Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) No 1785/81 on the common organization of the markets in the sugar sector
Date: 1995-11-21
Institutions: European Commission
Subjects: agricultural disaster, common organisation of markets, production quota, sugar, sugar industry, supply

COMMISSION  OF THE EUROPEAN  COMMUNITIES 

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Brussels, 21.11.1995 
COM(95) 561 final 

95/0278 (CNS) 

Proposal  for  a 

COUNCIL  REGULATION  (EC) 

amending  Regulation  (EEC) No 1785/81 on the common 
organization  of the markets  in the sugar sector 

(presented  by the Commission) 

Explanatory  memorandum 

The sugar sector is characterized by a system of production quotas which limit the quantities 
of Community  production  which may  benefit from the guarantees  provided  by the  common 
market  organization  arrangements.  For this  purpose,  basic A  and  B quantities  have  been 
established  for  each  product  concerned  and for  each  production  region.  These  constitute 
the quantitative  ceilings  for the allocation  by Member  States of A  and  B  production  quotas 
to the  producing  undertakings  located in those regions.  Always fixed for  specific  periods  of 
time,  the  basic  A  and  B  quantities  applicable  on  30  June  1995  have  been  rolled-over 
unchanged  by  Council  Regulation  (EC)  No  1101/95  of  24  April  1995  (1)  for  a  further 
6  marketing  years  covering  the  period  1 July  1995 to  30  June 2001. 

During  the  discussions 
leading  up  to  the  adoption  of  the  abovementioned  Council 
Regulation,  it became  clear  that the  small size of the  basic A  and  B quantities  established 
for  sugar  in  respect  of the  mainland  region of Portugal (equal to  0,4%  of the  overall A  and 
B  basic  quantities  for  sugar)  was  an  important  factor  contributing  to the  failure  of  a  sugar 
producing factory  being  constructed there.  Whilst  no solution was agreed  at that time, this 
question was raised again during the discussions  leading up to the fixing of the prices in the 
sugar  sector  for  the  1995/96  marketing  year  by Council  Regulations  (EC)  No  1533/95  and 
No  1534/95  (2), when  the  Commission  undertook  to  re-examine  the  question  of the  levels 
of  the  sugar  quotas  for  Portugal. 

In this  respect  it is important  to  bear  in mind that the  basic A and  B quantities  for  sugar  for 
the  mainland  region  of  Portugal were established  in the Act of Accession  of  Portugal  (3)  in 
spite  of the  fact  that  no  reference  production  had taken  place on which  to  determine  such 
quantities.  Their  objective  was  to  permit  the  development  of  sugar  beet  cultivation  and 
sugar production  in a region where alternative agricultural production was extremely limited. 
Since  1986, sugar  beet cultivation has indeed been launched on a small scale with the help 
of a special measure  under which Portuguese sugar beet could be manufactured  into sugar 
in  a factory  in  Spain  and  returned to  Portugal on  the  account  of  the  Portuguese  mainland 
production  quota.  No  sugar  factory  has  however  yet  been  constructed  although  planning 
has reached an advanced stage and a suitable site has been chosen.  The small size of the 
basic  quantities  has  been  cited  as  a  crucial  factor  in  preventing  commencement  of 
construction  of  a  sugar  factory. 

(1) OJ No L 110 of 17.5.1995, page 1. 
(2) OJ No L 148 of 30.6.1995, pages 9 and 11 
(3) OJ No L 302 of 15.11.1990, page 1. 

I 

With  this  in  view  and  in  the  light  of  the  understanding  in  the  Council  for  the  specific 
problems of the region in question, the Commission is of the opinion that a small increase 
in  the  level  of  the  basic  quantities  for  sugar  for  the  mainland  region  of  Portugal  would 
provide the impetus for the construction of a sugar factory there as envisaged  by the Act 
of Accession. 

Owing to  the  need to  proceed  with  caution  on  all  matters  dealing  with  such  a sensitive 
question  as  production  quota  levels, the  Commission  is of the  opinion  that  an  increase 
limited to 10.000 tonnes as already discussed in the Council, broken down between A and 
B quantities in the same proportion as the original A and B quantities established in the Act 
of Accession of Portugal, would be sufficient for the purpose without calling into question the 
levels of the basic quantities for sugar established for the other regions of the Community. 

