Proposal for a Council Decision establishing the position to be adopted on behalf of the Community in the International Grains Council and in the Food Aid Committee
Date: 2005-03-17
Institutions: European Commission
Subjects: European convention, cereals, food aid, international agreement

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 17.03.2005 
COM(2005) 95 final 

Proposal for a 

COUNCIL DECISION 

establishing the position to be adopted on behalf of the Community 
in the International Grains Council and in the Food Aid Committee 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

The International Grains Agreement 1995, is made up of two parts: the Food Aid Convention 
1999 and the Grains Trade Convention 1995. 

The  Food  Aid  Convention  of  1999  (FAC)  was  concluded  by  the  Community  by  Council 
Decision 2000/421/EC.  That  Agreement  remains  in  force  until  30  June  2005,  following  its 
extension by decision of the Food Aid Committee on 23 June 2003.  

The Grains Trade Convention of 1995 (GTC) was extended by decision of the Grains Trade 
Council on 24 June 2003 until 30 June 2005. 

According  to  the  interest  of  both  the  Commission  and  the  Member  States,  some  specific 
changes to the current FAC are required. It is a general agreement that these changes should be 
discussed amongst the members, within the FAC, during the last allotted two years extension. 
However, the linkages of these issues with the negotiations currently underway  in  the  WTO 
Doha Development Agenda, including the discussions on the rules and disciplines applicable 
to  all  food  aid  in  this  framework,  make  it  premature  to  agree  on  the  above  changes  at  this 
stage. 

It therefore proves convenient to further extent both conventions until the successful outcome 
of  the  WTO  negotiations,  and  for  a  period  of  up  to two years. To this purpose, the decision 
authorising the Commission to negotiate, on behalf of the European Community, the revision 
of  the  Food  Aid  Convention  1999,  adopted  by  the  Council  on  27  November  2003  will 
implicitly have to remain applicable until the end of the proposed extension of the FAC. 

Financial implications 

The  Community  contribution  to  the  administrative  budget  of  the  International  Grains 
Agreement, which covers the two conventions, is entered under item 05 06 01 (ex B7-8210) of 
the  European  Union  budget  (International  agricultural  agreements).  The  EC  commitment  to 
provide  food  aid  under  the  Food  Aid  Convention  implies  expenditure  under  items  21 02 01 
(products mobilised under the Food Aid Convention) and 21 02 02 (other aid in the form of 
products,  support  operations  and  transport,  distribution,  flanking  measures  and  measures  to 
monitor implementation). 

Conclusions 

– 

– 

The  Commission  proposes  that  the  Council  authorise  the  Commission  to  vote  on 
behalf of the European Community, in accordance with Article XXV(b) of the Food 
Aid  Convention  1999,  in  favour  of  the  further  extension  of  this  Convention,  for  a 
period of up to two years. 

The  Commission  proposes  that  the  Council  authorise  the  Commission  to  vote  on 
behalf  of  the  European  Community,  in  accordance  with  Article  33(2)  of  the  Grains 
Trade Convention 1995, in favour of the further extension of this Convention, for a 
period of up to two years. 

The  extension  of  both  agreements  is  in  the  interest  of  the  Community.  Taking  the  above 
prorogation into consideration, it is agreed upon that the mandate given by the Council to the 
Commission to negotiate the revision of the FAC, is hereby applicable for the same period. 

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Proposal for a 

COUNCIL DECISION 

establishing the position to be adopted on behalf of the Community 
in the International Grains Council and in the Food Aid Committee 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Article 181 in conjunction with Article 300(2) thereof, 

Having regard to the proposal from the Commission, 

Whereas: 

(1) 

(2) 

The  Food  Aid  Convention  1999  was  concluded  by  the  Community  by  Council 
Decision 2000/421/EC1  and  extended  by  decision  of  the  Food  Aid  Committee  in 
June 2003. This Agreement remains in force until 30 June 2005. A further extension of 
up  to  two  years  of  this  agreement  is  in  the  interest  of  both  the  Community  and  its 
Member  States.  The  Commission,  which  represents  the  Community  in  the  Food  Aid 
Committee, should therefore be authorised by a Council Decision to vote in favour of 
such extension. 

