Proposal for a Council Regulation amending Regulations (EEC) No 2771/75 and (EEC) No 2777/75 as regards the application of exceptional market support measures
Date: 2006-03-29
Institutions: European Commission
Subjects: animal disease, common organisation of markets, consumption, disease prevention, market support, poultry, poultrymeat, trade restriction, veterinary inspection

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 29.3.2006 
COM(2006) 153 final 

2006/0055 (CNS) 

Proposal for a 

COUNCIL REGULATION 

amending Regulations (EEC) No 2771/75 and (EEC) No 2777/75  
as regards the application of exceptional market support measures 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

The  extensive  media  coverage  given  to  the  highly  pathogenic  strain  of  bird  flu  (H5N1)  in 
several Member States, mainly in wild birds, has considerably hit consumption of poultrymeat 
in the EU in recent weeks.  

The  drop  in  consumption  in  some  Member  States,  due  to  an  underlying  loss  in  consumer 
confidence,  has  been  in  some  instances  more  than  50%.  The  drop  in  consumption  has  also 
resulted  in  a  very  significant  build-up  in  stocks  of  poultrymeat  in  many  Member  States, 
currently  estimated  at  300 000  tonnes.  The  situation  is  all  the  more  worrying  because  a 
number of third countries have placed a ban on imports of poultrymeat from certain Member 
States, or from the EU as a whole.  

Export  refunds  are  the  sole  market  management  instrument  available  to  the  common 
organisation of the market in poultrymeat. The Commission has already used this instrument 
by increasing export refund levels for certain products, but it is still insufficient to re-establish 
market equilibrium, given that consumption has also fallen on traditional export markets. The 
bans imposed by some third countries as mentioned above is further limiting the effect of the 
export refunds. 

Aside  from  the  use  of  export  refunds  for  market  management  purposes,  Articles  14  of  the 
Regulations on the common market organisation in eggs and poultrymeat respectively provide 
for exceptional market support measures where restrictions are placed on free circulation as a 
result of the application of measures to combat the spread of animal diseases. 

Such measures concern only poultry farms directly affected by health and veterinary measures 
and  so  cannot  support  the  market  more  generally  when  there  is  a  significant  fall  in 
consumption. 

It is therefore necessary to extend this legal basis in order to include support measures other 
than  those  provided  for  currently  in  cases  where  serious  market  disturbances  due  to  public 
health or animal health risks. 

This  proposal  amends  Articles  14  of  Council  Regulations  (EEC)  No  2777/75  and  (EEC) 
No 2771/75 to this end. 

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2006/0055 (CNS) 

Proposal for a 

COUNCIL REGULATION 

amending Regulations (EEC) No 2771/75 and (EEC) No 2777/75  
as regards the application of exceptional market support measures 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Articles 36 and 37 thereof, 

Having regard to the proposal from the Commission, 

Having regard to the opinion of the European Parliament1, 

Whereas:  

(1) 

(2) 

(3) 

(4) 

(5) 

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Article  14  of  Council  Regulation  (EEC)  No  2771/75  of  29  October  1975  on  the 
common  organisation  of  the  market  in  eggs2,  and  Article  14  of  Council  Regulation 
(EEC) No 2777/75 of 29 October 1975 on the common organisation of the market in 
poultrymeat3  provide  for  the  introduction  of  exceptional  market  support  measures  to 
take account of restrictions on free circulation caused by the application of measures to 
combat the spread of animal diseases.  

These exceptional market support measures are to be taken by the Commission and are 
directly related to or consequent upon veterinary and health measures adopted by the 
Member States concerned to combat the spread of animal diseases. They are taken at 
the request of the Member States in order to prevent serious disruption of the markets 
concerned. 

Experience  shows  that  serious  market  disturbances  such  as  a  significant  drop  in 
consumption  or  in  prices  may  be  attributed  to  a  loss  in  consumer  confidence  due  to 
public health, or animal health risks. 

The exceptional market support measures laid down in Regulations (EEC) No 2771/75 
and  (EEC)  No  2777/75  should  therefore  also  cover  market  disturbances  created  by 
consumer behaviour in response to such animal or public health risks. 

It should be clarified that veterinary or sanitary measures taken by Member States must 
be in conformity with Community law. 

OJ C …, …, p. …. 
OJ L 282, 1.11.1975, p. 49. Regulation as last amended by Regulation (EC) No 1913/2005 (OJ L 307, 
25.11.2005, p. 2). 
OJ L 282, 1.11.1975, p. 77. Regulation as last amended by Regulation (EC) No 1913/2005.  

