on the 
product,  either  of  a  guarantee  threshold  or  of  a  system  of  quotas;  whereas,  experience 
gained in respect of processed tomato products has led to the adoption  of a more  flexible 
system intended to enhance the dynamism  of undertakings and the competitiveness of the 
Community  industry; 

Whereas the distinctive features  of the  dried  grapes sector have led to the application  of 
a  system  of  aid  for  specialized  areas  cultivated;  whereas  this  system,  together  with  the 
system  of  maximum  guaranteed  areas  designed  to  prevent  the  cultivation  of  grapes 
intended  for  drying  from  expanding  excessively,  must be included,  as in the past,  in the 
same  regulation; 

Whereas the replanting operations to combat phylloxera are being continued; whereas, in 
order to prevent  those operations  being  discontinued  while large  areas  still  remain  to be 
replanted,  the  system  of  aid  to  assist  producers  who  are  replanting  their  vineyards  to 
combat  phylloxera  should  be  maintained; 

Whereas,  in  order  to  facilitate  the  disposal  of  processed  products  and  to  bring  their 
quality  more  into  line  with  market  requirements,  provision  should  be  made  for  laying 
down  standards; 

Whereas, in the case of the dried  grape and dried fig sectors, the system  of storage at the 
end  of  a  marketing  year,  limited  to  a  certain  quantity  of  dried  grapes,  should  be 
maintained  subject  to  certain  adjustments;  whereas the  buying-in  prices  for  each  of  the 
two  products  should  be  established  having  regard  to their  distinctive  characteristics; 

50 

Whereas  provision  should  be  made  for  the  implementation  of  special  measures  to assist 
certain  sectors  which  are  threatened  by  international  competition  but  where  production 
is  of  major  importance  at  local  or  regional  level,  whereas  such  measures  must  include 
structural  improvements  to enhance competitiveness  and  promote the use of the  products 
in  question, 

Whereas by  Regulation  (EC) No  3290/94(5) the Council  has  adopted  the adaptations  and 
transitional  arrangements  required  in  the  agricultural  sector  in  order  to  implement  the 
agreements  concluded  in  the  context  of  the  Uruguay  Round  of  multilateral  trade 
negotiations,  in  particular  the  new  trade  anangements  with  third  countries  in  the 
processed  fruit  and  vegetables  sector;  whereas  the  provisions  of  Regulation  (EEC) 
No  426/86,  as  amended  by  Annex  XIV  to  Regulation  (EC)  No  3290/94,  should  be 
inserted  in this Regulation; whereas, however, in order to simplify  matters, responsibility 
for  the  implementation  of  certain  technical  provisions  relating  to  any  sugar  shortages 
should  be  in the  hands  of  the  Commission; 

Whereas  the  granting  of  certain  aid  would  compromise  the  functioning  of  the  internal 
market;  whereas,  therefore,  the  provisions  of  the  Treaty  enabling  aid  granted  by 
Member  States to be examined  and enabling aid which is incompatible with the common 
market  to be  prohibited,  should  be  extended  to cover  the  fruit  and  vegetable  sector; 

Whereas the common  organization  of the market  in processed  fruit  and  vegetables  must 
take proper  and  simultaneous  account  of the objectives  set out  in  Articles 39 and  110 of 
the  Treaty; 

Whereas,  to  facilitate  the  implementation  of  the  proposed  measures,  a  procedure  for 
close  cooperation  between  the  Member  States  and  the  Commission  by  means  of  a 
management  committee  should  be  set up, 

HAS  ADOPTED  THIS  REGULATION : 

Article 1 

1.  This Regulation  sets up a common  organization  of the market in processed  fruit  and 

vegetables. 

(5)  OJ  No  L  349,  31.12.1994,  p.  105. 

51 

2.  The  organization  shall  cover  the  following  products: 

CN  Code 

Description 

(a)  ex  0710 

ex  0711 

ex  0712 

Vegetables  (uncooked  or  cooked  by  steaming  or  boiling  in 
water) frozen,  excluding sweet corn of subheading 0710 40 00, 
olives  of  subheading  0710  80  10  and  fruits  of  the  genus 
Capsicum  or the genus Pimenta  of  subheading  0710  80  59 

Vegetables  provisionally  preserved  (for  example,  by  sulphur 
dioxide gas, in brine, in  sulphur  water  or in  other  preservative 
immediate 
in 
solutions),  but  unsuitable 
consumption, excluding olives of subheading 0711 20, fruits of 
the  genus  Capsicum  or  of  the  genus  Pimenta  of  subheading 
0711  90  10 and  sweet  corn  of  subheading  0711  90  30 

that  state  for 

Dried  vegetables, whole,  cut,  sliced,  broken  or in  powder,  but 
not further  prepared, excluding potatoes dehydrated by  artificial 
heat-drying  and  unfit  for  human  consumption  falling  within 
subheading 0712 10 00, sweet corn of subheadings 0712 90  11, 
0712  90  19 and  olives falling  within  subheading  0712  90 90 

0804  20 90 

Dried  figs 

0806 20 

ex  0811 

0812 

ex  0813 

Dried  grapes 

Fruit  and  nuts, uncooked  or  cooked  by  boiling  or  steaming  in 
water,  frozen,  not  containing  added  sugar  or other  sweetening 
matter,  excluding  frozen  bananas  falling  within  subheading 
081190  90 

Fruit and nuts, provisionally preserved (for example by sulphur 
dioxide gas, in brine, in  sulphur water or in other  preservative 
solutions),  but  unsuitable 
immediate 
in 
consumption, excluding bananas provisionally preserved falling 
within  subheading  0812 90  90 

that  state 

for 

Fruit,  dried,  other  than  that  of  heading  Nos  0801  to  0806; 
mixtures  of  nuts  or  dried  fruits  of  this  chapter  excluding 
mixtures  exclusively  of  nuts  of  heading  Nos  0801  and  0802 
falling  within  subheadings  0813  50 31  and  0813  50  39 

0814  00  00 

Peel  of  citrus  fruit  or  melons  (including  watermelons),  fresh, 
frozen,  dried  or  provisionally  preserved  in  brine,  in  sulphur 
water  or  in  other  preservative  solutions 

0904  20  10 

Dried  sweet  peppers,  neither  crushed  nor  ground 

52 

(b)  ex  0811 

Fruit  and  nuts,  uncooked  or  cooked  by  steaming  or  boiling  in 
water,  frozen,  containing  added  sugar  or  other  sweetening 
matter 

ex  1302 20 

Pectic  substances  and  pectinates 

ex  2001 

Vegetables, fruit,  nuts and other edible parts of plants, prepared 
or  preserved  by  vinegar  or  acetic  acid,  excluding: 

Fruit  of  the  genus  Capsicum  other  than  sweet  peppers  or 
pimentos  of  subheading  2001  90  20 
Sweet  corn  {Zea  mays  var.  saccharata)  of  subheading 
2001  90  30 
Yams,  sweet  potatoes  and  similar  edible  parts  of  plants 
containing  5% or more by weight  of  starch of  subheading 
2001  90 40, and 
Palm  hearts  of  subheading  2001  90  60 
Olives  of  subheading  2001  90  65 
Vine  leaves,  hop  shoots  and  other  similar  edible  parts  of 
plants  falling  within  subheading  2001  90  96 

- 

Tomatoes  prepared  or preserved  otherwise  than  by  vinegar  or 
acetic  acid 

Mushrooms  and truffles,  prepared  or preserved  otherwise  than 
by  vinegar  or  acetic  acid 

Other  vegetables  prepared  or  preserved  otherwise  than  by 
vinegar or acetic acid, frozen,  excluding  sweet corn {Zea mays 
var.  saccharata)  of  subheading  2004  90  10,  olives  of 
subheading  2004  90 99  and  potatoes  prepared  or  preserved  in 
the  form  of  flour,  meal  or  flakes  of  subheading  2004  10 91 

Other  vegetables  prepared  or  preserved  otherwise  than  by 
vinegar  or  acetic  acid,  not  frozen,  excluding  olives  of 
subheading 2005 70 00, sweet corn {Zea mays var. saccharata) 
of  subheading  2005  80  00  and  fruit  of  the  genus  Capsicum 
other  than  sweet  peppers  or  pimentos  of  subheading  2005  90 
10  and  potatoes  prepared  or  preserved  in  the  form  of  flour, 
meal  or  flakes  of  subheading  2005  20  10 

2002 

2003 

ex  2004 

ex  2005 

ex  2006  00 

Fruit,  nuts,  fruit-peel  and  other  parts  of  plants,  preserved  by 
sugar  (drained,  glacé  or  crystallized),  excluding  bananas 
preserved  by  sugar  falling  within  subheading  2006  00  90 

53 

ex  2007 

ex  2008 

ex  2009 

Jams,  fruit  jellies,  marmalades,  fruit  or  nut  purée  and  fruit  or 
nut  pastes,  being  cooked  preparations,  whether  or  not 
containing  added  sugar  or other  sweetening  matter,  excluding: 
homogenized  preparations  of  bananas  of  subheading 
2007  10 
jams,  jellies,  marmalades,  puree  or  pastes  of  bananas  of 
subheadings  2007  99  39  and  2007  99  90 
bananas  otherwise  prepared  or  preserved  of  subheadings 
2008  99 48, 2008  99  69  and  2008  99  99 

Fruit,  nuts and other edible parts of  plants, otherwise  prepared 
or  preserved,  whether  or  not  containing  added  sugar  or  other 
sweetening  matter  or  spirit,  not  elsewhere  specified  or 
included,  excluding: 

- 

Peanut  butter  of  subheading  2008  11  10 
Palm  hearts of  subheading  2008  91  00 
Preparations  of the Musli  type  of  subheading  2008  92 45 
Maize  of  subheading  2008  99  85 
Yams,  sweet  potatoes  and  similar  edible  parts  of  plants, 
containing  5% or more by weight  of starch of  subheading 
2008  99 91, and 
Vine  leaves,  hop  shoots,  and  other  similar  edible  parts of 
plants falling  within  subheading  2008  99  99 
mixtures  of  banana  otherwise  prepared  or  preserved  of 
subheadings  2008  92  50,  2008  92  79,  2008  92  91  and 
2008  92 99 

Fruit  juices  (excluding  grape  juice  and  grape  must  of 
subheading  2009  60 and  banana juice  of  subheading  2009  80) 
and  vegetable  juices,  unfermented  and  not  containing  added 
spirit,  whether  or  not  containing  added  sugar  or  other 
sweetening  matter 

The  marketing  years  for  the  products  referred  to  in  paragraph  2  shall  be  fixed  in 
accordance  with  the  procedure  laid  down  in  Article 26. 

54 

Title  I 

System  of  aid 

Article 2 

1.  A  system  of  production  aid  shall  apply  to the  products  listed  in  Annex  I  obtained 

from  fruit  and vegetables  harvested  in the Community. 

2.  Production aid shall be granted to processors who have paid producers for their raw 
materials  a price  not  less  than the minimum  price under contracts  between,  on the 
one  side,  producer  organizations  recognized  or  provisionally  authorized  under 
Council  Regulation  (EC)  No  .../95(6),  and  processors  on  the  other.  The  producer 
organizations  shall  extend  the benefit  of the provisions  of this  Article to  operators 
not  affiliated  to  any  of  the  collective  structures  provided  for  in  Regulation  (EC) 
No  ..795, who undertake to market through such structures all their output intended 
for  the  manufacture  of  the  products  referred  to  in  Annex  I  and  who  pay  a 
contribution  towards  the  overall  management  costs  of  this  system  borne  by 
the organization. 

Contracts must be signed before the  start of the marketing year. 

Article 3 

1.  The minimum  price to be paid to producers  shall  be calculated  on the basis  of: 

(a) 

the minimum  price applying  during the previous marketing year; 

(b) 

the movement  of market prices in the fruit and vegetables  sector; 

(c) 

the need to ensure normal  market disposal  of fresh products for the various 
uses,  including  supply  to the processing industry. 

2.  Minimum prices shall  be fixed before the start of  each marketing year. 

3.  Minimum prices and detailed rules for the application of this Article shall be adopted 

in accordance  with the procedure  provided  for in Article 26. 

Article 4 

1.  The production aid may not exceed the difference  between the minimum price paid 
to  the  producer  in  the  Community  and  the  price  of  the  raw  material  in  the  main 
producing  and exporting third  countries 

(6)  OJ No L 

55 

2.  The  amount  of  aid  shall  be  so  fixed  as  to  enable  the  Community  product  to  be 
disposed  of at the minimum  price, within  the limit  set in paragraph  1. In  establishing 
the amount of the aid, without prejudice  to the application  of Article 5, account shall 
be  taken  in  particular  of: 

(a) 

the  difference  between  the  price  of the  raw  material  in the  Community  and 
that  obtaining  in  the  major  competing  third  countries; 

(b) 

the  amount  of  the  aid  fixed  for  the  previous  marketing  year;  and 

(c) 

where  Community  production  of  a  product  accounts  for  a  substantial  share 
of  the  market,  trends  in  the  volume  of  external  trade  and  in  the  prices 
obtaining in such trade, where the latter criterion  results in a reduction  in the 
amount  of the  aid. 

3.  The  aid  shall  be  fixed  in  terms  of  the  net  weight  of  the  processed  product.  The 
coefficients  expressing the relationship between the weight of raw material  used and 
the  net  weight  of  the  processed  product  shall  be  defined  on  a  standardized  basis. 
They  shall  be  regularly  updated  on the basis  of  experience. 

4.  Aid  shall  be granted  to  processors  only  for  processed  products  which 

(a) 

have  been  produced  from  raw  materials  harvested  in  the  Community,  for 
which  the  applicant  has  paid  at  least  the  minimum  price  referred  to  in 
Article 3; 

(b) 

meet  minimum  quality  requirements. 