and 

amended 

extended 

The  Grains  Trade  Convention  1995  was  concluded  by  the  Community  by  Council 
Decision 96/88/EC2, 
June  1999  by  Council 
Decision 1999/C262/01  for  a  two-year  period3.  This  Agreement  was  last  extended 
again by decision of the Grains Trade Council in June 2003 and remains in force until 
30 June 2005. A further extension of up to two years of this agreement is in the interest 
of both the Community and its Member States. The Commission, which represents the 
Community  in  the  Grains  Trade  Convention,  should  therefore  be  authorised  by  a 
Council Decision to vote in favour of such extension, 

in 

1 
2 
3 

OJ L 163, 4.7.2000, p. 37. 
OJ L 21, 27.1.1996, p. 47. 
OJ C 262, 16.9.1999, p. 1. 

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HAS DECIDED AS FOLLOWS: 

Sole Article 

1. 

2. 

3. 

The  European  Community  is  in  favour  of  the  extension  of  the  Grains  Trade 
Convention 1995 for a further period, up to two years. 

The European Community is in favour of the extension of the Food Aid Convention 
1999 for a further period, up to two years. 

The Commission is hereby authorised to express this position within the International 
Grains Council and within the Food Aid Committee. 

Done at Brussels, 

For the Council 
The President 

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LEGISLATIVE FINANCIAL STATEMENT 

Policy area: External aspects of certain Community policies 
Activities: International Agricultural Agreements 

TITLE  OF  ACTION: EUROPEAN COMMUNITY  CONTRIBUTION  TO  THE  INTERNATIONAL GRAINS 

COUNCIL 

1. 

BUDGET  LINE  +  HEADING:  ARTICLE  05  06  01  (EX  B  7-8210):  INTERNATIONAL 
AGRICULTURAL AGREEMENTS 

2. 

OVERALL FIGURES 

2.1. 

Total allocation for action (Part B): EUR 930 000 for the two years extension. 

2.2. 

Period of application: 1.7.2005 to 30.6.2007 

2.3. 

Compatibility with the financial programming and the financial perspective 

X 

Proposal compatible with the existing financial programming 

2.4. 

Financial impact on revenue 

No financial implications (involves technical aspects regarding implementation 

X 
of a measure) 

3. 

BUDGET CHARACTERISTICS 

Type of expenditure 

New 

EFTA 
participation 

Participation 
applicant countries 

Heading Financial 
Perspective 

Comp 

Diff 

NO 

NO 

NO 

4 External action 

4. 

LEGAL BASIS 

Article 181 of the Treaty in conjunction with Article 300(2). 

Council  Decisions  96/88/EC  of  27.1.1996  (OJ L 21  of  27.1.1996),  2001/C 195/01  (OJ C 195 
of 11.7.2001) and 2000/421/EC (OJ L 163 of 4.7.2000). 

5. 

DESCRIPTION AND GROUNDS 

5.1. 

Need for Community intervention 

Because  of  its  economic  importance,  especially  in  the  agricultural  sector,  the  EC  must  be 
represented in international agricultural agreements,  which represent an important means  for 
following  global  developments  and  defending  Community  interests  for  the  products 
concerned. 

The  payment  of  EC  membership  contributions  enables  the  objectives  of  the  International 
Grains  Council  (IGC)  to  be  attained.  The  IGC,  which  is  responsible  for  administering  the 
Agreements  relating  to  the  Grains  Trade  Convention,  1995  and  the  Food  Aid  Convention, 

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1999,  promotes  the  objectives  of  the  Agreements,  including  international  cooperation, 
exchange of statistical information and forecasting market trends, etc., and for the Food Aid 
Convention  the  guarantee  that  developing  countries  are  ensured  a  minimum  amount  of  food 
aid  by  the  European  Union.  It  is  therefore  in  the  interests  of  the  EC  to  be  a  part  of  the 
Agreements.  

