Opinion of the Economic and Social Committee on the ' Proposal for a Council Regulation (EC) amending Regulation (EEC) No 2075/92 on the common organization of the market in raw tobacco, and fixing the guarantee thresholds for leaf tobacco by group of tobacco varieties for the 1996 and 1997 harvests'
Date: 1996-02-29
Institutions: European Economic and Social Committee
Subjects: common organisation of markets, guarantee threshold, marketing year, production quota, tobacco













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51996AC0259

Opinion of the Economic and Social Committee on the ' Proposal for a Council Regulation (EC) amending Regulation (EEC) No 2075/92 on the common organization of the market in raw tobacco, and fixing the guarantee thresholds for leaf tobacco by group of tobacco varieties for the 1996 and 1997 harvests'  


Official Journal C 153 , 28/05/1996 P. 0053 





Opinion of the Economic and Social Committee on the  'Proposal for a Council Regulation (EC) amending Regulation (EEC) No 2075/92 on the common  organization of the market in raw tobacco, and fixing the guarantee thresholds for leaf tobacco by  group of tobacco varieties for the 1996 and 1997 harvests' ()(96/C 153/15)On 18  January  1996, the Council decided to consult the Economic and Social Committee, under Articles 43 and 198  of the Treaty establishing the European Community, on the above-mentioned proposal. The ESC decided to appoint Mr Zarkinos as Rapporteur-General responsible for preparing the  Committee's work on the subject. At its 333rd Plenary Session (meeting of 29  February 1996), the Economic and Social Committee  adopted the following Opinion nem. con., with 24  abstentions. 1. IntroductionThe Commission is here proposing to the Council the fixing of the  guarantee thresholds for leaf tobacco for the 1996 and 1997 harvests in order to allow producers to  plan their production in good time. It also proposes amending the basic Regulation (EEC) 2075/92 in order to allow Member States to  transfer certain guarantee threshold quantities from one group of varieties to other groups of  varieties without financial consequences. The Commission's aim is to introduce a degree of flexibility into the administration of guarantee  thresholds, to take account of unpredictable trends in market conditions. 2. General comments2.1. Tobacco is an annual crop and its production process starts in winter  with the leasing of land, the supply of equipment and the preparation of seed drills. Since the  regime for this sector assists production of a fixed quantity per producer, it is clear that the  producer can plan his production and avoid uneconomic activities and pointless expense only when he  knows what his quota is. By the same token, any negotiations with a view to crop contracts between  producers and dealers presuppose knowledge of producers' quotas. 2.2. The Committee has ascertained that for the 1995 financial year the producers were informed of  their quotas very late (end of  May). This led to protests from the producers and their  organizations, which in turn led the Council and the Commission to admit the need for allocation of  quotas to take place in good time. 2.3. The Committee takes the view that the Commission proposal on the guarantee thresholds for 1996  and 1997 is a step in the right direction, but the delay for the 1996 financial year is now  unavoidable. Regulation 1066/95 lays down that the Member States shall publish their confirmations  of quotas not later than 31  January of the year of the harvest concerned. The Commission proposal was submitted on 27  November 1995; however, owing to an unfortunate delay  in the decision-making procedure at European Union level, for yet another year the quotas will be  announced late, with negative effects on the producers and the sector in general. 2.4. The Committee feels that, if market conditions require revision of the guarantee thresholds  for 1997, the decision-making procedure will have to be completed by 31  December 1996, to allow  quotas to be allocated to producers in good time. 2.5. Finally, the Committee believes that the new Commission proposal on future policy in the  tobacco sector (proposal to be submitted before 1  April 1996) will need to tackle the sector as a  whole with a view to adapting production to market needs, improving quality and improving  organization, taking account of the role and importance of tobacco-growing for the economy and  social fabric of certain EU regions, as well as application of the Community preference. 3. Specific comments3.1. The Committee takes the view that the second part of the Commission  proposal is also positive, although it recognizes that the tobacco regime is characterized by  inflexibility as regards the management of guarantee thresholds. 3.2. The Committee noted that, according to the Commission's definitive figures for the 1994  harvest, total tobacco production in the EU amounted to 327 916 tonnes. Taking into account that the Council had fixed the total EU quota qualifying for premium in 1994 at  350 000 tonnes, one finds that the final quantity of tobacco delivered and receiving the premium  was 22 084 tonnes less (6,3 % of the total quota) and the expenditure saved on the sector amounted  to ECU 64 million. The situation was similar for the 1993 harvest. 3.3. Assuming the principle of financial neutrality, the Committee feels that, for a product in  serious deficit, some degree of flexibility is needed in the management of quotas, because the  rigidity of the system includes provisions which even hinder the full use of the funds budgeted for  the sector. 3.4. The Economic and Social Committee takes the view that, because of the differentiation in the  premiums given for each of the groups of varieties, the transfer of equivalent quantities from one  variety to another does not ensure financial neutrality. To achieve that, the transfer of  quantities would have to be of equal financial effect. Done at Brussels, 29 February 1996. The Presidentof the Economic and Social CommitteeCarlos FERRER() OJ No C 30,  3. 2. 1996, p. 6. APPENDIX to the Opinion of the Economic and Social CommitteeThe following amendment was  rejected during the course of the debate: 'Delete point 3.3.'ReasonIt is completely wrong to claim that tobacco is in serious deficit.  There is in fact a massive surplus of tobacco and tobacco products. Furthermore, it is wrong to  talk about the 'rigidity of the system' if the funds budgeted for the sector are not used in full. Result of the voteFor: 29, against: 32, abstentions: 22.