Opinion of the European Economic and Social Committee on the Proposal for a Council Regulation amending Regulation (EC) No 1698/2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) COM(2006) 237 final — 2006/0082 (CNS)
Date: 2006-12-13
Institutions: European Economic and Social Committee
Subjects: EU aid, aid to agriculture, economic and social cohesion, financial aid, fund (EU), rural development, sustainable development

30.12.2006

EN

Official Journal of the European Union

C 325/35

Opinion of the European Economic and Social Committee on the Proposal for a Council Regulation
amending Regulation (EC) No 1698/2005 on support for rural development by the European Agri-
cultural Fund for Rural Development (EAFRD)

COM(2006) 237 final — 2006/0082 (CNS)

(2006/C 325/08)

On 13 July 2006 the Council decided to consult the European Economic and Social Committee, under Arti-
cles 37 and 299(2) of the Treaty establishing the European Community, on the abovementioned proposal.

The Section for Agriculture, Rural Development and the Environment, which was responsible for preparing
the Committee's work on the subject, adopted its opinion on 8 November 2006. The rapporteur was
Mr Kienle.

At its 431st plenary session, held on 13 and 14 December 2006 (meeting of 13 December), the European
Economic and Social Committee adopted the following opinion by 127 votes to three, with 4 abstentions.

1. Summary of conclusions and recommendations

1.1
In the view of the EESC, the proposal to amend two arti-
cles in the EAFRD Regulation is a logical consequence of the
European Council decision on the Financial Perspective 2007-
2013. When allocating resources from the Cohesion Fund,
it
makes sense to take into account the economic strength of
Member States on a case-by-case basis.
In the situation as
described, exempting Portugal from the co-financing obligation
is acceptable.

The EESC also takes the opportunity afforded by the
1.2
submission of the Commission's proposal to study carefully the
reduction in EAFRD resources and the special regulations for
some Member States concerning the level and system of rural
development resources, both adopted at the European Council.

2. Introductory remarks

2.1 The EU's Financial Framework 2007-2013

2.1.1
Following months of negotiations, on 19 December
2005 the EU heads of state or government agreed on the EU's
Financial Framework for the period 2007-2013. The compro-
mise, enacted in the intersinstitutional agreement of 14 June
2006 between the European Parliament, the Council and the
European Commission, includes funding arrangements for the
various headings, as well as a raft of other provisions.

The Commission proposes incorporating the agree-
2.2.2
ments struck in December 2005 into Regulation (EC) No
1698/2005 (the EAFRD Regulation). The purpose of
the
Commission proposal is thus to bring the EAFRD Regulation
into line with the wording of the financial agreement.

3. Gist of the Commission proposal

3.1 Aim of the Commission proposal

3.1.1
The aim of the Commission proposal is to harmonise
the Council decision on the Financial Perspective 2007-2013 of
19 December 2005 and the EAFRD Regulation. This involves
amending two articles of the EAFRD Regulation, namely Arti-
cles 69(6) and 70.

3.2 Allocation of cohesion funding resources

for promoting

Article 69(6) of the present EAFRD Regulation limits
3.2.1
the total annual allocations that each Member State may receive
from funds
EAFRD
resources) to a maximum of 4 % of its GDP. Point 40 of the
Council decision on the Financial Perspective 2007-2013 limits
the total annual allocation of resources from funds promoting
cohesion to between 3.2398 % and 3.7893 % of GDP, based on
average per capita GNP.

cohesion (including

2.2 Current legal basis of the EAFRD Regulation

funding

3.3 Rules for calculating the allocation of resources from cohesion

Some of these agreements concern support for rural
2.2.1
areas, which is
in Council Regulation (EC) No
1698/2005 of 20 September 2005 on support for rural devel-
opment by the European Agricultural Fund for Rural Develop-
ment (EAFRD).

set out

3.3.1
The Council decision on the Financial Perspective
2007-2013 includes further technical rules. The upper threshold
for transfers is to be reduced by 0.09 percentage points of GDP
for every increase in average per capita GNP of five percentage
points compared with the EU average in 2001-2003.

