Commission Regulation (EC) No 1914/2006 of 20 December 2006 laying down detailed rules for applying Council Regulation (EC) No 1405/2006 laying down specific measures for agriculture in favour of the smaller Aegean islands
Date: 2006-12-20
Institutions: European Commission
Subjects: Aegean Islands, EU aid, Greece, aid to agriculture, financial aid, regional aid, security of supply

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COMMISSION REGULATION (EC) No 1914/2006

of 20 December 2006

laying down detailed rules for applying Council Regulation (EC) No 1405/2006 laying down specific
measures for agriculture in favour of the smaller Aegean islands

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty
Community,

establishing the European

Having regard to Council Regulation (EC) No 1405/2006 of 18
September 2006 laying down specific measures for agriculture
in favour of the smaller Aegean islands and amending Regu-
lation (EC) No 1782/2003 (1), and in particular Article 14
thereof,

Whereas:

(1)

In view of the changes introduced by Regulation (EC) No
1405/2006 and the experience gained, and in the
interests of legislative simplification, Commission Regu-
lations (EEC) No 2837/93 of 18 October 1993 laying
down detailed rules for the application of Council Regu-
lation (EEC) No 2019/93 with regard to the maintenance
of olive groves in traditional olive-growing areas (2), (EEC)
No 2958/93 of 27 October 1993 laying down detailed
rules for the application of Council Regulation (EEC) No
2019/93 as regards the specific arrangements for the
supply of certain agricultural products (3),
(EC) No
3063/93 of 5 November 1993 laying down detailed
rules for the application of Council Regulation (EEC)
No 2019/93 with regard to the aid scheme for the
production of honey of specific quality (4),
(EC) No
3175/94 of 21 December 1994 laying down detailed
rules of application for the specific arrangements for
the supply of cereal products to the smaller Aegean
islands and establishing the forecast supply balance (5),
(EC) No 1517/2002 of 23 August 2002 laying down
detailed rules for the application of Council Regulation
(EEC) No 2019/93 introducing specific measures for the
smaller Aegean islands, as regards the cultivation of

(1) OJ L 265, 26.9.2006, p. 1.
(2) OJ L 260, 19.10.1993, p. 5. Regulation as last amended by Regu-

lation (EC) No 2384/2002 (OJ L 358, 31.12.2002, p. 124).

(3) OJ L 267, 28.10.1993, p. 4. Regulation as last amended by Regu-

lation (EC) No 1820/2002 (OJ L 276, 12.10.2002, p. 22).

(4) OJ L 274, 6.11.1993, p. 5. Regulation as last amended by Regu-

lation (EC) No 780/2002 (OJ L 123, 9.5.2002, p. 32).

(5) OJ L 335, 23.12.1994, p. 54. Regulation as last amended by Regu-

lation (EC) No 2119/2005 (OJ L 340, 23.12.2005, p. 20).

certain agricultural products, potatoes
for human
consumption and seed potatoes (6), (EC) No 1999/2002
of 8 November 2002 laying down detailed rules for the
application of Council Regulation (EEC) No 2019/93 as
regards the specific aid arrangements for the smaller
Aegean Islands in respect of vineyards (7), and (EC) No
2084/2004 of 6 December 2004 derogating from Regu-
lation (EEC) No 2837/93 as regards the period for paying
the aid to maintain olive groves in traditional olive-
growing areas in the smaller Aegean islands (8), should
be repealed and replaced by a single Regulation laying
down rules for applying Regulation (EC) No 1405/2006.

Detailed implementing rules should be laid down for the
specific supply arrangements and the measures to assist
local agricultural products, both provided for in Regu-
lation (EC) No 1405/2006.

Detailed rules should be laid down for fixing the amount
of the aid for the supply of products under the specific
supply arrangements. Such rules should take account of
the additional costs of supply to the smaller Aegean
islands due to their remote and insular nature, which
constitute a burden that severely handicaps them.

The aid scheme for the supply of products under the
specific supply arrangements should be managed by
means of a certificate, called an ‘aid certificate’, using
the import licence form.

Management of the specific supply arrangements requires
the introduction of detailed rules on the issue of the aid
certificate which derogate
rules
applicable to import licences under Commission Regu-
lation (EC) No 1291/2000 of 9 June 2000 laying down
common detailed rules for the application of the system
of import and export licences and advance fixing certi-
ficates for agricultural products (9).

from the normal

(2)

(3)

(4)

(5)

(6) OJ L 228, 24.8.2002, p. 12.
(7) OJ L 308, 9.11.2002, p. 11.
(8) OJ L 360, 7.12.2004, p. 19.
(9) OJ L 152, 24.6.2000, p. 1. Regulation as last amended by Regu-

lation (EC) No 410/2006 (OJ L 71, 10.3.2006, p. 7).

