Proposal for a Council Regulation amending Regulation (EC) No 2596/97 extending the period provided for in Article 149(1) of the Act of Accession of Austria, Finland and Sweden
Date: 2003-07-02
Institutions: European Commission
Subjects: Finland, Sweden, common organisation of markets, derogation from EU law, food standard, marketing standard, milk, milk fat

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 2.7.2003
COM(2003) 372 final

2003/0144 (CNS)

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT
AND THE COUNCIL

on certain aspects of the markets for preserved milks and drinking milks

Proposal for a

COUNCIL REGULATION

amending Regulation (EC) No 2596/97 extending the period provided for
in Article 149(1) of the Act of Accession of Austria, Finland and Sweden

(presented by the Commission)

REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT
AND THE COUNCIL

on certain aspects of the markets for preserved milks and drinking milks

TABLE OF CONTENTS

1.

2.

3.

4.

5.

6.

7.

Introduction.................................................................................................................. 3

Regulatory framework – Different aspects of protein standardisation ........................ 4

Market effects of protein standardisation..................................................................... 5

Impact on the competitiveness of European companies .............................................. 7

Protein standardisation and support measures in the milk sector ................................ 7

Regulatory framework – Fat content of drinking milk ................................................ 8

Conclusions................................................................................................................ 10

2

1.

1.1.

INTRODUCTION

The present report honours a number of Commission declarations in the framework
of Council legislation on drinking milk and preserved milks.

In  December 1997,  the  Council  reached  a  political  agreement  on  a  recasting  of  the
rules on the production and marketing of drinking milk. These rules are contained in
Council  Regulation  (EC)  No 2597/97  laying  down  additional  rules  on  the  common
organisation  of  the  market  in  milk  and  milk  products  for  drinking  milk1.  The
agreement  on  these  rules  was  linked  to  three  Commission  declarations,  the  first  of
which was worded as follows:

“The  Commission  intends  to  follow  attentively  developments  on  the  drinking  milk
market and, notably, the aspects related to the protein content of milk. In this respect,
the  Commission  will  examine  the  consequences  of  decisions  on  the  Code  of
Principles adopted in the framework of the “Codex Alimentarius” and will report on
this to the Council.”

In  December 1999,  the  Council  reached  a  political  agreement  on  a  recasting  of  the
rules on the production and marketing of preserved milks. These rules are contained
in  Council  Directive 2001/114/EC2.  The  agreement  on  these  rules  was  linked  to  a
declaration worded as follows:

“The Commission intends to follow attentively developments on the preserved milks
market and in particular the aspects related to the protein content. In this respect, she
will examine the consequences, notably in relation to:

– 

– 

– 

– 

– 

the competitiveness of European companies,

the  rules  on  preserved  milks  adopted  in  the  framework  of  the  “Codex
Alimentarius”,

the image of the product,

the appropriateness of an adequate labelling,

the incidence on the Community budget.

The  Commission  will  report  to  the  Council  in  the  course  of 2000  and  will,
eventually, propose amendments to the present directive”.

Also  in  December  1999,  the  Council  adopted  Regulation  (EC)  No 2703/1999
amending  Regulation  (EC)  No  2596/97  extending  the  period  provided  for  in
Article 149(1) of the Act of Accession of Austria, Finland and Sweden3. Under this
derogation, Finland and Sweden are authorised to produce drinking milk that is not
complying with the rules on fat content provided for in Regulation (EC) No 2597/97.

The  extension  of  the  derogation  was  linked  to  a  provision  inviting  Finland  and
Sweden  to  “notify  the  Commission  before  31 December 2001  of  the  measures
adopted  with  a  view  to  adapting  to  the  Community  rules.  On  that  basis  the

1

2

3

OJ L 351, 23.12.1997, p. 13.
OJ L 15, 17.1.2002, p. 19.
OJ L 327, 21.12.1999, p. 11.

3

                                                
Commission  shall  present  to  the  Council  a  report  on  the  progress  made  by  the
Member States concerned”.

2.

2.1.