5.  The price of the raw material  in main competing third  countries shall be determined 
mainly  on  the basis  of  the  prices  actually  applying  at  the farm-gate  stage  for  fresh 
products  of  a comparable  quality  used  for  processing,  weighted  on the  basis  of  the 
quantities  of  finished  products  exported  by  those third  countries. 

6.  Where  Community  production  accounts  for  at  least  50%  of  the  quantities  of  a 
product  making up the Community  consumption  market, the trends in prices and the 
quantities  of  imports  and  exports  shall  be  assessed  by  comparing  the  data  for  the 
calendar year preceding the start of the marketing year with the data for the previous 
calendar  year. 

7 

In  the  case  of  products  processed  from  tomatoes,  the  production  aid  shall  be 
calculated  for: 

(a) 

tomato  concentrate  falling  within  CN  code  2002  90; 

(b) 

whole  peeled  tomatoes  obtained  from  the  San  Marzano  variety  or  similar 
varieties  and  falling  within  CN  code  2002  10; 

56 

(c) 

whole  peeled  tomatoes  obtained  from  the  Roma  or  similar  varieties  and 
falling  within  CN  code  2002  10, 

(d) 

tomato juice  falling  within  CN  code  2009  50. 

8.  The  production  aid  for  other  products  processed  from  tomatoes  shall  be  derived,  as 
appropriate, either from  the aid calculated for tomato concentrate, with account being 
taken  in  particular  of  the  dry  extract  content  of  the  product,  or  from  the  aid 
calculated  for  whole  peeled  tomatoes  obtained  from  the  Roma  or  similar  varieties, 
with  account  being  taken  in  particular  of  the  commercial  characteristics  of 
the  product. 

9.  The  Commission  shall  fix  the  amount  of the  aid  before  the  start  of  each  marketing 
year,  in  accordance  with  the  procedure  laid  down  in  Article  26.  The  coefficients 
referred  to in paragraph  3, the minimum  quality  requirements  and the other  detailed 
rules  for  the  application  of  this  Article  shall  be  adopted  in  accordance  with  the 
same  procedure. 

5 

Article 5 

1.  A  guarantee  threshold  for  the  whole  Community  is  hereby  introduced  for  each 
marketing  year  in  the  products  refened  to.  When  the  guarantee  threshold  is 
exceeded,  the  production  aid  shall  be  reduced.  The  guarantee  threshold  shall  be: 

(a) 

582 000  tonnes  net  weight  for  peaches  in  syrup  and/or  natural  fruit  juice, 

(b) 

102 805  tonnes  net  weight  for  Williams  and  Rocha  pears  in  syrup  and/or 
natural  fruit  juice. 

2.  The  amount  by  which  the  thresholds  refened  to  in  paragraph  1 are  exceeded  shall 
be calculated  on the basis of the average quantities produced  in the three  marketing 
years  preceding  the  marketing  year  for  which  the  aid  is  to  be  fixed.  Where  the 
guarantee  threshold  is  exceeded,  the  aid  for  the  following  marketing  year  shall  be 
reduced  in  proportion  to the  amount  by  which  the threshold  is  exceeded. 

Article  6 

1.  A  quota  system  is  hereby  introduced  for  granting  production  aid  on  products 
processed  from  tomatoes.  The  production  aid  shall  be  limited  to  a  volume  of 
processed products conesponding to a weight of 6  596  787 tonnes of fresh  tomatoes. 

2.  The  volume  of  processed  products  refened  to  in  paragraph  1 shall  be  apportioned 
every  five  years  among  three  separate  product  groups,  namely  tomato  concentrate, 
tinned  whole  peeled  tomatoes  and  other  products,  on  the  basis  of  the  average 
quantities  of  products  in  each  group  produced  in  compliance  with  minimum  prices 
during  the  five  marketing  years  preceding  the  marketing  year  for  which  the 
apportionment  is  made. 

57 

the  first  apportionment,  for  the  1996/97  marketing  year  and  for 
However, 
the  subsequent  four  marketing  years,  shall  be  on  the  basis  of  the  average 
quantities  actually  produced  during  the  marketing  years  1991/92,  1992/93,  1993/94 
and  1994/95. 

3.  The quantity  of fresh  tomatoes, determined  in accordance with  paragraph  2 for  each 
product  group, shall be shared  out each year among the Member  States according to 
the average quantities produced  in compliance with minimum prices during the three 
marketing  years  preceding  the  marketing  year  for  which  the  allocation  is  made, 
excluding  1995/96, which  shall  not  be taken  into  consideration. 

However,  for  the  first  three  apportionments,  for  the  marketing  years  1996/97, 
1997/98  and  1998/99,  the  quantities  taken  into  account  in  respect  of the  marketing 
years  1992/93,  1993/94  and  1994/95  shall  be the  quantities  actually  produced. 

No  apportionment  under this paragraph  may  result  in a variation,  by  Member  State 
and  by  product  group,  of  more  than  20%  from  one  marketing  year  to  the  next. 
Where  an  apportionment  is  made  under  paragraph  2,  that  percentage  shall  be 
calculated  on  the  basis  of  the  quantities  in  the  previous  marketing  year  adjusted 
by  the  coefficients  of  variation  resulting,  for  each  group  of  products,  from 
that  apportionment. 

4.  Member  States  shall  share  out  the  quantities  allocated  to  them  between  the 
processing  undertakings  established  on  their  territory  according  to  the  average 
quantities produced  in compliance with minimum  prices during the three marketing 
years  preceding  the  marketing  year  for  which  the  allocation  is  made,  excluding 
1995/96,  which  shall  not  be  taken  into  consideration. 

However,  for  the  first  three  apportionments,  for  the  marketing  years  1996/97, 
1997/98  and  1998/99, the  quantities  taken  into  account  in  respect  of  the  marketing 
years  1992/93,  1993/94  and  1994/95  shall  be The quantities  actually  produced. 

5.  The  apportionments  refened  to  in  paragraphs  2  and  3  shall  be  carried  out  in 
accordance  with  the  procedure  laid  down  in  Article  26.  The  detailed  rules  for  the 
application  of  this  Article  shall  be adopted  in  accordance with  the same  procedure. 
They  shall  include,  in  particular,  rules  applying  to  undertakings  that  have  been  in 
business  for  less  than  three  years,  to  new  undertakings  and  in  cases  of  mergers  or 
transfers  of  undertakings. 

Article  7 

1.  Aid  shall  be  granted  for  the  cultivation  of  sultanas,  dried  grapes  of  the  Moscatel 

varieties  and  cunants  which  are  dried  for  processing. 

The amount of the aid  shall be fixed per hectare of specialized  area harvested  on the 
basis of the average yield  per hectare of the area concerned. In addition, the  amount 
of  the  aid  shall  be  fixed  to  take  account  of: 

58 

(a) 

the need to ensure that  the areas traditionally  used  to grow  the  said  crops are 
maintained, 

(b) 

the  outlets  available  for  these  dried  grapes. 

The amount of aid may be differentiated  according to grape variety  and other  factors 
which  may  affect  yield. 

2.  A  maximum  guaranteed  Community  area  is  hereby  introduced  for  each  marketing 
year equal  to the average of the areas in the Community  used  for  the crops  refened 
to  in  paragraph  1  in  the  marketing  years  1987/88,  1988/89  and  1989/90.  If  the 
specialized  areas  used  for  the  production  of  dried  grapes  exceed  the  maximum 
_  guaranteed Community area, the amount of the aid shall be reduced for the  following 

marketing  year  according  to the  extent  by which  that  area  is  exceeded. 

3.  The  aid  shall  be  granted  once the  areas have been  harvested  and  the  products  have 

been  dried  for  processing. 

4.  Producers  who  replant  their  vineyards  to  combat  phylloxera  and  who  are  not  in 
receipt of aid provided  for  under  structural  measures against that disease  chargeable 
to  the  Guidance  Section  of  the  EAGGF  shall  be  entitled,  during  three  marketing 
years, to aid  of  an amount  determined  in the light  of the amount  of the  aid  refened 
to  in  paragraph  1  and  of  the  amount  of  aid  granted  under  the  said  structural 
measures.  In  this  case, paragraph  3  shall  not  apply. 

5.  Before  the beginning  of  each  marketing  year, the  Commission  shall  fix  the  amount 
of the  aid  in  accordance  with  the procedure  laid  down  in  Article  26. In  accordance 
with  the  same  procedure,  it  shall  lay  down the  detailed  rules for  the  application  of 
this  Article  and  determine,  as  necessary,  the  extent  to  which  the  maximum 
guaranteed  area  has  been  exceeded  and  the  consequent  reduction  in  the  amount 
of  aid. 

Article  8 

Common  quality  standards  may  be  introduced  for  the  products  listed  in  Article  1(2) 
intended  either  for  consumption  in  the  Community  or  for  export  to  third  countries,  in 
accordance  with  the  procedure  laid  down  in  Article 26. 

Article  9 

1.  During  the  last  two  months  of  a  marketing  year, 

legal  or 
natural  persons approved  by the Member  States concerned, hereinafter  referred  to as 
"storage  agencies",  may  buy  in  sultanas,  cunants  and  dried  figs  produced  in  the 
Community  during  the  current  marketing  year  provided  the  products  comply  with 
quality  standards  to be  determined. 

the  agencies, 

The quantities of  sultanas and  currants bought in under paragraph  2 may  not  exceed 
27  370 tonnes. 

59 

2.  The  buying-in  price  at  which  storage  agencies  buy  in  the  products  refened  to  in 

paragraph  1 shall be: 

(a) 

(b) 

in  the  case  of  dried  figs,  the  minimum  price  for  the  lowest  quality  class, 
less 5%, 

in the case  of  sultanas and currants,  the buying-in  price in force  during the 
1994/95  marketing  year,  adjusted  each year  in  line  with  the  change  in the 
minimum  import  price  referred  to  in  Article  13  or, from the year  2000,  in 
world prices. 

3.  The products bought-in by the storage agencies shall be disposed of on terms which 
do not jeopardize  the  balance  of  the  market  and  which  ensure  equal  access  to the 
products for  sale and equal  treatment of purchasers. 

Where  products  cannot  be  disposed  of  on normal  terms,  special  measures  may  be 
taken.  In that  case,  a special  security  may  be  required  to  ensure that  undertakings 
entered into are fulfilled,  in particular those relating to the destination of the product. 
The security shall be forfeit,  in full  or in part, if undertakings are not fulfilled  or are 
fulfilled  only  in part! 

4.  Storage aid shall be granted to storage agencies for the quantities of products which 
they  have bought in  and for  the  actual  duration  of  storage.  However,  the  aid shall 
cease  to  be  granted  at the  end  of  a period  of  18  months  following  the  end  of  the 
marketing year during which the product was bought in. 

5.  Financial  compensation  equal to the difference  between the buying-in price paid by 
storage  agencies  and  the  selling  price  shall  be  granted  to  storage  agencies.  This 
compensation  shall  be  reduced  by  the  amount  of  any  profits  resulting  from  the 
difference  between the buying-in  price and the selling price. 

6.  For  the  purposes  of  applying  paragraph  1,  Member  States  shall  approve  storage 
agencies which provide adequate guarantees both that they can store products under 
satisfactory technical conditions and that they can satisfactorily  manage the products 
bought in. 

These agencies shall be required in particular to store products bought in on separate 
premises and to keep  separate accounts for those products. 

7.  The  sale  of  products bought  in  under paragraph  1 shall  be  organized  by  invitation 

to tender or at a price fixed in advance. 

Tenders submitted  shall  be taken  into account only  where a security  is lodged. 

8.  The buying-in price referred to in paragraph 2 and detailed rules for the application 
of this Article, in particular the arrangements for storage aid, financial  compensation 
and  the  buying-in  and  sale  of  products  by  storage  agencies  shall  be  adopted  in 
accordance with the procedure laid  down in Article 26. 

60 

Article  10 

1. 

In  the  case  of  products  covered  by  Article  1  which  are  of  major  economic  or 
ecological  importance  at local  or regional  level  and are facing  strong  international 
competition,  special  measures  to  promote  them  and  enhance  their  competitiveness 
may be taken in accordance  with the procedure  laid  down  in Article 26. 

Such measures may  include,  in particular: 

(a) 

(b) 

action to improve the suitability  for processing  of products harvested and to 
adapt their characteristics to the needs of the processing  industry; 

action  to  perfect  the  scientific  and  technical  aspects  of  new  operational 
methods  and procedures  with  a view  to  improving  quality  and/or  reducing 
production  costs  for processed products; 

(c) 

action  relating  to  the  development  of  new  products  and/or  new  uses  for 
processed products; 

(d) 

the carrying out of  economic  and market studies; 

(e) 

action to promote the consumption  and use  of the products concerned. 

2.  The  measures  provided  for  in  paragraph  1  shall  be  carried  out  by  producer 
organizations  or their  associations  recognized  under Regulation  (EC)  No  .../95,  in 
association  with  organizations  representing  the  other  branches  of  activity  in  the 
sector concerned. 

3.  A proportion of  50% of the cost of the measures referred to in paragraph  1 will  be 
. met from public funds. Of this amount, Member States shall contribute  10% and the 
Community  90%  in  the  so-called  Objective  1  regions  under  Council  Regulation 
(EEC) No 2052/88™, with Member States contributing 20% and the Community 80% 
in other regions. 