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(6)

(7)

(8)

(9)

(10)

(11)

Management of the specific supply arrangements must
allow two objectives to be pursued. First,
it should
promote the rapid issue of certificates, particularly by
no longer requiring a security to be lodged beforehand
in all cases, and the rapid payment of aid for supplies of
products. Second,
it should guarantee the control and
monitoring of operations and provide the administrative
authorities with the instruments they need to ascertain
that
the scheme are being attained,
those being to secure a regular supply of certain agri-
cultural products and to offset the effects of the geogra-
phical situation of the smaller Aegean islands by ensuring
that the advantages of the scheme are actually passed on
to the stage at which the products destined for the end-
users are placed on the market.

the objectives of

those

consists

instruments

One of
in registering
the
operators pursuing an economic activity under
specific supply arrangements. Registered operators are
entitled to benefit
from the arrangements, provided
they meet the obligations laid down in the Community
and national rules. Applicants should be entitled to regis-
tration provided that
they meet a certain number of
objective requirements designed to facilitate adminis-
tration of the scheme.

ensure

The detailed rules for the administration of the specific
supply arrangements must
that, within the
framework of the quantities laid down in the forecast
supply balances, registered operators obtain a certificate
for
involved in the
and quantities
commercial transactions which they carry out on their
own account, on presentation of documents certifying
that the operation is genuine and that the application
for a certificate is in order.

the products

Monitoring of operations qualifying under the specific
supply arrangements requires,
to be
furnished that the supply operation covered by the certi-
ficate has been carried out in a short time-span, and the
transfer of the rights and obligations conferred on the
holder of the certificate in question to be prohibited.

inter alia, proof

The benefits granted in the form of Community aid must
be passed on so that they are reflected in production
costs and in the prices paid by the end-users. Checks
are therefore needed to ensure that
the benefits are
actually passed on.

Regulation (EC) No 1405/2006 lays down that products
covered by the specific supply arrangements may be
exported to third countries or dispatched to the rest of
the Community only under certain conditions to be set
up. Detailed rules should be laid down accordingly. In
particular,
to lay down the maximum
quantities of processed products which may be the
subject of traditional exports or consignments.

it is expedient

(12)

(13)

(14)

(15)

to protect consumers and the commercial
In order
interests of operators, products which are not of sound
and fair marketable quality, within the meaning of
Commission Regulation (EC) No 800/1999 of 15 April
1999 laying down common detailed rules for the appli-
cation of the system of export refunds on agricultural
products (10),
should be excluded from the specific
supply arrangements no later than the time when they
are first placed on the market and appropriate steps
should be taken where this requirement is not met.

The competent authorities should lay down the detailed
administrative rules needed to ensure the management
the specific supply arrangements.
and monitoring of
Moreover, to ensure that the arrangements are properly
monitored, rules are needed to specify the checks to be
carried out. Administrative penalties
the
smooth functioning of
the mechanisms implemented
should therefore be specified.

to ensure

In order to be able to assess how the arrangements are
being implemented, the competent authorities should be
required to report to the Commission at regular intervals.

The coverage of aid applications and the documents to
be attached with a view to assessing their justification
should be specified for each aid scheme directed at
local production.

(16)

It should be possible to amend at any time aid appli-
cations containing manifest errors.

(17)

(18)

(19)

The deadlines for submitting and amending aid appli-
cations must be complied with to enable the national
authorities to programme and subsequently carry out
effective checks on the correctness of applications for
aid for local production. Time limits should therefore
be fixed beyond which submissions can no longer be
accepted. Moreover, a reduction should be applied to
encourage beneficiaries to respect the time limits.

Beneficiaries should be allowed to withdraw their appli-
cations for aid for local production or parts thereof at
any time provided that the competent authority has not
yet
informed the beneficiary grower of any errors
contained in the aid application or announced an on-
in the part
the-spot
concerned by the withdrawal.

check which reveals

errors

Compliance with the rules on aid schemes managed
under the integrated administration and control system
should be effectively monitored. To this end, the criteria
and technical procedures for carrying out administrative
and on-the-spot checks should be set out
in detail.
Where appropriate, Greece should strive to combine
the various checks under this Regulation with those
provided for under other Community provisions.

(10) OJ L 102, 17.4.1999, p. 11. Regulation as last amended by Regu-

lation (EC) No 671/2004 (OJ L 105, 14.4.2004, p. 5).

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(20)

(21)

The minimum number of beneficiaries to undergo on-
the-spot checks under the various aid schemes should be
determined.

The sample for the minimum rate of on-the-spot checks
should be selected partly on the basis of a risk analysis
and partly at random. The main factors to be taken into
consideration for the risk analysis should be specified.

(22) Where significant irregularities are found, the rate of on-
the-spot checks should be increased during the current
and following years in order to attain an acceptable level
the aid applications concerned are
of assurance that
correct.