REGULATORY FRAMEWORK – DIFFERENT ASPECTS OF PROTEIN STANDARDISATION

It  follows  from  the  provisions  of  Regulation  (EC)  No 2597/97,  Article 3(2)  and
Directive 2001/114/EC, Article 3(1) and Annex 1, that drinking milks and preserved
milks  produced  and  sold  in  the  Community  should  have  a  protein  content  that
corresponds to the protein content of the raw milk that was used for their production.
This equivalence rule relates to both the total protein content and to the ratio of the
two types of milk protein, casein and whey proteins.

In  principle,  this  restriction  does  not  apply  to  products  manufactured  in  the
Community  but  sold  on  third  country  markets.  However,  for  commercial  and
practical reasons – such as the fact that the end destination of products is unknown at
the moment of manufacture – it may be assumed that almost all of the drinking milks
and  preserved  milks  produced 
the  non-
standardisation.

the  Community  comply  with 

in 

2.2.

In line with the preserved milks Directive, intervention measures for skimmed milk
powder in the framework of the common organisation of the market in milk and milk
products are restricted to products with a natural protein content.

In  particular,  Article 7  of  Council  Regulation  (EC)  No 1255/19994  provides  that
skimmed  milk  powder  offered  for  public  intervention  shall  not  be  standardised  as
regards its protein content and must have a minimum protein of 35.6% by weight of
the  non-fatty  dry  extract.  However,  a  reduced  purchase  price  applies  for  powder
whose protein content is at least 31.4% and less than 35.6%.

Equally,  Article 2  of  Commission  Regulation  (EC)  No 2799/19995  provides  that
skimmed milk powder subsidised upon use in animal feed shall not be standardised.
Again, a reduced aid amount is granted for powder whose protein content is at least
31.4% and less than 35.6%.

It is important to note that the requirements on minimum protein content applied in
the  framework  of  the  milk  CMO  differ  from  those  foreseen  by  the  relevant  Codex
Standard (see point 2.4 of this report).

2.3.

The “Codex General Standard for the use  of  dairy terms” provides  in  Section 4.2.3
for rules to be respected for milk that is adjusted for protein content:

– 

– 

– 

such  product  can  only  be  sold  where  such  adjustment  is  permitted  in  the
country of retail sale;

the minimum and maximum limits of protein content of the adjusted milk are
specified in the legislation of the country of retail sale. In this case the protein
content shall be within the limits of natural variation within that country;

the  adjustment  has  been  performed  according  to  methods  permitted  by  the
legislation  of  the  country  of  retail  sale,  and  only  by  the  addition  and/or

4

5

OJ L 160, 26.6.1999, p. 55.
OJ L 340, 31.12.1999, p. 3.

4

                                                
withdrawal  of  milk  constituents,  without  altering  the  whey  protein  to  casein
ratio;

– 

the adjustment is declared in accordance with Section 4.2.2 of the standard.

Section 4.2.2  provides  that  milk  which  is  modified  in  composition  by  the  addition
and/or withdrawal of milk constituents may be identified with a name using the term
“milk”, provided  that a clear description  of  the  modification  to  which  the  milk  has
been subjected is given in close proximity to the name.

The  Codex  Standards  for  Milk  Powders  and  Cream  Powder  (207-1999),  for
Evaporated  Milk  (A-3-1971)  and  for  Sweetened  Condensed  milks  (A-4-1971)
provide that the protein content of the milk may have been adjusted, only to comply
with  the  compositional  requirements  in  Section 3  of  the  Standards,  by  the  addition
and/or withdrawal of milk constituents in such a way as not to alter the whey protein
to  casein  ration  of  the  milk  being  adjusted.  Section 3  of  the  Standards  requires  a
minimum protein content in milk solids-non-fat of 34% (m/m).

MARKET EFFECTS OF PROTEIN STANDARDISATION

Drinking  milk  and  preserved  milks  production  absorbs  a  substantial  part  of  the
Community’s  milk  deliveries.  In  2001,  drinking  milk  production  was  around
28.6 Mio tonnes, milk powder production around 1.9 Mio tonnes and condensed milk
totalled  1.25 Mio tonnes.  The  manufacture  of  all  these  products  together  requires  a
combined milk pool of around 50 Mio tonnes, which accounts for around  43.5% of
total milk deliveries.

