Council Regulation (EC) No 1638/98 of 20 July 1998 amending Regulation No 136/66/EEC on the establishment of a common organisation of the market in oils and fats
Date: 1998-07-20
Institutions: Council of the European Union
Subjects: common organisation of markets, fats

L 210/32

‹

EN

‹

Official Journal of the European Communities

28. 7. 98

COUNCIL REGULATION (EC) No 1638/98

of 20 July 1998

amending Regulation No 136/66/EEC on the establishment of a common
organisation of the market in oils and fats

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 Commission (1),

Having regard to the opinion of
liament (2),

the European Par-

Having regard to the opinion of the Economic and Social
Committee (3),

(1) Whereas

1997

in February

the Commission
submitted a communication to the European Par-
liament and the Council on the olive and olive oil
sector, concluding that the current common organ-
isation of the market in oils and fats needed reform;
whereas that communication and the options for
reform set out therein have been discussed within
the Community
opinions
concur on the need for reform; whereas, however,
with a view to determining the best approach, more
reliable information must be obtained, in particular
on the number of olive trees in the Community, the
areas planted and yields; whereas, given the time
required to gather and analyse such data,
the
Commission has undertaken to submit a proposal for
reform in the course of 2000 for application from the
2001/02 marketing year;

institutions; whereas

fats (4) provides for production aid fixed on a flat-rate
basis for producers whose average production does
not exceed 500 kg; whereas
the measure was
intended in particular to reduce the administrative
costs connected with checking on entitlement to the
aid; whereas, however, changes to the production aid
scheme, and in particular the rise in the proportion
of expenditure on aid paid to small producers and
the increase in the level of aid, have transformed the
two-tier system of aid to producers into a source of
fraud; whereas the provisions relating specifically to
aid for
should accordingly be
deleted;

small producers

(4) Whereas the stabiliser mechanism for production aid
is currently based on a maximum guaranteed quant-
ity for the Community as a whole; whereas the
maximum guaranteed quantity should be increased
to take account, in particular, of production trends;

(NGQ); whereas

(5) Whereas, to encourage a reasonable level of produc-
tion in each Member State, the maximum guaranteed
quantity should be apportioned among the producer
Member States in the form of National Guaranteed
Quantities
apportionment
should essentially be based on production over a
representative period, taking no account of extreme
production years; whereas, however, account should
be taken of the situation in the sector in the different
Member States and in particular of the specific al-
location of aid previously granted to small producers
the production potential of existing olive
and of
groves in Spain and Portugal;

the

(2) Whereas experience has shown that some adjust-
ments need to be made in the near future to the
current common organisation of
to
reduce the difficulties of operators in the sector,
improve checks conducted by the national author-
the Community budget better;
ities and protect
whereas provision should be made for the necessary
adjustments to the present market organisation and
the relevant prices and amounts should be fixed for
the marketing years from 1998/99 to 2000/01;

the market

(6) Whereas, in order to mitigate the effects of fluctu-
ations in production, where the actual production of
a Member State is lower than its NGQ, part of the
shortfall may be added to that Member State’s NGQ
for
the
the following marketing year; whereas
remainder of the shortfall can offset other Member
StatesY NGQ overruns in order to continue to ensure
some solidarity between producers in the European
Union;

(3) Whereas Article 5 of Council Regulation No 136/
66/EEC of 22 September 1966 on the establishment
of a common organisation of the market in oils and

(7) Whereas the production aid is payable to the olive
growers; whereas the latter must receive the aid in
full, irrespective of the various reductions provided
for in the Community rules;

(1) OJ C 136, 1. 5. 1998, p. 20.
(2) OJ C 210, 6. 7. 1998.
(3) OJ C 235, 27. 7. 1998.

(4) OJ 172, 30. 9. 1966, p. 3025/66. Regulation as last amended
by Regulation (EC) No 1581/96 (OJ L 206, 16. 8. 1996, p. 11).

