Proposal for a Council Directive amending Directive 68/414/EEC 'imposing an obligation on Member States of the EEC to maintain minimum stocks of crude oil and/or petroleum products'
Date: 1998-04-14
Institutions: European Commission
Subjects: International Energy Agency, crude oil, petroleum product, security of supply, storage of hydrocarbons

C  160/18

EN

Official  Journal  of  the  European  Communities

27.5.98

Proposal  for  a  Council  Directive  amending  Directive  68/414/EEC  imposing  an  obligation  on
Member  States  of  the  EEC  to  maintain  minimum  stocks  of  crude  oil  and/or  petroleum  products

(98/C  160/09)

(Text  with  EEA  relevance)

COM(1998)  221  final  -  98/0137(CNS)

(Submitted  by  the  Commission  on  15  April  1998)

THE  COUNCIL  OF  THE  EUROPEAN  UNION,

Having  regard  to  the  Treaty  establishing  the  European
Community,  and  in  particular  Article  103a(1)  thereof;

Having  regard  to  the  proposal  from  the  Commission;

Having 
Parliament;

regard 

to 

the  opinion  of 

the  European

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

Whereas  the  Council  has  adopted  the  Directive  of
20  December  1968(cid:216)(˛) 
imposing  an  obligation  on
Member  States  of  the  European  Economic  Community
to  maintain  minimum  stocks  of  crude  oil  and/or
petroleum  products;

imported  crude  oil  and  petroleum  products
Whereas 
continue  to  play  an  important  role  in  the  Community’s
energy  supplies;  whereas  any  difficulty,  even  temporary,
having  the  effect  of  reducing  supplies  of  such  products,
or  significantly  increasing  the  price  thereof  on  inter(cid:220)
national  markets,  could  cause  serious  disturbances  in  the
economic  activity  of 
the
Community  must  be  in  a  position  to  offset  or  at  least  to
diminish  any  harmful  effects  in  such  a  case;  whereas  it  is
necessary  to  update  Directive  68/414/EEC  adapting  it  to
the  reality  of  the  internal  market  of  the  Community  and
the  evolution  of  the  oil  markets;

the  Community;  whereas 

Whereas  in  Directive  73/238/EEC  of  24  July  1973(cid:216)(ˇ),
the  Council  decided  upon  appropriate  measures  -
including  drawing  on  oil  stocks  -  to  be  taken  in  the
in  the  supply  of  crude  oil  and
event  of  difficulties 
petroleum  products  to  the  Community;  whereas  Member
States  have  undertaken 
the
Agreement  on  an  "International  Energy  Programme’(cid:216)(—);

similar  obligations 

in 

Whereas  it  is  important  that  the  security  of  oil  supply  is
enhanced;

it 

is  necessary 

Whereas 
the  organisational
arrangements  for  oil  stocks  ensure  the  smooth  running
of  the  internal  market;

that 

Whereas  the  provisions  of  this  Directive  do  not  affect  the
full  application  of  the  Treaty,  in  particular  the  provisions
concerning  the  internal  market  and  competition;

Whereas,  in  accordance  with  the  principle  of  subsidiarity
and  in  accordance  with  the  principle  of  proportionality
such  as  stipulated 
in  Article  3b  of  the  Treaty,  the
objective  of  maintaining  a  high  level  of  security  of  oil
supply  in  the  Community  through  reliable  and  trans(cid:220)
parent  mechanisms  based  on  solidarity  amongst  Member
States  and,  at  the  same  time,  complying  with  the  rules  of
the  internal  market  and  competition,  can  be  carried  out
more  adequately  at  the  level  of  the  Community;  whereas
the  minimum
is 
therefore 
requirements  to  achieve  this  objective  and  does  not
exceed  what  is  necessary  to  this  end;

this  Directive 

limited 

to 

Whereas  it  is  necessary  that  stocks  are  at  the  disposal  of
Member  States  should  difficulties  in  oil  supply  arise;

(˛)(cid:217)OJ  L  308,  23.12.1968,  p.  14;  Directive  last  amended  by

Directive  72/425/EEC  (OJ  L  291,  28.12.1972,  p.  154).