4.  Detailed  rules for  the application  of  this Article,  and in  particular for  ensuring the 
compatibility  and complementarity  of the measures provided for in this Article with 
those adopted under Article  17 of Regulation  (EC) No  .795,  on the one  hand, and 
with the measures financed under Articles 2,  5 and 8 of  Council  Regulation  (EEC) 
No 4256/88(8),  on the other,  shall be adopted in accordance with the procedure laid 
down in Article 26. 

m  OJNoL  185,  15.7.1988,  p. 9. 
(8)  OJ  No L 374,  31.12.1988,  p. 25. 

61 

Title  II 

Trade  with  third  countries 

Article  11 

1. 

Imports into the Community,  or exports therefrom,  of  any  of the products listed in 
Article  1(2) may be  subject to presentation  of  an import  or export licence. 

Licences shall be issued by Member States to any applicant, inespective  of his place 
of establishment in the Community  and without prejudice to measures taken for the 
application  of  Articles  15,  16,  17 and 18. 

Import  and export  licences  shall  be valid throughout the Community.  The  issue  of 
such  licences  may  be  subject  to  the  lodging  of  a  security  guaranteeing  that  the 
products are imported or exported during the term of validity  of the licence; except 
in cases oîforce  majeure, the security shall be forfeited  in whole or in part if import 
or export is not carried out,  or is carried out only  partially,  within that period. 

2.  The term  of  validity  of  licences  and other detailed  rules for the application  of this 
Article  shall  be adopted in  accordance with the procedure laid down in Article 26. 

Article  12 

1.  Save as otherwise  provided  for in this Regulation,  the rates of duty in the common 

customs tariff  shall  apply  to the products listed  in Article  1(2). 

2.  Detailed rules for the application of this Article shall be adopted in accordance with 

the procedure laid down in  Article 26. 

Article  13 

1.  A minimum import price for the  1995,  1996,  1997,  1998 and  1999 marketing years 
shall  be fixed for the products listed  in Annex  II.  The minimum  import price shall 
be determined  having  regard  in  particular to: 

- 

- 

- 

- 

the free-at-frontier prices on import into the Community, 

the prices obtaining  on world markets, 

the situation  on the  internal  Community market, 

the trend of trade with  third countries. 

Where the minimum import price is not observed, a countervailing charge in addition 
to  customs  duty  shall  be  imposed,  based  on  the  prices  of  the  main  supplier third 
countries. 

62 

2.  The  minimum  import  price  for  dried  grapes  shall  be  fixed  before  the  beginning  of 

the  marketing  year. 

A minimum  import  price shall  be fixed for  cunants  and  for  other  dried  grapes.  For 
each  of  the  two  groups  of  products,  the  minimum  import  price  may  be  fixed  for 
products in immediate  packing of a net weight to be determined  and for  products in 
immediate  packing  of  a  net  weight  exceeding  that  weight. 

3.  The minimum  import price for processed cherries shall be fixed before the beginning 
of the marketing year.  The price may be fixed for  products in immediate packing of 
a  determined  net  weight. 

4.  The minimum  import  price  to be  observed  for  dried  grapes  shall  be that  applicable 
on the  day  of  importation.  The  countervailing  charge to  be  levied,  if  any,  shall  be 
that  which  is applicable  on  the  same  day. 

5.  The minimum price to be observed for import of sour cherries and processed  cherries 
shall  be that  applicable  on  the  day  of  acceptance  of  entry  for  free  circulation. 

6.  Countervailing  charges  for  dried  grapes  shall  be  fixed  by  reference  to  a  scale  of 
import  prices.  The  difference  between  the  minimum  import  price  and  each  step  of 
the  scale  shall  be: 

1% of the  minimum  price  for  the  first  step, 

-  3.6 and 9%, respectively,  of the minimum  price for  the  second,  third  and  fourth 

steps, 

The fifth step of the scale  shall  cover  all  cases where the import price is lower than 
that  applied  for  the  fourth  step. 

The maximum countervailing charge to be fixed for dried grapes shall not exceed the 
difference  between the minimum  price and an amount determined on the basis of the 
most favourable  prices applied  on the world  market for  significant  quantities by  the 
most  representative  non-member  countries. 

7.  Where  the  import  price  for  sour  cherries  and  processed  cherries  is  less  than  the 
minimum  price  for  those  products,  a  countervailing  charge  equal  to  the  difference 
between  those  prices  shall  be  levied. 

8.  The minimum  import  price,  the  amount  of  the  countervailing  charge  and  the  other 
rules for  the implementation  of  this Article  shall  be  adopted  in  accordance with  the 
procedure  laid  down  in  Article 26. 

63 

Article  14 

1. 

In  order  to  prevent  or  Counteract  adverse  effects  on  the  market  in  the  Community 
which  may  result  from  imports  of  certain  products  listed  in  Article  1(2), imports of 
one or more of  such  products  at the  rate  of duty  laid  down  in the  common  customs 
tariff  shall  be  subject  to  payment  of  an  additional  import  duty  if  the  conditions  set 
out  in  Article  5  of  the  Agreement  on  Agriculture  concluded  in  accordance  with 
Article  228  of  the  Treaty  in  the  framework  of  the  Uruguay  Round  of  multilateral 
trade  negotiations  have  been  fulfilled,  unless  the  imports  are  unlikely  to  disturb 
the  Community  market,  or  the  effects  would  be  disproportionate  to  the  intended 
objective. 

2.  The  trigger  prices  below  which  an  additional  duty  may  be  imposed  shall  be  those 
forwarded  by  the  Community  to the  World  Trade  Organization  in  accordance  with 
its  offer  tabled  during the  Uruguay  Round  of  multilateral  trade  negotiations. 

The  trigger  volumes  to  be  exceeded  in  order  to  have  the  additional  import  duty 
imposed  shall  be  determined  in  particular  on  the  basis  of  imports  into  the 
Community  in  the  three  years  preceding  the  year  in  which  the  adverse  effects 
referred  to in  paragraph  1 arise  or  are likely  to  arise. 

3.  The import  prices to  be taken  into  consideration  for  imposing  an  additional  import 
duty  shall  be  determined  on  the  basis  of  the  cif  import  prices  of  the  consignment 
concerned. 

The  cif  import  prices  shall  be  verified  for  this  purpose  on  the  basis  of  the 
representative  prices  for  the  product  in  question  on  the  world  market  or  on  the 
Community  import  market  for  the  product. 

4.  Detailed rules for the application  of this Article shall be adopted  in accordance with 
the procedure laid down in Article 26. Such detailed rules shall  specify  in particular: 

(a) 

(b) 

the  products  to  which  additional  import  duties  may  be  applied  under 
Article  5 of  the Agreement  on  Agriculture; 

the other criteria necessary  for  application  of paragraph  1 in accordance with 
Article  5 of  the  Agreement  on  Agriculture. 

Article  15 

1.  Tariff  quotas  for  the  products  listed  in  Article  1(2)  resulting  from  agreements 
concluded  in the framework  of the Uruguay Round  of multilateral  trade negotiations 
shall  be  opened  and  administered  in  accordance  with  detailed  rules  adopted  in 
accordance  with  the  procedure  laid  down  in  Article  26. 

64 

2.  Quotas  may  be  administered  by  applying  one  of  the  following  methods  or  a 

combination  thereof: 

(a) 

(b) 

(c) 

a method  based  on the chronological  order  in which  applications  are lodged 
(on  a  "first  come,  first  served"  basis); 

a  method  allocating  quotas  in  proportion  to  the  quantities  requested  when 
applications  are  lodged  (using  the  "simultaneous  examination"  method), 

a  method  based  on  taking  traditional  trade  flows  into  account  (using  the 
"traditional/new  arrivals"  method). 

Other  appropriate  methods  may  be  adopted. 

They  must  avoid  discrimination  between  the  operators  concerned. 

3.  The method  of administration  adopted  shall, where appropriate,  take account  of the 
supply  needs  of  the  Community  market  and  the  need  to  safeguard  the  equilibrium 
of  that  market,  whilst  at  the  same  time  drawing  on  methods  applied  in  the  past  to 
quotas conesponding to those referred  to in paragraph  1, without prejudice  to rights 
arising from  agreements concluded in the framework  of the Uruguay Round  of trade 
negotiations. 

4.  The detailed rules referred  to in paragraph  1 shall provide for annual quotas, suitably 
phased  over  the  year,  shall  determine  the  administrative  method  to  be  used  and, 
where  appropriate,  shall  include: 

(a) 

guarantees  covering  the  nature,  provenance  and  origin  of the  product; 

(b) 

(c) 

recognition  of the document  used  for  verifying  the guarantees referred  to in 
(a);  and 

the  conditions  under  which  import  licences  are  issued  and  their  term  of 
validity. 

1.  To the  extent  necessary  to  enable  export  of: 

Article  16 

(a) 

economically  significant  quantities  of  the  products  without  added  sugar 
refened  to  in  Article  1(1); 

(b) 

white  and  raw  sugar  falling  with  CN  code  1701, 

glucose  and  glucose  syrup  falling  within  CN  codes  1702  30  51, 
1702  30  59,  1702  30 91,  1702  30  99  and  1702 40 90, 

65 

isoglucose falling within  CN codes  1702 30  10,  1702 40  10,  1702 60 10 
and  1702 90  30, and 

beet  and cane  syrups falling  within  CN code  ex  1702  90 99, 

used  in  the  products  listed  in  Article  1 (2)  (b),  on  the  basis  of  prices  for 
those  products  in  international  trade  and  within  the  limits  resulting from 
agreements  concluded  in  accordance  with  Article  228  of  the  Treaty,  the 
difference between those prices and prices in the Community may be covered 
by  export refunds. 

2.  The method to be adopted for the allocation of the quantities which may be exported 

with a refund  shall  be the method which: 

(a) 

is most suited to the nature of the product and the situation on the market in 
question,  allowing the most efficient  possible use of the resources available 
and takes due account of the efficiency  and structure of Community exports, 
without, however, creating discrimination between large and small operators; 

(b) 

least  cumbersome  administratively 

is 
requirements taken into account; 

for  operators,  administration 

(c) 

avoids any discrimination  between the operators concerned. 

3.  Refunds  shall be the same for the whole  Community. 

Where the international trade situation or the specific requirements of certain markets 
make  this  necessary,  the  refund  on  a  given  product  may  vary  according  to  the 
destination of the product. 

Refunds  shall  be  fixed  in  accordance  with  the  procedure  laid  down  in  Article  26. 
Refunds  shall  be fixed at regular intervals. 

Refunds fixed at regular intervals,  may, if necessary,  be amended in the interval by 
the Commission  at the request  of  a Member  State or on its own initiative. 

4.  Refunds  shall  be  granted  only  on  application  and  on  presentation  of  the  relevant 

export licence. 

5.  The  refund  applicable  to  exports  shall  be that applicable  on the  day  of  application 
for the licence and, in the case of a differentiated  refund, that applicable on the same 
day: 

(a) 

for the destination  indicated  on the licence; or 

(b) 

for  the  actual  destination  if  it  differs  from  the  destination  indicated  on the 
licence.  In  that  case,  the  amount  applicable  may  not  exceed  the  amount 
applicable for the destination  indicated  on the licence. 

66 

Appropriate  measures  may  be taken  to prevent  abuse  of  the  flexibility  provided  for 
in  this  paragraph. 

6.  Paragraphs 4 and 5 may be waived  in the case of products on which refunds  are paid 
under food-aid  operations, in accordance with the procedure laid down in Article 26. 

7.  Compliance  with  the  limits  on  volumes  arising  from  agreements  concluded  in 
accordance with Article 228 of the Treaty shall be ensured on the basis of the export 
certificates issued for the reference  periods provided for therein and applicable to the 
products concerned. With regard to compliance with the obligations arising under the 
agreements  concluded 
trade 
negotiatioons, the ending of a reference  period  shall  not affect  the validity  of export 
licences. 

the  Uruguay  Round  of 

the  framework  of 

in 

8.  Detailed  rules  for 

the  application  of  this  Article,  including  provisions  on 
redistribution  of  unallocated  or  unused  exportable  quantities,  shall  be  adopted  in 
accordance with the  procedure  laid  down  in  Article 26. 

Article  17 

1.  This Article  shall  apply  to the  refunds  referred  to  in  point  (a)  of  Article  16(1). 

2.  The following  shall  be taken  into  account  when  refunds  are being  fixed: 

(a) 

the existing  situation  and  future  trends with  regard  to: 

prices and availability  on the Community  market  of products  processed 
from  fruit  and  vegetables, 

prices ruling  in  international  trade; 

(b) 

minimum  marketing  and  transport  costs  from  the  Community  markets  to 
ports  or  other  points  of  export  in  the  Community,  as  well  as  costs  of 
shipment  to the countries  of  destination; 

(c) 

the  economic  aspect  of  the  proposed  exports; 

(d) 

limits  resulting  from 
Article  228  of  the  Treaty. 

the  agreements  concluded 

in  accordance  with 

3.  When  prices  on  the  Community  market  are  being  determined  for  the  products 
referred  to  in  point  (a)  of  Article  16(1),  account  shall  be  taken  of  the  ruling  prices 
which  are most  favourable  from  the  point of  view  of  exportation. 

67 

The  following  shall  be  taken  into  account  when  prices  in  international  trade  are 
being determined: 

(a) 

prices ruling on third-country  markets; 

(b) 

the most favourable prices in third countries of destination for imports from 
third countries; 

(c) 

producer prices recorded  in exporting  third countries; 

(d) 

offer  prices at the Community  frontier. 

