Commission Regulation (EC) No 1432/2003 of 11 August 2003 laying down detailed rules for the application of Council Regulation (EC) No 2200/96 regarding the conditions for recognition of producer organisations and preliminary recognition of producer groups
Date: 2003-08-11
Institutions: European Commission
Subjects: common organisation of markets, fruit, producer organisation, professional association, vegetable

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COMMISSION REGULATION (EC) No 1432/2003

of 11 August 2003

laying down detailed rules for the application of Council Regulation (EC) No 2200/96 regarding
the conditions for recognition of producer organisations and preliminary recognition of producer
groups

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European
Community,

Having regard to Council Regulation (EC) No 2200/96 of 28
October 1996 on the common organisation of the market in
fruit and vegetables (1), as last amended by Regulation (EC) No
47/2003 (2), and in particular Article 11(2)(a) and Article 48
thereof,

Whereas:

In the light of the experience acquired in recent years, it
is proving necessary to amend the provisions of
Commission Regulation (EC) No 412/97 of 3 March
1997 laying down detailed rules for the application of
Council Regulation (EC) No 2200/96 as regards the
recognition
of producer
last
as
(EC) No 43/
amended by Commission Regulations
2003 (4) and No 478/97 of 14 March 1997 laying down
detailed rules for the application of Regulation (EC) No
2200/96 as regards preliminary recognition of producer
organisations (5) as amended by Commission Regulation
(EC) No 243/1999 (6).

organisations (3),

In the interests of clarity and rationality, the provisions
of the above regulations and their amendments should
be concentrated in a single regulation replacing them.

Commission Regulations (EC) No 412/97 and (EC) No
478/97 should therefore be repealed.

(9)

Article 11(1)(a) and (3) of Regulation (EC) No 2200/96
make provision for different types of producer organisa-
tions. All producer organisations for which an applica-
tion for recognition is submitted should, as a rule, fall
into one of the categories laid down. Provision should
however be made to enable a producer organisation to
be recognised for some categories of product, for one or
several of these categories.

A minimum number of members and a minimum
volume of marketable production needs to be laid down.
Member States should therefore be allowed to lay down
minimum conditions more stringent than those provided
for by this Regulation.

In order to help achieve the goals of the common orga-
nisation of markets and to ensure that producer organi-
sations carry out their work in a sustainable and effective

(1) OJ L 297, 21.11.1996, p. 1.
(2) OJ L 7, 11.1.2003, p. 64.
(3) OJ L 62, 4.3.1997, p. 16.
(4) OJ L 7, 11.1.2003, p. 25.
(5) OJ L 75, 15.3.1997, p. 4.
(6) OJ L 27, 2.2.1999, p. 8.

there

should be the utmost

way,
stability within
producer organisations. Membership of a producer orga-
nisation should therefore be for a minimum period,
particularly with regard to the obligations relating to an
operational programme as referred to in Article 15 of
Regulation (EC) No 2200/96. It should be left up to the
Member States to lay down the notice periods and the
dates on which resignation from membership are to take
effect.

(7)

(8)

A producer organisation may not be able to ensure
directly in an efficient manner that all its activities take
place. Member States should be authorised to lay down
appropriate rules.

The main and essential activities of a producer organisa-
tion should relate to the production of its members.
However, producer organisations should be allowed to
engage in other activities, whether or not of a commer-
cial nature, within certain limits. Cooperation between
producer organisations
encouraged by
allowing the marketing of fruit and vegetables bought
exclusively from another recognised producer organisa-
tion to be left out of
the calculations both for the
purposes of the principal activity and for other activities.

should be

Producer organisations may hold shares in subsidiaries
which help to increase the added value of their produc-
tion of their members. In the case in point, rules should
be fixed for calculating the value of marketed produc-
tion.

In view of the nature of the products, their production
and their marketing,
the holdings of members of a
producer organisation may be located in Member States
other than that in which the producer organisation has
its head office.

To promote the concentration of supply in the Commu-
nity, the functions of associations of producer organisa-
tions and minimum criteria for their recognition should
be laid down, together with certain rules where these
associations are transnational in nature.

In order to facilitate the concentration of supply, the
merger of existing producer organisations to form new
ones should be encouraged and rules determined for the
operational programmes of the organisations resulting
from mergers.