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Official Journal of the European Union

30.12.2006

A review has been scheduled for 2010. If this reveals
3.3.2
that a Member State's cumulated GDP for the years 2007-2009
has diverged by more than 5 % from the estimated GDP,
including as a consequence of exchange rate changes,
the
amounts allocated for that period to that Member State will be
adjusted accordingly. The total net effect, whether positive or
negative, of these adjustments may not exceed EUR 3 billion.

3.3.3
zloty are also set out.

Rules for correctly calculating the value of the Polish

3.4 Portugal's partial exemption from co-financing obligations

Article 70 of

the EAFRD Regulation stipulates that
3.4.1
EAFRD resources are only supplementary and that
(varying
degrees of) national co-financing is mandatory. The financial
agreement of December 2005, however, grants Portugal a sum
of EUR 320 million for rural development which does not need
to be co-financed (point 63). According to the Commission's
proposal, this agreement is to be incorporated into Article 70 of
the EAFRD Regulation. Article 70(4)
includes an exemption
clause for outermost regions and the smaller Aegean islands
which permits EAFRD funding of up to 85 %. The same para-
graph will now also enshrine the exemption clause removing
Portugal's obligation to co-finance an EAFRD allocation of
EUR 320 million.

factors conducive to growth for the least developed Member
States and regions will bring them closer to the EU average.

The EESC points out that cohesion policy is imple-
4.3.2
mented via funds
(European Regional Development Fund
(ERDF), European Social Fund (ESF) and Cohesion Fund) and
that access to these depends on the economic strength and
situation of the region. Regions with a regional GDP below
the EU average are eligible for support under the
75 % of
convergence goal, while all other regions have access to assis-
tance under
the regional competitiveness and employment
goals. There is a total of 846 convergence regions in 18 out of
the 25 EU Member States. These include nine out of the ten
new Member States (Cyprus being the exception) and regions in
Germany, Spain, France, the United Kingdom, Portugal, Belgium,
Austria, Greece and Italy.

4.3.3
The EESC welcomes the rules which take into account
the differing economic strength of Member States when calcu-
lating the ceiling for allocating cohesion funding. A sliding
scale, in contrast to the blanket 4 % ceiling, respects the notion
of convergence and of a system of assistance which allows the
least developed Member States
to receive relatively more
funding.
It also validates a ceiling based on the economic
strength of a country.

4. General comments

4.1 Legal bases must be consistent

The EESC stresses the unquestionable need for legal
4.1.1
bases to be compatible. The Commission proposal to amend
Regulation (EC) No 1698/2005 on support for rural develop-
ment by the European Agricultural Fund for Rural Development
(EAFRD) is a logical consequence of the Council decision on the
in the
Financial Perspective 2007-2013. The formulations
Commission proposal reflect the Council decisions of December
2005 and are incorporated coherently into the structure of the
EAFRD Regulation.

4.2 Opportunity to comment on the substance of the Council decision

on the Financial Perspective

4.2.1
The European Parliament, the European Commission,
the Committee of the Regions and the EESC now have the
opportunity to comment on those substantive elements of the
Council decision on the Financial Perspective which are not
already part of the interinstitutional agreement.

4.3 Reinforcing the EU's cohesion policy

4.3.1
The EESC has always been committed to the cohesion
goals, which aim to strengthen economic and social cohesion in
the EU and to narrow the gaps in development between
regions. The premise of the convergence goal, an important
is that improving conditions and
element of cohesion policy,

4.4 Promotion of rural development must be appropriate in level and

organisation

In the view of the EESC, the ‘second pillar’ of the
4.4.1
Common Agricultural Policy — promoting rural development
— is an extremely important policy whose significance has
quite rightly increased in recent years and must continue to
the
increase. This
Commission and the Member States, even though the resources
provided for the ‘second pillar’
in the funding period 2007-
2013 in no way reflect such political declarations of intent. The
EESC is extremely critical in this regard and will address this
issue at an appropriate time.