4.  The refund  shall  be paid upon proof that: 

- 

the products have been exported from the Community, 

- 

- 

the products are of  Community  origin, and 

in the case of  a differentiated  refund  the products  have reached the  destination 
indicated  on the licence  or another destination  for which  the refund  was fixed, 
without  prejudice  to  point  (b)  of  Article  16(5).  However,  exceptions  may  be 
made  to  this  rule  in  accordance  with  the  procedure  laid  down  in  Article  26, 
provided conditions are laid down which offer  equivalent guarantees. 

5.  Detailed rules for the application of this Article shall be adopted in accordance with 

the procedure laid down in Article 26. 

Article  18 

1.  This Article  shall  apply  to the refunds  referred to in point (b) of Article  16(1). 

2.  The amount of the refund  shall  equal: 

- 

- 

- 

for  raw  sugar,  white  sugar  and beet  and  cane  syrup,  the  amount  of  the  export 
refund  for  such  products  in  the  unprocessed  state,  fixed  in  accordance  with 
Article  17  of  Council  Regulation  (EEC)  No  1785/81(9)  and  its  implementing 
provisions, 

for  isoglucose,  the  amount  of  the  export  refund  for  that  product  in  its 
unprocessed  state,  fixed  in  accordance  with  Article  17  of  Regulation  (EEC) 
No  1785/81  and its implementing  provisions, 

for glucose and glucose syrup, the amount of the export refund for such products 
in their  unprocessed  state,  fixed  for  each  of  those products  in  accordance  with 
Article  13  of  Council  Regulation  (EEC)  No  1766/92(10),  and  its  implementing 
provisions. 

(9)  OJNoL  177,  1.7.1981,  p. 4. 
(,0)  OJNoL  181,  1.7.1992,  p. 21. 

68 

3. 

In  order to benefit  from  the refund,  processed  products  must be accompanied,  upon 
export,  by  a  declaration  from  the  applicant  stating  the  quantities  of  raw  and  white 
sugar  and  beet  and  cane  syrups,  isoglucose,  glucose  and  glucose  syrup  used  in 
manufacture. 

The accuracy  of the declaration  refened  to in the first subparagraph  shall  be  subject 
to  checking  by  the  competent  authorities  of  the Member  States  concerned. 

4. 

If  the  refund  is  insufficient  to  allow  export  of  the  products  listed  in  point  (b)  of 
Article  1(2),  the  provisions  laid  down  for  the  refund  referred  to  in  point  (a)  of 
Article  16(1)  shall  apply  to  those  products  instead  of  those  in  point  (b)  of 
Article  1(2). 

5.  The  refund  shall  be granted  on  exports  of  products: 

(a) 

which  are of  Community  origin; 

(b) 

which  have  been  imported  from  third  countries  and  on  which  the  import 
duties referred  to in Article  12 have been paid, provided the exporter proves: 

that the product to be exported  and the product previously imported  are 
one and  the  same,  and 

that  the import  duties where  collected  on  importation. 

In  the  case covered  by  (b),  the refund  on  each  product  shall  be  equal  to the  duties 
collected on importation where the latter are lower than the refund  applicable; where 
the duties collected on importation  are higher than that refund,  the latter shall  apply. 

6.  The refund  shall  be  paid  upon  proof  that: 

- 

the  products fulfil  either  of  the  two  conditions  set  out in  paragraph  5, 

- 

- 

the products  have been  exported  from  the  Community,  and 

in  the  case  of  a  differentiated  refund  the  products  have  reached  the  destination 
indicated  on  the  licence  or  another  destination  for  which  the  refund  was  fixed, 
without  prejudice  to  point  (b)  of  Article  16(5).  However,  exceptions  may  be 
made  to  this  rule  in  accordance  with  the  procedure  laid  down  in  Article  26, 
provided  conditions  are laid  down  which  offer  equivalent  guarantees. 

7.  Detailed  rules for the application  of this Article  shall be adopted in accordance with 

the  procedure  laid  down  in  Article  26. 

69 

Article  19 

1.  To the  extent  necessary  for  the  proper  working  of  the  common  organization  of  the 
markets  in cereals,  sugar and  fruit  and  vegetables, the Council, acting in  accordance 
with  the  voting  procedure  laid  down  in  Article  43(2)  of  the  Treaty  on  a  proposal 
from  the Commission,  may,  in  particular  cases,  prohibit  in  whole  or in  part  the use 
of  inward  processing  anangements  in  respect  of: 

- 

the products  referred  to  in  point  (b)  of  Article  16(1),  and 

- 

fruit  and  vegetables  intended  for  the  manufacture  of  the  products  listed  in 
Article  1(2). 

2.  However,  by  way  of  derogation  from  paragraph  1,  if  the  situation  referred  to  in 
paragraph  1 arises with exceptional  urgency  and the Community  market is disturbed 
or is liable to be  disturbed  by  the inward  processing  arrangements, the  Commission 
shall,  at  the  request  of  a  Member  State  or  on  its  own  initiative,  decide  upon  the 
necessary  measures;  the  Council  and  the  Member  States  shall  be  notified  of  such 
measures, which shall be valid for no more than six months and shall be immediately 
applicable.  If the Commission  receives a request from  a Member  State, it shall  take 
a  decision  thereon  within  a week  following  receipt  of  the  request. 

3. 

Jhe  Commission's  decision  may  be  refened  to  the  Council  by  any  Member  State 
within a week of the day on which it was notified.  The Council, acting by a  qualified 
majority,  may  confirm,  amend  or  repeal  the  Commission's  decision.  If  the  Council 
has  not  acted  within  three  months,  the  Commission's  decision  shall  be  deemed  to 
have been  repealed. 

Article  20 

1.  Where under  Article  20 of  Regulation  (EEC) No  1785/81 a levy  exceeding  ECU 5 
per  100 kilograms  is charged  on  exports of  white  sugar,  the imposition  of  a  charge 
on exports of the products listed in Article  1(2) containing a minimum of 35% added 
sugar  may  be  decided  in  accordance  with  the procedure  laid  down  in  Article 26. 

2.  The  amount  of the  export  charge  shall  be  fixed  taking  into  account: 

- 

the nature of the product processed from  fruit  of vegetables which contains added 
sugar, 

- 

the  added  sugar  content  of  the  product  in  question, 

- 

- 

- 

the  prices  of  white  sugar  in  the  Community  and  on  the world  market, 

the  export  levy  applicable  to  white  sugar, 

the  economic  implications  of  applying  the  said  charge. 

70 

3.  Detailed rules for the application  of this Article shall  be adopted in accordance with 

the procedure  laid  down  in  Article 26. 

Article 21 

1.  The  general  rules  for  the  interpretation  of  the  Combined  Nomenclature  and  the 
special  rules  for  its  application  shall  apply  to  the  tariff  classification  of  products 
covered by this Regulation; the tariff nomenclature resulting from the application of 
this Regulation  shall  be incorporated  in the common  customs  tariff. 

2.  Save as otherwise provided for in this Regulation or in provisions adopted pursuant 

thereto, the following  shall  be prohibited  in trade with third countries: 

- 

- 

the levying  of any  charge having  equivalent  effect  to a customs duty, 

the application of any quantitative restriction or measure having equivalent effect. 

Article  22 

1. 

If,  by reason  of  imports  or exports,  the  Community  market  in  one  or more of  the 
products  listed  in  Article  1(2)  is  affected  by,  or  is  threatened  with,  serious 
disturbance likely  to jeopardize the achievement  of the objectives set out in Article 
39 of the Treaty, appropriate measures may be applied  in trade with third countries 
until  such disturbance or threat of  disturbance has ceased 

The  Council,  acting  on  a  proposal  from  the  Commission  in  accordance  with  the 
voting  procedure  laid  down  in Article  43(2)  of  the Treaty,  shall  adopt the general 
rules for the application of this paragraph and shall determine the cases in which and 
limits within which Member  States may take protective measures. 

2. 

If the situation referred to in paragraph 1 arises, the Commission shall, at the request 
of a Member State or* on its own initiative, decide upon the necessary  measures; the 
Member  States  shall  be  notified  of  such  measures,  which  shall  be  immediately 
applicable. If the Commission receives a request from a Member State, it shall take 
a decision thereon within three working days following  receipt  of the request. 

3.  Measures decided  upon by the Commission  may be refened  to the Council  by any 
Member  State within  three  working  days  of  the  day  on  which  they  were  notified. 
The Council shall meet without delay.  It may, acting by a qualified  majority, amend 
or annul the measure in question. 

4.  This  Article  shall  be  applied  having  regard  to  the  obligations  arising  from 
international  agreements concluded in accordance with  Article 228(2) of the Treaty. 

71 

Title  m 

General  provisions 

Article 23 

Articles  92,  93  and  94  of  the  Treaty  shall  apply  to  the  production  of  and trade  in  the 
products referred to in Article  1(2). 

Article  24 

1.  Member States and the Commission shall communicate to each other the information 
necessary  for the application  of this Regulation.  The data to be communicated shall 
be determined  in accordance  with  the  procedure  laid  down  in  Article  26.  Detailed 
rules for the  communication  and distribution  of  such information  shall  be  adopted 
in accordance with the  same procedure. 

2.  The laws, regulations and administrative provisions adopted by Member State for the 
application  of  this  Regulation,  including  any  amendments  thereto,  shall  be 
communicated to the Commission  no later than one month after their adoption. 

3.  Member  States  shall  take  all  appropriate  measures to  penalize  infringments  of the 
provisions of this Regulation  and to forestall  and bring to an end any  fraud. 

Article 25 

A Management  Committee for  processed  fruit and vegetables,  hereinafter  referred to as 
"the Committee", shall be set up, consisting of representatives of the Member States and 
chaired by a representative  of the Commission. 

Article 26  " 

1.  Where  reference  is  made to  the procedure  laid  down  in  this Article,  the  chairman 
shall  refer  the  matter  to  the  Committee  either  on  his/her  own  initiative  or  at the 
request of the representative  of  a Member State. 

2.  The representative  of the Commission  shall  submit to the Committee a draft  of the 
measures to be taken. The Committee shall  deliver its opinion on the draft within a 
time limit which the chairman may lay down according to the urgency of the matter. 
The  opinion  shall  be  delivered  by  the  majority  laid  down  in  Article  148(2)  of  the 
Treaty in the case of decisions which the Council  is required to adopt on a proposal 
from the Commission.  The votes of the representatives of the Member States within 
the Committee shall be weighted in the manner set out in that Article. The chairman 
shall  not vote. 

72 

The Commission  shall  adopt measures which  shall  apply  immediately.  However,  if 
these  measures are not in accordance with the opinion  of the Committee, they  shall 
be  communicated  by  the  Commission  to  the  Council  forthwith.  In  that  event  the 
Commission may defer application of the measures which it has decided for a period 
of  not more than one month from  the date of  such  communication. 

The Council,  acting by qualified  majority,  may take a different  decision within one 
month. 

Article 27 

The Committee may consider any other question referred to it by its chairman either on 
his/her own initiative  or at the request of the representative  of  a Member State. 

Article 28 

Expenditure  incurred  under Article  2,  Article  7,  Article  9(4)  and  (5)  and Article  10(3) 
shall be deemed to be intervention to stabilize the agricultural markets within the meaning 
of  point (b) of Article  1(2) of  Council  Regulation  (EEC) No  729/70(11). 

Article  29 

This  Regulation  shall be  so  applied that appropriate  account  is  simultaneously  taken  of 
the objectives  set out in Articles  39  and  110 of  the Treaty. 

Article  30 

Regulations  (EEC) Nos  426/86,  2245/88,  1206/90  and 668/93  are hereby repealed. 

References to those Regulations shall be understood as references to this Regulation and 
are to be read in accordance with the correspondence  tables in Annex IH. 

This Regulation  shall  enter into force  on  1 January  1996. 

Article 31 

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

Done  at Brussels, 

For the Council 
The President 

(11)  OJ No L 94, 28.4.1970,  p.  13. 