(10)

(11)

(12)

(1)

(2)

(3)

(4)

(5)

(6)

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(13) While upholding the respect for principles whereby a
producer organisation must be formed on the own
initiative of producers and scrutinised by the producers,
it should be left up to the Member States to establish the
conditions whereby other natural or legal persons are
accepted as members of a producer organisation.

(14)

In order to ensure that producer organisations genuinely
represent a minimum number of producers, Member
States should take steps to ensure that a minority of
members who may account for the bulk of production
in the producer organisation do not unduly dominate its
management and operation.

(15) Article 14 of Regulation (EC) No 2200/96 provides for
the possibility of a transitional period of preliminary
recognition to enable new producer groups or those
which have not been recognised under Regulation (EC)
No 2200/96 to satisfy the conditions for recognition laid
down in Article 11 of Regulation (EC) No 2200/96. As a
result, in order to take account of different production
and marketing circumstances in the various Member
States, the latter should lay down certain conditions for
the grant of preliminary recognition to producer groups
which submit a recognition plan.

the objectives of

To promote the setting-up of stable producer organisa-
tions capable of making a lasting contribution to the
attainment of
the common market
organisation, preliminary recognition should be granted
only to producer organisations which can demonstrate
their ability to meet all the requirements of Article 11 of
Regulation (EC) No 2200/96 within a specified time
limit.

To enable producer groups to submit a recognition plan
in accordance with Article 14 of Regulation (EC) No
2200/96, the information which producer groups must
provide in the plan should be laid down.

To enable producer groups better to meet the recogni-
tion conditions, there is a need to authorise changes to
recognition plans. To that end, provision should be
made for each Member State to be able to request the
producer organisation to take corrective action to ensure
that the plan is implemented.

(16)

(17)

(18)

(19)

(20)

(21)

(22)

(23)

To give producer groups granted preliminary recogni-
tion the opportunity to implement an operational
programme in accordance with Commission Regulation
(EC) No 1433/2003 of 11 August 2003 laying down
detailed rules for the application of Council Regulation
(EC) No 2200/96 as regards operational programmes,
funds and Community financial aid (1) as
operational
soon as recognition has been granted,
it should be
possible for such organisations to submit a draft opera-
tional programme when they submit their application
for recognition.

In order to ensure the sound operation of the market
organisation, Member States should keep the Commis-
sion regularly informed about the situation regarding the
granting of preliminary recognition.

In order to make it more efficient, the system of checks
and penalties needs to be clarified as do the conse-
quences which arise from a decision to withdraw recog-
nition, or non-recognition, from a producer organisa-
tion.

The provisions of Commission Regulation (EC) No 412/
97 in regard to the minimum number of members and
minimum volume of marketed production should
continue to apply until 31 December 2003 so as to
leave the Member States time to lay down new provi-
sions.

(24)

The measures provided for in this Regulation are in
accordance with the opinion of
the Management
Committee for Fresh Fruit and Vegetables,

HAS ADOPTED THIS REGULATION:

CHAPTER I

GENERAL PROVISIONS

Article 1

Scope

This Regulation lays down detailed rules for the application of
Regulation (EC) No 2200/96 regarding the conditions for
recognition of producer organisations and preliminary recogni-
tion of producer groups referred to in Articles 11 and 14
respectively of that Regulation.

Article 2

Definitions

The producer group may satisfy the conditions laid
down in Article 11 of Regulation (EC) No 2200/96
before the recognition plan is completed. Provision
should be made to allow such organisations to submit
applications for recognition under this Regulation. For
the sake of consistency, the grant of such recognition to
a producer organisation must signify the termination of
its recognition plan.

For the purposes of this Regulation:

(a) ‘producer’ means any individual or legal person who is a
member of a producer organisation and delivers production
to it for marketing in accordance with Regulation (EC) No
2200/96;

(1) See page 25 of this Official Journal.

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(b) ‘value of marketed production’ means the value of marketed
production as defined in Article 3 of Regulation (EC) No
1433/2003;

The minimum volume of marketable production referred to in
Article 11(2)(a) of Regulation (EC) No 2200/96 is hereby fixed
at EUR 100 000.

(c) ‘value of marketable production’ means

the value of

marketed production;

(d) ‘producer group’ means all organisations which have lodged
an application and are granted preliminary recognition
under Article 14 of Regulation (EC) No 2200/96;

(e) ‘subsidiary’ means a company in which one or more
producer organisations or associations thereof have taken
shares and which helps to increase the added value of the
production of their members;

(f) ‘associations of producer organisations’ means the associa-
tions as referred to in Article 16(3) of Regulation (EC) No
2200/96;

(g) ‘transnational producer organisation’ means any organisa-
tion where at least one of the producers' holdings is located
in a Member State other than where the organisation has
its head office;

(h) ‘transnational association of producer organisations’ means
any association of producer organisations in which at least
one of the associated organisations is located in a Member
State other than where the association has its head office.

