Proposal for a COUNCIL REGULATION (EC) amending Regulation (EEC) N° 404/93 on the common organization of the market in bananas
Date: 1996-03-06
Institutions: European Commission
Subjects: accession to the European Union, common organisation of markets, tariff quota, trade agreement, tropical fruit

COMMISSION  OF  THE  EUROPEAN  COMMUNITIES 

Brussels,  06.03.1996 
COM(96) 82 final 

96/080 (CNS) 

Proposal  for a 

COUNCIL REGULATION (EC) 

amending  Regulation (EEC)  No 404/93 on the common organization of the market in 
bananas 

(presented by the Commission) 

Explanatory  memorandum 

On  11th  October  1995,  the  Commission  adopted  a  report  on  the  operation  of  the 
banana  régime  (Document  SEC(95)1565),  which  contained  in  conclusion  some 
suggestions  for  modification  of the common  market organisation  in bananas,  in order 
to  create  a  sustainable  equilibrium  between  the  different  interests  involved,  whilst 
maintaining  the  principal  objectives  of the  régime. 

This  report was  submitted  to the  Council and discussed  in the Agriculture  Council  on 
22nd  January  1996,  during  which  the  Commission  undertook  to  prepare  formal 
proposals  for  modification  of  Council  Regulation  404/931  based  on  the  conclusions 
of  the  report.  This  proposal  is the  result  of  that  undertaking. 

It  is  hoped  that  by  taking  this  new  proposal  in  conjunction  with  the  two  proposals 
already  presented  to  the  Council  (COM  (95)114  and  COM  (95)115),  an  agreement 
can  be  reached  on  a  package  of  modifications  to  the  banana  régime. 

The  three  new  Member  States  have  a different  historic  pattern  of  banana  imports  to 
In  order  to  achieve  an 
the  EU 12,  taking  all  their  supplies  from  the  dollar  zone. 
equilibrium  which  maintains  the  same  level  of  protection  and  advantage  to  ACP  and 
EC  suppliers,  it  is  appropriate  therefore  to  adjust  the  percentage  of  the  tariff  quota 
allocated  to  Category  A  and  Category  B  operators,  so  as  to  keep  the  absolute 
quantity  of  Category  B  licences  at  a  similar  level  to  that  prior  to  the  accession  of 
Austria,  Finland  and  Sweden.  This  proposal  includes  a  provision  to  adjust  the 
distribution  of  licences  to  70.5% for  Category  A  and  26% for  Category  B, leaving  the 
3.5%  for  Category  C  unchanged. 

Currently the 90,000 tonnes of non-traditional ACP bananas which are permitted duty 
free  entry  to the  EU  are  governed  by the  same  rules  as  imports  from  third  countries, 
including  the  requirement  for  operators  to  present  a  tariff-quota  import  licence  from 
the  allocation  calculated  in accordance  with  their  reference  quantity.  The  zero-duty 
concession  is  not  sufficient  to  overcome  the  higher  costs  of  these  bananas  and  to 
It  is  proposed 
make  them  competitive  with  lower-cost  Latin  American  production. 
therefore to  allow the  import of this  quantity  under the  same  licence  requirements  as 
for traditional ACP  production.  The distinction  between traditional  and  non-traditional 
quantities  would  be  respected  because  the  latter  would  not  generate  rights  to 
Category  B  licences. 

Council  Regulation  404/93  allocates  3.5% of the tariff  quota to  newcomers  (Category 
C  operators),  however,  it  includes  no  provision  for  newcomers  ever  to  become 
established  operators,  with  a  licence  allocation  based  on  past  trade.  This  restricts 
the  scope  for  the  development  of trade  and  marketing  structures,  and  represents  an 
unreasonable  constraint  upon  those  operators  who  started  trading  in  bananas  after 
1.1.92.  This  proposal therefore  includes the creation  of a mechanism  whereby  those 
Category  C  operators  who  have  traded  for  a  minium  of  three  years,  and  who  fulfil 

OJ  L47  of  25.2.93  page  1 

4 a~ 

appropriate  criteria,  including  having  marketed  a minimum  volume  of  bananas,  can 
transfer to Category A. 

In certain cases, due to exceptional unforeseen circumstances beyond his control, an 
operator  may have been subject to genuine difficulties  in marketing  bananas  during 
part  of the  reference  period, which  result  in  a significant  reduction  in  his  reference 
quantity.  It is considered appropriate to create an suitable mechanism to alleviate the 
hardship  suffered  as  a  consequence  of  such  exceptional  circumstances.  This 
proposal  contains  a  provision  to  permit  the  extension  of  an  operator's  reference 
period  backwards  by two years,  if his  reference  quantity  falls  significantly  below  its 
habitual level, in order to take account of the  hardship experienced. 

