Commission Regulation (EC) No 4/2004 of 23 December 2003 laying down detailed rules for the application of Council Regulation (EEC) No 4045/89 on scrutiny by Member States of transactions forming part of the system of financing by the Guarantee Section of the European Agricultural Guidance and Guarantee Fund
Date: 2003-12-23
Institutions: European Commission
Subjects: EAGGF Guarantee Section, EU control, financial control, management audit

6.1.2004

EN

Official Journal of the European Union

L 2/3

COMMISSION REGULATION (EC) No 4/2004

of 23 December 2003

laying down detailed rules for the application of Council Regulation (EEC) No 4045/89 on scrutiny
by Member States of transactions forming part of the system of financing by the Guarantee
Section of the European Agricultural Guidance and Guarantee Fund

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

HAS ADOPTED THIS REGULATION:

Having regard to the Treaty establishing the European
Community,

Having regard to Council Regulation (EEC) No 4045/89 of 21
December 1989 on scrutiny by Member States of transactions
forming part of the system of
financing by the Guarantee
Section of the European Agricultural Guidance and Guarantee
Fund and repealing Directive 77/435/EEC (1), as last amended
by Regulation (EC) No 2154/2002 (2), and in particular Article
19 thereof,

Whereas:

(1)

(2)

(3)

(4)

(5)

In view of the deletion of the provisions of Regulation
(EEC) No 4045/89 concerning the reimbursement by the
Community of expenditure incurred by the Member
States in the framework of the scrutinies provided for by
that Regulation, the rules implementing those provisions
in Commission Regulation (EEC) No 1863/90 of 29 June
1990 laying down detailed rules for the application of
Council Regulation (EEC) No 4045/89 on scrutiny by
the
Member States of
system of financing by the Guarantee Section of the
European Agricultural Guidance and Guarantee Fund
and repealing Directive 77/435/EEC (3), as last amended
by Regulation (EC) No 2278/96 (4), serve no further
purpose.

transactions forming part of

is further appropriate to lay down detailed rules
It
concerning the procedure for
the
minimum number of scrutinies as provided for in the
third subparagraph of Article 7(1) of Regulation (EEC)
No 4045/89 establishing a system of mutual assistance
between Member States for the purpose of carrying out
the scrutinies.

the reduction of

Regulation (EEC) No 4045/89 requires Member States to
send to the Commission a number of communications.
As the standardisation of the form and content of such
their use and ensures a
communications
uniformity of approach,
is appropriate to adopt
detailed rules as to their form and content.

facilitates

it

Therefore, in view of the extent of the changes required
and in the interest of clarity, Regulation (EEC) No 1863/
90 should be replaced.

The measures provided for in this Regulation are in
accordance with the opinion of the Committee for the
European Agricultural Guidance and Guarantee Fund,

(1) OJ L 388, 30.12.1989, p. 18.
(2) OJ L 328, 5.12.2002, p. 4.
(3) OJ L 170, 3.7.1990, p. 23.
(4) OJ L 308, 29.11.1996, p. 30.

CHAPTER I

SUBJECT MATTER

Article 1

This Regulation lays down detailed rules for the application of
Regulation (EEC) No 4045/89.

CHAPTER II

APPLICATION FOR REDUCTION OF THE MINIMUM NUMBER
OF SCRUTINIES

Article 2

The request for a reduction of the number of scrutinies referred
to in the third subparagraph of Article 7(1) of Regulation (EEC)
No 4045/89 shall contain detailed information as set out in
Annex I to this Regulation.

Article 3

The decision to grant a reduction of the minimum number of
scrutinies as provided for in the third subparagraph of Article
7(1) of Regulation (EEC) No 4045/89 shall be based on an
assessment of the benefits in respect of the protection of the
Communities' financial interests and shall take into account the
following criteria:

(a) the risks identified;

(b) the approach adopted;

(c) the rate of completion of the minimum number of scruti-
nies for the previous three scrutiny periods and the number
and rate of timely completion of mutual assistance requests
for the previous three scrutiny periods;

(d) the feasibility of the proposed approach and any particular
scrutiny experience of the Member State(s) concerned with
the approach or in the sector concerned;

(e) the extent to which scrutineers of one Member State may
participate in the scrutinies under the joint exercise in the
other Member State(s);

(f) the confirmation that the other Member State(s) participate,
to the extent required, in the joint exercise, if that exercise
is not included in the other Member State(s) programme
handed in under Article 10(1) of Regulation (EEC) No
4045/89;

L 2/4

EN

Official Journal of the European Union

6.1.2004

(g) the extent to which scrutiny in third countries is envisaged

Article 6

and considered feasible;

(h) any other information considered necessary to support the

request.