Furthermore, as mentioned under point 2.4, the minimum protein content foreseen by
the Codex standards is 34% m/m expressed on solids-non-fat. Based on the average
composition of milk collected in the EU and assuming a certain safety margin, this
corresponds  to  around  2.9%  protein  on  product  weight.  For  the  year  2000,  the
average  protein  content  of  milk  collected  in  the  EU  was  3.35%.  This  means  that
protein  standardisation  potentially  could  result  in  extracting  important  quantities  of
protein from the milk used for drinking milk or preserved milk manufacture, making
increased  cheese  production.  Consequently,  protein
it  available  e.g. 
standardisation would impact on the existing surplus for milk in the Community.

for 

With  a  view  to  assessing  the  possible  impact  on  the  dairy  market  of  protein
standardisation for drinking  milks and  preserved  milks,  the  Commission  contracted
an external  expert  study, the  results  of  which  became  available  in  November 2001.
The purpose of this study was to achieve a realistic impact assessment notably based
on a range of interviews with the different players on the dairy market.

2.4.

3.

3.1.

3.2.

3.3.

3.4.

As regards preserved milks, the findings of the study can be summarised as follows:

(a)

the manufacturers of preserved milks are unanimous in their support of protein
standardisation.  Their  main  arguments  are:  legislation  in  force  prevents  the
producers  from  integrating  technological  progress  in  the  production  process,
following  the  adoption  of  the  1999  Codex  rules  other  major  dairy  producing
countries  practise  protein  standardisation  thereby  placing  EU  producers  in  a
disadvantaged  position,  detecting  illegal  protein  standardisation  requires
complex control procedures and can therefore hardly be prevented;

5

(b)

the  users  of  preserved  milks  (feed  producers,  confectionery  industry,  dietary
food producers) would generally be interested in using a standardised product.
Some of  these users would need to compensate for  a  protein  content  reduced
to 34%  by  using  additional  quantities  of  preserved  milks.  For  exported
preserved milks, the study estimates that around 60% would be standardised.

Based  on  this  analysis  and  using  data  for 1999,  the  study  concludes  that  protein
standardisation of preserved milks could release a surplus of milk protein of around
46 000 tonnes, which is the equivalent of 140 000 tonnes of skimmed milk powder.
It should be underlined that this estimate does not take account of existing selection
of raw milk according to its protein content (milk with a high protein content being
destined for cheese production) nor of illegal standardisation.

3.5

As regards drinking milk, the findings of the study can be summarised as follows:

(a)

the position of the manufacturers of drinking milk is far from being unanimous
and  positions  depend  on  the  nationality  of  the  company  and  on  the  type  of
drinking milk produced. In general, producers of UHT milk are more inclined
to defend protein standardisation than producers of pasteurised milk, producers
in the Scandinavian and Mediterranean countries attach great importance to the
image  of  freshness,  pureness  and  naturalness  of  milk  and  therefore  reject
protein  standardisation.  But  even  within  Member  States  different  positions
appeared;

(b)

the  position  of  consumer  organisations  is  reluctant,  fearing  a  deterioration  of
quality and nutritive value of drinking milk and insisting on a clear labelling of
standardised products.

Due  to  these  imponderables,  the  study  concludes  that  a  precise  estimate  on  the
market  consequences  of  protein  standardisation  for  drinking  milk  cannot  be  made
and that at best the surplus of protein released can be estimated in a margin ranging
between  61 000  and  84 000 tonnes  of  protein.  This  is  the  equivalent  of  188 000  to
258 000 tonnes of skimmed milk powder. Again these estimates do not take account
of possible selection of raw milk nor of illegal standardisation.

3.6.

Therefore,  on  a  global  level,  protein  standardisation  of  preserved  milk  and/or
drinking milk is not neutral vis-à-vis the market balance on the EU market. Within a
given milk production quota, protein standardisation would allow the dairy industry
to  increase  the  total  output  of  dairy  products  thereby  adding  to  an  existing  surplus
that  already  requires  substantial  internal  and  export  subsidies  for  its  disposal.  The
modest  increase  in  internal  unsubsidised  consumption  would  not  suffice  to  absorb
this additional output and, consequently, recourse to intervention measures could be
inevitable.  Deteriorating  markets  in  2001/02  underlined  the  need  for  a  cautious
approach  on  measures  that  affect  supply  so  as  to  avoid  important  budgetary
consequences.