(29)

(30)

(31)

(23)

(24)

(25)

(26)

For on-the-spot checks to be effective it is important for
the inspectors to be informed of the reasons why the
beneficiaries concerned have been selected for an on-
the-spot check. Greece should keep records of such infor-
mation.

In order to enable the national authorities and any
competent Community authority to follow up on-the-
spot checks carried out, the details of checks should be
recorded in an inspection report. Beneficiaries or their
representatives should be given the opportunity to sign
the report. However,
remote-sensing
checks, Greece should be allowed to provide for this
right only in cases where the check reveals irregularities.
Moreover, irrespective of the kind of on-the-spot check
carried out, the beneficiary should receive a copy of the
report if irregularities are found.

in the case of

To protect the Community's financial interests effectively,
adequate measures should be adopted to combat irregu-
larities and fraud.

Reductions and exclusions should be determined having
regard to the principle of proportionality and the special
problems arising in cases of
force majeure, exceptional
circumstances and natural disasters. Such reductions
and exclusions
should be graded according to the
gravity of the irregularity committed and should go as
far as the total exclusion from one or more aid schemes
for local production for a specified period.

(27) As a general rule, reductions and exclusions should not
be applied where beneficiaries have submitted factually
correct information or can otherwise show that they are
not at fault.

(28)

Beneficiaries who notify the competent national autho-
rities at any time of incorrect aid applications should not
be the subject of reductions or exclusions, irrespective of
the reason for the incorrectness, provided the beneficiary
grower
the
competent authority's intention to carry out an on-the-
spot check and provided the authority has not already
informed the beneficiary of any irregularity in the appli-
cation.

concerned has not been informed of

Reductions and exclusions provided for under this Regu-
lation should be applied without prejudice to additional
penalties under any other provisions of national law.

Beneficiaries who are unable to fulfil
the obligations
provided for under the detailed rules for implementing
the programmes as a consequence of force majeure or
exceptional circumstances should not
lose their enti-
tlement to the aid.

In order to ensure uniform application of the principle of
good faith throughout the Community, where unduly
conditions under
paid amounts
which that principle may be invoked should be laid
down without prejudice to the treatment of the expen-
diture concerned in the context of
the clearance of
accounts.

recovered,

the

are

(32) As a general

rule, Greece should take any further
this Regulation is

measures necessary to ensure that
properly implemented.

(33) Where appropriate, the Commission should be informed
of any measures taken by Greece to implement the aid
In order to
schemes provided for in this Regulation.
enable the Commission to monitor effectively, Greece
should regularly send it certain statistics on the aid
schemes.

(34)

The measures provided for in this Regulation are in
accordance with the opinion of
the Management
Committee for Direct Payments,

HAS ADOPTED THIS REGULATION:

TITLE I

SCOPE AND DEFINITIONS

Article 1

Scope

This Regulation lays down detailed rules for implementing
Regulation (EC) No 1405/2006, particularly as regards the
programme relating to specific supply arrangements for the
smaller Aegean islands as provided for in Chapter II of that
Regulation and measures to support local production in those
islands as provided for in Chapter III of that Regulation.

Article 2

Definitions

For the purposes of this Regulation:

(a)

‘smaller islands’ means any islands in the Aegean Sea except
the islands of Crete and Evia;

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(b) ‘competent authorities’ means the authorities appointed by

Greece to implement this Regulation;

(c)

‘programme’ means the support programme referred to in
Article 13 of Regulation (EC) No 1405/2006.

Presenting an aid certificate to the competent authorities shall
be tantamount to applying for the aid. Except in cases of force
majeure or climatic aberrations, certificates must be presented
within 30 days of the date on which they are charged. Where
that time limit is overrun, the aid shall be reduced by 5 % per
day of delay.

TITLE II

SPECIFIC SUPPLY ARRANGEMENTS

CHAPTER I

The aid shall be paid by the competent authorities not later
than 90 days after the date on which the utilised aid certificate
is lodged, except in one of the following cases:

Forecast supply balance

(a)

force majeure or climatic aberration;

Article 3

Fixing and granting of aid

For the purposes of applying Article 3(2) of Regulation
1.
(EC) No 1405/2006, Greece shall determine within the context
of the programme the amount of the aid to be granted in order
to compensate for remoteness, insularity and distant location,
taking into account:

(a)

the specific needs of the smaller islands and the precise
quality requirements;

(b) traditional trade flows with ports in mainland Greece and

between the islands in the Aegean Sea;

(c)

the economic aspect of the proposed aid;

(d) where applicable, the need not to obstruct the potential

development of local products;

(e) as regards specific additional

the inter-
mediate reloading costs involved in supplying goods to
the smaller islands;

transport costs,

(f) as regards the specific additional costs involved in local
processing, the small size of the market and the need to
guarantee security of supply for goods in the smaller islands
concerned.

