Proposal for a Council Decision establishing the position to be adopted on behalf of the Community within the Food Aid Committee as regards the extension of the Food Aid Convention, 1999
Date: 2008-05-13
Institutions: European Commission
Subjects: European convention, food aid, interim agreement (EU), renewal of an agreement

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 13.5.2008 
COM(2008) 303 final 

Proposal for a 

COUNCIL DECISION 

establishing the position to be adopted on behalf of the Community within the Food Aid 
Committee as regards the extension of the Food Aid Convention, 1999 

(presented by the Commission) 

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EXPLANATORY MEMORANDUM 

1. 

CONTEXT OF THE PROPOSAL 

The International Grains Agreement, 1995 is made up of two parts: the Food Aid Convention, 
1999 and the Grains Trade Convention, 1995. 

The  Food  Aid  Convention  of  1999  (FAC)  was  concluded  by  the  Community  by  Council 
Decision 2000/421/EC.  That  Convention  remains  in  force  until  30  June  2008,  following  its 
extension by decision of the Food Aid Committee at its 96th session on 1 June 2007.  

The Grains Trade Convention of 1995 (GTC) was extended by decision of the Grains Trade 
Council at its 25th session on 11 June 2007 until 30 June 2009.  

In the interest of both the Commission and the Member States, some specific changes to the 
current FAC are required. Therefore, there is a general agreement that these changes should 
be discussed amongst the members, within renegotiations of the FAC. Renegotiations of FAC 
have,  so  far,  been  put  on  hold  with  a  view  to  taking  into  account  the  outcome  of  the 
negotiations of the WTO Doha Development Agenda. As desirable as it would be to include 
the results of the Doha negotiations because of the significant time which has elapsed as well 
as  the  unpredictable  timeline  for  the  conclusion  of  these  negotiations,  the  Commission,  on 
behalf  of  the  European  Communities  and  its  Member  States,  will  insist  with  the  other  FAC 
members at the next FAC meeting in June 2008 in London on the commencement of the FAC 
renegotiations process. 

It is therefore considered necessary to further extend the Food Aid Convention for a period of 
one year. This would allow enough time for the renegotiation process of the FAC. 

The  Commission  will  act  under  the  authorisation  to  negotiate,  on  behalf  of  the  European 
Community,  the  revision  of  the  Food  Aid  Convention  1999,  conferred  on  it  by  Council 
Decision on 27 November 2003. 

•  Existing provisions in the area of the proposal 

Council Decision 2000/421/EC 
Council Decision 2006/906/EC 
Council Decision 2007/317/EC 

•  Consistency with the other policies and objectives of the Union 

This decision is consistent with the Grains Trade Convention 1995, that remain in force until 
30 June 2009. 

2. 

CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT 

At  the  Council  Working  Group  on  Food  Aid  on  15  February  2008,  Member  States  were 
favourable to a Community position regarding the prolongation of the Food Aid Convention 
1999  for  a  period  of  one  year,  i.e.  until  30  June  2009  to  be  decided  at  the  next  Food  Aid 
Convention 1999 meeting in London in early June 2008. 

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•  Collection and use of expertise 

There was no need for external expertise. 

•  Impact Assessment 

Not applicable. 

3. 

LEGAL ELEMENTS OF THE PROPOSAL 

•  Legal basis 

Article 181, in conjunction with Article 300(2) of the Treaty establishing the EC. 

•  Subsidiarity 

The proposal falls under the mixed competence of the Community. 

•  Proportionality 

The proposal complies with the proportionality principle. 

•  Choice of instrument 

Proposed instruments: Council Decision 

Other means would not be adequate for the following reason: it is the only way to adopt the 
European Community's position to be expressed within the Food Aid Committee. 

4. 

BUDGETARY IMPLICATIONS 

The  extension  of  the  Food  Aid  Convention  entails  the  prolongation  of  the  Community 
contribution to the administrative budget of the International Grains Agreement, which covers 
the  two  conventions.  That  contribution  is  budgeted  under  item  05 06 01  of  the  Community 
budget  (International  agricultural  agreements).  The  cost  estimated  of  this  proposal  is 
EUR 0.440 million, but it has already been taken into consideration at the moment of the last 
extension of the Grains Trade Convention, 1995. 