in the pronouncements of

is manifest

During the negotiations on the Financial Perspective
4.4.2
terms
2007-2013, several states managed to secure special
regarding the level and organisation of
rural development
funding. Of the total EUR 69.75 billion available for rural devel-
opment, EUR 4.07 billion were set aside for eight countries.
Austria received EUR 1.35 billion, Sweden EUR 820 million,
Ireland and Italy EUR 500 million each, Finland EUR 460
million, Portugal EUR 320 million, France EUR 100 million and
Luxembourg EUR 20 million. The EESC acknowledges that,
although this impromptu allocation of resources is a political
concession, it also shows the commitment to, and significance
of, rural development in these countries. Quite apart from the
principle involved in making such an exceptional and large allo-
cation of resources during negotiations, the EESC also sees the
danger of rural development policy fragmenting as a result of
different funding allocations and different degrees of commit-
ment by the individual Member States.

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Official Journal of the European Union

C 325/37

Aware of Portugal's difficult position, outlined in the
4.4.3
Commission's Report on the situation in Portuguese agriculture
(COM/2003/0359 final) of 19 June 2003, the EESC accepts the
Council's agreement to exempt that country from the obligation
to co-finance funding of EUR 320 million. The principle of co-

financing for promoting rural development is a correct one, but
not a dogma. The EESC will continue, as it does now, to criti-
cally examine the level and structure of co-financing on a case-
by-case basis.

Brussels, 13 December 2006.

The President

of the European Economic and Social Committee

Dimitris DIMITRIADIS

Opinion of the European Economic and Social Committee on the Proposal for a Regulation of the
European Parliament and of the Council amending Regulation (EC) No …/… on nutrition and health
claims made on foods

COM(2006) 607 final — 2006/0195 COD

(2006/C 325/09)

On 10 November 2006 the Council decided to consult the European Economic and Social Committee,
under Article 95 of the Treaty establishing the European Community, on the

On 25 October 2006 the Committee Bureau instructed the Section for Agriculture, Rural Development and
the Environment to prepare the Committee's work on the subject.

Given the urgent nature of the work, the European Economic and Social Committee appointed Mr Gkofas
as rapporteur-general at its 431st plenary session, held on 13 and 14 December 2006 (meeting of 13
December), and adopted the following opinion by 110 votes to 3 with 16 abstentions.

1. Conclusions and Recommendations

The EESC welcomes

1.1
to
amend Article 25 of the Regulation on claims, which signals the
Committee procedure to be followed to adopt measures neces-
sary for the implementation of the Regulation.

the Commission's proposal

In this context,

the EESC stresses the importance of
delay.
ensuring that the application of the new regulatory procedure
to certain articles of the Regulation on claims does not result in
too lengthy procedures which would hamper the effective and
timely implementation of the Regulation.

1.2
The EESC agrees with the inclusion of paragraphs (3) and
(4) to Article 25 as they provide for the application of a new
regulatory procedure with scrutiny when adopting measures of
general scope designed to amend non-essential elements of the
Regulation on claims. This change is necessary to make the
procedure they provide for more complete.

The EESC notes and considers that in the future the
1.5
Commission should address the question of simplifying the
regulatory framework with regard to food safety and consumer
protection. The EESC welcomes the Commission's intention to
review and update existing EU food labelling legislation (1) and
emphasises the importance of simplifying and clarifying existing
provisions on labelling in the context of better regulation.

1.3
The EESC endorses the application of the new regulatory
procedure with scrutiny to relevant articles of the Regulation on
claims, as the new procedure is more clear and effective than
that provided for previously.

1.6
The EESC welcomes the introduction of any European
regulatory framework that both serves the interests of consumer
protection and promotes harmonisation and effective func-
tioning of the internal market.

1.4
The EESC believes that the Regulation on claims, which
covers nutrition and health claims used in the labelling, presen-
tation and advertising of foods, should be implemented without

(1) General food labelling requirements are laid down in horizontal legisla-
tion (Directive 2000/13/EC and related texts) of which most of the
provisions date back to 1978. Vertical legislation includes other specific
provisions.