73 

ANNEX  I 

Products referred  to in  Article  2 

CN Code 

Description 

ex  0710  80  70 
ex  0712  90 30 
0804  20  90 
ex  0813  20  00 
2002  10  10 
2002  10 90 
ex  2002  10 90 
ex  2002  90 
ex  2002  90  11 
ex 2002  90  19 
ex  2002  90 31 
ex  2002  90 39 
ex  2002  90 91 
ex 2002  90  99 
ex 2008  40  51 
ex 2008 40  59 
ex  2008  40 71 
ex 2008 40  79 
ex 2008 40 91 
ex 2008 40  99 
ex  2008  70  61 
ex  2008  70 69 
ex 2008  70  71 
ex 2008  70 79 
ex 2008  70 92 
ex  2008  70  94 
ex  2008  70  99 
2009  50 

Peeled  tomatoes,  whether or not whole,  frozen 
Tomato flakes 
Dried  figs 
Prunes derived from  dried  "d'Ente" plums 
Peeled tomatoes,  whole  or in pieces 
Unpeeled tomatoes, whole  or in  pieces 
Crush or pizza  sauce 
Other (crush or pizza  sauce) 
Tomato juice  (including  passata) 

Tomato concentrate 

Williams and Rocha pears in syrup and/or in natural fruit juice 

Peaches in syrup and/or in natural  fruit juice 

Tomato juice 

74 

ANNEX  II 

Products refened  to in Article  13 

CN Code 

Description 

0806  20 
ex  0811 

ex  0811  90 

ex  0811  90  10 

ex  0811  90  10 
éx  0811  90  10 

ex 0811  90  10 
ex  0811  90  10 
08119030. 

ex 0811  90  30 
ex  0811  90  30 

ex 0811  90  30 
ex  0811  90  30 

ex  0811  90  75 
ex  0811  90  75 

ex  0811  90  80 
ex  0811  90  10 
ex  0812 

0812  10 00 
ex  0812  10 00 
ex  0812  10 00 
2008 

Dried grapes 
Fruit and nuts, uncooked  or cooked by  steaming  or boiling in 
water, frozen,  whether or not containing  added  sugar or other 
sweetening matter 
- Other 
~  Containing  added  sugar or other sweetening matter 
—With a sugar content exceeding  13% by  weight 
—Sour  cherries {Prunus cerasus) 

Unstoned 
Other 

—Other  cherries 
Unstoned 
Other 

—Other 
—Sour  cherries {Prunus cerasus) 

Unstoned 

-—Other 
—Other  cherries 
Unstoned 
Other 

—Cherries 
—Sour  cherries {Prunus cerasus) 

Unstoned 
Other 

—Other 

Unstoned 
Other 

for 

that  state 

Fruit and nuts provisionally preserved (for example by sulphur 
dioxide gas, in brine, in sulphur water or in other preservative 
solutions)  but  unsuitable 
immediate 
in 
consumption: 
-Cherries 
—Sour cherries {Prunus cerasus) 
-Other 
Fruit, nuts and other edible parts of plants, otherwise prepared 
or preserved,  whether  or not  containing  added  sugar  or other 
sweetening  matter  or  spirit,  not  , elsewhere  specified  or 
included: 

75 

CN  Code 

2008  60 

2008  60  51 
2008  60  59 

.2008 60 61 
2008  60  69 

2008  60  71 
2008  60  79 

2008  60  91 
2008  60  99 

Description 

-  Cherries 
—Not containing  added  spirit 
—Containing  added  sugar,  in  immediate  packings  of  a  net 
content  exceeding  1kg 

—Sour  cherries  {Prunus  cerasus) 
—Other 
—Containing  added  sugar,  in  immediate  packings  of  a  net 
content  not  exceeding  1 kg 
—Sour  cherries  {Prunus  cerasus) 
—Other 
—Not  containing  added  sugar,  in  immediate packings of  a net 
content: 
— of  4.5  kg  or  more 

Sour cherries  {Prunus  cerasus) 

—Other 
— Of  less than  4.5  kg 

Sour cherries  {Prunus  cerasus) 
Other 

76 

ANNEX  III 

Table  of  equivalence 

77 

NOTE ON PRESENTATION 

The following  pages give  an estimate of the financial  implications  of the new COM for 
fruit and vegetables in various tables covering the measures  provided  for. 

The  order  in  which  they  are  presented  differs  slightly  from  the  budget:  to  make  the 
summary  easier to read and understand, it has been.divided up into three main sections: 
fresh  products,  processed  products,  and others. 

The  tables  have  the  same  structure  as  the  various  measures  laid  down  in  the  new 
Regulation, making it easier to read in conjunction with the financial  statement The only 
difference  is  the  inclusion  of  processed  citrus fruit in  the  second  section,  even  though 
they  are  governed  by  their  own  specific  Regulation.  The  third  section  covers  those 
measures which,  although they  are not specifically  provided  for  in the new Regulation, 
are nevertheless  part of the sector. 

Therefore,  for a more correct assessment of  expenditure  resulting from the reform,  it is 
preferable  to  exclude  the last  section,  which  can be left  for  any  specific  measures that 
may be adopted. 

Thus,  as  can  be  seen,  in  the  long  term  overall  expenditure  on  fresh  and  processed 
products  is  basically  stable: the  amount estimated  for the  last year of  the period  under 
consideration  is  close to the  present level  as indicated  in  the letter  amending  the  1996 
PDB, 

It  should be borne in mind that the expenditure indicated  for  1996  is  special  in  that it 
covers not only some of the new measures - actual implementation of which will  depend 
on the use made by the Producer Organizations of the new  opportunities provided - but 
also,  and above  all,  expenditure for the  1995/96  marketing year,  which  falls within  the 
former  system but most of the costs for which  are to be paid  out of  the  1996 budget. 

Thus  it  is  clear  that  there  will  be  stability,  and  at  the  same  time  a  reorientation  of 
expenditure,  as set out in the Memorandum. 

This stability is evident in the fresh product sector, in which the reduction in withdrawal 
costs is matched by an increase in contributions paid through the Operational Fund or for 
specific  operations (for which  ceilings  have been  set at the end of the period). 

Finally,  as regards processed products, the fall  in expenditure is due firstly to the gradual 
contraction of processing aid for citrus fruit and refunds  - which, however, will  stabilize 
from the last marketing year -  and secondly to the costs for the structural  adjustment  of 
dried grapes by controlling phylloxera, which should also be almost completed by the end 
of the period under consideration. 

N.B  :  "  The Commission will  make any necessary proposals for mobilisation of budget 
resources required for this proposal in conformity  with the decision on budgetary 
discipline  of 31 October  1994 and with the financial  regulation." 

78 

SUMMARY  TABLE 

PDB  96*1996 

1997 

1998 

1999 

2000 

2001 

A. Fresh Fruit  and  vegetables 
1. Support for  producer  orgazations 
1.1  Operational  fund 
1.2  Specific  operations 

Total 

0.0 

128.7 
20.0 
148.7 

180.1 
35.0 
215.1 

205.8 
40.0 
245.8 

231.6 
45.0 
276.6 

257.3 
50.0 
307.3 

257.3 
50.0 
307.3 

2.  Intervention 
2.1  Withdrawals by  producer  organizations 
2.2 Withdrawals by  non-member producers 
2.3 Pilot projects 
2.4 Free distribution 

" 

' 

Total 

3. Other fruit  and  measures 
3.1 Nuts 
3.2 Refunds 
3.3  inspector corps 

366.0 

12 
373.2 

105.0 
98.0 

Total 

203.0 

322.7 
1.0 
1.5 
5.5 
330.7 

105.0 
98.5 
0.6 
204.1 

204.8 
5.1 
1.5 
52 
216.6 

196.5 
4.9 
1.0 
5.2 
207.6 

180.4 
4.7 
1.0 
5.2 
191.3 

151.4 
4.5 
0.5 
5.2 
161.5 

127.6 
4.3 
0.5 
5.2 
137.5 

100.0 
92.2 
0.6 
192.8 

101.3 
85.9 
0.6 
187.8 

102.1 
79.6 
0.6 
182.3 

104.1 
73.3 
0.6 
178.0 

75.1 
67.0 
0.6 
142.7 

TOTAL  FRESH  PRODUCTS 

576.2 

683.4 

624.5 

641.3 

650.2 

646.8 

587.5 

B. Processed  Fruit  and  Vegetables 

4. Fruit and  vegetables 
4.1 Peaches j>ears,pranes and 
42  Dried grapes 
4.3 Tomatoes 
4.4  Citrus fruit 

5. Other fruit  and  measures 
5.1  Specific  measures 
5.2  Refunds 
5.3 Pineapples 
5.4  Raspberries 

TOTAL  PROCESSED  PRODUCTS 

figs 

Total 

106:0 
138.0 
374.0 
208.0 
826.0 

107.6 
136.7 
366.9 
189.4 
800.6 

107.6 
141.8 
373.5 
186.5 
809.5 

107.6 
147.3 
373.5 
182.9 
811.3 

107.6" 
144.9 
373.5 
179.3 
805.4 

107.6 
142.9 
373.5 
175.7 
799.7 

107.6 
141.4 
373.5 
172.1 
794.7 

14.0 
12.0 
2.0 
28.0 

20.8 
14.5 
12.4 
2.0 
49.7 

33.2 
13.6 
12.4 
2.0 
61.2 

41.5 
12.6 
12.4 
1.0 
67.5 

45.7 
11.7 
12.4 
1.0 
70.8 

49.8 
10.8 
12.4 
1.0 
74.0 

49.8 
9.9 
12.4 
0.0 
72.1 

Total 

854.0 

850.3 

870.7 

878.8 

876.1 

873.8 

866.8 

FRESH  AND PROCESSED  PRODUCTS 

1430.2 

1533.7 

1495.3  1250.1 

1526.3 

1520.6  1454.4 

6.1 Promotion 
6.2  Modernization  programmes 
6.3  Special  aid for  Greece  (transport) 
6.4  Grubbing  (peach and nectarine  trees) 

13.0 
48.0 
9.0 
74.0 

13.0 
48.0 
17.0 
74.0 

15.0 
40.0 
17.0 
0.0 

15.0 
15.0 
10.0 
0.0 

15.0 
0.0 
0.0 
0.0 

15.0 
0.0 
0.0 
0.0 

15.0 
0.0 
0.0 
0.0 

TOTAL  OTHER 

GRAND TOTAL 

144.0 

152.0 

72.0 

40.0 

15.0 

15.0 

15.0 

1574.2 

1685.7 

1567.3  1560.1  1541.3 

1535.6  1469.4 

*  The  amounts  indicated  correspond  to  the  appropriation  requirements  in the letter amending the  1996  PDB 

79 

A. FRESH  FRUIT  AND  VEGETABLES 

1. Support  for  producer  organizations 
(Art.  15) 
Producer  organizations  (POs)  are  the  linchpin  of  this reform of  the  COM: they  will  be  required  to  play  a  more 
and  more  active  role  on  the  market  It  is therefore  logical for  them to  have  the  necessary  financial  resources 
and  consequently  be  given  greater support. The  EAGGF  Guarantee  Section will  directly  support  the  POs 
by  making  a  financial  contribution  to  the  operational  fund  which they  must  set  up, and  more  particularly  to  its 
structural  part, which  is intended  to  finance  the  structural  action programmes  which  they  undertake  to 
carry  out  within  a  minimum period  of  three years and a  maximum period  of  five  years. 

1.1  Operational  fund 
(Articles  15 and  16) 
The  POs  will  receive  from  the Member  States  (national  and/or regional  authorities)  and  from  the EAGGF  an 
amount  of  50% of  the  total  operational fund;  the EAGGF contribution  is  80% (Art.  15(5)). 
This  contribution  rises  to  90% in Objective  1 regions (Art.  16(b)). Where  a  programme  or part  of  a  programme 
is implemented  by  more than one PO as part of  an international  or interbranch  measure, the  public  contribution 
rises  to  60%  (Art. 16(c) and (d)). 

share  %  EAGGF 

1996 

1997 

1998 

1999 

2000 

2001 

ECUm 

1. Amounts  of  operational  funds 

Paid  by  the  POs 
Public  contribution 

2. International  measures 

Paid by  the POs 
Public  contribution 

3.  With  interbranch  cooperation 

Paid  by  the POs 
Public  contribution 

Total  public  contribution 
Amount  to  be  paid  by  EAGGF  : 

50% 

50% 

40% 

60% 

40% 

60% 

250 
125 
125 

30 
12 
18 

20 
8 
12 

350 
175 
175 

400 
200 
200 

40 
16 
24 

30 
12 
18 

45 
18 
27 

35 
14 
21 

450 
225 
225 

50 
20 
30 

40 
16 
24 

500 
250 
250 

55 
22 
33 

45 
18 
27 

500 
250 
250 

55 
22 
33 

45 
18 
27 

155.0 

217.0 

248.0 

279.0- 

310.0 

310.0 

1. Objective  1 
2. Other 

regions 
regions 

' 

30% 

70% 

90% 
80% 

41.9 

58.6 

67.0 

75.3 

83.7 

83.7 

86.8 

121.5 

138.9 

156.2 

173.6 

173.6 

Total  EAGGF 

Real  EAGGF  %  contribution 

128.7 

180.1 

205.8 

231.6 

257.3 

257.3 

83.0% 

83.0%  83.0% 

83.0% 

83.0%  83.0% 

1.2  Specific  measures 
(Art  17) 
The  Commission  may  finance  specific  measures to improve the competitiveness  of  certain products where the general 
instruments  of  the  COM  prove  inadequate  or  unsuitable. 

Estimate 

1996 

1997  1998  1999  2000  2001 

20.0 

35.0 

40.0  45.0  50.0  50.0 

(ECUm) 

80 

2.Intervention 
( Title  IV) 
Expenditure  on  withdrawals  should  fall  eventually.  The  costs  have been  charged  to  the  budgets  of  the  years 
concerned  on  the  basis  of  the  historical  distribution  of expenditure. Thus  the  amount  for  the  1996  budget 
includes  part  of the  expenditure  on  the  1995/96  marketing year, which is not  covered  by  the  new  COM. 
The  latter  expenditure  has been  assessed  on  the  basis of  the  assumptions  in the  letter  amending  the  1996  PDB. 

2.1 Withdrawals  by  producer  organizations 
(Articles  22, 25, 28) 
Expenditure  on  withdrawals  mainly  concerns  the POs. The  quantities  that  may  be  withdrawn  and  the  withdrawal 
compensation  will  be  reduced  gradually. 

Fresh fruit  and  vegetables 
Citrus  fruit 

(ECUm) 

19% 

246.6 
76.1 

1997  1998  1999  2000  2001 

147.3-  140.4 
57.6 

56.1 

125.7 
54.7 

98.1 
53.3 

75.7 
51.9 

Total  withdrawals 

322.7 

204.8 

196.5 

180.4 

151.4 

127.6 

2.2 Withdrawals  by  non-member  producers 
(Articles  23, 25, 28) 
The  quantities  which  these  producers  may  withdraw  are limited  to  10% of  their  marketed  produce  and  the 
compensation  paid  to  them  is  reduced  by  10% and by an additional  percentage  as à  contribution  to  the 
costs  incurred  by  the  POs  to  that  end. 

