CELEX: 51995PC0515
Language: en
Date: 1995-10-30
Title: Amended proposal for a COUNCIL DECISION on a Community financial contribution towards certain expenditures incurred by the Member States in implementing the monitoring and control system applicable to the commom fischeries policy

COMMISSION OF THE EUROPEAN COMMUNITIES
                                                Brussels, 30.10.1995
                                                COM(95) 515 final
                                                95/0142 (CNS)
                            Amended proposal for a
                            COUNCIL DECISION
 on a Gbmnmnity financial contribution towaids certain expenditures inclined by
the Member States in implementing the monitoring and control system applicable
                       to the commonfisheriespolicy
          (presented by the Commission pursuant to Article 189 a (2)
                                of the EC-Treaty)
 ---pagebreak---  ---pagebreak---                             EXPLANATORY MEMORANDUM
In June 1995, the Commission sent the Council a proposal for a Council Decision on a
Community financial contribution towards certain expenditures incurred by the Member
States in implementing the monitoring and control system applicable to the common
fisheries policy1.
On 13 October 1995, Parliament adopted a resolution delivering a favourable opinion on
the proposal, with 11 amendments.
To improve the etfectiveness of the Community's financial contribution, the Commission
agreed to include the following amendments in its current proposal, which stipulate that:
        the control programme must be based on a risk analysis (amendment 3)
        the Community contribution must be significant (amendment 4)
        a financial commitment statement must be sent to the Commission by the Member
        States subsequent to an application for funding (amendment 8);
        the Commission is to set a time limit on the inquiries carried out by the Member
        States if it feels that the facilities are not being used for the purposes intended
        (amendment 11).
These amendments clarify the initial proposal.
The Commission did not agree to the other amendments because they could formally
harm the content of the proposal.
Adoption of Parliament's amendments by the Council will show that the political
authorities unanimously agree on the need for a Community financial contribution to
implement the monitoring and control system applicable to the common fisheries policy.
        COM(95) 243 final.
                                                                                  >
 ---pagebreak---                      AMENDED PROPOSAL FOR A COUNCIL DECISION
         on a Community financial contribution towards certain expenditures incurred by
        the Member States in implementing the monitoring and control system applicable
                                   to the common fisheries policy
The proposal is amended as follows:
                                           Recital 4a (new)
Whereas the control programme must be based on a risk analysis of the areas most likely to be
the subject of fraudulent or irregular activity;
                                               Récitai 6
Whereas, in order to ensure supervision of all the catches and landings required if the common
fisheries policy is to be really implemented. Member States must, in all maritime waters, monitor
the activities of Community and third-country vessels, whereas a significant Community
contribution towards certain inspection and monitoring expenditures incurred by the Member
States is therefore required.
                                        Article 5, paragraph 1
    Member States wishing to benefit from a Community financial contribution towards the
    expenditure referred to in Article 2 shall forward to the Commission, on the first occasion
    before 15 November 1995 and subsequently before 31 May of each year, an application for
    funding for the following year containing the information specified in points 1, 2 and 3 of the
    Annex hereto. In order to take account of the constraints of the Member States' budgetary
    procedures, an annex updating the original application including a financial commitment
    statement, should be forwarded to the Commission before 30 September of each year.
                                                                                  ir_
 ---pagebreak---                                   Article 10, third paragraph
If the Commission considers that the facilities are not being used for the intended purpose or in
accordance with the conditions set out in this Decision, it shall inform the Member State
accordingly. The Member State shall then conduct an inquiry in which Commission officials
sMI participate whenever possible. Within a time limit decided by the Commission, the Member
State shall inform it of the progress and results of the inquiry and provide the Commission
without delay with a copy of the report of the inquiry and the principal data used in preparing
it.
                                                                                     Ill
 ---pagebreak---                                   FINANCIAL STATEMENT
Heading R2-901: financial participation in inspection and monitoring operations
1.    Title of operation
      Financial participation in inspection and monitoring operations.
2.    Budget heading involved
      B2-901.
3.    Legal basis
      Article 43 of the Treaty and Council Decision 89/631/EEC.