CHAPTER II

PRODUCER ORGANISATIONS

Article 3

Categories of producer organisations

1.
their
Producer organisations may be recognised, at
request, for one or more of the categories of products referred
to in Article 11(1)(a)(ii) to (vii) of Regulation (EC) No 2200/96.

With regard to the category of products referred to in Article
11(1)(a)(i) of Regulation (EC) No 2200/96 only individual
recognition is possible.

2. Member States shall determine the procedures for indivi-
dual or multiple recognition of producers in accordance with
Article 11 of Regulation (EC) No 2200/96.

2. Member States may fix minimum numbers of producers
and minimum volumes of marketable production greater than
those laid down in paragraph 1.

They shall forthwith inform the Commission thereof.

3. Where a producer organisation is wholly or partly made
up of members which are themselves organisations with legal
personality made up of producers, the minimum number of
producers referred to in the first indent of the first paragraph
shall be calculated on the basis of the number of producers
associated with each of the organisations with legal personality.

Article 5

Minimum length of membership

1.
The minimum membership period of a producer shall
not be less than one year. However, where an operational
programme pursuant to Regulation (EC) No 2200/96 has been
submitted, no member may renounce their obligations under
that programme while it is still running, unless the producer
organisation concerned gives its approval.

The Member States may set longer periods for the minimum
length of membership provided for in the previous paragraph.

2.
Resignation from membership shall be notified to the
organisation in writing. The Member States shall lay down the
notice periods, which shall not exceed six months, and the
dates on which resignation shall take effect.

Article 6

Structures and activities of producer organisations

1. Member States shall satisfy themselves that producer
organisations have at their disposal the staff, infrastructure and
equipment necessary to achieve the aims laid down in Article
11 of Regulation (EC) No 2200/96 and ensure their essential
functioning, in particular:

— the knowledge of their members' production,

— sorting, storing and packaging the production of

their

members,

Article 4

— commercial and budgetary management,

Minimum size of producer organisations

— centralised bookkeeping and a system of invoicing.

1.
The minimum number of members referred to in Article
11(2)(a) of Regulation (EC) No 2200/96 is hereby fixed at five
producers by category.

2. Member States shall determine the conditions on which a
producer organisation may entrust to third parties the perfor-
mance of the tasks set out in Article 11 of Regulation (EC) No
2200/96.

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Article 7

Producer organisations' main activity

Legal persons who are members of a recognised associa-
3.
tion of producer organisations who are not
recognised
producer organisations under Regulation (EC) No 2200/96 may
not:

The main activity of a producer organisation shall relate
1.
to the marketing of the products of its members for which it is
recognised.

— be considered for the recognition criteria,

— vote on decisions relating to operational funds,

The value of a producer organisation's marketed produc-

2.
tion shall not be less than the value of its other activities.

— benefit directly from the measures

financed by the

Community.

‘Other activities’ shall mean selling products included in the
category or categories of recognition which do not come from
its own members.

The following activities shall be excluded both from the

3.
calculation of the principal activity and that of other activities:

(a) the marketing of fruit and vegetables not belonging to the

category or categories of recognition,

(b) the marketing of fruit and vegetables, whether relating or
to the recognition category, bought directly from
not
another producer organisation recognised under Regulation
(EC) No 2200/96,

(c) activities relating to the production of other agricultural

products and their packaging, including processing,

(d) supply of services,

Article 10

Transnational producer organisations

1.
A transnational producer organisation's head office must
be established in the Member State where the organisation has
significant holdings or a significant number of members and/or
achieves an important level of marketed production.

2.
The Member State in which the head office of the trans-
national producer organisation is located shall be responsible
for the following:

(a) recognising the producer organisation,

(b) approving the transnational producer organisation's opera-

(e) producer organisations' non-farming activities.

tional plan,

Article 8

Producer organisations' subsidiaries

(c) establishing the necessary administrative collaboration with
the other Member State(s)
in which the members are
located with respect to compliance with the terms of recog-
nition and the system of checks and penalties.

The value of marketable production may be calculated at the
ex-subsidiary stage providing the producer organisations or
their associations own at least 90 % of the capital.