Article 4

The decision referred to in Article 3 shall fix the rate and
number of the reduction on the minimum number of scrutinies
required under Article 2(2) of Regulation (EEC) No 4045/89.

CHAPTER III

THE CONTENT OF DOCUMENTS

Article 5

1.
The annual report referred to in Article 9(1) of Regulation
(EEC) No 4045/89 shall include detailed information on each
of the aspects of the application of Regulation (EEC) No 4045/
89 listed in Annex II to this Regulation, set out in clearly iden-
tified sections under the headings referred to.

2.
The annual programme of scrutinies referred to in Article
10 of Regulation (EEC) No 4045/89 shall be drawn up in
accordance with the specimen form shown in Annex III to this
Regulation.

3.
The list of undertakings referred to in Article 7(2) of
Regulation (EEC) No 4045/89 shall be drawn up in accordance
with the specimen form shown in Annex IV to this Regulation.

4.
The list of undertakings referred to in Article 7(3) of
Regulation (EEC) No 4045/89 shall be drawn up in accordance
with the specimen form shown in Annex V to this Regulation.

5.
A request by a Member State for a priority inspection of
an undertaking in another Member State, as referred to in
Article 7(2) and (4) of Regulation (EEC) No 4045/89, shall be
drawn up in accordance with the specimen form shown in
Annex VI to this Regulation.

6.
The information on the results of the scrutinies referred
to in Article 7(2) and (4) of Regulation (EEC) No 4045/89 shall
be drawn up in accordance with the specimen form shown in
Annex VII to this Regulation.

The information on the requests and the results of the
7.
scrutinies referred to in Article 7(2) and (4) of Regulation (EEC)
No 4045/89, to be communicated to the Commission in quar-
terly reports as provided for in the second subparagraph of
Article 7(4) of that Regulation, shall be drawn up in accordance
with the specimen form shown in Annex VIII to this Regu-
lation.

The information to be submitted under Article 5 may be
communicated in paper form or in electronic form, in a format
to be agreed between the sender and the recipient.

Transaction data under Article 7 of Regulation (EEC) No 4045/
89 shall be communicated in electronic form in the format
provided for in Annex II point 2 of Commission Regulation
(EC) No 2390/1999 (1).

CHAPTER IV

JOINT ACTIONS

Article 7

1.
The Commission, acting on its own initiative or on the
basis of a proposal by a Member State, and with the agreement
of the Member States concerned, may decide to coordinate
joint actions involving mutual assistance between two or more
Member States, as provided for in Article 7(1) of Regulation
(EEC) No 4045/89.

For its decision the Commission shall take into account the
following points, in particular:

(a) the level of risk involved;

(b) the extent of operations,

in particular the frequency of
intra- and extra-Community trade, and their financial scale;

(c) the need to achieve a uniform approach.

2.
In agreement with the Member States concerned, a
Member State shall be designated to be responsible for the
management of the joint action.

However, each Member State shall remain responsible for
carrying out the scrutinies required by Regulation (EEC) No
4045/89.

3.

Each Member State concerned shall:

(a) designate those persons or services responsible for carrying

out the joint action on its behalf;

(b) ensure that a sufficient number of adequately experienced
officials is made available for the conduct of the joint
action;

(c) ensure that within set time limits the scrutiny is carried out
and the report finalised and made available to all partici-
pating Member States and to the Commission.

CHAPTER V

FINAL RULES

Article 8

Regulation (EEC) No 1863/90 is repealed.

(1) OJ L 295, 16.11.1999, p. 1.

6.1.2004

EN

Official Journal of the European Union

L 2/5

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

Article 9

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

Done at Brussels, 23 December 2003.

For the Commission

Franz FISCHLER

Member of the Commission

L 2/6

EN

Official Journal of the European Union

6.1.2004

ANNEX I

6.1.2004

EN

Official Journal of the European Union

L 2/7

ANNEX II

Information to be contained in the annual report provided for in Article 9(1) of Regulation (EEC) No 4045/89

1. Administration of Regulation (EEC) No 4045/89

Information shall be provided concerning the administration of Regulation (EEC) No 4045/89, including changes to
the organisations responsible for controls and to the special department responsible for monitoring the application of
that Regulation, as referred to in Article 11 thereof, and to the competences of those organisations.