28. 7. 98

‹

EN

‹

Official Journal of the European Communities

L 210/33

(8) Whereas, where necessary to allow support for table
olives, Member States must be able to make use of
part of the resources allocated to aid for olive oil
production;

there is a need for a system of aid for private storage
contracts, with priority for such contracts being given
to producer groups and associations thereof recog-
nised under Council Regulation (EC) No 952/97 of
20 May 1997 on producer groups and associations
thereof (5);

(9) Whereas consumption aid cannot be increased
without a risk of fraud and is ineffective at its present
level; whereas in the past it was reduced sharply
without adverse effect on the consumption of olive
oil in the Community; whereas abolishing it would
enable checks on the production aid scheme to be
stepped up, in particular by the inspection agencies
provided
(EEC)
No 2262/84 of 17 July 1984 laying down special
measures in respect of olive oil (1); whereas Council
Regulation (EEC) No 3089/78 of 19 December 1978
laying down general rules in respect of aid for the
consumption of olive oil (2) must
therefore be
repealed;

in Council Regulation

for

(10) Whereas the provisions for promoting the consump-
tion of olive oil and table olives in the Member
States and third countries should be maintained,
clarified and strengthened; whereas such measures
are intended to establish better balance on the
market and as a consequence the relevant expendit-
ure should be deemed intervention within the
meaning of Article 3 of Council Regulation (EEC)
No 729/70 of 21 April 1970 on the financing of the
common agricultural policy (3); whereas those provi-
sions call for certain technical adaptations to Council
Regulation (EEC) No 1970/80 of 22 July 1980 laying
implementing rules for campaigns
down general
aimed at promoting the consumption of olive oil in
the Community (4); whereas that Regulation should
be repealed and its provisions incorporated, with the
requisite
in Regulation No 136/
66/EEC;

amendments,

(11) Whereas the system of public buying-in constitutes a
production incentive which is liable to destabilise the
market; whereas buying-in must therefore be discon-
tinued and the references to the intervention price
must be deleted or replaced;

(12) Whereas, if the supply of olive oil is to be regulated
the market,

when there is serious disturbance of

(1) OJ L 208 3. 8. 1984, p. 11. Regulation as last amended by Re-
gulation (EC) No 2599/97 (OJ L 351, 23. 12. 1997, p. 17).
(2) OJ L 369, 29. 12. 1978, p. 12. Regulation as last amended by
Regulation (EC) No 1582/96 (OJ L 206, 16. 8. 1996, p. 13).
(3) OJ L 94, 28. 4. 1970, p. 13. Regulation as last amended by Re-
gulation (EC) No 1287/95 (OJ L 125, 8. 6. 1995, p. 1).
(4) OJ L 192, 26. 7. 1980, p. 5. Regulation as amended by Regu-
lation (EEC) No 1651/86 (OJ L 145, 30. 5. 1986, p. 10).

(13) Whereas the definitions of the categories of virgin
olive oil in the Annex to Regulation No 136/66/EEC
refer to an organoleptic assessment based on a par-
ticular method; whereas methods of sensory analysis
have improved recently, although they retain an
inherent risk of some subjectivity; whereas the def-
initions in question should be amended to refer,
where necessary, to more effective analysis methods;

(14) Whereas,

in order to improve knowledge of and
checks on the production of olive oil at the level of
the individual producer, special attention should be
paid to work on the olive cultivation register during
the 1998/99 to 2000/01 marketing years; whereas, to
take account of experience gained, the method used
for other crops in the context of
the Integrated
Administration and Control System should also be
applied for the olive cultivation register; whereas the
Commission must therefore determine the measures
to be taken and the arrangements and criteria to be
complied with to achieve the creation of a Geo-
graphical Information System; whereas it is therefore
from Regulation (EEC)
necessary
No 154/75 (6) and Regulation (EEC) No 2261/84 (7);

to derogate

the

(15) Whereas the options for the reform may encourage
producers to plant new olive trees; whereas such new
plantings would seriously jeopardise
future
balance of the market, which is currently already in
surplus; whereas, in order to forestall that risk, provi-
sion should be made at this stage to exclude new
from eligibility under any future aid
plantings
scheme, unless
they are part of a programme
approved by the Commission; whereas, owing to the
time elapsing between the presentation of
the
Commission’s proposal and its adoption, plantings

(5) OJ L 142, 2. 6. 1997, p. 30.
(6) Council Regulation (EEC) No 154/75 of 21 January 1975 on
the establishment of a register of olive oil cultivation in the
Member States producing olive oil (OJ L 19, 24. 1. 1975, p. 1).
Regulation as last amended by Regulation (EEC) No 3788/85
(OJ L 367, 31. 12. 1985, p. 1).

(7) Council Regulation (EEC) No 2261/84 of 17 July 1984 laying
down general rules on the granting of aid for the production
of olive oil and of aid to olive oil producer organisations (OJ
L 208, 3. 8. 1984, p. 3). Regulation as last amended by Regula-
tion (EC) No 636/95 (OJ L 67, 25. 3. 1995, p. 1).