2.
No aid shall be granted for the supply of products in a
smaller island which has already benefited from the specific
supply arrangements in another smaller island.

CHAPTER II

Aid certificate, payment,

register, end user, quality and

securities

Article 4

Aid certificate and payment

1.
The aid provided for in Article 4(1) of Regulation (EC) No
1405/2006 shall be paid on presentation of a certificate, here-
inafter referred to as an ‘aid certificate’, which has been fully
utilised and is accompanied by the purchase invoice and the
original or a certified copy of the bill of lading or airway bill.

(b) where

an administrative

been opened
concerning entitlement to the aid; in such cases, payment
shall take place only after entitlement has been recognised.

enquiry

has

2.
Aid certificates shall be drawn up on the basis of the
specimen of import licence set out in Annex I to Regulation
(EC) No 1291/2000.

Articles 8(5), 13, 15, 17, 18, 21, 23, 26, 27, 29 to 33 and 36
to 41 of Regulation (EC) No 1291/2000 shall apply, mutatis
mutandis, without prejudice to this Regulation.

The entry ‘aid certificate’ shall be printed or stamped in

3.
box 20 (special particulars) of the certificate.

4.

Boxes 7 and 8 of the certificate shall be struck out.

Box 12 of aid certificates shall show the last day of

5.
validity.

6.
The amount of the aid applicable shall be that in force on
the day on which the application for the aid certificate was
lodged.

7.
The competent authority shall issue aid certificates at the
request of the parties concerned, subject to the limits of the
forecast supply balances.

Article 5

Passing on the advantage to the end-user

1.

For the purposes of applying this Title:

(a)

the ‘advantage’ referred to in Article 4(3) of Regulation (EC)
No 1405/2006 means
the grant of Community aid
provided for in that Regulation;

(b) ‘end-user’ means

(i) in the case of products for direct consumption: the

consumer,

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(ii) in the case of products for the processing or packaging
industry which are intended for human consumption:
the final processor or packager,

(iv) refrain from acting in any way likely to create artificial
shortages of products and from marketing the available
products at artificially low prices,

(iii) in the case of products for the processing or packaging
industry for use as animal feed and products for use as
agricultural inputs: the farmer.

2.
The competent authorities shall take all appropriate steps
to check that the advantage is actually passed on to the end-
user. In doing so they may assess the trading margins and prices
applied by the various operators concerned.

The measures referred to in the first subparagraph, and in
particular the control points used to determine whether the
aid has been passed on, and any amendments made, shall be
the report
notified to the Commission in the context of
provided for in Article 33.

Article 6

Register of operators

1.
Aid certificates shall be issued only to operators entered in
a register kept by the competent authorities (hereinafter referred
to as ‘the register’).

(v) ensure to the satisfaction of the competent authorities
that, when the agricultural products are disposed of in
the smaller islands, the advantage is passed on to the
end-user.

Operators

intending to dispatch to the rest of

3.
the
Community or export to third countries processed or unpro-
cessed products under the conditions referred to in Article 13
shall, at the time of applying for entry in the register or later,
declare their intention to engage in this activity and indicate the
location of the packaging plant where applicable.

Processors

intending to export

to third countries or
4.
dispatch to the Community processed products under
the
conditions referred to in Article 13 or 14 shall, at the time
of applying for entry in the register or later, declare their
intention to engage in this activity,
indicate the location of
the processing plant and, where applicable, provide analytical
lists of the processed products.

Any operator established in the Community may apply to

2.
be entered in the register.

Documents to be presented by operators and validity of
aid certificates

Article 7

Entry in the register shall be subject to the following conditions:

(a) operators shall possess the means, structures and legal
authorisations required to carry on their activities and
shall,
in particular, have duly complied with their obli-
gations regarding business accounting as appropriate and
taxation;

(b) operators shall be able to guarantee that their activities are

carried on in the smaller islands;

(c)

in the context of the specific supply arrangements for the
smaller islands, and in compliance with the objectives of
those arrangements, operators shall undertake to:

(i) communicate to the competent authorities, at

their
request, all relevant information about their commercial
activities, particularly regarding the prices and profit
margins they practise,

(ii) operate exclusively in their own name and on their own

account,

The competent authorities shall accept the aid-certificate
for each consignment,
they are accompanied by the original or a

1.
application presented by operators
provided that
certified copy of the purchase invoice.

The purchase invoice, bill of
drawn up in the name of the applicant.

lading or airway bill must be

2.
The period of validity of certificates shall be 45 days. The
validity period may be extended by the competent authority in
special cases where serious and unforeseeable difficulties affect
the transportation time, but may not exceed two months from
the date on which the certificate was issued.

Article 8

Presentation of certificates and goods; non-transferability
of certificates

1.
For products covered by the specific supply arrangements
aid certificates shall be presented to the designated authorities
within no more than 15 working days from the date of
unloading the goods. The competent authorities may reduce
this maximum time.