The  Commission  is  accordingly  proposing  an  increase  in  the  basic  A  and  B  quantities 
established for sugar for Portugal (mainland), as follows : 

existing level 

proposed level 

Bask: Quantity A 
Basic Quantity 8 

54 545,5 tonnes 
5 454,5 tonnes 

63 €36,4 tonnes 

6 363,6 tonnes 

TOTAL 

60 000,0 

tomes 

?$ 000,0 tonnes 

3 

Proposal for a 

COUNCILREGULATION(EC) No 

of 

amending  Regulation  (EEC) No 1785/81 on the common 
organization  of the markets  in the sugar sector 

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  Article  24  of  Council  Regulation  (EEC)  No  1785/81  of  30  June  1981  on  the 
common organization of the markets in the sugar sector(1), as last amended by Regulation 
(EC)  No 1101/95(2), lays down the basic quantities for the allocation of A and B quotas to 

producing  undertakings during the marketing years  1995/1996 to 2000/2001; 

Whereas the basic quantities for sugar for the mainland region of Portugal are those fixed 

in the Act of Accession of Portugal for the purpose of enabling sugar production to start up 

there; whereas the size of those basic quantities has proved to be insufficient to provide the 

impetus for the envisaged start up of sugar production, to the detriment of the producers in 

the  region  concerned; whereas  the  basic  quantities  for  sugar  for  the  mainland  region  of 

Portugal should be increased to the levels needed to permit sugar  production to start up, 

OJ NoL  177,  1.7.1981, p. 4. 
OJ NoL  110, 17.5.1995, p. 1 

M 

HAS ADOPTED THIS REGULATION : 

Article  1 

Article 24(2)  of  Regulation  (EEC) No 1785/81 is hereby amended  as follows : 

1. 

In Table  I under the column entitled "(a)  Basic quantity A for  sugar", "54.545,5" on 

the  line "Portugal (mainland)" is replaced by  "63.636,4". 

2. 

In Table II under the column entitled "(a) Basic quantity B for sugar", "5.454,5" on the 

line "Portugal (mainland)", is replaced by "6.363,6'. 

Article  2 

This Regulation shall enter into force on the day of its publication in the Official Journal of 

the  European Communities. 

It shall apply from  1 July 1995. 

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

Done at 

For the Council 

I 

FINANCIAL  STATEMENT 

BUDGET  HEADING: 
Revenue  110 
Expenditure B1-110 

(PSUC\EN\0032.wpd) 

Date:  12 October  1995 

APPROPRIATIONS: 
ECU 725 million 
ECU  1 225  million 

TITLE: 
Proposal  for  a Council  Regulation  amending  Regulation  (EEC) No  1785/81 on the common  organization  of the  markets 
in the  sugar  sector. 

LEGAL BASIS: 
Articles 42 and 43 of the  Treaty 

AIMS: 
Increase by  10 000 tonnes the production  quotas  for  sugar  for  Portugal. 

5. 

FINANCIAL  IMPLICATIONS: 

5.0. 

EXPENDITURE 
- CHARGED TO THE  EC BUDGET 

(REFUNDS/INTERVENTION) 

- NATIONAL  AUTHORITIES 
- OTHER 

5.1. 

REVENUE 
-  OWN RESOURCES  OF THE EC 
(LEVIES/CUSTOMS  DUTIES) 

-  NATIONAL 

PERIOD OF  12 
MONTHS 

(ECU  million) 

CURRENT 
FINANCIAL 
YEAR 
(95) 
(ECU  million) 

FOLLOWING 
FINANCIAL 
YEAR 
(96) 
(ECU  million) 

4.7 

4.2 

1997 
(ECU  million) 

1998 
(ECU million) 

1999 
(ECU  million) 

2000 
(ECU  million) 

ESTIMATED  EXPENDITURE 
ESTIMATED  REVENUE 

4.7 
4.2 

4.7 
4.2 

METHOD OF CALCULATION: 
On basis of current  refund  level  cost is estimated  in future  at:  10 000 t x ECU 470/t =  ECU  4.7  million 
The net amount  of Community  own resources, resulting  from  production  levies, corresponds to  90% of this  expenditure 
after  deducting  the  10% reimbursed to Member States. 

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

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

WILL A SUPPLEMENTARY  BUDGET BE NECESSARY? 

WILL FUTURE BUDGET  APPROPRIATIONS  BE NECESSARY? 

YES 

YES 

NO 

NO 

5.0.1. 
5.1.1. 

5.2. 

6.0. 

6.1. 

6.2. 

6.3. 

OBSERVATIONS  The absence  of a sugar producing  factory  in  Portugal  at the present  time means that  less than  1 000 tonnes  [j 

of the current  Portuguese  quota are manufactured  in Spain. The additional  10 000 tonnes will  not  be  fully 
produced  before  the  1998/99 marketing year (1999 budget). 

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