L 210/34

‹

EN

‹

Official Journal of the European Communities

28. 7. 98

from the month following the date when operators
are notified of the Commission’s intention in this
respect should also be ineligible;

(16) Whereas the need for a reform of the olive oil sector
stems from the ultimate impossibility of maintaining
certain measures
in Regulation
No 136/66/EEC; whereas, despite the transitional
the measures in
adjustments provided for herein,
question should be
from
1 November 2001,

repealed with effect

provided

for

HAS ADOPTED THIS REGULATION:

Article 1

Regulation No 136/66/EEC is amended as follows:

1. In Article 2a(2), the words ‘intervention price’ shall be

replaced by the following:

‘production target price, less production aid and an
amount taking account of market variations and the
costs of transporting the olive oil from the areas of
production to the areas of consumption,’.

2. Article 4 shall be replaced by the following:

‘Article 4

A production target price shall be fixed for the

1.
Community.

That price shall be fixed at the wholesale marketing
stage for ordinary virgin olive oil with a free fatty acid
content expressed as oleic acid of 3,3 g/100 g.

2.
For the 1998/99 to 2000/01 marketing years, the
production target price provided for in paragraph 1
shall be ECU 383,77/100 kg.

Save as otherwise decided by the Council acting
3.
by a qualified majority on a proposal
from the
Commission, the olive oil marketing year shall run
from 1 November to 31 October of the following
year.’;

3. Article 5 shall be replaced by the following:

‘Article 5

1.
Production aid shall be granted for olive oil.
Such aid shall be intended to contribute towards es-
tablishing a fair income for producers.

The aid shall be granted to olive growers on the basis
of the quantity of olive oil they actually produce.

Without prejudice
reductions
provided for in the Community rules, the aid shall be
paid in full to the olive growers.

different

the

to

For the 1998/99 to 2000/01 marketing years, the
2.
unit amount of the production aid provided for in
paragraph 1 shall be ECU 132,25/100 kg.

The maximum quantity of olive oil to which the
3.
aid provided for in paragraph 1 shall apply shall be
1 777 261 tonnes per marketing year. That maximum
guaranteed quantity shall be apportioned among the
Member States as follows in the form of NGQs:

— Spain

— France

— Greece

— Italy

— Portugal

760 027 tonnes

3 297 tonnes

419 529 tonnes

543 164 tonnes

51 244 tonnes.

Under

to be

conditions

approved by the
4.
Commission in accordance with the procedure laid
down in Article 38, each Member State may allocate
part of its NGQ and of its olive oil production aid to
support for table olives.

In such cases, the NGQ used for applying paragraphs
5 and 6 shall be the one given in paragraph 3,
reduced by a quantity corresponding to the aid
granted to table olives.

5. Where actual production in any marketing year
in a Member State is less than its NGQ:

(a) 20 % of the shortfall shall be distributed among
the Member States which exceeded their NGQs
during the same marketing year; the distribution
shall be carried out in proportion to the NGQs of
the beneficiary States; and

(b) 80 % of the shortfall shall be added, solely for the
subsequent marketing year, to the NGQ of the
Member State in question.

The residual quantities shall be distributed by the
Commission in accordance with the procedure laid
down in Article 38.

The aid fixed in paragraph 2 shall be granted in
6.
those Member States whose actual production recog-
nised as eligible for the aid is lower than or equal to
their NGQs, plus any increase in accordance with
paragraph 5.

In the other Member States, the unit aid granted shall
be equal to the amount fixed in paragraph 2, multi-
plied by a coefficient. That coefficient shall be arrived
the Member State
at by dividing the NGQ of
concerned, plus any increase in accordance with para-
graph 5, by the actual production recognised as
eligible for the aid.

28. 7. 98

‹

EN

‹

Official Journal of the European Communities

L 210/35

7. With a view to checks of the quantity of olive
oil eligible for the aid, olive and olive oil yields shall
be fixed for each marketing year per homogeneous
production area.

8.
Recognised producer organisations and associa-
tions thereof may be associated in the work of deter-
mining actual production as referred to in paragraph
5 and of establishing yields as referred to in para-
graph 7.

9.
A percentage of the production aid allocated to
all or some producers shall be used to finance re-
gional measures to improve the quality of oil produc-
tion and its environmental impact in each producer
Member State.

For the 1998/99 to 2000/01 marketing years, the
percentage referred to in the first subparagraph shall
amount to 1,4 % of the production aid allocated to
olive oil producers.

10.
Acting by a qualified majority on a proposal
from the Commission, the Council shall lay down
general rules for applying this Article.