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(6) 

Regulation (EEC) No 2771/75 and Regulation (EEC) No 2777/75 should therefore be 
amended accordingly, 

HAS ADOPTED THIS REGULATION: 

Article 1 

Article 14(1) of Regulation (EEC) No 2771/75 is hereby replaced by the following: 

“1. 

Exceptional  support  measures  for  the  affected  market  may  be  taken  under  the 
procedure referred to in Article 17(2) in order to take account:  

(a) 

(b) 

of  restrictions  on  free  circulation  that  may  result  from  the  application  of 
measures to combat the spread of animal diseases, or 

serious market disturbances attributed to a loss in consumer confidence due to 
public health, or animal health risks. 

These measures shall be taken at the request of the Member State(s) concerned.  

In  the  case  of  the  restrictions  on  free  circulation  referred  to  under  (a)  above,  exceptional 
measures  may  be  taken  only  if  the  Member  State(s)  concerned  have  taken  the  health  and 
veterinary  measures,  in  conformity  with  Community  law,  needed  to  stamp  the  disease  out 
quickly and only to the extent and for the duration strictly necessary to support this market.” 

Article 2 

Article 14(1) of Regulation (EEC) No 2777/75 is hereby replaced by the following: 

“1. 

Exceptional  support  measures  for  the  affected  market  may  be  taken  under  the 
procedure referred to in Article 17(2) in order to take account:  

(a) 

(b) 

of  restrictions  on  free  circulation  that  may  result  from  the  application  of 
measures to combat the spread of animal diseases, or 

serious market disturbances directly attributed to a loss in consumer confidence 
due to public health, or animal health risks. 

These measures shall be taken at the request of the Member State(s) concerned. 

In  the  case  of  the  restrictions  on  free  circulation  referred  to  under  (a)  above,  exceptional 
measures  may  be  taken  only  if  the  Member  State(s)  concerned  have  taken  the  health  and 
veterinary  measures,  in  conformity  with  Community  law,  needed  to  stamp  the  disease  out 
quickly and only to the extent and for the duration strictly necessary to support this market.” 

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

Article 3 

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

Done at Brussels,  

For the Council 
The President 

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FINANCIAL STATEMENT 

1. 

2. 

3. 

4. 

BUDGET HEADING: 
05 02 15 07 

APPROPRIATIONS: 
p.m. 

TITLE: 
Proposal for a Council Regulation amending Regulations (EEC) No 2771/75 and (EEC) No 2777/75 as 
regards the application of exceptional market support measures 

LEGAL BASIS: 
Article 37 of the Treaty 

AIMS: 
To  extend  the  scope  of  application  of  Article  14  on  the  introduction  of  “exceptional  market  support 
measures”.  This  proposal  is  intended  to  include  market  difficulties  following  loss  of  consumers’ 
confidence directly linked with animal or public health problems. 

5. 

FINANCIAL IMPLICATIONS 

5.0 

CHARGED TO THE EC BUDGET 

EXPENDITURE 
– 
(REFUNDS/INTERVENTIONS) 
– 
– 

NATIONAL AUTHORITIES 
OTHER 

5.1  REVENUE 

OWN RESOURCES OF THE EC  

– 
(LEVIES/CUSTOMS DUTIES) 
– 

NATIONAL 

5.0.1  ESTIMATED EXPENDITURE 
5.1.1  ESTIMATED REVENUE 

5.2  METHOD OF CALCULATION: 

– 

12 MONTH 
PERIOD 

(EUR million) 

CURRENT 
FINANCIAL 
YEAR 2006 
(EUR million) 

FOLLOWING 
FINANCIAL 
YEAR 2007 
(EUR million) 

(1) 

– 

– 

– 

– 

– 

2008 

(1) 

2009 

(1) 

2010 

2011 and following

(1) 

(1) 

6.0  CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE 

RELEVANT CHAPTER OF THE CURRENT BUDGET? 

6.1  CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF 

THE CURRENT BUDGET? 

6.2  WILL A SUPPLEMENTARY BUDGET BE NECESSARY? 

6.3  WILL APPROPRIATIONS NEED TO BE ENTERED IN FUTURE BUDGETS? 

YES NO 

YES NO 

YES NO 

YES NO 

OBSERVATIONS: 

(1) 

This proposal lays down the legal basis for a possible later introduction of specific exceptional market 
support  measures  in  the poultry  meat  and  eggs  sector. At this  moment  it  is  not  possible  to  make  an 
estimate of the future expenditure level. It will only be possible to estimate the expenditure at the time 
that concrete measures are proposed. 

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