Proposal for a Council Decision establishing the Community position in the respect to the prolongation of the International Agreement on Olive Oil and Table Olives, 1986
Date: 2003-06-02
Institutions: European Commission
Subjects: agreement (EU), international agreement, olive, olive oil, renewal of an agreement

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 2.6.2003
COM(2003) 318 final

2003/0112 (ACC)

Proposal for a

COUNCIL DECISION

establishing the Community position in the respect to the prolongation
of the International Agreement on Olive Oil and Table Olives, 1986

(presented by the Commission)

EXPLANATORY MEMORANDUM

The  International  Agreement  on  Olive  Oil  and  Table  Olives  of  1986,  of  which  the
Community is a member, entered into force on 1 July 1986. It was amended in 1993 and its
application  prolonged  to  1998.  It  has  been  extended  twice  for  further  periods  of  two  years
until  31  December  2000  and  31  December  2002.  In  December  2002  it  was  extended  for  a
period of six months ending on 30 June 2003.

Under Article 61 of the International Agreement on Olive Oil and Table Olives of 1986 and
Article 9 of the Protocol amending and extending the Agreement, the International Olive Oil
Council (IOOC) may decide to prolong the Agreement for successive periods not exceeding
two years on each occasion.

The IOOC is planning to take the decision to prolong the Agreement for a further period, in
the course of its 88th session, which will take place between 23 and 27 June 2003.

The budgetary implications are as follows:

The  European  Community  participation  share  pertaining  to  the  Administrative  Budget
amounts to 781/1000, i.e. 78.1%, which is paid under budget-item B7-8210. The Community
share of the IOOC-budget for 2003 is estimated at about € 4,000,000. This estimate has to be
divided into two equal parts, as there has already been an extension of this Agreement for the
first  semester  2003.  In  the  draft  preliminary  budget  for  2004,  an  amount  of  €  4,235,000  is
foreseen.

Moreover,  the  Agreement  foresees  an  obligatory  contribution  of  € 500,000/year  to  the
Promotion  Fund  to  be  paid  under  budget  line  B1-3811.  The  European  Community  share  is
809.7/1000, i.e. 80.97% and, therefore, amounts to € 404,850/year. This amount is fixed and
will stay the same for the years 2003 and 2004.

Moreover,  the  mission-man-day-involvement  of  Commission  staff  for  the  participation  in
IOOC-sessions  twice  per  year  and  in  the  various  committees  can  be  estimated  at  around
70 man-days/year.

The purpose of this proposal is to authorise the Commission on behalf of the Community to
vote  in  favour  of  the  prolongation  of  the  Agreement  for  a  period  of  18  months  maximum.
Pending  the  results  of  an  audit  into  the  entire  financial  management  of  the  IOOC  the
Commission  does,  however,  reserve  the  right  to  alter  this  proposal  once  these  results  are
available.

2

2003/0112 (ACC)

Proposal for a

COUNCIL DECISION

establishing the Community position in the respect to the prolongation
of the International Agreement on Olive Oil and Table Olives, 1986

THE COUNCIL OF THE EUROPEAN UNION,

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular
Article 133, in conjunction with the first sentence of Article 300 (2) thereof,

Having regard to the proposal from the Commission1,

Whereas:

(1)

(2)

(3)

The  International  Agreement  on  Olive  Oil  and  Table  Olives,  1986,  (hereafter:  the
Agreement),  was  concluded  by  the  Community  by  Council  Decision  87/401/EEC2,
amendments thereof were approved in 1993 by Council Decision 93/622/EC3. It was
prolonged thereafter for additional periods of two years and lately for a period of six
months ending on 30 June 2003. It will expire then unless the International Olive Oil
Council  (hereafter:  IOOC)  decides  on  a  prolongation  for  a  further  period.  It  is
proposed that this prolongation is agreed for a period of up to eighteen months,

The  objective  of  the  Agreement  is  to  promote  the  international  co-operation  in  the
field of olive oil and table olives. The prolongation of the Agreement is, therefore, in
the interest of the Community,

The  Commission,  representing  the  Community  in  the  IOOC,  should,  therefore,  be
authorised to vote in favour of such prolongation,

HAS DECIDED AS FOLLOWS:

1

2

3

OJ C …, …, p. …
OJ L 214, 4.8.87, p. 1.
OJ L 298, 3.12.1993, p. 36.