The yields referred to in paragraph 7 and the
11.
detailed rules for applying this Article shall be deter-
mined in accordance with the procedure laid down
in Article 38 of
this Regulation and, where ap-
plicable, the procedure laid down in Article 13 of
Council Regulation (EEC) No 729/70 of 21 April
1970 on the financing of the common agricultural
policy (*).

(*) OJ L 94, 28.4.1970, p. 13. Regulation as last
amended by Regulation (EC) No 1287/95 (OJ L
125, 8. 6. 1995, p. 1).’;

4. Articles 5a, 7 and 8 shall be deleted;

5. Article 11 shall be replaced by the following:

‘Article 11

1.
The Community may undertake measures
directly or indirectly to provide information or to
promote, in Member States or third countries, the
consumption of olive oil and table olives produced
in the Community.

The measures referred to in the first subparagraph
may entail the following:

(a) dissemination of existing knowledge, in particular
regarding the nutritional qualities of olive oil;

(b) market studies to expand the market for olive oil;

(c) publicity, public

relations

and promotional
campaigns
to encourage the consumption of
olive oil, in particular with a view to stressing its
quality, and of products prepared with olive oil;

(d) research work,

in particular covering scientific

study of the nutritional aspects of olive oil;

(e) study to assess

the

results of promotional

campaigns.

2.
The Commission shall send the Council a
programme of the measures it contemplates under-
taking during the following marketing year(s). With a
view to drawing up the programme, the Commission
may in particular consult bodies
specialising in
market studies and publicity campaigns and research
institutes.

3.
The Commission shall decide on the measures
listed in paragraph 1 after consulting the Manage-
ment Committee for Oils and Fats in accordance
with the procedure laid down in Article 39.

4.
Expenditure incurred on measures referred to
in paragraph 1 may be financed at a rate of 100 %
by the Community and shall be deemed intervention
within the meaning of Article 3 of Regulation (EEC)
No 729/70.

5. Detailed rules for applying this Article shall be
adopted in accordance with the procedure laid down
in Article 38.’;

6.

the first paragraph of Article 11a shall be replaced by
the following:

to penalise infringements of

‘The individual Member States shall take the neces-
sary steps
the aid
scheme provided for in Article 5. Where infringe-
ments are reported by the inspection agencies
in Council Regulation (EEC) No
provided for
2262/84 of 17 July 1984 laying down special
measures in respect of olive oil (*), the Member States
shall decide on action to be taken within 12 months
of the report.

(*) OJ L 208, 3.8.1984, p. 11. Regulation as last
amended by Regulation (EC) No 2599/97 (OJ L
351, 23. 12. 1997, p. 17).’;

7. Article 12 shall be deleted;

8. Article 12a shall be replaced by the following:

‘Article 12a

In the event of serious disturbance of the market in
certain regions of the Community, in order to regu-
larise the market, a decision may be taken in accord-
ance with the procedure laid down in Article 38 to
authorise bodies offering sufficient guarantees, and
approved by
to conclude
the Member States,
contracts for the storage of olive oil that they market.
Among the bodies concerned, priority shall be given
to producer groups and associations thereof recog-
nised in accordance with Regulation (EC) No
952/97 (*).

L 210/36

‹

EN

‹

Official Journal of the European Communities

28. 7. 98

The measures referred to in the first paragraph may
be implemented inter alia when the average price
recorded on the market during a representative
period is less than 95 % of the intervention price
applicable during the 1997/98 marketing year.

The amount of the aid granted for the performance
of contracts and the detailed rules for implementing
this Article, in particular the quantities, qualities and
duration of storage of the oils concerned, shall be
established by the procedure laid down in Article 38
in such a way as to ensure a significant impact on
the market. The aid may be granted by means of
tenders.

(*) OJ L 142, 2.6.1997, p. 30.’;

9. Article 20(2) shall be deleted;

10.

the last subparagraph of Article 20a(2) and Article
20a(4) shall be deleted;

11. Article 20d(1) shall be replaced by the following:

‘1.
A percentage of the production aid shall be
withheld from the amount paid to recognised
producer groups and associations thereof under this
Regulation. The resulting amount shall help finance
activities under Article 5(7) and Article 20c.

For the 1998/99 to 2000/01 marketing years, the
percentage of the production aid referred to in the
first subparagraph shall be 0,8 %.’;

12. Article 20d(3) shall be deleted;

13. point 1 of the Annex shall be replaced by the fol-

lowing:

‘1. Virgin olive oils:

Oils obtained from the fruit of the olive tree
solely by mechanical or other physical means
under conditions, particularly thermal conditions,
that do not lead to alterations in the oil, which
have not undergone any treatment other than
washing, decantation, centrifugation and filtra-
to the exclusion of oils obtained using
tion,
solvents or
re-esterification processes and any
mixture with oils of other kinds.

