CELEX: 51989PC0091(02)
Language: en
Date: 1989-07-03
Title: PROPOSAL FOR A COUNCIL REGULATION ( EEC ) ON IMPROVING THE PROCESSING AND MARKETING OF AGRICULTURAL AND FORESTRY PRODUCTS

No C 240/16                            Official Journal of the European Communities                                    20. 9. 89
              Proposal for a Council Regulation (EEC) on improving the processing and marketing of agri-
                                                  cultural and forestry products
                                                        COM(89) 91 final
                                       (Submitted by the Commission on 19 May 1989)
                                                          (89/C 240/06)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,                             Whereas, for such plans, the Commission should adopt
                                                                     sectoral Community support frameworks, to be drawn
                                                                     up in agreement with the Member States concerned,
Having regard to the Treaty establishing the European                within the framework of the partnership, taking account,
Economic Community, and in particular Articles 42 and                as appropriate, of the Community support frameworks
43 thereof,                                                          adopted for plans relating to Objectives 1 and 5 (b);
Having regard to the proposal from the Commission,
                                                                     Whereas an effective means should be adopted for
                                                                     ensuring that Community action is consistent with the
Having regard        to  the   opinion   of   the    European        CAP; whereas the most effective way to achieve this is to
Parliament,                                                          adopt selection criteria with which to determine which
                                                                     investments should be given priority for consideration;
Having regard to the opinion of the Economic and
Social Committee,                                                    Whereas in order to ensure the necessary transparency in
                                                                     the operations of the Fund, eligible expenditure should
Whereas Article 10 (1) of Council Regulation (EEC) No                be defined;
4256/88 of 19 December 1988 laying down provisions
for implementing Regulation (EEC) No 2052/88 as
regards the EAGGF Guidance Section (') provides for a                Whereas it must be ensured that investmeats are viable
Council decision on the forms of the Fund's contribution             and that farmers have a share in the economic benefits of
to measures to improve the conditions under which agri-              the action taken;
cultural, forestry and fishery products are processed and
marketed with a view to achieving the objectives referred
to in Council Regulation (EEC) No 4253/88 of 19                      Whereas application of the measure should in general be
December 1988 laying down provisions for implementing                restricted to the agricultural products listed in Annex II
Regulation (EEC) No 2052/88 as regards coordination                  to the Treaty and to forestry products; whereas in
of the activities of the different Structural Funds between          certain cases, however, processed products no longer
themselves and with the operations of the European                   included in the Annex may be of importance to farmers
Investment Bank and the other existing financial                     in so far as they create new market outlets and/or
instruments ( 2 );                                                   increase the added value of the basic product;
Whereas the types of investments eligible for a contri-
                                                                     Whereas, in connection with the reform of the Structural
bution from the EAGGF Guidance Section (hereinafter
                                                                     Funds, Regulation (EEC) No 4256/88 provides for new
called 'the Fund') should be defined, taking account of
                                                                     forms of assistance by the Fund as regards improving
the current situation both on the agricultural markets
                                                                     structures for marketing and processing agricultural and
and in the agriculture and food sector, as well as the
                                                                     forestry products; whereas general rules should therefore
prospects for developing outlets for agricultural and
                                                                     be laid down for its implementation;
forestry products;
Whereas in order to ensure a coherent improvement in                 Whereas to allow for the differing structural situations in
the processing and marketing of agricultural and forestry            the different regions of the Community and to ensure
products, financial assistance from the Fund for                     that the action of the Fund is concentrated where it is
investments in that field should be made conditional on              needed, contribution rates should be differentiated by
the inclusion of such investments in sectoral plans                  category of region;
containing an in-depth analysis of the situation in the
sector and the proposed improvement;
                                                                     Whereas to ensure harmony between the Community's
                                                                     actions and those of the Member State and to ensure the
                                                                     additionality of Community assistance, the investments
O OJ No L 374, 31. 12. 1988, p. 25.                                  selected for financing by the Fund should be co-financed
O OJ No L 374, 31. 12. 1988, p. 1.                                   by the Member State;
 ---pagebreak---  20. 9. 89                              Official Journal of the European Communities                            No C 240/17
 Whereas to ensure a smooth transition for the financing           2.   The chief objective of the common measure is to
 arrangements under Council Regulation (EEC) No                   contribute towards the achievement of Objectives 1 and
 355/77 (') to the new provisions in this Regulation,              5, as set out in Article 1 of Council Regulation (EEC)
 provision should be made for transitional rules regarding        N o 2052/88 (2) namely speeding up the adjustment of
 action by the Fund approved before the entry into force           agricultural structures with a view to reform of the
 of this Regulation;                                              common agricultural policy and promoting, the devel-
                                                                  opment of rural areas and of the regions whose devel-
                                                                  opment is lagging behind, subject to the conditions laid
 Whereas provision should be made for the possibility of          down in Regulation (EEC) No 4256/88.