6

4.

IMPACT ON THE COMPETITIVENESS OF EUROPEAN COMPANIES

Generally, the price of milk at farm level is based on the protein and fat content of
the milk. Dairy companies paying a higher price for milk rich in protein are clearly
interested in passing this extra cost on to the purchasers of their products. In certain
cases,  the  latter  may  be  willing  to  pay  a  higher  price  for  products  with  a  higher
protein  content.  But  for  most  of  the  preserved  milks  and  for  all  drinking  milk,  the
selling price does not take account of the protein content.

Dairy  companies  collecting  milk  in  regions  characterised  by  high  protein  contents,
therefore  claim  to  be  in  a  disadvantaged  position  when  competing  on  the  same
market with products having a  fairly low protein content. This is typically the  case
for drinking milk in certain regions of the Community, but also on the world market
for milk powders where products with 34% protein (the Codex minimum) are setting
the standard.

PROTEIN STANDARDISATION AND SUPPORT MEASURES IN THE MILK SECTOR

A possible amendment of Directive 2001/114/EC, with a view to legalising  protein
standardisation  for  preserved  milk,  cannot  be  considered  in  isolation  from  other
legislation,  notably  in  the  framework  of  the  milk  CMO.  The  Commission  indeed
believes that there  should be  consistency between  the  production  standards  and  the
definition  of  products  covered  by  the  CMO.  Consequently,  should  the  Community
accept protein standardisation in line with the Codex standard this would need to be
accompanied by changes to other legislation.

As regards public intervention, this would involve amending Article 7(1) of Council
Regulation (EC) No 1255/1999 so as to limit intervention to skimmed milk powder
with  a  protein  content  of  at  least  34%  (instead  of  31.4%,  which  is  the  current
minimum requirement). Moreover, the full intervention price now applies to powder
with a minimum protein content of 35.6%. Products with 34% protein are purchased
at  a  price  equal  to  97.2%  of  the  full  intervention  price.  Consequently,  should
skimmed milk powder with 34% protein become the new intervention standard, the
intervention price should be reduced by 2.8%. This in turn could reduce slightly the
budgetary costs resulting from increased milk product availability following protein
standardisation.  In  any  case  the  standardisation  could  create  an  additional  milk
protein surplus equivalent to 140 000 tonnes of SMP with a disposal cost estimated
at more than 130 Mio €.

As regards skimmed milk powder subsidised upon use in animal feed, the link with
the  preserved  milk  directive  is  not  evident  because  the  latter  relates  to  products
intended  for  human  consumption.  Nevertheless,  for  the  sake  of  consistency  and
simplification,  Article 2  of  Commission  Regulation  (EC)  No 2799/1999  could  be
amended with a view to reserving aid for powder with at least 34% protein. The aid
amounts  specified  in  Article 7  of  the  Regulation  should  then  be  adjusted  in
consequence.

As  regards  exports  of  preserved  milks,  under  existing  legislation  refunds  are  only
granted for products containing at least 34% protein in the non-fat dry matter. This
requirement  is  in  line  with  the  Codex  standards  that  set  the  norm  for  international
trade.

7

5.

5.1.

5.2.

5.3.

5.4.

6.

6.1.

REGULATORY FRAMEWORK – FAT CONTENT OF DRINKING MILK

In  Council  Regulations  (EC)  No 2597/97  and  (EEC)  No 1898/87  marketing
standards  and  protected  designations  for  milk  are  established.  As  part  of  the
accession  negotiations,  Finland  and  Sweden  were  authorised  to  derogate  from  the
provisions on the fat content of drinking milk foreseen in Council Regulation (EC)
No 2597/97.  This  derogation  was  originally  foreseen  for  a  period  of  three  years,
expiring  on  31 December  1997.  Council  Regulation  (EC)  No 2596/97  originally
granted  an  extension  of  two  years,  but  Regulation  (EC)  No 2703/1999  added  a
further  period  of  four  years  bringing  the  expiry  date  of  the  derogation  to
31 December  2003.  In  December 2001,  Finland  and  Sweden  submitted  reports  on
this  derogation 
(EC)
No 2703/1999.

thus  complying  with  a 

in  Regulation 

requirement 

Derogation on the fat content of drinking milk for Finland and Sweden

6.2.