(ˇ)(cid:217)OJ  L  228,  16.8.1973,  p.  1.
(—)(cid:217)As  last  amended  on  7th  August  1992.

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C  160/19

whereas  Member  States  must  possess  the  powers  and  the
capacity  to  control  the  use  of  stocks  so  that  they  can  be
made  available  promptly  for  the  benefit  of  the  areas
which  most  need  oil  supplies;

Whereas  organisational  arrangements 
the  main(cid:220)
tenance  of  stocks  must  ensure  the  stocks’  availability  and
their  accessibility  to  the  consumer;

for 

it 

is 

that 

Whereas 
organisational
appropriate 
arrangements  for  the  maintenance  of  stocks  are  trans(cid:220)
parent,  ensuring  a  fair  and  non(cid:220)discriminatory  sharing  of
the  burden  of  the  stock(cid:220)holding  obligation;  whereas,
therefore,  the  cost  of  holding  oil  stocks  should  be
identified  in  the  final  price  of  the  oil  products  sold  in  the
market  concerned;

Whereas,  in  order  to  organise  the  maintenance  of  stocks
as  indicated  avove,  Member  States  may  have  recourse  to
a  system  based  on  a  stockholding  body  or  entity  which
will  hold  all,  or  part,  of  the  stocks  making  up  their
stockholding  obligation;  whereas  the  balance, 
if  any,
should  be  maintained  by  refiners  and  other  market
operators;  whereas  partnership  between  the  Government
and  the  industry  is  essential  to  operate  efficient  and
reliable  stockholding  mechanisms;

Whereas  high  national  production  contributes  in  itself  to
security  of  supply;  whereas  the  oil  market  evolution  can
justify  a  higher  maximum  derogation  from  the  obligation
to  maintain  oil  stocks  for  Member  States  with  indigenous
oil  production;

Whereas  it  is  appropriate  to  adopt  approaches  which  are
already  followed  by  the  Community  and  the  Member
States  within 
and
agreements;  whereas,  owing  to  changes  in  the  pattern  of
oil  consumption, 
international  aviation  bunkers  have
become  an  important  component  of  this  consumption;
whereas  these  bunkers  are  part  of  inland  consumption;

international  obligations 

their 

is  a  need  to  adapt  and  simplify  the
Whereas  there 
Community  statistical  reporting  mechanism  concerning
oil  stocks;

it 

Whereas  oil  stocks  can,  in  principle,  be  held  anywhere  in
the  Community  and,  therefore, 
is  appropriate  to
facilitate  the  establishment  of  stocks  outside  national
territory;  whereas 
is  necessary  that  decisions  for
holding  stocks  outside  national  territory  are  taken  by  the
Government  of  the  Member  State  concerned  according
to  its  needs  and  supply  security  considerations;  whereas
in  the  case  of  "delegated’  stocks,  more  detailed  rules  are

it 

needed  to  guarantee  their  availability  and  accessibility  in
the  event  of  oil  supply  difficulties;

Whereas  it  is  appropriate  to  strengthen  the  administrative
supervision  of  stocks  and  establish  efficient  mechanisms
for  the  control  and  verification  of  stocks;  whereas  a
regime  of  sanctions 
impose  such  a
control;

is  necessary  to 

Whereas  Council  Directive  72/425/EEC  of  19  De(cid:220)
cember  1972  raised  from  65  to  90  days  the  reference
period  appearing  at  the  first  indent  of  Article  1  of
Directive  68/414/EEC  and  foresaw  the  conditions  to
implement  this  increase;  whereas  the  provisions  of  that
this  Directive;
Directive  have  become  obsolete  by 
whereas  Directive  72/425/EEC  must 
therefore  be
repealed;

Whereas  it  is  appropriate  to  inform  the  Council  on  a
regular  basis  of  the  situation  concerning  security  stocks
in  the  Community;

HAS  ADOPTED  THIS  DIRECTIVE:

Article  1

Directive  68/414/EEC  is  amended  as  follows:

1.(cid:217)Article  1  is  replaced  by  the  following  text:

"Article  1

1.(cid:218)(cid:217)Member  States  shall  adopt  such 
laws,  regu(cid:220)
lations  or  administrative  provisions  as  may  be  appro(cid:220)
priate  in  order  to  maintain  within  the  territory  of  the
European  Community  at  all  times,  subject  to  the
provisions  of  Article  7,  their  stocks  of  petroleum
products  at  a  level  corresponding,  for  each  of  the
categories  of  petroleum  products  listed  in  Article  2,  to
at  least  90  days’  average  daily  internal  consumption  in
the  preceding  calendar  year.

2.(cid:218)(cid:217)That  part  of 
internal  consumption  met  by
derivatives  of  petroleum  produced  indigenously  by  the
Member  State  concerned  may  be  deducted  up  to  a
maximum  of  25(cid:216)%  of  the  said  consumption.’

2.(cid:217)Article  2  is  deleted.

3.(cid:217)Article  3  becomes  Article  2  and  is  supplemented  by

the  following  paragraph:

"Bunker  supplies  for  sea(cid:220)going  vessels  shall  not  be
included  in  the  calculation  of  internal  consumption.
Bunker  supplies  for 
international  aviation  shall  be
included  in  the  calculation  of  internal  consumption’.

C  160/20

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27.5.98

4.(cid:217)Article  3  hereafter  is  inserted:

6.  Article  5  is  replaced  by  the  following  text:

"Article  3

"Article  5

1.(cid:218)(cid:217)Stocks  maintained  according  to  Article  1  shall  be
fully  at  the  disposal  of  Member  States  should  diffi(cid:220)
culties  arise  in  obtaining  oil  supplies.  Member  States
shall  ensure  they  have  the  legal  powers  to  control  the
use  of  stocks  in  such  circumstances.

At  all  other  times,  Member  States  shall  ensure  the
availability  and  accessibility  of  these  stocks;  they  shall
establish  arrangements  allowing  for  the  identification,
accounting  and  control  of  the  stocks.

fair  and
2.(cid:218)(cid:217)Member  States 
non(cid:220)discriminatory  conditions  apply  in  their  stock(cid:220)
holding  arrangements.

shall  ensure 

that 

The  cost  burden  resulting  from  the  maintenance  of
stocks  according  to  Article  1  shall  be  identified  by
transparent  arrangements  in  the  final  product  price  of
the  oil  products  concerned.  In  case  stocks  are  main(cid:220)
tained  solely  by  commercial  undertakings,  the  stock(cid:220)
holding  cost  burden  may  be  indicative.

3.(cid:218)(cid:217)To  fulfil  the  requirements  of  paragraphs  1  and  2,
Member  States  may  decide  to  have  recourse  to  a
stockholding  body  or  entity  which  will  be  responsible
for  holding  all  or  part  of  the  stocks.

Two  or  more  Member  States  may  decide  to  have
recourse  to  a  joint  stockholding  body  or  entity.  In
that  case  they  shall  be  jointly  responsible  for  the  obli(cid:220)
gations  deriving  from  this  Directive.’

5.  Article  4  is  replaced  by  the  following  text:

"Article  4

Member  States  shall  submit  to  the  Commission  a  stat(cid:220)
istical  summary  showing  stocks  existing  at  the  end  of
each  month,  drawn  up  in  accordance  with  Articles  5
and  6  and  specifying  the  number  of  days  of  average
consumption  in  the  preceding  calendar  year  which
those 
summary  must  be
submitted  at  the  latest  by  the  25th  day  of  the  second
month  after  the  month  to  be  reported.

represent.  This 

stocks 

Stocks  required  to  be  maintained  by  Article  1  may  be
maintained  in  the  form  of  crude  oil  and  intermediate
products,  as  well  as  in  the  form  of  finished  products.