 laying down certain specific implementing rules adapted
 to the special nature of the measure that is the subject of
 this Regulation, to ensure that it is implemented effec-
 tively,
                                                                                            TITLE I
                                                                  SECTORAL PLANS, COMMUNITY SUPPORT FRAME-
                                                                              WORKS AND SELECTION CRITERIA
 HAS ADOPTED THIS REGULATION:
                            Article 1                                                       Article 2
             Objectives of the common measure                     Role     of   the sectoral plans, Community         support
                                                                                frameworks and selection criteria
 1.     In order to facilitate the adaptation or orientation
 of agriculture in line with the development of the               In order to ensure that the processing and marketing
 common agricultural policy, a common measure within              sectors develop in a way that is consistent with
the meaning of Article 2 (1) of Regulation (EEC) No               Community policy, and particularly with the common
 4256/88, designed to improve and rationalize the                 agricultural policy, and to ensure the effectiveness of
treatment, processing and marketing of agricultural and           Community aid, the financing of investments must take
forestry products, is hereby introduced. Within the               place within the framework of plans designed to improve
framework of this measure, the Fund may participate in            the structures relating to the various products in question
the financing of investments:                                     (hereinafter called 'sectoral plans') to be drawn up by the
                                                                  Member States, and on the basis of corresponding
                                                                  Community support frameworks, drawn up with due
 (a) which help to guide production in keeping with fore-         regard for the selection of investments eligible for
      seeable market trends or which encourage the devel-         Community financing (hereinafter called 'section
     opment of new outlets for agricultural products, in          criteria') to be laid down by the Commission.
     particular through the production and marketing of
     new products or of high-quality products, including
     organically-grown products;
                                                                                            Article 3
 (b) which relieve the intervention mechanisms of the                                 Content of the plans
     market organizations by furthering long-term
     structural improvement where this is needed;                 1.    The sectoral plans shall include at least the infor-
                                                                  mation specified in Articles 4 and 5.
(c) which are located in regions encountering special
     problems in adapting to the economic consequences
     of developments on the agricultural markets or               2.    The information forwarded with the sectoral plans
     which will benefit such regions;                             must reflect the situation throughout the Member State
                                                                  in question.
(d) which help to improve or rationalize marketing
     channels or processing procedures for agricultural
     and forestry products;                                       3.    In the case of regions and areas covered by
                                                                  Objectives 1 and 5 (b) of the reform of the Structural
                                                                  Funds, it must be shown that sectoral plans are consistent
(e) which help to improve the quality, preparation and            with the regional or rural development plans and with
     presentation of products or which encourage a better         the appropriate Community support frameworks.
     use of by-products, particularly by recycling waste.
(*) OJ No L 51, 23. 2. 1977, p. 1.                                (') OJ No L 185, 15. 7. 1988, p. 9.
 ---pagebreak---  No C 240/18                             Official Journal of the European Communities                                20. 9. 89
                            Article 4                               (h) the administrative, legislative or financial measures
                                                                        adopted or to be taken to implement the plan, in
                Analysis of the initial situation                       particular details of the intended form of action and
 1.     The information referred to in Article 3 (1) must,              the authorities or bodies designated in accordance
as regards the current situation of the marketing and                   with Articles 14 (1) and 16 (1) of Regulation (EEC)
processing sector, include at least the following:                      No 4253/88;
 (a) demarcation of the sector, and the reasons therefor:          (i) a description of the national arrangements for the
                                                                        management and control of the operational
                                                                        programmes or global grants which are the subject of
(b) the initial situation and the trends which can be
                                                                        the application for aid.
      inferred from it, in particular as regards:
     — the economic and social situation in general, in                                       Article 6
          so far as this has a bearing on the plan, and in
          particular the prospective outlets for agricultural                        Updating and new plans
          and forestry products,                                   If the period initially estimated by the Member State for
                                                                   implementation of a plan has expired, an updated or new
     — the importance of argriculture and forestry,                plan must, in addition to the information referred to in
                                                                   Articles 4 and 5, include a report showing:
     — the situation as regards the processing and
          marketing of the agricultural and forestry               (a) the progress made in relation to the forecasts in the
          products covered by the plan, and especially the              expired plan, including the public funds, made
          existing capacity of the undertakings concerned               available;
          and their geographical distribution.