3

                                                
Sole Article

1.

2.

The prolongation of the International Agreement on Olive Oil and Table Olives for a
period of up to eighteen months is hereby approved.

The  Commission  is  hereby  authorised  to  express  this  position  within  the  spring
session of the International Olive Oil Council.

Done at Brussels,

For the Council
The President

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LEGISLATIVE FINANCIAL STATEMENT

Policy area: Agriculture

Activities:  External  Relations  (B7-8210)  and  General  Operational  Support  and  Co-ordination
(B1-3811)

TITLE  OF  ACTION:  INTERNATIONAL  AGREEMENT  ON  OLIVE  OIL  AND  TABLE  OLIVES,  1986

(B7-8210); PROMOTION MEASURES (B1-3811)

1.

BUDGET LINES + HEADINGS

B7-8210:
B1-3811:

International Agricultural Agreements
Measures in Third Countries

2.

OVERALL FIGURES

2.1.

Total allocation for action (Part B): € million for commitment

(a)

2003 (second semester):

€ 1.962 (budget-line B7-8210)
€ 0.202 (budget-line B1-3811)

(b)

2004:

€ 4.235 (budget-line B7-8210)
€ 0.405 (budget-line B1-3811)

2.2.

2.3.

(a)

Period of application: Calendar years 2003 (from 1 July to 31 December) and 2004

Overall multiannual estimate of expenditure

Schedule of commitment appropriations/payment appropriations (financial intervention)

€ million (to three decimal places)

Commitments

Payments

2003
€ 1.962 (B7-8210)
€ 0.202 (B1-3811)

€ 1.962 (B7-8210)
€ 0.202 (B1-3811)

2004
€ 4.235 (B7-8210)
€ 0.405 (B1-3811)

€ 4.235 (B7-8210)
€ 0.405 (B1-3811)

Total

€ 6.197 (B7-8210)
€ 0.607 (B1-3811)

€ 6.197 (B7-8210)
€ 0.607 (B1-3811)

2.4.

Compatibility with financial programming and financial perspective

X

Proposal is compatible with existing financial programming.

3.

BUDGET CHARACTERISTICS (WITH REGARD TO BUDGET-LINE B7-8210)

Type of
expenditure

New

EFTA
contribution

Contributions from
applicant countries

Heading in financial
perspective

Comp

Diff

no

no

no

No 4 External
Relations

5

BUDGET CHARACTERISTICS (WITH REGARD TO BUDGET-LINE B1-3811)

Type of
expenditure

Comp

Non-
diff

New

no

EFTA
contribution

Contributions from
applicant countries

Heading in financial
perspective

no

no

No 1a Agric.
Expenditure

4.

LEGAL BASIS

Article  133  in  conjunction  with  the  first  sentence  of  Article  300(2)  of  the  Treaty  establishing  the
European Community

5.

DESCRIPTION AND GROUNDS

5.1.

Need for Community intervention

5.1.1.

Objectives pursued

Due  to  its  economic  importance  in  the  agricultural  sector  the  Community  should  be  represented  in
international  agricultural  organisations.  Being  a  member  of  the  International  Olive  Oil  Council,  in
particular, enables the Community to  pursue  the  developments  of  the  markets  for  olive oil  and table
olives and, thus, to defend its interest with regard to these products. The International Agreement on
Olive  Oil  and  Table  Olives  1986  supports  international  co-operation  and  contributes  to  the
development and the stability of the markets for these products.

5.1.2. Measures taken in connection with ex ante evaluation

N/A

5.1.3. Measures taken following ex post evaluation

N/A

5.2.

Action envisaged and budget intervention arrangements

The Community pays its annual membership contribution as fixed in accordance with the International
Agreement  and  the  obligatory  contribution  to  the  Promotion  Fund  of  the  IOOC  as  fixed  in  the
International  Agreement. These  obligations continue  as  long  as the  Community  is  a  signatory  of  the
International Agreement.

The Commission, representing the Community, as well as the other members of the IOOC participates
actively in the IOOC-activities and profits fully of the advantages of being a member of the IOOC.

6.

FINANCIAL IMPACT

6.1.

Total financial impact on Part B - (over the entire programming period)

6.1.1.