Estimate 

1996  1997  1998  1999  2000  2001 

1.0 

5.1  4.9  4.7 

4.5 

4.3 

(ECUm) 

2.3  Pilot  projects 
(Art  30(2)) 
The  Commission  can  decide  to  implement  pilot projects  as part  of the free  distribution  of  fruit 

Estimate 

1996 

1997  1998  1999  2000  2001 

1.5 

1.5 

1.0 

1.0 

0.5 

0.5 

(  ECUm) 

2.4  Expenditure  on free  distribution  (sorting  and  packaging) 
(Art  29(5)) 
The  EAGGF  will  bear  the  cost  of  transport,  sorting  and packaging  involved  in the free  distribution  of  apples 
and  citrus  fruit 

Sorting and packaging 

5.5 

5.2 

5.2 

5.2 

5.2 

5.2 

1996 

1997  1998  1999  2000  2001 

(ECUm) 

81 

3.  Other fruit  and  measures 
(Articles  34  and  39 ) 
This  section  covers  expenditure  on nuts  (the  ten-year  plans for  which  will  gradually  come  to  a  close), and  on 
external  trade  arrangements,  i.e.  refunds  (taking  account  of  the commitments  entered  into  in the  Uruguay 
Round), and  management  of  the market  and  the functioning  of  the  COM 

1996 

1997 

1998 

1999 

2000 

2001 

(  ECUm) 

3.1  Nuts 

105.0 

100.0 

101.3 

102.1 

104.1 

75.1 

3.2. Refunds  - taking  account  of  GATT 

commitments  (Art. 34) 

98.5 

92.2 

85.9 

79.6 

73.3 

67.0 

3.3.  Corps  of inspector  (Art  39) 

0.6 

0.6 

0.6 

0.6 

0.6 

0.6 

Total 

204.1  192.8 

187.8 

182.3 

178.0 

142.7 

82 

B. PROCESSED FRUIT AND VEGETABLES 

9) 

4.1 Peaches, pears, prunes  and  figs 
(Articles  5, 
Expenditure  has been  assessed  on  the  basis  of  the  aid  currently  in force.  As  regards  quantities,  it  is 
assumed  that all the thresholds for  pears  and  peaches will be used and  that  there will be a slight  increase  for  figs  and 
prunes 

(ECUm) 

4.2  Dried  grapes 
(Articles  7, 
9 ) 
Dried grapes  qualify  for  aid per  hectare  (which  replaces  the former  processing  aid in  full 
- up to a maYimnm area of 53 000 ha),  for  special aid to control phylloxera  (Art. 7(4)), and for  storage  aid  limited  to 
27 370 t  (Art.  9) 

Aid per Ha 
Controlling  phylloxera 
Storage aid 
Improving  qual. 

(ECUm) 

1996 

1997 

1998 

1999 

2000 

2001 

119.7 
9.8 
3.5 
3.6 

111.4 

107.2 

23.5 
3.5 
3.4 

33.3 
3.5 
3.2 

29.4 
3.5 
2.0 

110.0 
19.6 
3.5 

119.8 

128.1 

9.8 
3.5 

Total 

136.7  141.8 

147.3 

144.9 

142.9 

141.4 

4.3  Tomatoes 
(Articles  4 , 6) 
The  quota  has been fixed at 6  596  787  t  ( fresh  product)  as at present  and  spread over the  three  groups  of 
finished  products; the allocation  may  be  revised  every  five  years in the  case of the  product  groups, and  allocation 
between the Member  States every  year  (Art6(3)).  Assessment  is based  on the aid  in force  for  the  1995/96 
marketing year on the assumption  that  all  the  quantities  will be processed  and that these will  remain  stable. 

Concentrate 
Peeled 
Other 
Additional  aid 

Total 

(  ECUm) 

1996 

1997 

1998 

1999 

2000 

2001 

230.0 
96.7 
34.2 
5.9 

241.3 
89.5 
42.7 

241.3 
89.5 
42.7 

241.3 
89.5 
42.7 

241.3 
89.5 
42.7 

241.3 
89.5 
42.7 

366.9 

373.5 

373.5 

373.5 

373.5 

373.5 

83 

4.4  Citrus  fruit 
(Art.  3) 
The  new  processing  aid  is limited  to  50% of  the  withdrawal  compensation  in force  for  the  same  marketing  year. 
The  percentage  increases to  65% in cases where  multiannual  contracts  are  concluded.  Non-member  producers 
may  qualify  for  the  system  (but  not  the  contracts), but  the  aid  they  qualify  for  is limited  to  40% of  the 
compensation. 

1996 

1997 

1998 

1999 

2000 

2001 

(ECUm) 

Lemons 
Oranges 
Mandarins 
Clementins 
Satsumas 

Total 

- - 

42.1 

47.2 
123.4  120.4 
6.5 
4.6 
7.7 

6.8 
6.2 
11.0 

41.6 
117.0 
6.4 
62 
11.6 

41.1 
113.7 
6.1 
62 
12.2 

40.6 
110.4 
5.7 
62 
12.8 

40.1 
107.0 
5.4 
6.2 
13.4 

189.4 

186.5 

182.9 

179.3 

175.7 

172.1 

5. Other fruit and measures 
This section covers expenditure on trade with third countries, i.e. refunds, taking account of the  commitments 
entered into under the Uruguay Round, expenditure  on specific .measures to improve the  competitiveness 
of certain products, part-financed  by the EAGGF, the POs and the national authorities (Art.  10), 
and  aid for  pineapples  and raspberries. 

5.1. Specific  measures 
(artikel.10) 
-Total  amount 
-  Public  contribution 
of wich EAGGF: 
-  Objective  1 
-Other 

regions 

regions 

1997 

1998 

1999 

2000 

2001 

(ECUm) 

50% 

30% 
70% 

90% 
80% 

50.0 
25.0 

6.8 
14.0 

80.0 
40.0 

10.8 
22.4 

100.0 
50.0 

110.0 
55.0 

120.0 
60.0 

120.0 
60.0 

13.5 
28.0 

14.9 
30.8' 

16.2 
33.6 

16.2 
33.6 

TOTAL  EAGGF 

20.8 

33.2 

41.5 

45.7 

49.8 

49.8 

5.2. Refunds  (art  16) 

14.5 

13.6 

12.6 

11.7 

10.8 

9.9 

5.3. Pineapples 

tonnes 

7500 

1656.46  12.4 

12.4 

12.4 

12.4 

12.4 

12.4 

5.4. Raspberries 

2.0 

2.0 

1.0 

1.0 

1.0 

Total 

49.7 

612 

67.5 

70.8 

74.0 

72.1 

84 

C. Other 

The measures in this section are not specifically  included in the new Regulation but are governed by ad-hoc 
Regulations and fall  within the fruit  and vegetables sector. Attention is drawn to the following: 

a. From  1997 onwards, the item "Promotion" includes traditional expenditure on the promotion of apples and 
citrus fruit  and on nuts. 
b. The actual level of expenditure on modernization programmes (Reg.3816/92) in  1996 and in following years 
will depend on the rate at which the programmes, for which a total amount of ECU  120m has been fixed, are 
actually im- plemented. 
c. As regards expenditure on the special aid for Greece for transport (Reg. 3438/92), it is assumed that 
the conflict  situation in former Yugoslavia will continue into  1997. Therefore  the amounts provided for in the 
letter amending the  1996 PDB will have to rise to the level of the  1995 SAB. 

6.1. Promotion 

13.0 

15.0 

15.0 

15.0 

15.0 

15.0 

1996 

1997 

1998 

1999 

2000 

2001 

(ECUm) 

62.  Modernization programmes 

48.0 

40.0 

15.0 

63.  Special aid for Greece  (transport) 

17.0 

17.0 

10.0 

6.4. Grubbing (peaches and nectarines) 

74.0 

Total 

152.0  72.0 

40.0 

15.0 

15.0 

15.0 

85 

ANNEX  I 

FINANCIAL  STATEMENT 

1 

TITLE  OF  OPERATION 

Proposal  for a Council Regulation on the common  organization  of the market in 
fruit  and vegetables. 
— 
Proposal  for a Council Regulation on the common  organization  of the market in 
processed fruit and vegetables. 

2 

3 

BUDGET  HEADING  INVOLVED 

LEGAL  BASIS 

Articles 42 and 43  of the Treaty. -

4 

DESCRIPTION  OF  OPERATION 

Objectives 

As part of the general reform of the common organizations of the markets in fresh 
fruit and vegetables and in processed fruit and vegetables, this financial  statement 
covers the following operations: 

-  Specific  measures:  Article  17  "of  the  Regulation  on  the  common 
organization  of the market  in  fruit  and  vegetables  and  Article  10  of the 
Regulation  on the common organization  of the market in processed  fruit 
and vegetables provide that specific  measures with Community  financing 
may be taken for certain products of  local  or regional  importance. 
These  specific  measures will  vary  depending  on the product in question, 
the  production  region  and  the  particular  characteristics  of  the  type  of 
production  involved.  In the  case  of  fresh  products,  these  measures  may 
include  cooperation  between  interbranch  organizations  or  cross-border 
operations,  production  improvement  measures  (grubbing),  or  varietal 
improvement for the reorientation  of production. 
In the case of processed products, the specific  measures will  be aimed at 
improving  marketing,  product  promotion,  or  identifying  new  markets, 
again  taking  account  of  the  particular  characteristics  of  the  product and 
region in question. 

-  Pilot  projects:  Article 29(2)  of  the  proposal  for  a  Regulation  on  the 
common organization of the market in fresh fruit and vegetables provides 
for the free distribution of fruit to school  children. 
This free distribution of fruit,  not as part of  school  meals,  may cover the 
initial  investments  (distribution  facilities  in  schools,  etc.),  with  the 

86 

objective of getting children into the habit of eating fruit, making it more 
readily available, and avoiding the destruction of fruit withdrawn from the 
market. 

Period  covered 

Unlimited. 

CLASSIFICATION  OF EXPENDITURE  OR  REVENUE 

Compulsory  expenditure. 
Non-differentiated  appropriations. 

TYPE  OF  EXPENDITURE 

-  Specific  operations  and  measures:  for  products  or  sectors  of  local  or 
regional  importance: 

- for fresh products: specific measures, case by case, depending on 
the product or sector, with Community  financing. 
- for processed products: 40% Community part-financing  and 10% 
at Member State level. 
For  Objective  1  regions  (in  accordance  with  Regulation  (EC) 
No 2052/88),  45%  Community  financing  and  5%  borne  by  the 
Member States. 

-Pilot  projects: as part of the free distribution of fruit to school  children. 
Community  financing. 

FINANCIAL  IMPACT 

Method  of  calculating total  cost  and indicative  schedule :-

-  Specific  measures 

1. Fresh products:  (Article  17 of the fresh fruit and vegetable Regulation): 

Estimate 

ECUm 

-total  amount 

20.0 

35.0 

40.0 

45.0 

50.0 

50.0 

1996 

1997 

1998 

1999 

2000 

2001 

2.  Processed  products  :  (Article  10 of the processed fruit and vegetable 
Regulation) 

87 

Estimate 

ECUm 

1996 

1997 

1998 

1999 

2000 

2001 

-total  amount 

50.0 

80.0 

100.0 

110.0 

120.0 

120.0 

-public contribution: 

50% 
(of which EAGGF) 

25.0 

40.0 

50.0 

55.0 

60.0 

60.0 

-Objective  1 regions  90% 
(estimate:  30%) 
-other areas 
(estimate: 70%) 

80% 

. 

6.8 

10.8 

13.5 

14.9 

16.2 

16.2 

14.0 

22.4 

28.0 

30.8 

33.6 

33.6 

TOTAL EAGGF 

20.8 

33.2 

41.5 

45.7 

49.8 

49.8 

Free  distribution: Pilot  projects (Article  20(2)  of  the  fresh  fruit and 
vegetable Regulation): 

Estimate 

1996 

15 

1997 

1.5 

1998 

1.0 

1999 

1.0 

ECUm 

2000 

0.5 

2001 
0.5 

J 

FRAUD  PREVENTION MEASURES PLANNED 

All  expenditure  under the  common  organizations  of  the  markets  in  fruit  and 
vegetables will be subject to normal scrutiny by the EAGGF. In addition, Title VI 
of the proposal for a reform of the COM in fresh fruit and vegetables provides for 
special measures on national and Community controls. Provision is made for the 
creation of a corps of Community inspectors. 

ELEMENTS  OF COST-EFFECTIVENESS  ANALYSIS 

Objectives of the operation: 
-  Specific  measures for  fresh  fruit  and vegetables  and for  processed  fruit and 
vegetables: 

To allow the Commission to propose at short notice, under a simplified 
procedure,  specific  measures for certain sectors or produce  of  local  or 
regional  importance facing strong external competition. 

- Pilot projects: 

88 

Free  distribution  is  one  way  of  disposing  of  withdrawals.  Where  it 
considers  it  necessary,  the  Commission  will  be  able  to  initiate  pilot 
projects to promote  such  free  distribution  in schools. 

Grounds  for  the  operation 

1. 

The  fruit  and  vegetables  sector  comprises  a  wide  range  of  different 
products covered by the common market organization. For most of these 
products, the common  market organization  instruments are adequate. 

However,  for some products which  are not of any crucial importance at 
Community  level,  but which  do have local  or regional  significance  and 
are  frequently  faced  with  international  competition,  it  is  difficult  to 
provide  for  a  uniform  solution.  In  order  to  be  able  to  find  the  most 
appropriate  solution  for  each  situation, the measures to be taken  should 
be laid  down  on  a case-by-case  basis  at the  appropriate time. This was 
the case with red fruit  or nuts. 

The existing legal  instruments under the COM are sometimes unsuitable 
for introducing  such  measures.  The proposal  for a Regulation  therefore 
provides for a legal  basis which will  enable the Commission to take the 
most appropriate measures  in each situation. 