                                                                   (b) a description of developments in the situation
2.     The information referred to in paragraph 1 must be               regarding the processing and marketing of products,
up to date.                                                             showing that there is a need for updating or for a
                                                                        new plan.
                            Article 5
                                                                                              Article 7
         Objectives and implementation of the plans
                                                                   Submission of sectoral plans and decision on corre-
The information referred to in Article 3 (1) must, as                       sponding Community support frameworks
regards the objectives and resources relating to the plan,
include at least the following:                                    1.    The sectoral plans and any amendments thereto
                                                                   shall be forwarded to the Commission by the Member
                                                                   States concerned.
(a) the needs to be met by the plan and the objectives
     which it is intended to achieve, in particular the
     capacity to be reached;                                       2.    The Community support frameworks relating to
                                                                   sectoral plans shall be established in agreement with the
(b) the economic importance of the plan for the sector             Member State concerned, within the partnership, and by
     concerned and the implications for agricultural and           Commission decision under the procedure laid down in
     forestry undertakings;                                        Article 29 of Regulation (EEC) No 4253/88 and in
                                                                   accordance with the rules laid down in Title III of that
                                                                   Regulation.
(c) any aid measures in place in the sector covered by
     the plan;
                                                                   3.    The Commission shall, as part of the procedure
(d) the means proposed for achieving the objectives,               referred to in paragraph 2, ensure that the sectoral plans
     particularly the total amount of investment and the           are consistent with the priorities of Community policies,
     financial participation of the Member State;                  in particular those of the common agricultural policy.
(e) the relationship of the plan to any other measures to                                     Article 8
     encourage the harmonious development of the whole
     economy;                                                                            Selection criteria
                                                                   1.    The selection criteria referred to in Article 2 shall
(f) the estimated time required for the execution of the           be used to determine which investments are to receive
     plan, which in principle should be between three and          assistance from the Fund, within the framework of the
     five years;                                                   approval of the operational programmes or global grants
                                                                   referred to in Article 9. The criteria shall lay down
(g) the likely effects on the environment and, where               priorities and indicate investments which must be
     appropriate, the environmental measures to be taken;          excluded from Community financing.
 ---pagebreak--- 20. 9. 89                              Official Journal of the European Communities                            No C 240/19
2.    The selection criteria shall be drawn up in                — to determine the precise form of assistance to be
accordance with the guidelines of the Community's                     provided by the Fund, where appropriate on the basis
policies, particularly the common agricultural policy.                of information already given in any corresponding
                                                                      Community support framework.
3.    The selection criteria and, where applicable,
amendments thereto shall be adopted by the
                                                                                           Article 11
Commission. The decision shall be communicated to the
Member States and published in the Official Journal of                       Eligible investments and expenditure
the European Communities.
                                                                  1.    To be eligible for aid from the Fund in the forms
                                                                 listed in Article 9 investments must relate to:
                           TITLE II
OPERATIONAL PROGRAMMES AND GLOBAL GRANTS                          (a) rationalizing or developing the market preparation,
                                                                      preservation, treatment or processing of agricultural
                                                                      and forestry products or recycling manufacturing
                           Article 9
                                                                      waste;
                     Forms of assistance
The Fund shall provide assistance in the implementation           (b) improving marketing channels, including the trans-
of the measure which is the subject of this Regulation by             parency of price formation;
means of:
                                                                  (c) applying new processing techniques, including the
(a) part-financing of operational programmes within the               development of new products, by-products or
     meaning of Article 5 (5) of Regulation (EEC) No                  markets;
     2052/88; or
                                                                  (d) improving product quality.
(b) the provision of global grants within the meaning of
     Article 5 (2) (c) of Regulation (EEC) No 2052/88.
                                                                 2.     Special priority may be given to investments to
                                                                 improve the marketing structures for agricultural
                          Article 10                             products, particularly if such investments encourage the
                     Applications for aid                        development of new outlets by facilitating the marketing
                                                                 of new products or of high-quality products having
1.    The authorities and intermediaries referred to in          characteristics which comply with the Community's
Articles 14 (1) and 16 (1) of Regulation (EEC) No                policy on foodstuffs, including organically grown
4253/88 may submit applications for aid in the form of           products.
operational programmes or global grants.