2. Legislative changes

Information shall be provided regarding any national legislative changes relevant to the application of Regulation
(EEC) No 4045/89 that have intervened since the previous annual report.

3. Amendments to the scrutiny programme

A description shall be provided of any amendments or modifications that were made to the scrutiny programme
submitted to the Commission under Article 10(2) of Regulation (EEC) No 4045/89 since the date of submission of
that programme.

4. Execution of the scrutiny programme covered by the present report

Information shall be provided on the execution of the programme of scrutinies for the period ending on 30 June
preceding the closing date for submission of the report, as referred to in Article 9(1) of Regulation (EEC) No 4045/
89, including the following points, both in total and broken down by control body (where more than one carries out
controls under that Regulation):

(a) the number of scrutinies carried out and the number of undertakings subject to these scrutinies;

(b) the number of scrutinies still in the course of being carried out and the number of undertakings subject to these

scrutinies;

(c) the number of scrutinies planned for the period in question that were not carried out and the number of under-

takings that were not subject to scrutiny as a result of the non-execution of these scrutinies;

(d) the reasons why the scrutinies referred to in point (c) were not carried out;

(e) the breakdown, by amounts received by or paid to, and by measure, of the scrutinies referred to in points (a), (b),

and (c);

(f) the results of the scrutinies referred to in point (a), including:

(i) the number of scrutinies for which irregularities were discovered, and the number of undertakings involved,

(ii) the nature of these irregularities,

(iii) the measure concerned where an irregularity was discovered,

(iv) the estimated financial consequence of each irregularity;

(g) an indication of the average duration of scrutinies in person/days, indicating, where practicable, the time spent

on planning, preparation, execution of controls, and reporting.

5. Execution of the scrutiny programmes preceding the one covered by the present programme

The report shall contain the results of the scrutinies carried out in respect of previous scrutiny periods, for which the
results were not available at the time of the submission of the reports for those scrutiny periods, including:

(a) the number of scrutinies through which irregularities were discovered, and the number of undertakings involved;

(b) the nature of these irregularities;

(c) the measure concerned where an irregularity was discovered;

(d) the estimated financial consequence of each irregularity.

The results of the scrutinies pursuant to the third subparagraph of Article 7(1) of Regulation (EEC) No 4045/89 shall
be presented as such.

L 2/8

EN

Official Journal of the European Union

6.1.2004

6. Mutual assistance

Mutual assistance requests made and received under Article 7 of Regulation (EEC) No 4045/89 shall be communi-
cated, including the results of scrutinies carried out as a matter of priority under Article 7(2) and (4) of that Regu-
lation, and a summary of the lists both sent and received under Article 7(2) and (3) of that Regulation.

7. Resources

Details on the resources available for the carrying out of the scrutinies under Regulation (EEC) No 4045/89 shall be
transmitted, including:

(a) the number of staff, expressed in person/years, allocated to scrutinies under Regulation (EEC) No 4045/89, by

control body, and, where appropriate, region;

(b) training received by staff working on scrutinies under Regulation (EEC) No 4045/89, with an indication of the
proportion of the staff referred to in point (a) who have received such training, and the nature of the training
itself; and,

(c) computer equipment and tools at the disposal of staff working on scrutinies under Regulation (EEC) No 4045/89.

8. Difficulties in applying Regulation (EEC) No 4045/89

Information shall be provided on any difficulties encountered in the application of the Regulation, and the measures
taken to overcome them or proposals to this end.

9. Suggestions for improvement

Where appropriate, suggestions shall be made for the improvement, either of the application of Regulation (EEC) No
4045/89, or of that Regulation itself.

6.1.2004

EN

Official Journal of the European Union

L 2/9

I
I
I

X
E
N
N
A

L 2/10

EN

Official Journal of the European Union

6.1.2004

6.1.2004

EN

Official Journal of the European Union

L 2/11

L 2/12

EN

Official Journal of the European Union

6.1.2004

6.1.2004

EN

Official Journal of the European Union

L 2/13

L 2/14

EN

Official Journal of the European Union

6.1.2004

V

I

X
E
N
N
A

6.1.2004

EN

Official Journal of the European Union

L 2/15

V
X
E
N
N
A

L 2/16

EN

Official Journal of the European Union

6.1.2004

ANNEX VI

6.1.2004

EN

Official Journal of the European Union

L 2/17

L 2/18

EN

Official Journal of the European Union

6.1.2004

ANNEX VII

6.1.2004

EN

Official Journal of the European Union

L 2/19

ANNEX VIII

L 2/20

EN

Official Journal of the European Union

6.1.2004