The membership contributions are determined on an annual basis and are due for as long as 
the EC is a member of the Agreements. 

It is clear that if the EC had to carry out on its own the same actions as are carried out by the 
IGC,  the  total  cost  of  these  would  be  much  greater  than  the  cost  of  the  membership 
contributions.  

5.2. 

Actions envisaged and arrangements for budget intervention 

The EC pays membership dues on an annual basis for the International Grains Council. 

The dues are paid for as long as the EC remains a signatory to the Agreements. 

The European Community and the Member States participate fully in the activities of the IGC 
and take full advantage of the benefits of membership. 

6. 

FINANCIAL IMPACT 

6.1. 

Total financial impact on Part B 

Commitments  (to  the  3rd  decimal  place):  EUR 0.930  million  for  the  period  of  two  years. 
€0.465 million cost is estimated for each year. 

6.2. 

Calculation 

The  expenditure  involved  in  the  application  of  the  two  Conventions  is  covered  by  annual 
contributions from all members of the Grains Convention. The contribution of each member 
for each financial year is fixed in proportion to the number of votes attributed to that member 
in relation to the  total  number  of  votes  held by members. The number of votes attributed to 
each member is adjusted on the basis of the composition of the IGC when the budget for the 
financial  year  in  question  is  adopted.  There  is  a  total  of  2 000  votes  in  the  Convention,  of 
which  the  European  Union  holds  410  for  2004/05  (after  enlargement).  The  same  figure  is 
projected for 2005/06 and for 2006/07. The estimated cost per vote for the period of extension 
is €1 134 (410 votes x €1 134/vote = €465 000). 

7. 

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE 

7.1. 

Impact on human resources 

Type of post 

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

Number of 
permanent posts 

Number of 
temporary posts 

Officials or 
temporary staff 

A 
B 
C 
Other human resources 
Total 

0.2 
0.1 
- 
- 
0.3 

EN 

- 
- 
- 
- 
- 

6 

Description of tasks deriving  
from the action 

Preparation for attendance at and 
follow up from meetings of the IGC 

Total 

0.2 
0.1 
- 
- 
0.3 

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7.2. 

 Overall financial impact of human resources 

Type of human resources 

Amount in EUR 

Method of calculation * 

Officials 
Temporary staff 

Other human resources 

32 400 

0.3 x 108 000 

* 

Human  resources  and  administrative  requirements  will  be  covered  from  the  allocation  given  to  the 
managing  DG  under  the  annual  allocations  procedure.  The  amounts  are  total  expenditure  for  twelve 
months. 

Total 

32 400 

8. 

FOLLOW-UP AND EVALUATION 

8.1. 

Follow-up arrangements 

The Commission services will participate fully in the Administrative Committees and Council 
of the IGC; these are the bodies responsible for determining budgetary contributions. 

A  report  of  these  meetings  and  of  the  decisions  taken  in  the  course  of  these  meetings  is 
published and is freely available to members. 

8.2. 

Details and frequency of planned evaluations 

In  view  of  the  specific  nature  of  the  proposed  intervention  (extension  of  Community 
contribution  to  the  administrative  budget  of  the  International  Grains  Agreement)  and  of  the 
relatively  small  sum  involved,  an  external  evaluation  does  not  seem  justified.  The  relevance 
and  usefulness  of  continuing  with  a  contribution  to  the  administrative  budget  of  this 
Agreement will be evaluated internally, at regular intervals, by means of active Commission 
involvement in the management committees and in the International Grains Council. 

9. 

ANTI-FRAUD MEASURES 

The  execution  and  the  control  of  EC  contributions  are  checked  in  conformity  with  the  rules 
foreseen by the IOOC Agreement. 

Specific  modalities  of  audit  and  control  are  laid  down  within  the  legal  basis  of  this 
international organisation. 

The  accounts  of  this  organisation  are  certified  by  an  independent  external  auditor.  This 
certification  is  submitted  to  the  competent  body  of  the  IOOC  in  view  of  its  approval  and 
subsequent publication. 

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