                                                                 2.     Eligible expenditure in respect of the investments
2.    Applications for aid must supply the necessary             referred to in paragraph 1 may include:
information to enable the Commission:
— to evaluate the conformity of the proposed measures            (a) the construction and acquisition of immovable
    with Community policies, particularly the common                  property, with the exception of land purchase;
    agricultural policy,
                                                                 (b) machinery and equipment,           including   computer
— to evaluate the contribution the proposed action will               software and programmes;
    make to the improvement of processing and
    marketing structures, the coherence of the measures
                                                                 (c) general costs, such as architects', engineers' and
    which constitute it and their conformity with the
                                                                      consultants' fees and feasibility studies, up to a
    sectoral plan, the Community support frameworks
                                                                      ceiling of 12 % of the cost referred to in (a) and (b).
    and the selection criteria,
— to assess the socio-economic impact of the measures                                      Article 12
    in the areas concerned,
                                                                 Products concerned and participation of the producers
— to assess the proposed measures' impact on the envi-            1.    Investments must contribute to improving the
    ronment and their effectiveness in that field,               situation of the basic agricultural production sector in
                                                                 question; in particular, having regard to the specific
— to check that the execution methods and the                    nature of each sector, they must guarantee the producers
    financing are suited to the effective implementation         of the basic agricultural product an adequate and lasting
    of the measures,                                             share in the resulting economic benefits.
 ---pagebreak---  No C 240/20                           Official Journal of the European Communities                                  20. 9. 89
 2.    The investments must as a rule concern the                 2.    The decision referred to in paragraph 1 shall be
 products listed in Annex II to the Treaty, to the                communicated to the authority referred to in Article 14
 exclusion of those covered by Council Regulation (EEC)           (1) of Regulation No 4253/88 or to the intermediary
 No . . ./89. However, investments relating to forestry           referred to in Article 16 (1) of that Regulation, and to
 products and products falling within C N codes 45 02,            the Member State concerned.
 45 03 and 45 04 shall also be eligible.
 The Commission may accept investments relating to                3.    In the case of multiannual operations, the authority
 other products provided the aid recipients have direct           or intermediary referred to in paragraph 2 shall forward
 contractual links with the producers of the basic agri-          to the Commission each year the information required
 cultural products.                                               for the commitment of the annual instalments referred to
                                                                  in Article 20 (2) of Regulation (EEC) No 4253/88 and
                                                                  for checking that the investments to be made comply
                                                                 with the decisions taken in accordance with paragraph 1
 3.    Sufficient evidence must       be   given   that  the      and Article 7 (2).
 investments will be profitable.
                           Article 13                                                      TITLE III
                    Ineligible investments                                FINANCIAL AND GENERAL PROVISIONS
 1.    The following investments shall be excluded:
                                                                                           Article 16
— investments at the retail level,
                                                                                      Aid rates and rules
                                                                  1.    Aid from the Fund may not exceed, in relation to
— investments in the marketing           or   processing  of     the eligible costs of the selected investments:
     products from third countries.
                                                                 (a) 50 % in the Objective 1 regions referred to in Article
2.     The work proposed may not be commenced before                  1 (1) of Regulation (EEC) No 2052/88;
the date on which the Commission receives the
application for assistance.
                                                                 (b) 30 % in other regions.
                          Article 14
                          Recipients                             2.    Aid from the Fund shall in general take the form of
 1.   Aid from the Fund shall be granted to the natural          capital grants. If other forms of assistance are used, they
or legal persons, or groups thereof, who are ultimately          must not exceed the capital grant equivalent referred to
responsible for financing the investments.                       above.
2.    Aid from the Fund shall be paid through:                   3.    The Member States concerned must undertake to
                                                                 participate in financing the investments selected by the
                                                                 Commission for assistance from the Fund, to at least
— the authorities designated in accordance with Article          5 % of the eligible costs.
     14 (1) of Regulation (EEC) No 4253/88, or
— the intermediary agencies designated in accordance             4.    The financial contribution by the recipients referred
    with Article 16 (1) of Regulation (EEC) No 4253/88.          to in Article 14 (1) in relation to the eligible costs of the
                                                                 selected investments must be not less than:
                          Article 15
                                                                 (a) 25 % in the Objective 1 regions referred to in Article
      Decision to grant aid and budget commitment                     1 (1) of Regulation (EEC) No 2052/88;
1.    The Commission shall decide on the granting of aid
from the Fund in accordance with the procedure laid
down in Article 29 of Regulation (EEC) No 4253/88.               (b) 45 % in other regions.