Financial intervention

Breakdown

Action 1 (B7-8210)

Action 2 (B1-3811)

TOTAL

Commitments (in € million to three decimal places)

2004

€ 4.235

€ 0.405

€ 4.640

Total

€ 6.197

€ 0.607

€ 6.804

2003

€ 1.962

€ 0.202

€ 2.164

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6.2.

Calculation  of  costs  by  measure  envisaged  in  Part  B  (over  the  entire  programming
period)

For  Action  1,  the  amount  is  estimated,  taking  account  of  the  current  EC  share,  on  the  basis  of  the
administrative budget established by the COI for the first semester 2003. For 2004, an increase of 5%
is foreseen. Final 2004 figures may only be decided upon more precisely on the basis of new internal
rules of the IOOC to be implemented as a consequence of the internal reform of the IOOC, currently
under preparation and discussion.

For  action  2,  the  same  reasons  apply.  Calculations  are  based  on  the  “Promotion”  obligatory
contribution laid down by the COI Agreement (500 000 Euro), taking account of current EC share of
80.97%.

These sums are forecasts. Factors of uncertainty that could have an impact on the forecasted amounts
are the accession of new members to the COI (Jordan and maybe Libya) leading to changes in the EC
share  and  the  weight  of  moving  exchange  rates  between  the  US  dollar  and  the  Euro  leading  to
unforeseeable changes in the COI administrative budget.

7.

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE

7.1.

Impact on human resources

Description of tasks deriving
from the action

Staff to be assigned to management
of the action using existing and/or
additional resources

Number of
permanent posts

Number of
temporary posts

0.25
0.25
-

-

0.5

-
-
-

-

-

Total

0.25
0.25
-

-

0.5

Types of post

A
B
C

Officials or
temporary staff

Other human
resources

Total

7.2.

Method of calculation

Assuming  that  an  average  salary  of  an  official
amounts  to  € 75,000/year  half  an  annual  salary
would amount to € 37,500. Taking into account all
further 
the  Community
(contributions  to  the  various  funds  and  overhead
costs) this amount was doubled to € 75,000.

contributions 

of 

Overall financial impact of human resources

Type of human resources

Amount (€)
€ 75,0004

Officials

Temporary staff

Other human resources

The amounts are total expenditure for twelve months.

Total

€ 75,000

4

This is just an estimation.

7

                                                
7.3.

Other administrative expenditure deriving from the action

Budget line (number and heading)

Amount €

Method of calculation

Overall allocation (Title A7)

A0701 – Missions

€ 30,000

2  sessions  of  5  days/year  which  are  attended  by
3 staff  in  the  average  =  30  daily  allowances  in
Spain  plus  10  return  flights  (different  staff  at
different days) to Madrid.

Various  IOOC  committee-meetings  to  be  attended
by  Commission  staff  rounding  up  to  40  daily
allowances  in  Spain  plus  20  return  flights  to
Madrid.

The amounts are total expenditure for twelve months.

Total

€ 30,000

I.

II.

III.

8.

Annual total (7.2 + 7.3)

€ 105,000 per year

Duration of action

one and a half years (2003 second semester, 2004)

Total cost of action (I x II)

€ 152,500

FOLLOW-UP AND EVALUATION

8.1.

Follow-up arrangements

The  IOOC-activities  are  closely  followed  by  its  members  and  there  are  regular  meetings  which  are
attended by Commission staff.

8.2.

Arrangements and schedule for the planned evaluation

Activity  reports  are  regularly  distributed  by  the  IOOC,  which  allows  an  evaluation  of  the  activities.
Commission  staff  reports  back  to  the  PROBA-group  of  the  Council  and  the  IOOC  activities  are
followed up in that context, too.

9.

ANTI-FRAUD MEASURES

Article  17(10)  and  24  of  the  International  Agreement  on  Olive  Oil  and  Table  Olives  1986  and
Article 28,  lit  d)  of  the  Internal  Rules  of  the  IOOC  provide  for  control  and  audit  mechanisms.  The
accounts have to be certified by an independent account commissioner.

With  regard  to  the  contributions  to  the  Promotion  Fund  the  Commission  carries  out  controls  of  the
accounts by own staff, as the case may be, on-the spot, and monitors the contracts.

Moreover, the IOOC-members have recently agreed upon an in-depth audit into the overall financial
management of the IOOC. The results of that audit are to be expected later in 2003.

8