Virgin olive oils are classified and described as
follows:

(a) Extra virgin olive oil:

Virgin olive oil having a maximum free
acidity, in terms of oleic acid, of 1 g per 100 g,
the other characteristics of which comply with
those laid down for this category.

(b) Virgin olive oil

(the expression “fine virgin
oil” may be used at the production and whole-
sale stage):

Virgin olive oil having a maximum free
acidity, in terms of oleic acid, of 2 g per 100 g,
the other characteristics of which comply with
those laid down for this category.

(c) Ordinary virgin olive oil:

Virgin olive oil having a maximum free
acidity, in terms of oleic acid, of 3,3 g per 100
g, the other characteristics of which comply
with those laid down for this category.

(d) Lampante virgin olive oil:

Virgin olive oil having a free acidity, in terms
of oleic acid, of more than 3,3 g per 100 g
and/or
the other characteristics of which
comply with those laid down for this cat-
egory.’

Article 2

1. Notwithstanding Regulation (EEC) No 154/75, work
on the olive cultivation register during the 1998/99 to
focus on the creation,
2000/01 marketing years shall
updating and utilisation of a geographic information
system (GIS).

The GIS shall be created using the data from the olive
cultivation register. Additional data shall be supplied from
the crop declarations attached to the aid applications. The
information in the GIS shall be geographically situated
using computerised aerial photographs.

2. Member States shall verify that the information in
the crop declarations corresponds to the information in
the GIS. If this information does not correspond, the
Member State shall carry out verifications and on-the-spot
checks.

The Commission shall determine the detailed rules and
criteria for ensuring correspondence as referred to in the
first subparagraph and the acceptable tolerance. It shall
also lay down the detailed rules and intensity for the veri-
fications and on-the-spot checks to be carried out during
each of
the three marketing years from 1998/99 to
2000/01.

3.
If, during the verifications and checks referred to in
paragraph 2, the information in the crop declaration is
found to be incorrect, particularly as regards the number
of olive trees, the Member State shall apply, for one or
more marketing years, and depending on the size of the
discrepancies observed:

28. 7. 98

‹

EN

‹

Official Journal of the European Communities

L 210/37

— a reduction in the quantity of olive oil eligible for aid,

or

— exclusion of the olive trees concerned from eligibility

for the aid,

in accordance with rules and criteria to be laid down by
the Commission.

4.
The Commission shall adopt the measures to be
taken and the detailed rules, criteria and intensity of
checks to be laid down under this Article for the 1998/99
to 2000/01 marketing years,
in accordance with the
procedure laid down in Article 38 of Regulation No 136/
66/EEC.

5.
The measures provided for in this Article shall apply
by way of derogation from those laid down in Regulation
(EEC) No 2261/84 as regards crop declarations and their
links with the aid.

Article 3

1.
In accordance with the procedure laid down in
Article 38 of Regulation No 136/66/EEC, the Commis-
the measures required for a smooth
sion may adopt
changeover
the
1997/98 marketing year
to those resulting from the
measures introduced by this Regulation.

from the arrangements

in force for

from the Commission to be
2. On a proposal
presented in 2000,
the Council shall decide on the
common organisation of the market in oils and fats which
is to replace, as from 1 November 2001, the one es-
tablished by Regulation No 136/66/EEC.

relevant areas planted after 1 May 1998 and those not
covered by a cultivation declaration at a date to be deter-
mined.

However:

— additional olive trees in connection with the conver-

sion of an old olive plantation, or

— new plantings

on areas covered by a programme approved by the
Commission may be taken into account within certain
limits to be determined. For Greece, France and Portugal,
the areas provided for by the programmes to be approved
by the Commission during the period running until 1
November 2001 shall be 3 500 ha, 3 500 ha and 30 000
ha respectively.

Detailed rules for applying this Article shall be adopted in
accordance with the procedure laid down in Article 38 of
Regulation No 136/66/EEC.

Article 5

Articles 5, 11a, 12a, 13 and 20a of Regulation No 136/
66/EEC are hereby repealed with effect from 1 November
2001.

Regulations (EEC) Nos 3089/78 and 1970/80 are hereby
repealed.

Article 6

Article 4

No aid under the common organisation of the market in
oils and fats in force from 1 November 2001 may be paid
to olive growers in respect of additional olive trees or the

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

It shall apply from 1 November 1998.

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

Done at Brussels, 20 July 1998.

For the Council

The President

W. MOLTERER