Article 11

Article 9

Associations of producer organisations

1. Member States shall determine the procedures and criteria
for the recognition of associations of producer organisations in
accordance with Article 11 of Regulation (EC) No 2200/96.
These associations shall be set up on the initiative and under
the supervision of producer organisations recognised under that
Regulation.

2. Member States shall determine the conditions on which
the associations of producer organisations may carry out in
whole or in part the tasks of their members described in Regu-
lation (EC) No 2200/96, Article 11, and laid down in Article
6(1) of this Regulation. They shall take the necessary steps to
avoid any abuse of a dominant position and any agreement
liable to restrict competition, other than those provided for by
Regulation (EC) No 2200/96.

Transnational association of producer organisations

The head office of

1.
the transnational association of
producer organisations shall be established in a Member State
in which this association has a significant number of member
organisations and/or the member organisations achieve an
important level of marketed production.

2.
The Member State in which the head office of the trans-
national association of producer organisations is located shall
be responsible for the following:

(a) recognising the association;

(b) approving, where necessary, the association's operational

programme;

(c) establishing the necessary administrative collaboration with
the other Member State(s) in which the associated organisa-
tions are located with respect to compliance with the terms
of recognition and the system of checks and penalties.

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Article 12

Mergers of producer organisations

No member of a producer organisation may have more
2.
than 20 % of the voting rights. However, the Member State
may increase this percentage up to a maximum of 49 % in
proportion to the member's contribution to the value of the
marketed production of the producer organisation.

1. Where producer organisations with previously different
operational programmes have merged, they shall operate the
programmes in parallel and separately until 1 January of the
year following the merger. Such organisations shall request the
merger of the operational programmes by means of a change,
in accordance with the provisions of Article 14 of Regulation
(EC) No 1433/2003.

Notwithstanding paragraph 1, the Member States may
2.
authorise the producer organisations which request it, for duly
substantiated reasons,
separate operational
to implement
programmes in parallel until they reach their natural conclu-
sion.

Article 13

CHAPTER III

PRODUCER GROUPS

Article 15

Submission of recognition plans

New producer groups requesting preliminary recognition
1.
in accordance with Article 14 of Regulation (EC) No 2200/96
shall submit a recognition plan for acceptance by the compe-
tent authority of the Member State in which the producer
group has its head office.

Non-producer members

2. Member States shall define:

1.
The Member States may determine whether and on what
conditions any individual or legal person who is not a producer
may be accepted as a member of a producer organisation.

2. When setting the conditions referred to in paragraph 1,
in accordance with Article
the Member States shall ensure,
11(1)(a) and (d)(3) of Regulation (EC) No 2200/96, that

(a) the rule whereby a producer organisation must be formed

on the own initiative of producers is respected,

(b) the rules of association of producer organisations shall
contain rules enabling the producer members to scrutinise
their organisation and its decisions democratically.

The natural or legal persons referred to in paragraph 1

3.
may not:

(a) be considered for the recognition criteria,

(a) the minimum criteria which producer groups must meet to

be able to submit a recognition plan,

(b) the rules for the drafting, content and implementation of

recognition plans,

(c) the administrative procedures for the approval, monitoring

and fulfilling of recognition plans.

Article 16

Content of recognition plans

A draft recognition plan shall cover at least the following:

(a) a description of the initial situation, in particular as regards
the number of producer members, giving full details of
members, production, marketing and infrastructure;

(b) expected duration of the plan, which may not exceed five

(b) benefit directly from the measures financed by the Commu-

years;

nity.

(c) measures to be implemented to achieve recognition.

Member States may restrict or prohibit access of these indivi-
duals to vote on decisions relating to operational funds, in line
with the conditions laid down in paragraph 2.

Article 17

Approval of recognition plans

Article 14

Democratic accountability of producer organisations

1.
The competent national authority shall decide on a draft
recognition plan within three months of receipt of the plan
accompanied by all supporting documents.

1. Member States shall take such measures as are required to
avoid any abuse of power or influence by one or more
members over the management and operation of a producer
organisation.

The competent national authority shall verify by all

2.
appropriate means, including on-the-spot inspections,

(a) the accuracy of the information provided in the recognition

plan;

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(b) the commercial consistency and the technical quality of the
plan, the soundness of the estimates in the investment plan,
and the planning of its implementation.

3.

The competent national authority shall, as appropriate:

(a) accept the plan and grant preliminary recognition;

(b) request changes to the plan;

(c) reject the plan.