 ---pagebreak--- 20. 9. 89                             Official Journal of the European Communities                            No C 240/21
5.     Within the field of application of this Regulation,      — if some of the conditions laid down in the
Member States may take additional aid measures which                 Commission's Decision referred to in Article 15 (1)
are subject to conditions or rules differing from those              have not been met, or
provided for in the Regulation, or where the amounts of
aid exceed the ceilings specified herein, on condition that
such measures comply with Articles 92 to 94 of the              — if time limits set for implementation have not been
Treaty.                                                              respected.
                          Article 17                             3.    The decision shall be communicated to the Member
                                                                 State concerned and the authority designated in
             Procedures for payment of the aid
                                                                 accordance with Article 14 (1) of Regulation (EEC) No
1.     Payment of advances or balances to be carried out         4253/88 or, where appropriate, the intermediary referred
in accordance with Article 21 of Regulation (EEC) No             to in Article 16 (1) of that Regulation.
4253/88 shall be made to the authority designated in
accordance with Article 14 (1) of Regulation (EEC) No
4253/88 or, where applicable, to the intermediary                                         Article 19
referred to in Article 16 (1) of that Regulation.
                                                                         Transition period for the approval of plans
2.     The authority or intermediary referred to in              For 12 months following the entry into force of this
paragraph 1 shall check the supporting documents                 Regulation, a decision may be taken to provide the
relating to the expenditure of the final recipients and          assistance referred to in Article 9 (1) in respect of
ensure that they are in order before paying the                  measures which can be implemented in not more than
Community contribution. It shall also make on-the-spot           one year and which are not part of an approved sectoral
checks to verify that the information contained in the           plan, provided that the sector in question is covered by a
application corresponds to the true situation.                   sectoral programme approved by the Commission under
                                                                 Article 5 (1) of Regulation (EEC) No 355/77 and that
                                                                 the implementation period laid down has not expired.
Payment to final recipients must take place within four
weeks of the date when the application was lodged,
provided that the application contains all the documents
required to establish that the expenditure was justified.                                 Article 20
                                                                                 Discontinuance of carry-over
3.     At the end of each quarter the authority or inter-
                                                                 By way of derogation from Article 10 (3) of Regulation
mediary referred to in paragraph 1 shall forward to the
                                                                 (EEC) No 4256/88, Article 21 of Regulation (EEC) No
Commission a statement of the payments made to reci-
                                                                 355/77 shall not apply to projects which have not been
pients, indicating the references of the supporting
                                                                 granted aid from the Fund for 1990.
documents in its possession.
4.     An implementation report shall be sent to the                                      Article 21
 Commission every half-year.
                                                                 Transitional provisions for payments in respect          of
                                                                        projects under Regulation (EEC) No 355/77
                          Article 18
                                                                  1.    From 1 January 1991, the payment of aid in respect
                    Checks and penalties                         of the projects referred to in Article 10 (3) of Regulation
                                                                  (EEC) No 4256/88 shall be carried out in accordance
 1.    The authority designated in accordance with Article       with Articles 17 and 18 of this Regulation.
 14 (1) of Regulation (EEC) No 4253/88 or, were appro-
priate, the intermediary referred to in Article 16 (1) of
 that Regulation shall forward to the Commission, at the
                                                                  2.    Member States shall, not later than 15 December
 latter's request, all supporting documents and evidence
                                                                  1990, communicate to the Commission:
 that can establish that the financial or other conditions
 have been met. The Commission may carry out
 on-the-spot checks.
                                                                 — the authorities they have designated to pay out the
                                                                      aid in question,
 2.    The Commission may decide to suspend, reduce or
 cancel assistance from the Fund granted in accordance
 with Articles 15 (1) and 14 (2) of this Regulation:             — the estimated amount of the payments for the first
                                                                      half of 1991, and
 — if the investments have not been implemented as
     provided for, or                                            — the basis on which that estimate was calculated.
 ---pagebreak--- No C 240/22                           Official Journal of the European Communities                             20. 9. 89
3.    On receipt of the duly reasoned communication,                                     Article 23
the Commission shall make an initial lump-sum payment
and will make additional payments on the basis of the                                   Application
quarterly statements referred to in Article 17 (3)              The Commission shall adopt detailed rules for the
according to the estimated needs communicated by the            application of this Regulation.
Member States.
                         Article 22                                                      Article 24
                 Extension of programmes                                              Entry into force
Specific programmes relating to agricultural products           This Regulation shall enter into force on the third day
approved in accordance with Article 5 of Regulation             following its publication in the Official Journal of the
(EEC) N o 355/77 for which the deadlines for                    European Communities.
completion are between 1 January 1989 and the date of
entry into force of this Regulation shall be extended until     This Regulation shall be binding in its entirety and
the end of the period referred to in Article 19.                directly applicable in all Member States.