Council Regulation (EC) No 1437/2007 of 26 November 2007 amending Regulation (EC) No 1290/2005 on the financing of the common agricultural policy
Date: 2007-11-26
Institutions: Council of the European Union
Subjects: EU financing, EU financing arrangements, common agricultural policy

7.12.2007

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Official Journal of the European Union

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(Acts adopted under the EC Treaty/Euratom Treaty whose publication is obligatory)

I

REGULATIONS

COUNCIL REGULATION (EC) No 1437/2007

of 26 November 2007

amending Regulation (EC) No 1290/2005 on the financing of the common agricultural policy

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty
Community, and in particular
Article 37(2) thereof,

establishing the European
the third subparagraph of

Having regard to the proposal from the Commission,

Having regard to the Opinion of the European Parliament (1),

Whereas:

(1)

(2)

In the case of intervention measures in respect of which
a sum per unit is not determined within the framework
of a common organisation of the markets, implementing
rules should be laid down, with regard in particular to
the method for determining the amounts to be financed,
the financing of expenditure resulting from the tying-up
of the funds necessary for buying-in products and the
financing of expenditure resulting from storage and,
where appropriate, processing operations.

In view of the nature of the measures and programmes
covered by Council Decision 90/424/EEC of 26 June
field (2),
1990 on expenditure

veterinary

in the

(1) Opinion of 11 October 2007 (not yet published in the Official

Journal).

(3)

(4)

(5)

provision should be made that in duly justified excep-
tional cases the European Agricultural Guarantee Fund
(EAGF) may finance administrative and personnel costs
incurred in the
and
programmes.

such measures

execution of

Council Regulation (EC) No 1290/2005 (3) sets out the
procedure to be followed by the Commission to decide
to reduce or suspend monthly payments as well as the
procedure to be followed to decide to suspend or reduce
intermediate payments.

are

that

exclusion from Community

to Regulation (EC) No 1290/2005,

the
Pursuant
Commission decides on amounts
to be
excluded from Community financing if it finds that this
expenditure has been incurred in a way that has infringed
Community rules. In the context of the procedure leading
the
to the
Commission,
in order to remedy the situation, makes
recommendations to the Member State concerned as to
how to apply Community legislation.
the Member
State fails to implement these recommendations, further
decisions excluding the expenditure will be taken by the
Commission. In addition to this it can be established in
certain cases that such recommendations will not or
cannot be implemented in the immediate future.

financing,

If

intermediate payments as
in Regulation
for

Under such circumstances the possibility to suspend or
is
it
reduce monthly or
currently
(EC) No
provided
1290/2005 does not protect sufficiently the financial
interest of
is
to provide for a new procedure
considered useful
permitting the Commission to suspend or
reduce
payments in specific situations in a more effective way.

the Community.

In this

respect,

it

(2) OJ L 224, 18.8.1990, p. 19. Decision as last amended by Decision

(3) OJ L 209, 11.8.2005, p. 1. Regulation as last amended by Regu-

2006/965/EC (OJ L 397, 30.12.2006, p. 22).

lation (EC) No 378/2007 (OJ L 95, 5.4.2007, p. 1).

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(6)

(7)

(8)

(9)

(10)

concerned.

the Member State

An ex-ante suspension or reduction of payments in the
agricultural field could have serious financial implications
In addition,
for
in
comparison with the procedure for
the conformity
clearance decision, the Member State has only limited
possibilities
the
its
Commission. For these reasons the new procedure of
suspension or reduction of payments should only be
used where one or more of the key components of the
national control system in question do not exist or are
not effective due to the gravity or persistence of the
deficiencies found.

position

vis-à-vis

defend

to

Provision should be made to clarify the conditions under
which an intermediate declaration of expenditure under
the European Agricultural Fund for Rural Development
(EAFRD) is inadmissible.

of

Section

system of

Council Regulation (EEC) No 4045/89 of 21 December
transactions
1989 on scrutiny by Member States of
forming part of
financing by the
the
European Agricultural
Guarantee
requires Member
Guidance
States to carry out ex-post controls on certain common
agricultural policy expenditure of financial year ‘n’ in the
period from 1 July n + 1 to 30 June n + 2. The report to
the Commission on the control activities in that period is
only due by the end of the year n + 2.

and Guarantee

Fund (1)

the

The limitation in time for
the conformity clearance
decisions laid down in Regulation (EC) No 1290/2005
makes it effectively impossible for the Commission to
decide on an exclusion from Community financing
where a Member State does not comply with its
(EEC) No
control
4045/89.
the
limitation in time should not apply for infringements
of the Member States’ control obligations under Regu-
lation (EEC) No 4045/89, provided that the Commission
acts upon the Member States’ report within a period of
12 months after receipt of that report.

Regulation
to deal with this problem,

obligations
In order

under

Since there is no need for Member States to inform the
Commission on the way they have decided or plan to
reuse the cancelled funds and to amend the financing
plan for the rural development programme concerned,
the
(EC) No
of
1290/2005 should be deleted.