Acceptance may be granted, where necessary, only if
the
changes requested under point (b) have been incorporated in
the plan.

4.

It shall notify the producer group of its decision.

in the
The Member State shall send the Commission,
5.
month following notification of acceptance of the recognition
plan to the producer group, particulars of the latter, the date of
preliminary recognition and the duration of the plan.

Article 18

Implementation of recognition plans

The recognition plan shall be implemented in annual
its acceptance by the

1.
segments starting from the date of
competent national authority.

2. Member States shall set the conditions on which producer
groups may request changes to plans during their implementa-
tion. These requests shall be accompanied by all the necessary
supporting documents.

3.
The competent national authority shall decide on changes
to plans within three months of receipt of the request for
change, after considering the evidence supplied. Where no deci-
sion is taken on a request for change within that period, the
request shall be deemed to have been rejected.

No later than the fourth month following the end of a
4.
year of a recognition plan, the producer group shall send the
competent authority in the Member State a copy of the balance
sheet for the preceding year.

Article 19

Fulfilment of recognition plans

1.
Producer groups implementing a recognition plan may, at
any time, submit an application for recognition under Article
11 of Regulation (EC) No 2200/96 on the terms laid down in
this Regulation.

CHAPTER IV

CHECKS AND PENALTIES

Article 20

Checks

1.
In the context of the checks referred to in Regulation (EC)
No 2200/96, Articles 12(1) and 14(5), Members States shall
conduct an on-the-spot visit of all new producer organisations
or producer groups prior to granting recognition or preli-
minary recognition.

shall check a significant

sample of
2. Member States
producer organisations and producer groups each year to
monitor compliance with the recognition or preliminary recog-
nition criteria. The sample must correspond to at least 30 % of
recognised producer organisations or of producer groups
granted preliminary recognition.

All producer organisations and groups must be checked

3.
at least once every five years.

The Member States shall notify the Commission of the

4.
measures taken in accordance with this Article.

Article 21

Penalties

1. Where a check carried out by the competent authorities
of the Member States in accordance with Article 20(2) reveals
that the conditions required for the recognition of a producer
organisation have not been met, the said authority shall take a
temporary decision within a time period not exceeding one
month. This decision shall immediately be notified to the rele-
vant producer organisation.

2.
A recognised producer organisation which has acted in
good faith shall wholly retain the rights which devolve from its
recognition right up to the moment that its recognition is with-
in the case of the aid schemes referred to in
drawn and,
Council Regulation (EC) No 2201/96, Articles 2 and 6a and
also Article 1 of Council Regulation (EC) No 2202/96, until the
end of the current marketing year.

Nevertheless, in the event that a producer organisation deliber-
ately or by serious negligence fails to meet its obligations, the
decision to withdraw recognition shall take effect from the date
from which the conditions for recognition are no longer being
fulfilled.

2.
From the date on which such an application is lodged,
the group in question may submit a draft operational
programme on the terms laid down in Regulation (EC) No
1433/2003.

3.
The competent national authority must call upon a
producer group to take corrective action if it finds shortcom-
ings in the implementation of the plan which may compromise
its fulfilment.

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4. Member States shall recover at least 50 % of the aid paid
under Article 14 of Council Regulation (EC) No 2200/96 if the
implementation of
in
recognition, unless for duly substantiated reasons demonstrated
to the satisfaction of the Member State.

the recognition plan does not result

Amounts recovered and interest shall be paid to the competent
paying agency and deducted from expenditure financed by the
European Agricultural Guidance and Guarantee Fund.

CHAPTER V

REPEAL AND FINAL PROVISIONS

Article 22

Member States' provisions

shall notify the Commission of

The Member States
the
measures taken under Articles 4, 6, 13, 14 and 15 of this
Regulation in accordance with Article 26 of Regulation (EC) No
1433/2003.

Article 23

Repeal

Regulations (EC) No 412/97 and (EC) No 478/97 are hereby
repealed.

References to the repealed Regulation shall be construed as
referring to this Regulation.

Article 24

Entry into force

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

Nevertheless, the provisions of the first indent of Article 2(1) of
Commission Regulation (EC) No 412/97 shall remain in force
until the adoption by the Member States of the provisions of
Article 4(2) of this Regulation, and at the latest 31 December
2003.

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

Done at Brussels, 11 August 2003.

For the Commission

Franz FISCHLER

Member of the Commission