The extension of Food Aid Convention 1999 means that yearly commitments to provide food 
aid by the European Community and its Member States under Article III(e) of the Convention 
will be extended for one year. In view of increasing food prices and rising transport costs (due 
to  high  energy  costs),  which  have  an  impact  on  the  costs  of  meeting  the  Commission's 
commitments  towards  the  Food  Aid  Convention  1999,  the  Commission  is  in  the  process  of 
identifying  the  budgetary  needs  and  ways  to  mobilise  additional  resources  to  address  any 
possible shortfall in these commitments. 

CONCLUSIONS 

The  Commission  proposes  that  the  Council  authorises  the  Commission  to  vote  on  behalf  of 
the  European  Community,  in  accordance  with  Article XXV(b)  of  the  Food  Aid  Convention 
1999, in favour of the further extension of this Convention, for a period of one year, i.e. until 
30 June 2009,  since  the Grains Trade Convention 1995 remains in force until and  including 
that date as stipulated in Article XXV(a) of the Food Aid Convention 1999. 

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Proposal for a 

COUNCIL DECISION 

establishing the position to be adopted on behalf of the Community within the Food Aid 
Committee as regards the extension of the Food Aid Convention, 1999 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Article 181 in conjunction with Article 300(2), second paragraph, thereof, 

Having regard to the proposal from the Commission, 

Whereas: 

(1) 

(2) 

The Food Aid Convention 1999 (hereinafter: the "Convention") was concluded by the 
Community by Council Decision 2000/421/EC1 and extended by decisions of the Food 
Aid Committee in June 2003, June 2005 and June 2007, so as to remain in force until 
30 June 2008.  

A  further  extension  of  one  year  of  the  Convention  is  in  the  interest  of  both  the 
Community  and  its  Member  States.  Pursuant  to  Article  XXV(b)  of  the  Convention, 
that extension is conditional upon the remaining in force, for the same period, of the 
Grains Trade Convention 1995. The Grains Trade Convention 1995 remains in force 
until  30  June  2009.  The  Commission,  which  represents  the  Community  in  the  Food 
Aid  Committee,  should  therefore  be  authorised  by  a  Council  Decision  to  vote  in 
favour of such extension, 

HAS DECIDED AS FOLLOWS: 

Sole Article 

The  European  Community's  position  within  the  Food  Aid  Committee  shall  be  to  vote  in 
favour of the extension of the Food Aid Convention 1999 for a period of one year, since the 
Grains Trade Convention 1995 remains in force for the same period, i.e. until 30 June 2009. 
The European Community's position within the Food Aid Committee shall be to request the 
commencement  of  a  renegotiation  of  the  Food  Aid  Convention  1999  without  further  delay. 
The EC will insist on the urgency to embark on the renegotiation process at the forthcoming 
FAC meeting in June 2008 with a target completion date of end June 2009, coinciding with 
the end of the extended Food Aid Convention 1999.  

1 

OJ L 163, 4.7.2000, p. 37. 

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The  Commission  is  hereby  authorised  to  express  this  position  within  the  Food  Aid 
Committee. 

Done at Brussels,  

For the Council 
The President 

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LEGISLATIVE FINANCIAL STATEMENT 

Policy area: Agriculture and Rural Development 

Activity: International aspects of Agriculture and Rural Development policy area 

TITLE OF ACTION: EXTENSION OF THE FOOD AID CONVENTION 1999 

(COMMUNITY CONTRIBUTION TO THE INTERNATIONAL GRAINS COUNCIL) 

1. 

BUDGET LINE + HEADING 

Heading 4 – The EU as a global partner 
05 06 01: International agricultural agreements 

2. 

OVERALL FIGURES 

2.1. 

Total allocation for action: EUR 440 000 for the one year extension 

2.2. 

Period of application: 1.7.2008 to 30.6.2009 (budget 2009) 

2.3. 

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 The EU as a 
global partner 

4. 

LEGAL BASIS 

Article 181 of the Treaty in conjunction with Article 300(2) 
Council Decisions 96/88/EC of 27.1.1996 (OJ L 21 of 27.1.1996), 2001/C 195/01 (OJ C 195 
of 11.7.2001) and 2000/421/EC (OJ L 163 of 4.7.2000). 

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. 