Proposal for a 

COUNCIL  REGULATION  No ...796 

amending  Regulation  (EEC)  No 404/93 on the common  organization  of the market  in 
bananas 

THE COUNCIL  OF THE  EUROPEAN UNION, 

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

Having  regard to the  proposal from the Commission1, 

Having  regard to the opinion  of the  European  Parliament2, 

Having regard  to the opinion  of the  Economic  and Social Committee3, 

Whereas Regulation (EEC) No 404/93 on the common organisation of the market in bananas4, 
as last  amended  by Regulation  (EEC)  No 3290/945, provides for the opening of a tariff  quota 
for the  import  of bananas; 

Whereas Article  19 of Regulation (EEC) No 404/93 allocates the tariff quota opened each year 
for  the  import  of third-country  and  non-traditional  ACP  bananas  between three  categories  of 
operator,  hereinafter  referred  to as Category  A, Category  B and Category  C; 

Whereas  non-traditional  ACP import face a relative economic disadvantage compared to third 
country production; whereas, therefore, in conformity with undertakings  made by the European 
Union in the context of its relations with the ACP countries,  provision should be made for non-
traditional ACP  imports  to  be managed  separately  from  third  country  imports; whereas  these 
provisions should respect the distinction between traditional and non-traditional ACP quantities; 

Whereas following the enlargement  of the Union through the accession of Austria, Finland and 
Sweden,  the  traditional  pattern  of  supply  to  the  Community  market  has  altered  and  as  a 
consequence  the tariff  quota  should  be increased; whereas  as a result  of this  increase  in the 
tariff quota, in order to maintain the equilibrium between the different categories of operator, the 
allocation  of the tariff  quota  amongst  the  different  categories  of operator  should  be adjusted; 
whereas  this adjustment  maintains  the  advantages  to  suppliers  of Community  and  traditional 
ACP  bananas  in conformity  with the Community's  obligations; 

Whereas Article 19.1 (c) of Regulation No (EEC) 404/93 allocates a proportion of the tariff quota 
to new operators  (Category  C); whereas  no provision exists for  such Category  C operators  to 
establish themselves  as operators  defined by Article  19.1 (a)  (Category  A operators)  through 
their activities as new operators; whereas this restricts the scope for the development  of trade 
and marketing structures; whereas, therefore, Regulation No (EEC) 404/93 should be amended 
to allow  new operators  the opportunity  to establish themselves  as Category  A operators; 

OJ No L 
OJNo  L 
OJNo  L 
OJNo  L  47, 25.02.1993, p.  1. 
O J N oL  349, 31.12.1994,  p. 105. 

/ ?C 

Whereas,  in certain  circumstances,  operators'  access  to the  tariff  quota  is significantly  lower 
than would have been expected due to circumstances beyond their control; whereas, therefore, 
in  the  light  of  the  experience  Regulation  No  (EEC)  404/93  should  be  amended  to  include 
provisions with a view to  providing  relief to operators  who suffer  such hardship; 

HAS ADOPTED THIS REGULATION: 

Regulation  (EEC)  No 404/93  is amended  as follows: 

Article 1 

1. 

"1. 

The first paragraph  of Article  18 is replaced by the following: 

A tariff  quota shall be opened each year for imports  of third-country  bananas and non-
traditional  ACP  bananas.  A  fixed  quantity  of  90,000  tonnes  of  this  quota  shall  be 
reserved  for  non-traditional  ACP bananas.  The tariff  quota shall be 2,553,000  tonnes 
(net weight). 

Within  the  framework  of  the  tariff  quota,  imports  of  third-country  bananas  shall  be 
subject to a levy of 75 ECU per tonne and imports of non-traditional ACP bananas shall 
be subject to a zero duty. 

Where  Community  demand  determined  on the basis of the supply  balance  referred  to 
in Article 16 increases, the volume of the tariff quota shall be increased in consequence, 
in accordance  with the procedure  laid down in Article 27. 

The  portion  of  the  tariff  quota  reserved  for  imports  of  non-traditional  bananas 
shall  be  allocated  according  to  appropriate  conditions  which  take  into  account  the 
circumstances  of  ACP  production  and  may  be  defined  in  accordance  with  the 
procedure  laid down in Article 27. 

2. 

Article  19 is replaced by the  following: 

"Article  19 

1 

The volume of the tariff quota attributed to third countries shall be allocated as follows: 

(a) 

(b) 

(c) 

70.5% to the category of operators who imported third country bananas (referred 
to as Category  A operators); 

26% to  the  category  of  operators  who  marketed  Community  bananas  and/or 
imported traditional ACP bananas  (referred  to as Category  B operators); 

3.5%  to  the  category  of  operators  established  in the  Community  who  started 
importing third country  bananas on or after  1.1.1992 (referred to as Category C 
operators). 

The  import  opportunities  pursuant  to  (a)  and  (b)  shall  be  available  to  operators 
established in the Community who imported or marketed in the Community on their own 
account  a minimum  quantity  of bananas of the above origins, to  be determined. 

Supplementary  criteria to be met by operators shall be laid down in accordance with the 
procedure  provided  for  in  Article  27.  The  Member  States  shall  draw  up  the  list  of 
operators  and the  reference  quantity  per  operator  referred  to in paragraph  2. 

2. 