In  the  statistical  summary  of  stocks  provided  for  in
Article  4,  finished  products  shall  be  accounted  for
according  to  their  actual  tonnage;  crude  oil  and  inter(cid:220)
mediate  products  shall  be  accounted  for:

-(cid:217)in  the  proportions  of  the  quantities  for  each
category  of  product  obtained  during  the  preceding
calendar  year  from  the  refineries  of  the  State
concerned;  or

-(cid:217)on  the  basis  of  the  ratio  between  the  total  quantity
manufactured  during  the  preceding  calendar  year
in  the  State  concerned  of  products  covered  by  the
obligation  to  maintain  stocks  and  the  total  amount
of  crude  oil  used  during  that  year;  the  foregoing
shall  apply  to  not  more  than  40(cid:216)%  of  the  total
obligation  for  the  first  and  second  categories
(petrol  and  gas  oils),  and  to  not  more  than  50(cid:216)%
for  the  third  category  (fuel  oils).

Blending  components,  when  intended  for  processing
into  the  finished  products  listed  in  Article  2,  may  be
substituted  for  the  products  for  which  they  are
intended.’

7.  Article  6  is  amended  as  follows:

(a)(cid:217)Paragraph  1  is  replaced  by  the  following  text:

level  of  minimum
"1.(cid:218)(cid:217)When  calculating  the 
stocks  provided  for 
in  Article  1,  only  those
quantities  which  would  be  held  in  accordance
with  Article  3  shall  be  included  in  the  statistical
summary.’

(b) Paragraph  2  is  replaced  by  the  following  text:

implementing 

the  purposes  of 

"2.(cid:218)(cid:217)For 
this
Directive,  stocks  may  be  established,  under  indi(cid:220)
vidual  agreements  between  Governments,  within
the  territory  of  a  member  State  for  the  account  of
undertakings  established 
in  another  Member
State.

The  annual  consumption,  upon  which  the  new  stock(cid:220)
holding  obligation 
is  calculated,  shall  change  on
31  March  every  year.

In  the  statistical  summary,  stocks  of  jet  fuel  of  the
kerosene  type  shall  be  reported  separately  under
category  II.’

the  Member  State  on  whose
In  such  cases, 
territory  the  stocks  are  held  under  the  framework
of  such  an  agreement  shall  not  oppose 
the
transfer  of  these  stocks  to  the  other  Member
States  for  the  account  of  which  stocks  are  held
under  that  agreement;  it  shall  keep  a  check  on
such  stocks  in  accordance  with  the  procedures
specified  in  that  agreement  but  shall  not  include
them  in  its  statistical  summary.  The  Member  State

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on  whose  behalf  the  stocks  are  held  may  include
them  in  its  statistical  summary.

by  another  undertaking,  or  body/entity, 
following  conditions  shall  be  met:

the

Together  with  the  statistical  summary  provided
for  by  Article  4,  each  Member  State  shall  send  a
report  to  the  Commission  concerning  the  stocks
maintained  within  its  own  territory  for  the  benefit
of  another  Member  State,  as  well  as  the  stocks
held  in  other  Member  States  for  its  own  benefit.
In  both  cases,  the  storage  locations,  quantities  and
product  category  -  or  crude  oil  -  stored  will  be
indicated  in  the  report.

Drafts  of  the  agreements  mentioned  in  the  first
subparagraph  shall  be  sent  to  the  Commission,
which  may  make  its  comments  known  to  the
Governments  concerned.  The  agreements,  once
concluded,  shall  be  notified  to  the  Commission,
which  shall  make  them  known  to  the  other
Member  States.

-(cid:217)the  beneficiary  undertaking,  or  body/entity,
must  have  the  contractual  right  to  acquire
these  stocks  during  the  delegation  period;  the
methodology  for  establishing  the  price  of  such
acquisition  must  be  agreed  between  the  parties
concerned;

-(cid:217)the  minimum  delegation  period  must  be  90

days;

-(cid:217)storage 

location,  quantity  and  category  of
product,  or  crude  oil,  stored  in  that  location
must  be  specified.’