Under current derogation Finland has an authorisation for 1% milk to be marketed in
the country of production or exported to a third country. In its report, Finland stresses
the complexity of the issue, underlining in particular that:

– 

– 

– 

– 

– 

the  industry’s  decision  on  the  product  range  is  consumer  driven,  noting  that
milk with 1% fat accounts for a market share of 10 to 12%;

milk  is  natural  part  of  Finnish  diets  with  69  to  84%  of  the  population
consuming it daily, depending on the age;

because  of  the  exceptionally  large  intake  of  fresh  milk,  concern  should  be
given  to  the  fat  content  of  milk  and  a  variety  of  low  fat  products  should  be
offered accordingly;

Finnish death rate figures for cardio-vascular disorders are amongst the highest
in the world. Consequently, a reduction in fat intake is recommended;

according  to  a  market  survey,  if  the  “1%  milk”  would  be  banned  from  the
market, some 10% of the consumers would stop drinking milk.

Finland  therefore  advocates  a  cautious  approach  concerning  the  discontinuation  of
the  current  derogation  and  requests  a  broad  discussion  on  the  future  EU  policy  in
relation to drinking milk.

6.3

The derogation for Sweden is granted for a product with a fat content of 3%, which
can be marketed in Sweden or exported to third countries. The Swedish report firstly
refers  to  two  national  market  analysis  that  were  carried  out  in  order  to  asses  the
market opportunities for milk  with 3.5%  fat  as  a  substitute  for  the  current  “whole”
milk with 3.0% fat.

The results of a market analysis show the importance of  milk  in  the  diet  especially
for  families  with  young  children  and  teenagers  as  well  as  a  clear  trend  among
consumer  to  choose  milk  with  a  lower  fat  content.  During  the  first  six  months  of
2001, consumption of milk with 3% fat dropped by 0.8% compared to the previous
year, while the consumption of milk with 1.5% fat increased by 1%. Furthermore, the
market analysis shows that in case of a change from 3.0 to 3.5%, some 33% of the
consumers would opt for a less fatty alternative. This equals a reduction in the milk
fat uptake of 600 000 kg per year.

8

The results of a study by the National Food Agency show that from a public health
perspective the consumption of fat, especially of saturated fat as in milk, should be
reduced. There is indeed a clear connection between the high level of saturated fat in
the Nordic diet and vascular disorders, overweight and gallstone.

Based on these studies, the Swedish authorities make the following comments:

– 

– 

– 

– 

since  the  time  of  accession  there  has  been  no  support  among  consumers  for
increasing the fat level in drinking milk and the political position has been to
reduce the consumption of fat and especially saturated fat;

although Sweden understands the wish to harmonise the rules for drinking milk
and  to  limit  derogations  in  time,  it  also  believes  that  consumer  preferences
should be respected and that it is preferable that Member States would decide
the fat content of drinking milk based on their own situation;

the  priority  must  be  to  maximise  the  consumption  of  drinking  milk,  not  to
reduce the fat surplus in the market through excessive fat content requirements;

Sweden believes that  the  standards  for  drinking milk  should be considered in
isolation  from  the milk CMO and that  legislation should  focus  on  the  correct
labelling of drinking milk.  It wishes that a broad discussion on these subjects
should be launched in the near future.

6.4

Recent  trends  in  drinking  milk  consumption  in  EU-15  are  summarised  in  the
following table. The data show a small decline in total drinking milk production and
a  shift  from  whole  to  semi-skimmed  milk.  Skimmed  milk  production  has  a  fairly
constant  market  share,  which  seems  to  suggest  that  consumers  are  looking  for  a
compromise between reduced fat intake and taste, the latter being assimilated to the
presence of some milk fat.