Regulation

provision

relevant

(11)

In order to align the transitional rules for the European
Agricultural Guidance and Guarantee Fund (EAGGF)
Guidance Section to the new provisions applicable for
the next programming period of the Structural Funds,

Regulation (EC) No 1290/2005 should be amended in
line with Council Regulation (EC) No 1083/2006 of 11
July 2006 laying down general provisions on the
European Regional Development Fund,
the European
Social Fund and the Cohesion Fund (2).

(12)

(13)

In particular,

It is necessary to clarify the legal basis for the adoption
of detailed rules for the application of Regulation (EC) No
1290/2005.
the Commission should be
able to adopt detailed rules of application in respect of
the publication of information on beneficiaries of the
in respect of intervention
common agricultural policy,
measures where no fixed sum per item has been laid
down in a common market organisation and in respect
of appropriations which have been carried over
to
finance direct payments to farmers under the common
agricultural policy.

In the context of the revision of Council Regulation (EC,
Euratom) No 1605/2002 of 25 June 2002 on the
Financial Regulation applicable to the general budget of
the European Communities (3),
the provisions on the
annual
funds
ex-post publication of beneficiaries of
deriving from the budget were inserted into that Regu-
lation in order to implement the European Transparency
Initiative. Sector-specific Regulations are to provide the
means for such a publication. Both the EAGF and the
EAFRD form part of the general budget of the European
Communities and finance expenditure in a context of
shared management between the Member States and
the Community. Rules should therefore be laid down
for the publication of information on the beneficiaries
of
these Funds. To that end, Member States should
the beneficiaries
ensure annual ex-post publication of
and the amounts received per beneficiary under each of
these Funds.

(14) Making

this

these funds,

information accessible

to the public
enhances transparency regarding the use of Community
funds in the common agricultural policy and improves
in
the sound financial management of
particular by reinforcing public control of the money
used. Given the overriding weight of
the objectives
pursued,
it is justified with regard to the principle of
proportionality and the requirement of the protection
of personal data to provide for the general publication
of the relevant information as it does not go beyond
what is necessary in a democratic society and for the
prevention of
the
opinion of the European Data Protection Supervisor of
10 April 2007 (4), it is appropriate to make provision for
the beneficiaries of funds to be informed that those data
may be made public and that they may be processed by
auditing and investigating bodies.

irregularities. Taking into account

(2) OJ L 210, 31.7.2006, p. 25. Regulation as amended by Regulation

(EC) No 1989/2006 (OJ L 411, 30.12.2006, p. 6).

(3) OJ L 248, 16.9.2002, p. 1. Regulation as amended by Regulation

(1) OJ L 388, 30.12.1989, p. 18. Regulation as last amended by Regu-

(EC) No 1995/2006 (OJ L 390, 30.12.2006, p. 1).

lation (EC) No 2154/2002 (OJ L 328, 5.12.2002, p. 4).

(4) OJ C 134, 16.6.2007, p. 1.

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(15)

Regulation (EC) No 1290/2005 should therefore be
amended accordingly,

The monthly payments may be reduced or suspended

2.
if all of the following conditions are met:

HAS ADOPTED THIS REGULATION:

Regulation (EC) No 1290/2005 is hereby amended as follows:

Article 1

1. In Article 3, the following paragraph shall be added:

‘3. Where, within the framework of a common organi-
sation of the markets, a sum per unit is not determined in
respect of an intervention measure, the EAGF shall finance
the measure concerned on the basis of standard amounts
uniform throughout the Community, in particular for funds
originating in the Member States used for buying-in
for material operations arising from storage
products,
and, where appropriate,
intervention
for processing of
products.

The respective charges and costs shall be calculated in
accordance with the procedure referred to in Article 41(3).’;

2. In Article 13, the following subparagraph shall be added:

‘In duly justified exceptional cases, the first subparagraph
shall not apply to measures and programmes covered by
Council Decision 90/424/EEC of 26 June 1990 on expen-
diture in the veterinary field (*).

___________
(*) OJ L 224, 18.8.1990, p. 19. Decision as last amended
by Decision 2006/965/EC (OJ L 397, 30.12.2006,
p. 22).’

3. The following article shall be inserted:

(a) one or more of the key components of the national
control system in question do not exist or are not
effective due to the gravity or persistence of the defi-
ciencies found;

(b) the deficiencies

(a) are of a
referred to in point
continuous nature and have been the reason for at
least two decisions pursuant to Article 31, excluding
from Community financing expenditure
from the
Member State concerned, and

(c)

the Commission concludes
the Member State
concerned has not implemented its recommendations
to remedy the situation and is not in a position to do
so in the immediate future.

that

Before taking the decision referred to in paragraph 1,
3.
the Commission shall inform the Member State concerned
of its intention and shall ask it to react within a period
determined by the Commission according to the severity of
the problem and which generally may not be less than 30
days.

The percentage by which the monthly payments may be
to the percentage
reduced or suspended shall be equal
decided by the Commission in its
latest decision as
referred to in paragraph 2(b). It shall be applied to the
relevant expenditure effected by the paying agency where
the deficiencies referred to in paragraph 2(a) exist.

The reduction or suspension shall not be continued if
4.
the conditions laid down in paragraph 2 are no longer met.
It shall be without prejudice to the conformity clearance
pursuant to Article 31.’