On the  basis of separate  calculations  for  Category  A and Category  B operators,  each 

t 

operator  shall obtain  import  licences  (referred  to  as  Category  A  or  Category  B import 
licences)  on the  basis of the  average  quantity  of  bananas  that  he  has  imported  or,  for 
Community  production,  placed on the  market  on his own account  in the  last two  years 
for which figures are available, this quantity being referred to as the operator's  reference 
quantity. 

For  Category  A  operators,  the  quantities  to  be  taken  into  consideration  shall  be  the 
imports  of  bananas  using  Category  A  import  licences,  so  that  the  initial  allocation  of 
licences  between  the  different  categories  of operator  is unchanged. 

In the case of Category  B operators,  account must be taken of the imports of traditional 
ACP  bananas  and/or  quantities  of Community  bananas  placed  on the  market. 

If  the  volume  of  applications  from  Category  C  operators  exceeds  the  quantity  fixed 
pursuant  to  paragraph  1 (c),  a  reduction  coefficient  shall  be  calculated  and  applied  to 
each  application. 

If  the  volume  of  applications  pursuant  to  paragraph  1  (c)  is  less  than  the  quantity 
available,  any  surplus  volume  shall  be  re-allocated  to  Category  A  and  Category  B 
operators  under  conditions  laid down  by the  procedures  referred  to  in Article  27. 

If  the  tariff  quota  is  increased,  the  additional  available  quantity  shall  be  allocated  to 
importers  in the categories  referred  to in paragraph  1 in accordance  with the  preceding 
paragraphs. 

Category  C operators  who, for a period of at least three  years,  have  imported  annually 
on their  own  account  a  minimum  volume  of third  country  bananas,  to  be  determined, 
may  transfer  to  Category  A.  This  minimum  volume,  and  other  necessary  conditions, 
shall  be  defined  in accordance  with the  procedure  referred  to  in paragraph  27. 

If,  due  to  exceptional  circumstances  beyond  the  control  of  a  diligent  operator,  the 
reference  quantity  used  to  determine  the  allocation  of  licences  to  a  Category  A  or 
Category  B operator for a particular year in accordance with paragraph  2, is significantly 
below  his average  reference  quantity  for the  previous  two  years,  the  reference  period 
used  to  calculate  the  reference  quantity  for  the  year  in  question  shall  be  extended 
backwards by two years.  The  operator  must submit sufficient documentary  evidence in 
support  of his claim to satisfy  the  national  competent  authorities. 

Supplementary criteria, such as the definition of exceptional circumstances, the minimum 
percentage  reduction  in reference  quantity  required  to  qualify  for  such treatment,  and 
the  maximum  additional reference  quantity which can  be granted,  may  be  laid down in 
accordance  with Article 27." 

Article  2 

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

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

Done  at  Brussels, 

For  the  Council 

% 

FINANCIAL STATEMENT 

BUDGET  HEADING:  1000 

VI/3380/96F ADD 
(PCUL\EN\0094.wpd) 

Date:  12 February  1996 

APPROPRIATIONS: 
ECU  864 million 

2. 

4. 

TITLE: 
Proposal  for  a Council  Regulation  amending  Regulation  (EEC) No 404/93 on the common  organization  of the market  ir 
bananas 

LEGAL  BASIS: Article  43  of the  Treaty 

AIMS: 
To  increase  the  annual  tariff  quota  for  banana  imports  into the  EU as a result  of the  accession  of the three  new  Membei 
States and  suitable  breakdown  of tariff  quotas between  the  various categories  of  operators 

FINANCIAL  IMPLICATIONS: 

PERIOD OF  12 
MONTHS 

(ECU  million) 

CURRENT 
FINANCIAL 
YEAR 
(96) 
(ECU  million) 

FOLLOWING 
FINANCIAL 
YEAR 
(97) 
(ECU  million) 

5.0. 

EXPENDITURE 
-  CHARGED TO THE EC  BUDGET 

(REFUNDS/INTERVENTION) 

- NATIONAL  AUTHORITIES 
-  OTHER 

5.1. 

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

-  NATIONAL 

5.0.1. 
5.1.1. 

ESTIMATED  EXPENDITURE 
ESTIMATED  REVENUE 

5.2. 

METHOD OF  CALCULATION: 

353 000 t  x ECU  75/t  =  ECU  26.5 million 

+ 26.5 

+  26.5 

+ 26.5 

1998 

1999 

2000 

2001 

ECU 26.5 m 

ECU 26.5 m 

ECU 26.5 m 

ECU 26.5 m 

6.0. 

6.1. 

6.2. 

6.3. 

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

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

WILL  A SUPPLEMENTARY  BUDGET  BE NECESSARY? 

WILL  FUTURE  BUDGET  APPROPRIATIONS  BE NECESSARY? 

YES/NO 

YES/NO 

YES/NO 

YES/NO 

OBSERVATIONS 

Increase  of 353  000 tonnes  in tariff  quota. 

(4 

ISSN 0254-1475 

COM(96) 82 final 

DOCUMENTS 

EN 

02  03  11 

Catalogue number  : CB-CO-96-107-EN-C 

ISBN 92-78-01380-3 

Office for Official Publications of the European Communities 

L-2985 Luxembourg