Proposal for a Council Decision establishing the Community position in respect of the prolongation of the International Sugar Agreement, 1992
Date: 2005-09-09
Institutions: European Commission
Subjects: commodity agreement, international agreement, renewal of an agreement, sugar

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 09.09.2005 
COM(2005) 414 final 

2005/0172 (ACC) 

Proposal for a 

COUNCIL DECISION 

establishing the Community position in respect of the prolongation  
of the International Sugar Agreement, 1992 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1. 

2. 

The International Sugar Agreement 1992 entered into force on 1 January 1993. It has 
been prolonged five times for a two-year period. This means that the Agreement is 
due to expire on 31 December 2005. 

At  the  meeting  of  the  International  Sugar  Council  on  26  May  2005  it  has  been 
two-year  period  until 
the  Agreement  for  a  further 
proposed 
31 December 2007 under the provisions of Article 45.2 of the Agreement. 

to  prolong 

3. 

The budgetary implications of this proposal are as follows: 

The  European  Community's  contribution  to  the  administrative  budget  of  the 
International Sugar Organisation is entered under budget line 05 06 01 (International 
agricultural  agreements)  on  heading  4  of  the  financial  perspectives  (External 
Relations). 

The budgetary implications of this agreement in 2006 were taken in consideration in 
the Preliminary Draft Budget of the European Communities and for 2007 they were 
foreseen and are compatible with the proposed financial perspectives. 

4. 

The purpose of this proposal is to authorise the Commission to express a favourable 
opinion with regard to the prolongation of the International Sugar Agreement 1992 
on behalf of the Community. 

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2005/0172 (ACC) 

Proposal for a 

COUNCIL DECISION 

establishing the Community position in respect of the prolongation  
of the International Sugar Agreement, 1992 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Article 133 in conjunction with the second subparagraph of Article 300(2) thereof, 

Having regard to the proposal from the Commission, 

Whereas: 

(1) 

(2) 

(3) 

The  International  Sugar  Agreement  1992  was  approved  on  behalf  of  the  European 
Economic  Community  by  Council  Decision  92/580/EEC1,  and  was  prolonged  most 
recently in 2003 for an additional period of two years. This Agreement remains in force 
until  31  December  2005,  unless  it  is  prolonged  beyond  that  date  by  decision  of  the 
International Sugar Council for a period of no more than two years. 

If  the  EC  has  to  carry  out  on  its  own  the  same  actions  as  are  carried  out  by  the 
International  Sugar  Organisation,  which 
the 
Agreement,  the  total  cost  would  be  much  greater  than  the  cost  of  the  membership 
contributions.  Therefore  the  prolongation  of  the  Agreement  is  in  the  interest  of  the 
Community. 

is  responsible  for  administering 

The  Commission,  representing  the  Community  in  the  International  Sugar  Council, 
should therefore be authorised to express a favourable opinion, including delivering a 
favourable vote, with regard to such a prolongation, 

HAS DECIDED AS FOLLOWS: 

1 

OJ L 379, 23.12.1992, p. 15. 

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Sole Article 

The  Commission  is  hereby  authorised  to  express  within  the  International  Sugar  Council  on 
behalf  of  the  European  Community  a  favourable  opinion,  including  delivering  a  favourable 
vote, with regard to the prolongation of the International Sugar Agreement 1992 for a period 
of up to two years after 31 December 2005. 

Done at Brussels,  

For the Council 
The President 

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LEGISLATIVE FINANCIAL STATEMENT 

Policy area: Agricultural and Rural Development 

Activity: International Agricultural Agreements 

TITLE  OF  ACTION:  EUROPEAN  COMMUNITY  CONTRIBUTION  TO  THE  INTERNATIONAL  SUGAR 

ORGANISATION 

1. 

BUDGET LINE + HEADING: 

Heading 4 – External Relations 

05 06 01: International agricultural agreements 

2. 

OVERALL FIGURES 

2.1. 

Total allocation for action (Part B): EUR 930,000 for commitment 

2.2. 

Period of application: 1.1.2006 to 31.12.2007 

2.3. 

Overall multi-annual estimate on expenditure (EUR million) (*): 

Commitments 

Payments 

2006 

0.460 

0.460 

2007 

0.470 

0.470 

Total 

0.930 

0.930 

(*)  Account has been taken of the enlarged EUR-25 on the basis of ISO estimates 

of future contributions for the new Member States. 

2.4. 

Compatibility with the financial programming and the financial perspective 

X 

Proposal compatible with the existing financial programming 

2.5. 

Financial impact on revenue 

X  No financial implications (involves technical aspects regarding implementation 

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 133 of the Treaty. 

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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 
Sugar Agreement to be attained. The International Sugar Organisation, which is responsible 
for  administering  the  Agreement,  promotes  the  objectives  of  the  Agreement,  such  as 
international cooperation, exchange of statistical information, forecasting market trends, etc. 
It is therefore in the interests of the EC to be a part of the Agreement. 

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

It is clear that if the EC had to carry out on its own the same actions as are carried out by the 
ISO,  the  total  coast  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 Sugar Agreement. 

The dues are paid for as along as the EC remains a signatory to the Agreement. 

The  European  Commission  participate  fully  in  the  activities  of  the  ISO  and  take  full 
advantage of the benefits of membership. 

6. 

FINANCIAL IMPACT 

6.1. 

Total financial impact on Part B (*) 

Commitments in EUR million (to the 3rd decimal place) 

Breakdown 

Year 2006 

Year 2007 

EC Contribution 

TOTAL 

0.460 

0.460 

0.470 

0.470 

Total 

0.930 

0.930 

(*) 

Account  has  been  taken  of  the  enlarged  EUR-25  on  the  basis  of  ISO  estimates  of  future 
contributions for the new Member States. 

6.1. 

Calculation 

Each  contribution  is  fixed  in  proportion  to  the  number  of  votes  attributed  to  the 
member  concerned  (out  of  a  total  of  2 000)  and  proportionally  to  its  importance  in 
the international market of sugar. For 2006 and 2007, the number of votes allocated 
to  the  Community  is  estimated  at  542  resulting  in  a  Community  contribution  of 
EUR 460 000 and 470 000 respectively.  

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7. 

IMPACT ON STAFF AND ADMINISTRATIVE EXPENDITURE 

7.1. 

Impact on human resources 

Types 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 

Permanent 
officials or 
temporary staff 

A 
B 
C 

Other human 
resources 

Total 

0.3 
– 
– 

– 

0.3 

– 
– 
– 

– 

– 

Total 

0.3 
– 
– 

– 

0.3 

Description of tasks deriving  
from the action 

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

7.2. 

Overall financial impact of human resources 

Type of human resources 

Amount EUR 

Method of calculation 

Officials 
Temporary staff 

Other human resources 

32 400 

0,3 x 108 000 

The amounts are total expenditure for twelve months. 

Total 

32 400 

8. 

FOLLOW-UP AND EVALUATION 

8.1. 

Follow-up arrangements 

The  ISO  activities  are  closely  followed  by  its  members  and  EC  fully  participate  in  ISO’s 
regular meetings. A report of ISO activities is regularly published. 

9. 

ANTI-FRAUD MEASURES 

Payments will only be made directly to the bank account of the ISO on receipt of a written 
request, after verification that the request coincides with the figure agreed by the Council of 
the International Sugar Agreement. 

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