2003/530/EC: Council Decision of 16 July 2003 on the compatibility with the common market of an aid that the Italian Republic intends to grant to its milk producers
Date: 2003-07-16
Institutions: Council of the European Union
Subjects: Italy, State aid, dairy production, production aid

23.7.2003

EN

Official Journal of the European Union

L 184/15

COUNCIL DECISION

of 16 July 2003

on the compatibility with the common market of an aid that the Italian Republic intends to grant
to its milk producers

(2003/530/EC)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Com-
munity, and in particular the third subparagraph of Article
88(2) thereof,

Having regard to the application of the Italian Republic,

Whereas:

(1)

(2)

(3)

(4)

(5)

(6)

(7)

Articles 87, 88 and 89 of the Treaty have been declared
applicable to the milk market by the common market
organisation in milk and milk products as established by
Regulation (EC) No 1255/1999 (1).

Italian milk producers have produced milk in excess of
their reference quantities during the period from 1995/
1996 to 2001/2002 and are due to pay to the Commu-
nity an amount of EUR 1 386 475 250 by virtue of the
additional levy on milk and milk products established in
accordance with Regulation (EEC) No 3950/92 (2).

This amount has to a large extent not been recovered by
the Italian authorities following suspensions of payment
obtained by these producers from national Administra-
tive Courts.

The current situation in Italy is characterised by the fact
that the collection of the additional levy is running into
a series of difficulties, which have notably resulted in a
vast number of pending court cases which may continue
to retard actual payments for a considerable time in the
future.

The Italian authorities envisage measures to settle this
pending litigation and to remove the social tensions that
currently exist by allowing these milk producers to settle
their outstanding debt by means of deferred payment
without interest over a number of years.

The Italian authorities intend to this effect to grant State
aid to these producers whereby the Italian Republic
would itself make payment to the Community of the
total amount due from these producers to the Commu-
nity and would recover this amount in full from the
producers by way of deferred payment.

The Italian government undertakes to avoid similar
problems in the future by imposing the rigorous applica-
tion of the additional levy on the basis of a new law for

(1) OJ L 160, 26.6.1999, p. 48. Regulation as last amended by Regula-

tion (EC) No 806/2003 (OJ L 122, 16.5.2003, p. 1).

(2) OJ L 405, 31.12.1992, p. 1. Regulation as last amended by
Commission Regulation (EC) No 572/2003 (OJ L 82, 29.3.2003, p.
20).

(8)

(9)

the future management of milk quotas, providing a
radical overhaul and modernisation of its implementa-
tion provisions. According to the Commission's assess-
ment, this law provides the correct legislative basis for
application of the regime and, once fully and correctly
implemented, the regime is expected to function well.

individual

In order to avoid the imposition of heavy financial
Italian milk producers
burdens on the
concerned, which would probably be caused by the
immediate recovery in full of all the amounts due, and
thus to alleviate the existing social tensions, exceptional
circumstances exist which justify considering the aid
which the Italian Republic intends to grant to these milk
producers in the form of an advance and a deferred
payment to be compatible with the common market in
derogation from Article 87 of the Treaty, if the condi-
tions laid down in this Decision are fulfilled.

Under Article 88(1) of the Treaty the Commission keeps
under constant review all aid schemes authorised by the
Council. In accordance with the procedures set out by
Council Regulation (EC) No 659/1999 of 22 March
1999 laying down detailed rules for the application of
Article 93 of the EC Treaty (3), the Commission monitors
compliance with the conditions under which an aid
scheme is approved and can order the recovery of
unlawful aid,

HAS ADOPTED THIS DECISION:

Article 1

The aid the Italian Republic intends to grant to milk producers,
by itself making payment to the Community of the amount
due from them to the Community by virtue of the additional
levy on milk and milk products for the period 1995/1996 to
2001/2002 and by allowing these producers to repay their debt
by way of deferred payment over a number of years without
interest, is exceptionally considered to be compatible with the
common market on condition that:

— repayment shall be in full by yearly instalments of equal

size,

— the repayment period shall not exceed 14 years, starting

from 1 January 2004.

(3) OJ L 83, 27.3.1999, p. 1.

L 184/16

EN

Official Journal of the European Union

23.7.2003

Article 2

Article 3

The grant of the aid set out in Article 1 shall be conditional on
Italy declaring the amount of EUR 1 386 475 250, corre-
sponding to the total additional levy for the periods referred to
to the European Agricultural Guarantee and
in Article 1,
Guidance Fund (EAGGF).

Italy shall deduct the outstanding debt, which corresponds to
the total additional levy reduced by the levy already declared
for the time-period up to and including March 2003 and cred-
ited to the EAGGF, the levy already withheld on the basis of
reductions of monthly advances as well as the levy already
withheld on the basis of the decision relating to the clearance
of accounts for 1995/1996 and 1996/1997, and interest
of
to
thereon
EUR 249 585 217, in three yearly instalments of equal size,
from the expenditure financed by the EAGGF for November
2003, November 2004 and November 2005 respectively.

corresponding

amount

total

a

In order to allow the Commission to perform its tasks under
Article 88(1) of the Treaty, the competent Italian authorities
shall report annually to the Council and the Commission on
the progress made by them in recovering the amount due from
the producers by virtue of the additional levy for the period
1995/1996 to 2001/2002. The Commission will assess this
information and report its assessment to the Council.

Article 4

This Decision is addressed to the Italian Republic.

is reduced by the
Interest, calculated on a monthly basis,
interest already charged on the basis of the decisions relating to
the clearance of accounts for 1995/1996 and 1996/1997.

Declarations of the additional levy for April 2003 and onwards,
for the periods referred to in Article 1, and credited to the
EAGGF shall be taken into consideration.

Done at Brussels, 16 July 2003.

For the Council

The President

G. MAGRI