(iii) submit certificate applications commensurate with their
real capacity to dispose of the products concerned, such
capacity being proven by reference to objective factors,

The goods shall be presented in bulk or in separate lots

2.
corresponding to the certificate presented.

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3.

Aid certificates shall not be transferable.

The competent authorities shall notify the Commission imme-
diately of the instances in which this Article is applied.

Article 9

Quality of products

Only products of sound and fair marketable quality, within the
meaning of Article 21(1) of Regulation (EC) No 800/1999, may
qualify for the specific supply arrangements.

Conformity of the products with the requirements laid down in
the first paragraph shall be examined no later than the stage of
first marketing, in accordance with the standards or practices in
force in the Community.

Where a product is considered not to meet the requirements
laid down in the first paragraph, the entitlement under the
specific supply arrangements shall be withdrawn and the corre-
sponding quantity shall be reattributed to the forecast supply
balance. Where aid has been granted in accordance with
Article 4, the aid shall be reimbursed.

Article 10

Lodging of security

No security shall be required when applying for aid certificates.

However, in special cases and to the extent necessary to ensure
the proper application of this Regulation, the competent autho-
rities may require a security to be lodged equal to the amount
of the advantage accorded. In such cases, Article 35(1) and (4)
of Regulation (EC) No 1291/2000 shall apply.

Article 11

Significant increases in applications for aid certificates

If

1.
the state of execution of a forecast supply balance
indicates a significant increase in applications for aid certificates
for a given product which might jeopardise achievement of one
or more of the objectives of the specific supply arrangements,
Greece shall take all necessary steps to ensure that the smaller
islands are supplied with essential products, taking account of
available supply and the requirements of the priority sectors.

2.
In the event of restrictions on the issue of certificates, the
competent authorities shall apply to all pending applications a
uniform reduction percentage.

Article 12

Fixing a maximum quantity per certificate application

Insofar as is strictly necessary to avoid disturbances on the
market
in the smaller islands, or the pursuit of speculative
actions likely to be prejudicial to the smooth functioning of
the specific supply arrangements,
the competent authorities
shall fix a maximum quantity per certificate application.

CHAPTER III

Export to third countries and dispatch to the rest of the
Community

Article 13

Conditions of export or dispatch

1.
The export and dispatch of unprocessed products which
have benefited from the specific supply arrangements, or
packaged or processed products containing products which
have benefited from the specific supply arrangements, shall be
subject to the requirements laid down in paragraphs 2 to 3.

2.
Quantities of products which have benefited from aid and
are exported or dispatched shall be reattributed to the forecast
supply balance and the aid granted shall be reimbursed by the
exporter or consignor by the time of export or dispatch at the
latest.

Those products may not be dispatched or exported until the
reimbursement referred to in the first subparagraph has been
made.

Where it is impossible to establish the amount of aid granted,
the products shall be considered to have received the highest
rate of aid fixed by the Community for such products during
the six-month period preceding the submission of the appli-
cation for export or dispatch.

Such products may benefit from an export refund, provided that
the criteria for granting such a refund are met.

The competent authorities shall authorise the export or
3.
dispatch of quantities of processed products other than those
referred to in paragraph 2 and in Article 14 only where the
processor or exporter certifies that the products concerned do
not contain raw materials introduced under the specific supply
arrangements.

The competent authorities shall authorise the re-export or re-
dispatch of unprocessed products or packaged products other
than those referred to in paragraph 2 only where the consignor
certifies that those products have not benefited from specific
supply arrangements.

The competent authorities shall carry out the necessary checks
to ensure the accuracy of the certificates referred to in the first
and second subparagraphs and shall,
if necessary, recover the
advantage.

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Article 14

Traditional exports and traditional dispatches of processed
products

Processors who have declared, in accordance with Article
1.
6(4), that they intend to export in the context of traditional
trade flows or to dispatch in the context of traditional trade
flows, as referred to in Article 5(2) of Regulation (EC) No
containing raw materials
1405/2006, processed products
which have benefited from specific supply arrangements may
do so within the limits of the annual quantities indicated in the
approved programme and presented in accordance with the
specimen set out
in the Annex to this Regulation. The
competent authorities shall deliver the requisite authorisations
in such a way as to ensure that transactions do not exceed those
annual quantities.

The export of products referred to in this Article shall not

2.
be subject to the presentation of an export licence.

CHAPTER IV

Checks and penalties

Article 15

Checks

1.
The administrative checks carried out on the, entry, export
and dispatch of agricultural products shall be exhaustive and
involve cross-checks with the documents referred to in
shall
Article 7(1).

2.
The physical checks carried out in the smaller islands on
the, entry, export and dispatch of agricultural products shall
involve a representative sample amounting to at least 5 % of
the certificates presented in accordance with Article 8.