‘Article 17a

Reduction and suspension of monthly payments in
specific cases

4. In Article 26, paragraph 4 shall be replaced by the

following:

to reduce or

1. Without prejudice to Article 17, the Commission may
take a decision, in accordance with paragraphs 2 and 3 of
suspend monthly payments
this Article,
referred to in Article 14 for a period to be determined in
the decision, which shall not exceed twelve months but
further periods not
which may be prolonged for
exceeding twelve months if
in
paragraph 2 of this Article continue to be met.

the conditions set out

‘4.
If one of the requirements laid down in paragraph 3
forthwith inform the
is not met, the Commission shall
accredited paying agency and the coordinating body,
where one has been appointed. If one of the requirements
laid down in point
(a) or (c) of paragraph 3 is not
respected,
the declaration of expenditure shall be inad-
missible.’

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5. The following article shall be inserted:

(a) point 1 shall be replaced by the following:

‘Article 27a

Suspension and reduction of intermediate payments in
specific cases

Article 17a shall apply mutatis mutandis to the suspension
intermediate payments referred to in
and reduction of
Article 26.’

6. In Article 31(5), the following point shall be added:

‘(c)

infringements by Member States of their obligations
under Council Regulation (EEC) No 4045/89 of 21
December 1989 on scrutiny by Member States of
transactions forming part of the system of financing
by the Guarantee Section of the European Agricultural
Guidance and Guarantee Fund (*), provided that the
Commission notifies the Member State in writing of
its inspection findings within 12 months following
receipt of the Member State’s report on the results of
its controls of the expenditure concerned.

___________
(*) OJ L 388, 30.12.1989, p. 18. Regulation as
amended
Regulation
(OJ L 328, 5.12.2002, p. 4).’

(EC) No

by

last
2154/2002

7. In Article 33(4), the second subparagraph shall be deleted;

8. In Article 40, paragraph 1 shall be replaced by the

following:

‘1.
By way of derogation from Articles 31(2), 32(4) and
37(1) of Council Regulation (EC) No 1260/1999 of 21
June 1999 laying down general provisions on the
Structural funds (*), partial sums committed for assistance
co-financed by the EAGGF Guidance Section approved by
the Commission between 1 January 2000 and 31
December 2006,
for which the certified statement of
expenditure actually paid, the final report on implemen-
tation and the statement referred to in Article 38(1)(f) of
that Regulation have not been sent to the Commission
within 15 months after the final date of eligibility of expen-
diture laid down in the decision granting a contribution
from the Funds, shall be automatically de-committed by
the Commission not
that
deadline, giving rise to the repayment of amounts unduly
paid.

than 6 months after

later

‘1.

the conditions applicable to the accreditation of
paying agencies as well as the specific accreditation
of coordinating bodies, their respective functions,
the information required and the arrangements
for it to be made available or transmitted to the
Commission;’;

(b) the following points shall be inserted:

‘8a. detailed rules on the financing and accounting of
intervention measures in the form of public storage
as well as on other expenditure financed by the
EAGF and the EAFRD;

aspects

8b. the detailed rules on the publication of information
concerning beneficiaries referred to in Article 44a
and on the practical
related to the
individuals with regard to the
protection of
processing of
their personal data in accordance
with the principles laid down in Community legis-
lation on data protection. These rules shall ensure,
in particular,
funds are
informed that these data may be made public and
may be processed by auditing and investigating
the
bodies
including
financial
the time that this information shall take place;

for
interests of the Communities,

the beneficiaries of

the purpose of

safeguarding

that

8c. the conditions and detailed rules applicable to
appropriations which have been carried over in
accordance with Article 149(3) of Regulation (EC,
Euratom) No 1605/2002 to finance the expen-
diture referred to in Article 3(1)(c) of this Regu-
lation.’

10. The following article shall be inserted:

‘Article 44a

Publication of the beneficiaries

Pursuant to Article 53b(2)(d) of Regulation (EC, Euratom)
No 1605/2002, Member States shall ensure annual ex-post
publication of the beneficiaries of the EAGF and the EAFRD
and the amounts received per beneficiary under each of
these Funds.

___________
(*) OJ L 161, 26.6.1999, p. 1. Regulation as last amended
by Regulation (EC) No 1198/2006 (OJ L 223,
15.8.2006, p. 1).’

The publication shall contain at least:

9. Article 42 is hereby amended as follows:

(a)

the EAGF,

for
subdivided in direct
amount
payments within the meaning of Article 2(d) of Regu-
lation (EC) No 1782/2003 and other expenditure;

the

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(b) for the EAFRD, the total amount of public funding per

beneficiary.’

Article 2

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

to the Member States’
Article 1(6) shall apply with respect
reports received by the Commission after 1 January 2008,
excluding any expenditure effected by Member States before
the financial year 2006.

Point (3) and Article 1(5) shall apply as from 1 July 2008.

Article 1(10) shall apply to EAGF expenditure incurred from 16
October 2007 and to EAFRD expenditure from 1 January 2007.

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

Done at Brussels, 26 November 2007.

For the Council
The President

J. SILVA