In the case of fresh fruit and vegetables, these measures will complement 
the  operational  funds  and  may  include,  among  others,  cooperation 
between  interbranch  or  cross-border  organizations  or  measures  to 
improve production such as grubbing. This has already been done for red 
fruit  and  nuts,  and  will  probably  be  done  for  other  products  such  as 
garlic, asparagus and mushrooms. 

However,  in  the  case  of  processed  products,  these  measures  will  vary 
depending  on  the  product  in  question  and  the  market  situation.  They 
could  take the  form  of  operations  to  improve  the marketing  of  certain 
products  or  promote  products  experiencing  difficulties,  or  research 
programmes on  specific  problems. 
These measures, for which Community part-financing is provided for, can 
be compared to the operational  funds  for fresh products. 

2. 

Given  concern  about  public  health  in  Europe,  children  should  be 
encouraged to improve their eating habits. The use of products withdrawn 
from the markets to this  end  should be encouraged,  and will  also avoid 
the unfortunate destruction  of  such produce. 
The purpose  of  the  pilot  projects,  therefore,  is  to  show  producers that 
free distribution can promote consumption and thus reduce withdrawals. 

89 

ANNEX 

II 

FINANCIAL  STATEMENT 

1.  TITLE  OF  OPERATION 

Proposal  for  a  Council  Regulation  on the  common  organization  of  the  market  in  fruit 
and vegetables. 

(Article  14: aid to new  producer  organizations not recognized  under Regulation  (EEC) 
No  1035/72) 

2.  BUDGET  HEADING  INVOLVED  (1995  nomenclature) 

Article: 

B2-100 

Structural  measures,  EAGGF  Guidance  Section,  Community 
support  frameworks. 

Items: 

B2-1000  Objective  1 
B2-1001  Objective  5(a)  (outside  Objectives  1 and  5(b)) 
B2-1002  Objective  5(a)  (within  Objective  5(b)) 
B2-1004  Objective  6 

3. 

LEGAL  BASIS 

Article 40  of the EC  Treaty. 

4.  DESCRIPTION  OF  OPERATION 

Objectives 

The  purpose  of  the  proposal  is  the  adoption  of  a  new  Regulation  on  the  common 
organization  of the market in fruit and vegetables, in view of the fact  that changés have 
occurred  which  place the  sector  in  a new  situation  to which  producers  have to  adapt. 

Producer  organizations  cannot  be  recognized  byv Member  States  unless  they  meet  a 
number  of  conditions.  New  groupings  or  groupings  which  were  not  recognized  under 
Regulation  (EEC)  No  1035/72  and  which  wish  to  become  producer  organizations  in 
accordance  with  this  Regulation,  must  be  allowed  a  transitional  period  during  which 
they  may  be  granted  State  aid  provided  that  they  undertake  to  respect  certain 
commitments. 

Duration 

This  aid  in  the  form  of. part-financing  by  the  structural  funds  (EAGGF,  Guidance 
Section)  may  be  granted  by  Member  States  during the four-year  period  following  the 
date of preliminary  recognition. 

90 

The  duration  of  the  proposed  Regulation  is not  limited. 

5. 

CLASSIFICATION  OF  EXPENDITURE 

Non-compulsory  expenditure 

Differentiated  appropriation 

6. 

Type  of  expenditure 

Aid  for  the  part-financing  of  public  expenditure  eligible  at  a  rate  of  50%  for  zones 
outside  Objectives  1/6  and,  for  zones  covered  by  Objectives  1/6,  on  the  basis  of  the 
programming  documents for  those objectives,  in accordance with the rules currently  in 
force. 

The part-financing  rates given in the programming documents for  Objectives  1/6  areas 
follows: 

Portugal  and Ireland 
75% 
Spain 
70% 
Greece 
65% 
60% 
Germany  and  Italy 
United  Kingdom  and Finland  50% 

(The other Member  States are not planning to apply  this measure  in the zones  covered 
by  Objectives  1/6). 

7. 

FINANCIAL  IMPACT 

Method  of  calculating  total  cost  of  operation 

(a)  Aid for  the formation  and  administrative  operation  of the producer  organizations 

Article  14  of  Regulation  (EEC)  No  1035/72  provides  for  aid  for  the  first  five 
years  of  5%,  5%,  4%,  3%  and  2%  respectively  of  the  value  of  the  marketed 
production  covered  by  the producer  organization's  measure. 

The draft for the new common market organization (Doc VT/3100/95) provides for 
the  grant  of  aid  for  four  years,  the  amounts  of  which  are  to  be  established  in 
accordance with the procedure  laid  down  in  Article 45  (Management  Committee 
for  Fruit  and  Vegetables).  Without  anticipating  these  future  decisions,  one 
assumption  would  be to  fix  the  aid  for  those  four  years  at  5%,  5%,  5%  and 4% 
of the  marketed  production,  in  other words  a total  of  19%. 

The amount of the aid over four years would therefore be roughly equal to the aid 
pursuant  to Regulation  (EEC) No  1035/72  over five years  (also  a total  of  19%). 

91 

With  regard  to  Portugal,  which  benefits  from  a  higher  rate  of  aid  (Regulation 
(EEC) No  746/93),  the  percentages could  be  raised  to  10%,  10%,  10% and 8%. 

(b) 

Investment  aids 

Article  14(2)(b)  of  the  new  draft  CMO (Document  VI/3100/95)  proposes  aid to 
cover investments  required to attain recognition. 

The amount of the investment aid to be charged to the EAGGF, Guidance Section, 
is  estimated  at between  ECU  15 and 20 million  per year for  an initial  period  of 
six  years (about  20% of the average annual  1991-93 figure financed  in  the  fruit 
and vegetables  sector under Regulation  (EEC) No  866/90). 

Although  investment  aid  can  be  granted  under  Regulation  (EEC)  No  866/90, 
Article  14(2) of document VT/3100/95 provides for a set of aid measures intended 
specifically  so that producer organizations may  attain recognition. 

The aid,  which  is  an  integral  part of  the overall  process  of  recognition,  may  be 
considered an alternative finance to the "type Regulation (EEC) 866/90"  financing. 
As  a result,  it is  assumed that the financial  impact of  the investment  aid will  be 
zero,  because  it  will  be  offset  by  a reduction  in  the  amount  of  financing  under 
Regulation  (EEC) No  866/90  of the same order of magnitude. 

(c)  An  estimate  of  the  number  of  producer organizations  likely  to  benefit  from  the 
formation  aid  arrangements  can  be  found  in  Annex  I,  which  also  contains 
hypotheses for the allocation key between Objectives and the various rates of part-
financing. 

(d)  There  are  very  few  data  on  the  value  of  the  fruit  and  vegetables  marketed  by 

producer organizations.  However,  some assumptions  are possible: 

Total  value  of the annual  production of fruit and vegetables 

(EC  12) 

ECU 32 000 million 

Proportion  by  producer organizations 

+/- 60% 

Number of  producer organizations  in the Community 

+/-  1 400 

Average  production  per PO/year 

ECU  13  million 

Indicative  schedule  of  commitment  and  payment  appropriations 
A forecast of the appropriations necessary for the new aid for the formation  of producer 
organizations in the fruit and vegetables sector, broken down by Member State, year for 
the period  1996/2001  and Objective,  is given in Annex  H 

92 

Annex II also includes a forecast  of the appropriations necessary  for the new investment 
aid  per  Objective. 

8. 

PLANNED  ANTI-FRAUD  MEASURES 

The  system  of  aids  financed  by  the  EAGGF,  Guidance  Section,  in  this proposal  for  a 
Regulation is subject to Articles 23 (financial  control) and 24 (reduction, suspension  and 
cancellation  of  assistance)  of  the  structural  funds  coordination  Regulation  (Regulation 
(EEC)  No 4253/88). 

Since this is structural  assistance, Commission Regulation  (EC) No  1681/94 concerning 
irregularities  and  the recovery  of  sums  wrongly  paid  in  connection  with the  financing 
of the structural policies and the organization  of an information  system in this field, also 
applies. 

9. 

ELEMENTS  OF  THE  COST/EFFECT  ANALYSIS 

Specific  quantifiable  objectives,  target  population 

The  producer  organizations  are  already  one  of  the  pillars  of  the  current  CMO.  The 
reform  of the  CMO  implies  an  increased  effort  on  the  part  of  the  organizations  if  its 
objectives  are to be  attained: 

concentration  of  supply; 
planning  of  production; 
reduced  production  costs; 
promotion  of  environmentally  sound  techniques;  and 
management  of  withdrawals. 

There  are  two  other  important  considerations  in  the  current  situation  of  producer 
organizations: 

the  weakness  or  under-representation  of  producer  organizations  in  certain 
Community  regions; 
the  existence  of  producer  organizations  concentrating  on withdrawals  and  not  on 
a  commercial  production  role. 

That  situation  suggests  the  need  for  two  general  measures: 

assist  producer  organizations  in  increasing  their  size  and  facilitate  their  creation 
where they  do not  exist; 
make  stricter  the  Community  criteria  for  the  recognition  by  Member  States  of 
producer  organizations. 

93 

For producer organizations already  existing  but not yet recognized  these measures will 
be  implemented  within  the  adjustment  programmes  over  the  four-year  transitional 
period. 

For the new producer organizations, the reform  of the CMO proposes a measure which 
consists in the grant of  aid to: 

encourage their formation  and facilitate  their administrative operation; 
cover part of the investments  required to attain recognition. 

Target  population 

The target population is  producer organizations which  meet the following  conditions: 

any new producer organization  or one which  has not yet been  recognized under 
Regulation (EEC) No  1035/72 but which has been granted preliminary recognition 
by a Member State on the basis of a recognition plan with timetable presented by 
a  producer  organization.  The  plan  must  contain  the  elements  necessary  for 
recognition  in  accordance  with  the  conditions  of  Article  II  of  Document 
VI/3100/94. 
producer organizations already meeting the conditions referred to in Article  11 of 
Document  VI/3100/94 are not covered by  these measures. 

Justification  of  the  measure 

The increase  in start-up  aid is justified  by  the need  to improve the still  unsatisfactory 
operation  of  certain  producer organizations  and to  increase  the  effectiveness  of  other 
producer organizations while restricting the recognition criteria. 

The  advantages  of  this  measure  over  previous  measures  will  be  to  guarantee  better 
concentration of supply, particularly in regions where producer organizations are in the 
minority,  and  to  move  towards  the  elimination  of  the  problems  linked  to  producer 
organizations which can only justify  their existence by the management of withdrawals 
or the receipt of  structural  subsidies. 

The  concentration  of  supply  must be  done  on  a voluntary  basis  thanks to the  special 
effective  marketing  services  which the  producer  organizations will  be able to  offer  to 
their  members.  The  start-up  aid  measures  will  provide  an  important  support  to  the 
improvement of marketing effectiveness.  The spin-offs will be more effective marketing 
and better integration with environmental  measures. 

Monitoring and  evaluation  of  the  operation 

The  performance  indicators  are  mainly  direct  values  (withdrawals  and  the  value  of 
marketed production). 

94 

Other effects,  less tangible in the short term, will be seen in the reduction in production 
costs,  regularization of  prices and protection  of the  environment. 

Evaluation of the measure will be with the cooperation of the Member States, which are 
obliged  to  supply  reports  specifying  the  numbers  of  producer  organizations  having 
benefited from the measure and the value of their production, expressed as a percentage 
of national  production. 

Since this measure is structural assistance, Articles 25 (monitoring) and 26  (assessment) 
of the structural  funds  coordination Regulation (Regulation  (EEC) No  4253/88)  apply. 

Coherence  with  financial  planning 

Finance  is  guaranteed  within  the  allocations  for  Objectives  1 and  5(a)  for  the  period 
1994-99  (1995-99  for  the  new  Member  States).  The  new  aids  introduced  by  the 
proposed Regulation will  not have any additional impact on budget expenditure because 
they will be covered by the amounts provided for under Regulation (EEC) No  1035/72, 
by  the  products  of  annual  indexation  or by  the  transfer  of  the  amounts  provided  for 
other  measures  within  the  framework  of  the  periodic  review  of  the  financial 
programming within the  above allocations. 

95 

A N N EX  I 

1-NUMBER OF POs BENEFITING  FROM THE NEW AIDS (1) 

1996 

1997 

1998 

1999 

2000 

2001 

TOTAL 

MS 

AT 

DE 

EL 

ES 

FI 

FR 

IR 

IT 

PT 

UK 

MS 

AT 

DE 

EL 

ES 

FI 

FR 

IR 
rr 

PT 

UK 

20 

16 

62 

60 

11 

48 

229 

38,87 

19,24 

33,67 

132,08 

109,07 

3,77 

2,47 

23,66 

198,90 

2,47 

564,20 

15 

15 

14 

10 

12 

U 

11 

10 

10 

10 

TOTAL 

CUM. 

45 

45^ 

47 

92 

48 

140 

33 

173 

28 

201 

28 

229 

2  -AMOUNT OF DART-FINANCING OF POs BENEFITING FROM THE NEW AIDS  (2) 

Ecu Mi. 