Whole milk

Semi-
skimmed

Skimmed

Total

Production 1995

14 272 800 t

13 094 500 t

2 385 600 t

29 752 900 t

Production 1999

12 118 300 t

14 348 800 t

2 310 800 t

28 847 900 t

Market share 1995

Market share 1999

Source: Eurostat

48.0%

42.3%

44.0%

49.7%

8.0%

8.0%

100%

100%

Following the successful conclusion of the negotiations with ten Candidate Countries
on  13 December 2002  in  Copenhagen  six  new  Member  States  have  been  granted  a
derogation  for  the  fat  content  of  drinking  milk  for  a  period  of  five  years.  The
derogations  are  indicated  in  a  table  below.  Data  for  the  Swedish  and  Finnish
derogations are included for the sake of comparison.

9

Country

Fat content

Duration of transitional
arrangement (1)

Market share

Cyprus
Hungary
Latvia

Lithuania

Malta
Poland

Finland
Sweden

3.2%
2.8%
3.2%
2.5%
2.0%
3.2%
2.5%
1%
2.5%
3.2%
2%

1%
3%

5 years
5 years
5 years
"
"
5 years
"
"
5 years
5 years
"

60%
69%
no data
"
"
66%
13%
1%
no data
32%
64%

11%
35%

(1)

Transitional  period  agreed  for  Lithuania  is  until  1 January 2009  and  30 April 2009  for
the other five acceding Member States.

As  in  the  case  of  Finland  and  Sweden,  the  new  transitional  arrangements  were
granted  under  condition  that  drinking  milk  covered  by  the  derogation  may  only  be
marketed  in  the  country  of  production.  These  new  derogations  were  accepted  until
30 April 2009. Since the requirements relating to the fat content of milk for human
consumption  continue  to  cause  difficulties  for  Finland  and  Sweden  it  seems
appropriate to extend also their present derogations to the same date.

7.

CONCLUSIONS

Based on the above analysis the Commission suggests the following approach:

(a)

(b)

(c)

as regards drinking milk, protein standardisation should not be legalised taking
account  of  the  need  to  preserve  the  natural  image  of  milk  thereby  avoiding
negative  impact  on  consumption  and  also  with  a  view  to  avoiding  additional
milk protein surpluses on the Community market;

as  regards  preserved  milks,  protein  standardisation  in  line  with  the  Codex
Alimentarius  standards  can  be  justified  on  the  basis  of 
international
harmonisation.  However,  standardisation  will  have  an  impact  to  an  internal
market balance. It could create an additional milk protein surplus equivalent to
140 000 tonnes  of  skimmed  milk  powder  for  which  the  disposal  cost  is
estimated at more than 130 Mio €. Such  a standardisation, if agreed, should be
accompanied  by  additional  restrictive  measures  for  the  milk  sector  so  as  to
neutralise the effects on the Community budget;

since  the  requirements  relating  to  the  fat  content  of  milk  for  human
consumption  continue  to  cause  difficulties  for  Finland  and  Sweden  it  is
proposed  to  extend  their  present  derogations  until  30 April 2009.  In 2007  the
Commission  will  make  a  report  on  the  market  for  drinking  milk,  possibly
accompanied by proposals to harmonise the rules.

10

EXPLANATORY MEMORANDUM

To  take  account  of  the  difficulties  posed  by  the  application  of  the  Community  rules  on
drinking  milk,  Finland  and  Sweden  have  since  their  accession  benefited  from  a  derogation
relating to the fat content requirements for that milk.

Originally this derogation was based on the Act of Accession and on the assumption that the
Council would be re-examining the fat categories of drinking milk. However, the process of
re-examination of the fat categories as well as the consolidation of the relevant rules resulted
in the adoption of Regulation (EC) No 2597/97, which did not permit the integration of all the
drinking milk marketed in Finland and Sweden. An initial period of derogation has therefore
been extended twice. In December 2001, Finland and Sweden submitted reports on progress
in applying those rules indicating that adaptation was causing persistent problems.