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The  payment  of  EC  membership  contributions  enables  the  objectives  of  the  International 
Grains  Council  (IGC)  to  be  attained.  The  IGC,  which  is  responsible  for  administering  the 
Agreements  relating  to  the  Grains  Trade  Convention,  1995  and  the  Food  Aid  Convention, 
1999,  promotes  the  objectives  of  the  Agreements,  including  international  cooperation, 
exchange of statistical information and forecasting market trends, etc. and for the Food Aid 
Convention the guarantee that developing countries are ensured a minimum amount of food 
aid  by  the  European  Union.  It  is  therefore  in  the  interests  of  the  EC  to  be  a  part  of  the 
Agreements. 

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

It is clear that if the EC had to carry out on its own the same actions as are carried out by the 
IGC,  the  total  cost  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 Grains Council. 

The dues are paid for as long as the EC remains a signatory to the Agreements. 

The European Community and the Member States participate fully in the activities of the IGC 
and take full advantage of the benefits of membership. 

6. 

FINANCIAL IMPACT 

6.1. 

Total financial impact 

Commitments (to the 3rd decimal place): The cost estimated of this proposal is €0.440 million 
(GBP 0.327 million), but it has already been taken into consideration at the moment of the last 
extension of the Grains Trade Convention, 1995. 
While the subject of this decision is to extend the Food Aid Convention 1999, it should also 
be taken into consideration that, in view of increasing food prices and rising transport costs 
(due  to  high  energy  costs),  the  Commission  is  in  the  process  of  identifying  the  budgetary 
needs  and  ways  to  mobilise  additional  resources  to  address  any  possible  shortfall  in  these 
commitments. 

6.2. 

Calculation 

The  expenditure  involved  in  the  application  of  the  two  Conventions  is  covered  by  annual 
contributions from all members of the Grains Convention. The contribution of each member 
for each financial year is fixed in proportion to the number of votes attributed to that member 
in relation to the total number of votes held by members. The number of votes attributed to 
each member is adjusted on the basis of the composition of the IGC when the budget for the 
financial  year  in  question  is  adopted.  There  is  a  total  of  2 000  votes  in  the  Convention,  of 
which the European Union holds 399 for 2006/07. The same figure is projected for 2008/09. 
The estimated cost per vote for the period of extension is €1 103 ( 399 votes x €1 103/vote = 
€440 000). 

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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 resources 
and/or additional resources 

Number of 
permanent posts 

Number of 
temporary posts 

Permanent 
officials or 
temporary staff 

A 
B 
C 

Other human 
resources 

Total 

0.2 
0.1 
– 

– 

0.3 

– 
– 
– 

– 

– 

Total 

0.2 
0.1 
– 

– 

0.3 

7.2. 

Overall financial impact of human resources 

Description of tasks deriving  
from the action 

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

Type of human resources 

Amount EUR 

Method of calculation* 

Officials 
Temporary staff 

Other human resources 

35 400 

0.3 x 118 000 

*  Human resources and administrative requirements will be covered from the allocation given to the managing 

DG under the annual allocations procedure. The amounts are total expenditure for twelve months. 

Total 

35 400 

8. 

FOLLOW-UP AND EVALUATION 

8.1. 

Follow-up arrangements 

The Commission services will participate fully in the Administrative Committees and Council 
of IGC; these are the bodies responsible for determining budgetary contributions. 

A  report  of  these  meetings  and  of  the  decisions  taken  in  the  course  of  these  meetings  is 
published and is freely available to members. 

8.2. 

Details and frequency of planned evaluations 

In  view  of  the  specific  nature  of  the  proposed  intervention  (extension  of  Community 
contribution  to  the  administrative  budget  of  the  International  Grains  Agreement)  and  of  the 
relatively small sum involved, an external evaluation does not seem justified. The relevance 
and  usefulness  of  continuing  with  a  contribution  to  the  administrative  budget  of  this 
Agreement will be evaluated internally, at regular intervals, by means of active Commission 
involvement in the management committees and in the International Grains Council. 

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9. 

ANTI-FRAUD MEASURES 

The execution and the control of EC contributions are checked in conformity with the rules 
foreseen by the IGC Agreement. 

Specific  modalities  of  audit  and  control  are  laid  down  within  the  legal  basis  of  this 
international organisation. 

The  accounts  of  this  organisation  are  certified  by  an  independent  external  auditor.  This 
certification  is  submitted  to  the  competent  body  of  the  IGC  in  view  of  its  approval  and 
subsequent publication. 

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