(c) Paragraph  3,  second  indent,  is  replaced  by  the

following  text:

in  another  Member  State  within 

Any  Member  State  which  decides  not  to  maintain
stocks 
the
framework  of  such  agreements  shall  inform  the
such  a
Commission  about 
decision.

reasons 

the 

for 

Agreements  shall  satisfy  the  following  conditions:

-(cid:217)they  must  relate  to  crude  oil  and  to  all
petroleum  products  covered  by  this  Directive;

-(cid:217)they  must 

lay 

and
down 
arrangements  for  the  maintenance  of  stocks
with  the  aim  of  safeguarding  control  and
availability  of  these  stocks;

conditions 

from 

excluded 

statistical 

"Consequently  the  following  shall,  in  particular,
be 
summary:
the 
indigenous  crude  oil  not  yet  extracted;  supplies
intended  for  the  bunkers  of  sea(cid:220)going  vessels;
supplies  in  direct  transit  apart  from  the  stocks
referred  to  in  paragraph  2;  supplies  in  pipelines,  in
road  tankers  and  rail  tank(cid:220)wagons,  in  the  storage
tanks  of  retail  outlets,  and  those  held  by  small
consumers.  Quantities  held  by  the  armed  forces
and  those  held  for  them  by  the  oil  companies  shall
also  be  excluded  from  the  statistical  summary.’

8.  Article  6a  hereafter  is  inserted:

"Article  6a

-(cid:217)they  must  specify  the  procedures  for  checking

and  identifying  the  stocks  provided  for;

Member  States  shall  adopt  all  the  necessary  provisions
and  take  all  the  necessary  measures  to  ensure  control
and  supervision  of  stocks.  They  shall  put  in  place
mechanisms  to  verify  the  stocks  according  to  the
provisions  of  this  Directive.’

-(cid:217)they  must  as  a  general  rule  be  concluded  for

an  unlimited  period;

9.  Article  6b  hereafter  is  inserted:

-(cid:217)they  must  state  that,  where  provision  is  made
for  unilateral  termination,  the  latter  shall  not
operate  in  the  event  of  a  supply  crisis  and  that,
in  any  event,  the  Commission  shall  receive
prior  information  of  any  termination.

When  stocks  established  under  such  agreements
are  not  owned  by  the  undertaking,  or  body/
entity,  which  has  an  obligation  to  hold  stocks,  but
are  delegated  to  this  undertaking,  or  body/entity,

"Article  6b

the 

shall  determine 

sanctions
Member  States 
applicable  to  the  violation  of  the  national  provisions
made  pursuant  to  this  Directive,  and  shall  take  any
measure  necessary  to  ensure  the  implementation  of
these  provisions.  Sanctions  must 
effective,
proportional  and  dissuasive.  Member  States  shall
notify  these  provisions  to  the  Commission  at  the  latest
on  31  December  1999,  as  well  as  any  later  modifi(cid:220)
cation  concerning  them,  as  soon  as  possible.’

be 

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27.5.98

Article  2

Directive  72/425/EEC 
31  December  1999.

is  hereby  repealed  as 

from

accompanied  by  such  a  reference  on  the  occasion  of
their  official  publication.  The  methods  of  making  such
reference  shall  be  laid  down  by  Member  States.

Article  3

shall  adopt  and  publish 

1.(cid:218)(cid:217)Member  States 
the
necessary  measures  to  comply  with  this  Directive  before
31  December  1999.  They  shall  inform  the  Commission
immediately  thereof.  They  apply  these  provisions  as  from
1  January  2000.

2.(cid:218)(cid:217)When  Member  States  adopt  these  provisions,  they
shall  contain  a  reference  to  this  Directive  or  shall  be

Article  4

the 

The  Commission  shall  submit  regularly  to  the  Council  a
report  on 
the
situation  concerning 
Community,  as  required  by  Directive  68/414/EEC.  The
first  report  shall  be  submitted  to  the  Council  during  the
second  year  following  the  date  stipulated  in  Article  3(1).

stocks 

in 

Article  5

This  Directive  is  addressed  to  the  Member  States.