In  view  of  the  persistence  of  the  difficulties  which  made  the  derogation  necessary,  the
attached  proposal  for  a  Regulation  provides  for  a  derogation  of  five  years  on  the
understanding  that  the  new  period  will  expire  at  the  same  date  as  the  similar  transitional
arrangements  granted  for  new  Member  States,  and  that  two  years  before  the  expiry  of  all
current  derogations  the  Commission  will  make  a  report  on  the  market  of  drinking  milk,
possibly  accompanied  by  proposals  to  harmonise  the  rules  covered  by  Regulation  (EC)
No 2597/97.

11

2003/0144 (CNS)

Proposal for a

COUNCIL REGULATION

amending Regulation (EC) No 2596/97 extending the period provided for
in Article 149(1) of the Act of Accession of Austria, Finland and Sweden

THE COUNCIL OF THE EUROPEAN UNION,

Having  regard  to  the  Act  of  Accession  of  Austria,  Finland  and  Sweden,  and  in  particular
Article 149(2) thereof,

Having regard to the proposal from the Commission6,

Having regard to the opinion of the European Parliament7,

Having regard to the opinion of the European Economic and Social Committee8,

Whereas:

(1)

(2)

6

7

8

9

The  second  subparagraph  of  Article 1  of  Council  Regulation  (EC)  No 2596/979
extends until 31 December 2003 the period during which transitional measures may be
adopted with regard to the fat content requirements for milk on the market under the
conditions set out in the Act of Accession of Austria, Finland and Sweden. In the milk
and milk products sector the requirements relating to the fat content of milk for human
consumption continue to cause difficulties for Finland and Sweden.

It is  therefore  necessary  to  make  use  of  the  possibility  afforded  by  Article 149(2)  of
the 1994 Act of Accession to extend the period in question. An additional period until
30 April 2009 seems appropriate,

OJ C …, …, p. …
OJ C …, …, p. …
OJ C …, …, p. …
OJ  L  351,  23.12.1997, p.  12.  Regulation  last  amended  by  Regulation  (EC)  No 2703/1999  (OJ L 327,
21.12.1999, p. 11).

12

                                                
HAS ADOPTED THIS REGULATION:

Article 1

In Article 1 of Regulation (EC) No 2596/97, the second subparagraph shall be replaced by the
following:

“However,  with  regard  to  the  requirements  relating  to  the  fat  content  of  milk  for  human
consumption  produced  in  Finland  and  Sweden,  the  period  is  hereby  extended  until
30 April 2009.”

This Regulation shall enter into force on 1 January 2004.

Article 2

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

Done at Brussels,

For the Council
The President

13

FINANCIAL STATEMENT

1.

2.

3.

4.

BUDGET HEADING:
B1-20

APPROPRIATIONS:
EUR 2 672 million

TITLE:
Council  Regulation  amending  Regulation  (EC)  No  2596/97  extending  the  period  provided  for  in
Article 149(1) of the Act of Accession of Austria, Finland and Sweden

LEGAL BASIS:
Article 149(2) of the Act of Accession of Austria, Finland and Sweden

AIMS:
To extend by five years and four months the transitional measures as regards the minimum fat content of
milk intended for human consumption in Finland and Sweden.

5.

FINANCIAL IMPLICATIONS

12 MONTH
PERIOD

(EUR million)

CURRENT
FINANCIAL
YEAR 2003
(EUR million)

FOLLOWING
FINANCIAL
YEAR 2004
(EUR million)

-

-

-

-

-

-

2005

-

2005

-

2007

2008

-

-

EXPENDITURE
–

CHARGED TO THE EC BUDGET
(REFUNDS/INTERVENTIONS)
NATIONAL AUTHORITIES
OTHER

REVENUE
–

OWN RESOURCES OF THE EC
(LEVIES/CUSTOMS DUTIES)
NATIONAL

–
–

–

5.0.1 ESTIMATED EXPENDITURE
5.1.1 ESTIMATED REVENUE

5.2 METHOD OF CALCULATION:

5.0

5.1

6.0

6.1

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

YES / NO

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

6.2 WILL A SUPPLEMENTARY BUDGET BE NECESSARY?

YES / NO

YES / NO

6.3 WILL APPROPRIATIONS NEED TO BE ENTERED IN FUTURE BUDGETS?

YES / NO

OBSERVATIONS:

The measure proposes a status quo situation and has as such no direct financial impact.

14