1996 

1997 

1998 

1999 

2000 

2001 

TOTAL 

1,95 

1,95 

2,60 

9,75 

4,55 

0,00 

0,00 

1,95 

13,00 

0,00 

3,90 

3,25 

5,20 

19,50 

10,40 

0,65 

0,00 

3,90 

26,00 

0,00 

7,15 

4,55 

7,15 

28,60 

16,90 

0,65 

0,65 

5,20 

8,71 

4,81 

7,93 

30,55 

23,79 

0,65 

0,65 

5,46 

39,00 

46,80 

0,65 

0,65 

8,71 

2,99 

5,98 

24,70 

26,13 

1,17 

0,65 

4,16 

40,30 

0,65 

8,45 

1,69 

4,81 

18,98 

27,30 

0,65 

0,52 

2,99 

33,80 

0,52 

TOTAL 

35,75 

72,80 

110,50 

130,00 

115,44 

99,71 

?6 

3 -ESTIMATE  OF ALLOCATION BETWEEN OBJECTIVES 

MS 

%  ALLOCATION 

EO 

%  PART-FINANCING 

01/6  (3) 

5A-5A 

5A-5B 

01/6  (5) 

5A-5A 

5A-5B 

0% 

100% 

100% 

65% 

12% 

0% 

100% 

42% 

100% 

8% 

<4> 

40% 

0% 

0% 

9% 

22% 

50% 

0% 

38% 

0% 

23% 

AT 

DE 

EL 

ES 

FI 

FR 

IR 
rr 

PT 

UK 

60% 

0% 

0% 

26% 

66% 

50% 

0% 

20% 

0% 

69% 

AT 

DE 

EL 

ES* 

FI 

FR 

IR 
rr 

PT 

UK 

(6) 

50% 

50% 

50% 

. 5 0% 

50% 

50% 

50% 

50% 

50% 

50% 

0% 

60% 

65% 

70% 

50% 

0% 

75% 

60% 

75% 

50% 

50% 

50% 

50% 

50% 

50% 

50% 

50% 

50% 

50% 

50% 

_ . .. 

NOTES 
(l)Esdmate of Unit DG VTJE.1 
(2)Average production by producer organization estimated at  13 Mecu/year, the amount of aid for the three 
first years of 5% (PT10%) and 4% (PT 8%) for the fouth year 
(3)Hypothesis based on the past financial implementation (1989-93) of R 1035/72. for Finland t the 
indicative allçocation 1995-99 between 0675a has been taken 
(4)Hypothesis based on the allocation of the 5a indicative financial programming for the period  1994-99 
(5)According to the different  programming documents presented to the Commision 
(6)In accordance with R  1282/94 

97 

ANNEX II 

INDICATIVE  TIMETABLE  FOR APPROPRIATIONS  NEEDED  FOR THE NEW  AIDS FOR THE FORMATION  OF POs 

(Article  14 (2)  (a), DOC.  Vl/3100/94) 

(Ecu Mi) 

MS 

1996 

1997 

1998 

1999 

2000 

2001 

01/6 

3A-3B 

3A-3B 

01/6 

3A-3B 

3A-3B  • 

01/6 

SA-5B 

3A-3B 

01/6 

3A-3B 

3A-3B 

01/6 

3A-3B 

5A-5B 

01/6 

5A-3B 

5A-5B 

. 

oo 

AT 

DE 

EL 

ES 

FI 

FR 

IR 

IT 

PT 

UK 

0,0 

1,2 

1,7 

4,4 

0,3 

0,0 

0,0 

0,5 

9,8 

0,0 

0,4 

0,0 

0,0 

0,4 

0,5 

0,0 

0,0 

0,4 

0,0 

0,0 

TOTAL 

17,8 

1,7 

0,6 

0,0 

0,0 

1,3 

1,5 

0,0 

0,0 

0,2 

0,0 

0,0 

3,6 

0,0 

2,0 

3,4 

8,9 

0,6 

0,0 

0,0 

0,8 

0,0 

0,0 

0,9 

1,1 

0,2 

0,0 

1,0 

0,7 

19,5 

0,0 

35,3 

0,0 

0,0 

3,7 

1,2 

0,0 

0,0 

2,6 

3,4 

0,2 

0,0 

0,4 

0,0 

0,0 

7,7 

0,0 

2,7 

4,6 

13,0 

1,0 

0,0 

0,5 

1,3 

29,3 

0,0 

52,5 

1,4 

0,0 

0,0 

1,3 

1,9 

0,2 

0,0 

1,0 

0,0 

0,1 

5,8 

2,1 

0,0 

0,0 

3,8 

5,6 

0,2 

0,0 

0,5 

0,0 

0,2 

0,0 

2,9 

5,2 

13,9 

1,4 

0,0 

0,5 

1,4 

35,1 

0,0 

12,4 

60,4 

1,7 

0,0 

0,0 

1,3 

2,6 

0,2 

0,0 

1,0 

0,0 

0,1 

7,0 

2,6 

0,0 

0,0 

4,0 

7,9 

0,2 

0,0 

0,6 

0,0 

0,2 

0,0 

1,8 

3,9 

11,2 

1,6 

0,0 

0,5 

1,0 

1,7 

0,0 

0,0 

1,1 

2,9 

0,3 

0,0 

0,8 

30,2 

0,0 

0,0 

0,1 

6,8 

2,6 

0,0 

0,0 

3,2 

8,6 

0,3 

0,0 

0,4 

0,0 

0,2 

0,0 

1,0 

3,1 

8,6 

1,6 

0,0 

0,4 

0,8 

25,4 

0,0 

15,4 

40,9 

1,7 

0,0 

0,0 

0,8 

3,0 

0,2 

o,o 

0,6 

0,0 

0,1 

6,3 

2,5 

0,0 

0,0 

2,5 

9,0 

0,2 

0,0 

0,3 

0,0 

0,2 

14,7 

15,4 

50,3 

INDICATIVE TIMETABLE FOR APPROPRIATIONS NEEDED FOR THE NEW INVESTMENT AIDS 

(Article 14 (2) (a), DOC. VI/3100/94) 

MS 

1996 

1997 

1998 

1999 

2000 

2001 

01/6 

5A-5B 

5A-SB 

01/6 

5A-SB 

3A-3B 

01/6 

3A-3B 

3A-3B 

01/6 

3A-3B 

3A-3B 

01/6 

3A-3B 

5A-3B 

01/6 

3A-3B 

3A-5B 

TOTAL 

9,6 

2,4 

5,5 

9,6 

2,4 

5,5 

9,6 

2,4 

5,5 

r

1 

II 

9,6 

2,4 

5,5 

9,6 

2,4 

5,5 

9,6 

2,4 

5,5 

(Ecu mil.) 

 
ANNEX 

I II 

FINANCIAL  STATEMENT 

1 

TITLE  OF  OPERATION 

Proposal  for a Council  Regulation  on the common  organization  of the market in 
fruit  and vegetables. 

(Article  39:  establishment  of  a  special  corps  of  inspectors Tn  the  fruit  and 
vegetable sector). 

2 

BUDGET  HEADING  INVOLVED 

-

Part A of the budget for the cost of  officials. 
Part B  of  the  budget  for  the  experts  called  in  (Heading  B2-511,  Inspection  in 
agriculture). 

3 

LEGAL  BASIS 

Articles 42  and 43  of  the Treaty.  -

4 

DESCRIPTION  OF  OPERATION 

Objectives 

The proposal  is part of the measures included in the proposal  for a Regulation on 
the common  organization  of  the market in fruit and vegetables. 

The  purpose  of  thé  controls  is  to  ensure  correct  and  uniform  application  of 
Community  rules in the sector. 

~ 

Period  covered 

It is planned for  the  measure to commence in  1996. The proposed Regulation  is 
of unlimited duration. 

5 

CLASSIFICATION  OF  EXPENDITURE 

Nôn-compulsory  expenditure. 

Non-differentiated  appropriations  for  Part  A;  differentiated  appropriations  for 
PartB. 

6 

TYPE  OF  EXPENDITURE 

Recruitment of three  A  officials. 

Bearing 100% of the mission expenses (travel  +  subsistence) of experts designated 
by the Commission. 

100 

The  experts will  be designated  by  the Commission  for  each  individual  mission. 

7 

FINANCIAL  IMPACT 

Expenditure  under  part B  of  the  budget  covers  the  cost  of  missions  by  experts 
called  in (travel  expenses +  subsistence  allowances). 

7.1  Method  of calculating  total  cost  of  operation 

Travel  expenses  are  estimated  at  ECU  1 000/mission/expert  on  average 
and daily allowances  at ECU  116.85/day. 
The  corps (experts  and  officials)  is  to  cany  out  90  missions  every  year 
(six/year x  15 Member  States),  70  of  which  will  be  carried  out  by  the 
experts.  They will  last  an  average  of  five  days.  Each  mission  team  will 
consist of two persons. 

7.2 

Itemised  breakdown  of  cost 

The cost per standard mission  will  therefore be: 

travel (2 persons x ECU  1 000) 
subsistence (5  days x  2 (persons x ECU  116.85) 

= ECU 2  000 
= ECU  1  169 

TOTAL PER MISSION 

ECU 3  169 

TOTAL FOR OPERATION 

(3  169 X  70) 

ECU 221  830 

8 

FRAUD  PREVENTION  MEASURES  PLANNED 
The  tasks  to  be  carried  out  by  the  corps  of  inspectors  should  limit  the  risk  of 
fraud in the various areas controlled. 

9 

ELEMENTS  OF  COST-EFFECTIVENESS  ANALYSIS 

9.1 

Objectives. Target  population 

The purpose of the corps of inspectors  is to  ensure proper application  of 
the Regulation. A non-exhaustive list of areas of control is given in Annex 
IV to the proposed Regulation,  and includes  the  following: 

checks for conformity  with  standards, 
checks  on  producer  organizations  and  scrutiny  of  the  use  they 
make of public funds, 
checks on withdrawal  operations, 
checks  on  application  of  the  rules  on  trade  with  non-member 
countries. 

The checks must be carried  out in  all  Member States. 

101 

9.2 

Grounds  for  the  operation 

At  present  the  corps  of  inspectors  is  made  up  of  one  official  and  one 
temporary  staff  member,  and  it  should  be  enlarged  to  ensure  proper 
application  of  Community  rules in the sector.  The Commission  report to 
the Council  and the European Parliament on  the activities of the corps in 
1992 and  1993  (COM(94) 271)  ilustrates  the  need  for  such controls. 

The  principle  of  subsidiarity  is  complied  with.  There  is  absolutely  no 
question of replacing the Member States' controls - quite the opposite: the 
idea is to harmonize them. Using experts from the  15 Member States is a 
good way  of  going about it. 

9.3  Monitoring  and  evaluation  of the  operation 

The  main  performance  indicators  are  quantifiable  values  (number  of 
producer organizations controlled, quantities withdrawn, fruit and vegetable 
distribution points, etc.). 

The operation is assessed in cooperation with the Member States. A report 
covering control  activities is published by the EAGGF every year. 

Any information  and/or findings  resulting from  inspections giving rise to 
suspicion of fraud detrimental to the Community's financial  interests must 
be  communicated  automatically  and  without  delay  to  the  SG/UCLAF, 
which will  take over the dossier for investigation. 

10 

ADMINISTRATIVE  EXPENDITURE 

The  proposed  action  requires the assignment  of  three additional  officials  to the 
spécial  corps of inspectors for fruit and vegetables. 

Experts will be called in only to carry out missions on a case-by-case basis in the 
Member States. 

Actual  mobilization  of the administrative resources necessary will  depend on the 
annual  decision by the Commission on the allocation of resources, taking account 
of  the additional  staff  and amounts authorized by  the budget authority. 

Under no circumstances will  additional  requests prejudge the decision which the 
Commission will  be required to adopt on the allocation  of resources. 

102 

10.1 

Impact  on  the  number  of  staff 

Types of  post 

S t a ff 
to  management  of 

to  be  a s s i g n ed 
t he 

o p e r a t i on 

Permanent  p o s ts 

Temporary  p o s ts 

1 

3 

1 

A 

B 

C 

O f f i 
c i a ls 
or 
tempo 
r a ry 
s t a ff 

Other 
r e s o u r c es 

of  which 

duration 

by  using 
additional 
resources 

^3 

by  using 
e x i s t i ng 
resources 
the  DC  or 
deptartaent 
concerned 

in 

1 

1 

unlimi 
t e d/ 

T o t al 

4 

1 

2 

3. 

Assignment will  be from  1996 onwards. 

10.2  Overall  financial  impact  of  additional  human  resources. 

. 

Officials 
Temporary staff 
Other resources 

Amount 

341.600 
- 
- o 

Method of calculation 

One A4 official and two A6 
officials. The amount is 
calculated on the basis of 
the average annual cost of 

• .,•''•••','  . 

Total 

'  ' •  :-  posts remunerated in 1995. 
ECU 
341.600 

103 

10.3 

Increase  in  other  operating  expenditure  resulting  from  the  measure. 

METHOD OF 
CALCULATION 

Assumptions 

Travel  expenses are 
estimated  at ECU  1 000 
on average.  For 
subsistence  expenses, a 
standard amount  of 
ECU  116.85/day  is 
allowed  for. 
The number of  missions 
planned  per year is 20, 
lasting  on average 5 
days.  The mission team 
is  made up of  2 persons. 

Costs: 

The cost  per standard 
mission will  be: 
travel (2  persons  x 
ECU  1 000)  =2000 

subsistence allowances 
(5  days x  2  persons x 
ECU  116.85/day)  =1169 

TOTAL PER MISSION: 

ECU 3  169 
Number of  missions: 

20  missions 

TOTAL COST: 
(20 x  3  169)  = 
ECU 63  380 

BUDGET HEADING 

AMOUNT 

A-1300(1106)  Mission 
expenses 

63  380 

TOTAL 

Ecu  63 380 

Part  A 

Part  B 

TOTAL  COST 

Ecu  404  980 

Ecu  221 830 

Ecu  626  810 

104 

ISSN 0254-1475 

COM(95) 434 final 

DOCUMENTS 

EN 

03 

Catalogue number  : CB-CO-95-515-EN-C 

ISBN 92-77-94270-3 

Of&ce for Official Publications of the European Communities 

L-2985 Luxembourg