ON THE COMMON ORGANIZATION OF THE MARKET IN HOPS ( OFFICIAL JOURNAL , ENGLISH SPECIAL EDITION 1971 ( II ), P . 634 ). ARTICLE 8 RELATES TO THE GRANT OF AID TO RECOGNIZED PRODUCER GROUPS TO ENCOURAGE THEIR FORMATION AND TO FACILITATE THEIR OPERATION . ARTICLE 9 RELATES TO THE GRANT OF AID TO PRODUCER GROUPS FOR OPERATIONS TO BE USED FOR CHANGING TO DIFFERENT VARIETIES AND FOR REORGANIZING HOP GARDENS .
3 ARTICLE 9 OF REGULATION NO 1696/71 WAS AMENDED BY COUNCIL REGULATION ( EEC ) NO 1170/77 OF 17 MAY 1977 ( OFFICIAL JOURNAL 1977 , L 137 , P . 7 ). PARAGRAPH ( 3 ) THEREOF , IN ITS AMENDED FORM , PROVIDES THAT THE MEMBER STATES MAY GRANT TO RECOGNIZED PRODUCER GROUPS AID FOR CONVERSION TO OTHER VARIETIES AND THE REORGANIZATION OF HOP GARDENS , PROVIDED THAT SUCH OPERATIONS ENTAIL A REDUCTION OF AT LEAST 40 % IN THE AREA CONCERNED .
4 THE CONCEPT OF A ' ' PRODUCER GROUP ' ' IS DEFINED IN ARTICLE 7 OF REGULATION NO 1696/71 , AS AMENDED BY REGULATION NO 1170/77 . ACCORDING TO THAT DEFINITION A PRODUCER GROUP CONSISTS EXCLUSIVELY OR MAINLY OF HOP PRODUCERS FORMED ON THE INITIATIVE OF THE PRODUCERS FOR A NUMBER OF HOP PRODUCTION AND MARKETING PURPOSES INCLUDING ' ' ADAPTING SUCH PRODUCTION JOINTLY TO THE REQUIREMENTS OF THE MARKET AND IMPROVING THE PRODUCT BY CONVERTING TO OTHER VARIETIES AND BY REORGANIZING HOP GARDENS ' ' . THE OTHER OBJECTIVES INCLUDE THE PROMOTION OF RATIONALIZATION AND MECHANIZATION OF CULTIVATION AND HARVESTING OPERATIONS AND THE ADOPTION OF COMMON RULES FOR THE PRODUCTION AND MARKETING OF ALL THE PRODUCE OF THE MEMBERS .
5 ACCORDING TO ARTICLE 7 A PRODUCER GROUP IS TO BE RECOGNIZED BY THE MEMBER STATES IF IT FULFILS CERTAIN GENERAL CONDITIONS , IN PARTICULAR THE CONDITION THAT IT APPLIES COMMON RULES FOR PRODUCTION AND PLACING ON THE MARKET . ACCORDING TO COMMISSION REGULATION NO 2564/77 OF 22 NOVEMBER 1977 ( OFFICIAL JOURNAL L 299 , P . 9 ) THOSE COMMON RULES ARE TO COMPRISE INTER ALIA , RULES RELATING TO THE USE OF ONE OR MORE SPECIFIED VARIETIES WHEN RENEWING PLANTATIONS OR CREATING NEW ONES , TO COMPLIANCE WITH CERTAIN METHODS OF CULTIVATION , TO HARVESTING AND DRYING AND RULES RELATING TO THE QUANTITIES WHICH THE PRODUCERS ARE AUTHORIZED TO SELL THEMSELVES AND THE RULES GOVERNING SUCH SALES .
6 IN SUBSTANCE THIS DISPUTE RELATES TO THE CONSEQUENCES OF THE GRANT OF AID FOR CONVERSION TO OTHER VARIETIES AND FOR REORGANIZATION OF HOP GARDENS PROVIDED FOR IN ARTICLE 9 OF REGULATION NO 1696/71 , AS GRANTED TO RECOGNIZED PRODUCER GROUPS .
7 REGULATION NO 2253/77 PROVIDES FIRST , IN ARTICLE 3 , THAT SUCH AID IS TO BE GRANTED ON PRESENTATION TO THE AUTHORITIES APPOINTED BY THE MEMBER STATES OF A PLAN FOR CONVERSION TO OTHER VARIETIES AND FOR THE REORGANIZATION OF HOP GARDENS ' ' WHICH ENTAILS AT LEAST A 40 % REDUCTION IN THE TOTAL AREA