Physical checks
in
accordance with the procedures laid down in Council Regu-
lation (EEC) No 386/90 (11).

shall be carried out, mutatis mutandis,

In special cases the Commission may request
checks cover different percentages.

that physical

Article 16

Penalties

(b) temporarily suspend or revoke the operator's registration,

depending on the seriousness of the infringement.

The advantage referred to in point (a) shall be equal to the
amount of the aid determined in accordance with Article 13(2).

their entitlement

Except in cases of force majeure or climatic aberrations,
2.
where holders of a certificate do not carry out the planned
entry,
shall be
suspended for a period of 60 days following expiry of that
certificate. After the suspension period, the issue of subsequent
certificates shall be subject to the lodging of a security equal to
the amount of the advantage to be granted during a period to
be determined by the competent authorities.

to apply for certificates

The competent authorities

3.
the measures
required to reutilise any quantities of products made available
as a result of non-execution, partial execution or cancellation of
the certificates issued or recovery of the advantage.

shall adopt

CHAPTER V

National provisions

Article 17

National management and monitoring rules

The competent authorities shall adopt
needed
arrangements in real time.

and monitor

to manage

the additional
specific

the

rules
supply

They shall notify the Commission of any measures they intend
to implement pursuant to the first paragraph, prior to the entry
into force of those measures.

TITLE III

MEASURES TO ASSIST LOCAL PRODUCTS

CHAPTER I

Aid to assist local products

Article 18

Amount of aid

Except in cases of force majeure or climatic aberrations, if
1.
an operator fails to comply with the requirements of Article 6,
and without prejudice to any penalties applicable under national
law, the competent authorities shall:

The amount of aid granted under the measures to assist
1.
local agricultural production as provided for in Chapter III of
Regulation (EC) No 1405/2006 shall be within the ceilings fixed
in Article 12 of that Regulation.

(a) recover the advantage granted from the holder of the aid

certificate;

(11) OJ L 42, 16.2.1990, p. 6.

2.
The conditions for granting aid, the lines of agricultural
production and the amounts concerned shall be specified in the
programme approved in accordance with Article 13(2) of Regu-
lation (EC) No 1405/2006.

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CHAPTER II

Aid applications and aid payment

Article 19

Submission of applications

Aid applications for a calendar year shall be submitted to the
office designated by the competent authorities of Greece in
accordance with the specimens drawn up by the latter and
within the periods they have laid down. Those periods shall
be fixed so as to allow time for the necessary on-the-spot
checks
the
and shall not
following calendar year.

run beyond 28 February of

Article 20

Correction of manifest errors

An aid application may be rectified at any time after
submission where a manifest error
competent authority.

its
recognised by the

is

Article 23

Aid payments

After verifying the aid applications and relevant supporting
documents, and calculating the amounts to be granted under
the support measures provided for in Article 7 of Regulation
(EC) No 1405/2006, the competent authorities shall pay the aid
for a calendar year during the period:

— in the case of direct payments, in accordance with Article
28 of Council Regulation (EC) No 1782/2003 (12), and

— in the case of other payments, during the period beginning
on 16 October of the current year and ending on 30 June
of the following year.

CHAPTER III

Checks

Article 24

General principles

Article 21

Late submission of applications

Except in cases of force majeure and exceptional circumstances,
submission of an aid application after the time limit laid down
in accordance with Article 19 shall lead to a 1 % reduction per
working day in the amounts to which the beneficiary would
have been entitled if the aid application had been lodged within
the time limit. If the delay amounts to more than 25 calendar
days, the application shall be considered inadmissible.

Article 22

Withdrawal of aid applications

An aid application may be totally or partially withdrawn

1.
at any time.

However, where the competent authority has already informed
the beneficiary of irregularities in the aid application or has
given notice to the beneficiary of its intention to carry out an
on-the-spot check and this check reveals irregularities, with-
drawal shall not be authorised in respect of the parts of the
aid application affected by those irregularities.

Verification shall be by administrative and on-the-spot checks.

Administrative checks shall be exhaustive and shall
include
cross-checks with, inter alia, data from the integrated adminis-
tration and control system provided for in Chapter 4 of Title II
of Regulation (EC) No 1782/2003.

On the basis of a risk analysis in accordance with Article 26(1),
the competent authorities shall perform on-the-spot checks by
sampling at least 5 % of aid applications. The sample must also
represent at least 5 % of the amounts covered by the aid.

In all appropriate cases, Greece shall make use of the integrated
administration and control system.

Article 25

On-the-spot checks

On-the-spot checks

1.
shall be unannounced. However,
provided that the purpose of the check is not compromised,
advance notice limited to the strict minimum necessary may be
given. Such notice shall not exceed 48 hours, except in duly
justified cases.

2. Withdrawal under paragraph 1 shall return the claimant
to the situation prior to submitting the aid application or part
of the aid application in question.

2. Where applicable, the on-the-spot checks provided for in
this Chapter shall be carried out in conjunction with any other
checks provided for by Community legislation.

3.
No later than 31 March of each year an analysis of aid
applications withdrawn for the previous calendar year should be
carried out to identify the main causes and potential trends at
local level.

3.
The aid application or applications concerned shall be
rejected if beneficiaries or their representatives prevent an on-
the-spot check from being carried out.

(12) OJ L 270, 21.10.2003, p. 1.

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Article 26

Selection of beneficiaries to be subjected to on-the-spot
checks

Beneficiaries shall be selected to undergo on-the-spot
1.
checks by the competent authority on the basis of a risk
analysis and the representativeness of
the aid applications
submitted. The risk analysis shall, as appropriate, take account
of:

Beneficiaries or their representatives shall be given the
2.
opportunity to sign the report to attest their presence at the
check and to add observations. Where irregularities are found
the beneficiary shall receive a copy of the inspection report.

Where the on-the-spot check is carried out by remote-sensing,
Greece may decide not to give the beneficiaries or their repre-
sentatives the opportunity to sign the inspection report if no
irregularities are revealed during the check by remote-sensing.

(a)

the amount of aid;

(b) the number of agricultural parcels and the surface area
covered by the aid application, or the quantity produced,
transported, processed or marketed;

(c) changes on the previous year;

(d) the findings of checks performed in the preceding years;

(e) other parameters to be defined by Greece.

representativeness, Greece shall
To provide the element of
randomly select between 20 % and 25 % of
the minimum
number of beneficiaries to be subjected to on-the-spot checks.

The competent authority shall keep records of the reasons
2.
why specific beneficiaries were selected for on-the-spot checks.
The inspector performing the on-the-spot check shall be
informed of those reasons before beginning the check.

Article 27

Inspection report

Every on-the-spot check shall be the subject of an
1.
inspection report relating the details of the checks carried out.
Reports shall indicate in particular:

(a)

the aid schemes and applications checked;

(b) the persons present;

(c)

the agricultural parcels checked,
measured,
measured and the measuring methods used;

the agricultural parcels
the measurements per parcel

the results of

(d) the quantities produced, transported, processed or marketed

which are covered by the check;

(e) whether advance notice was given to the beneficiary of the

visit and, if so, how much;

CHAPTER IV

Reductions and exclusions, and undue payments

Article 28

Reductions and exclusions

In the event of a discrepancy between the information declared
in the context of aid applications and the findings of
the
inspections
III, Greece shall apply
reductions and exclusions to the aid. Those reductions and
exclusions shall be effective and proportionate and shall act as
a deterrent.

referred to in Chapter

Article 29

Exceptions to the application of reductions and exclusions

1.
The reductions and exclusions provided for in Article 28
shall not apply where the beneficiary submitted factually correct
information or can otherwise show that he or she is not at
fault.

The reductions and exclusions shall not apply with regard
2.
to those parts of
the aid application which the beneficiary
informs the competent authority in writing are incorrect or
have become incorrect since it was lodged, provided that the
competent authority has not already informed the beneficiary of
its intention to carry out an on-the-spot check or of any irre-
gularity in the application.

On the basis of the information given by the beneficiary as
referred to in the first subparagraph, the aid application shall
be rectified to reflect the actual situation.

Article 30

Recovery of undue payments and penalties

1.
In the event of undue payment, Article 73 of Commission
Regulation (EC) No 796/2004 (13) shall apply mutatis mutandis.

2. Where the undue payment has been made as a result of a
false declaration, false documents or serious negligence on the
part of the beneficiary, a penalty shall be imposed equal to the
amount unduly paid, with interest calculated in accordance with
Article 73(3) of Regulation (EC) No 796/2004.

(f) any further control measures carried out.

(13) OJ L 141, 30.4.2004, p. 18.

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Article 31

(a) any significant changes in the socio-economic and agri-

Force majeure and exceptional circumstances

cultural environment;

Cases of force majeure or exceptional circumstances within the
meaning of Article 40(4) of Regulation (EC) No 1782/2003
shall be notified to the competent authority in accordance
with Article 72 of Regulation (EC) No 796/2004.

(b) a summary of the available physical and financial data on
followed by an
the implementation of each measure,
analysis of the data and, where necessary, a presentation
and analysis of the sector to which the measure relates;

TITLE IV

GENERAL AND FINAL PROVISIONS

Article 32

Communications

As

the

supply

regards

specific

1.
the
competent authorities shall send to the Commission, no later
than the 15th day of the month following the end of each
quarter, the following data relating to the previous months of
the reference calendar year, by product and CN code and, where
applicable, by individual destination:

arrangements,

(c)

the progress of the measures and priorities in relation to the
specific and general objectives on the date of presentation of
the report, using quantified indicators;

(d) a brief account of any major problems encountered in
managing and implementing the measures including the
conclusions of the analysis mentioned under Article 22(3);

(e) an examination of the results of all the measures, taking

account of their reciprocal links;

(a)

the quantities broken down according to whether they are
dispatched from mainland Greece or other islands;

(f)

for the specific supply arrangements:

(b) the amount of aid and the expenditure actually paid by

product;

(c)

the quantities for which aid certificates have not been
utilised;

(d) any quantities exported to third countries or dispatched to
the rest of the Community after processing in accordance
with Article 13;

(e)

transfers within an overall quantity for a category of
products and amendments to the forecast supply balances
during the period;

(f)

the available balance and the utilisation rate.

— data and an analysis relating to price trends and the
manner in which the advantage granted was passed
on, as well as the measures taken and the checks
performed to ensure that it was passed on;

— taking account of the other aid available, an analysis of
the proportionality of the aid in relation to the addi-
tional cost of transport to the smaller islands and the
prices applied and, in the case of products intended for
processing and agricultural
inputs, the additional costs
of insularity and distant location;

(g) an indication, based on objective indicators, of the extent to
the measures

which the objectives assigned to each of
contained in the programme have been achieved;

The data provided for in the first subparagraph shall be supplied
on the basis of the certificates utilised.

(h) data on the annual supply balance of the smaller islands in
inter alia, consumption, headage developments,

terms of,
production and trade;

As regards support

2.
notify the Commission:

for local production, Greece shall

(a) not later than 31 March of each year, of the aid applications
received and the amounts involved for the previous calendar
year;

(b) not later than 31 July of each year, of the aid applications
the

definitively eligible and the amounts
previous calendar year.

involved for

Article 33

Report

(i) data on the amounts actually granted for the implemen-
tation of programme measures on the basis of the criteria
defined by Greece, such as the number of eligible producers,
the eligible surface area or
the number of holdings
concerned;

(j)

information on the
financial
measure under the programme;

implementation of

each

(k) statistics on the checks carried out by the competent autho-

rities and any penalties applied;

The report provided for in Article 17(2) of Regulation (EC)

1.
No 1405/2006 shall contain inter alia:

(l)

the comments of Greece on the implementation of
programme.

the

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For 2007 the report shall contain an assessment of the
2.
impact, on stockfarming and on the agricultural economy in the
smaller islands, of the aid programme for traditional activities
relating to the production of beef and veal, sheepmeat and
goatmeat.

programme approved under Article 13(2) of Regulation (EC)
implementing that
No 1405/2006 for
the purposes of
programme may not exceed 1 % of
the total amount of
financing for the programme.

Article 34

Amendments to programmes

Amendments

1.
to programmes approved under Article
13(2) of Regulation (EC) No 1405/2006 shall be submitted to
the Commission for approval.

However, such approval shall not be necessary for the following
amendments:

(a)

in the case of forecast supply balances, Greece may amend
the level of aid and the quantities of products which may be
covered by the supply arrangements;

(b) in the case of Community support programmes for local
production, Greece may adjust by up to 20 % the financial
allocation for each measure and the unit amount of aid
above or below the amounts in force at the time when
the request for amendment is presented.

2.
Greece shall notify the Commission once a year of the
planned amendments. However, Greece may notify amendments
at any time in cases of force majeure or exceptional circum-
stances. If the Commission has no objections to the planned
amendments, they shall apply from the first day of the second
month following that in which they were notified.

Article 35

Financing of studies, demonstration projects, training or
technical assistance measures

Article 36

Additional national measures

Member States shall take all the additional measures required to
apply this Regulation.

Article 37

Reduction of advances

the

information transmitted

Without prejudice to the general rules on budgetary discipline,
where
to the
Commission under Articles 32 and 33 is incomplete or the
transmitting that
time limit
information has not been
for
the Commission may reduce advances on
complied with,
entry in the
expenditure on a
accounts of
temporary and flat-rate basis.

by Greece

agricultural

Article 38

Repeal

(EC) No
Regulations (EEC) No 2837/93,
3063/93,
(EC) No
1999/2002, and (EC) No 2084/2004, are hereby repealed
with effect from 1 January 2007.

(EEC) No 2958/93,
(EC) No 1517/2002,

(EC) No 3175/94,

Article 39

Entry into force

This Regulation shall enter into force on the third day following
that of
the European
Union.

its publication in the Official

Journal of

The amount required to finance studies, demonstration projects,
training and technical assistance measures provided for in a

It shall apply from 1 January 2007.

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

Done at Brussels, 20 December 2006.

For the Commission

Mariann FISCHER BOEL
Member of the Commission

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ANNEX

Maximum quantities of processed products which can be exported or dispatched annually from the smaller
islands in the context of traditional consignments

CN code

To the Community

To third countries

(Quantity in kilograms (or litres))