4.    Description of operation
      4.1     General objective of operation
              The question of financial assistance for inspection operations carried out by the
              Member States was raised when the CFP was introduced. After a preliminary
              stage, assistance of an initial amount of ECU 22 million per annum was granted
              for the period from 1991 to 1995 on the basis of Decision 89/631/EEC, allowing
              the Commission to contribute up to 50% of expenditure on equipment incurred by
              the Member States. The Council undertook to decide on future provisions before
              30 June 1995 on the basis of a report drawn up by the Commission. In the mean
              time, the Council has taken other decisions which have a bearing on this question.
              When the new control Regulation was adopted, the Council said that the current
              system of inspections would now extend to new areas and required the
              implementation of additional measures not covered by the previous Decision
              (89/631/EEC)1. The range of operations for which a financial contribution could
              be made to the expenditure of the Member States would therefore have to be
              widened:
  OJ No L 364, 14.12.1989, p.64.
 ---pagebreak---            - .    Support for investment expenditure must continue to be a priority for
                  financial assistance. The acquisition of heavy equipment is particularly
                  difficult tofinancefromnational budgets. Moreover, the investments made
                  during the period 1989 to 1995 have not fully covered needs as shown by
                  the assessments made by the Member States for the period 1996 to 2000.
                  The working life of the equipment concerned ranges from several decades
                  (seagoing equipment) to several years (motor vehicles, computer
                  equipment, technical inspection equipment), airborne inspection equipment
                  coming somewhere in between. The equipment with a short working life
                  will have to be replaced within the next five years. Even amongst the
                  seagoing equipment there will have to be additions, replacements and
                  renewals. A greater priority will furthermore have to be given to
                  investments in modern technology. Investment will have to cover not only
                  the acquisition of equipment but also other types of expenditure, in
                  particular on software.
                  If rapid progress is to be made, integrated projects may need to be set up,
                  the financing of which, like that of the satellite pilot projects, may require
                  expenditure over and above the cost of investments. The setting-up of
                  information networks depends on such integrated projects. The agreement
                  reached in the Council in December 1994 on fisheries inspection west of
                  longitude 4°W requires very rapid implementation and specific financial
                  arrangements.
                  The serious problem of training needs to be stressed. Support must be
                  permitted for the Member States' initiatives in this area. Priority must also
                  be given to assistance for exchanges between Member States and between
                  Member States and the Commission, both for the initial training of
                  officials responsible for control and subsequently to promote temporary
                  detachments and exchanges.
   4.2     Duration of operation and provisions for renewal
           The operation forms part of a measure planned to cover the period 1996 to 2000.
           Any subsequent action will have to be decided upon before the end of the period.
5. Classification of expenditure or revenue
   5.1     Non-compulsory expenditure.
   5.2     Differentiated appropriations.
   5.3     No revenue.
 ---pagebreak--- 6. Type of expenditure or revenue
   Subsidy for joint financing with other sources in the public and/or private sector
   Subsidy in the form of a reimbursement. Possibility of paying advances.
7. Financial impact
   7.1    Method of calculating the total cost of the scheme
          The financial.contribution to investment expenditure is, inter alia, for the
          acquisition or modernization of:
                  vessels, aircraft, and land vehicles employed in the monitoring and
                  supervision of fishing activities;
                  systems for the detection and recording of fishing activities (including
                  equipment installed on fishing vessels);
                  systems for recording, managing and transmitting inspection data,
                  including computer applications and software.
          The contribution should be limited to 35%, as against 50% under the previous
          Decision.
          The financial contribution to expenditure intended to improve the application of
          the common fisheries policy as part of specific measures and projects not
          exceeding two years is limited to 50%.
          The same limit applies for expenditure on the training of national officials
          involved in inspection work, in particular in a Member State other than that in
          which they are employed.
          The Commission may, however, decide on higher rates, in particular:
                  to permit the implementation of a coordinated measure by Member States
                  and the Commission to overcome difficulties with inspection in an area of
                  Community interest;
                  to permit experimentation with and the introduction of new technology to
                  improve the control of fishing and related activities;
                  to permit an additional Community financial contribution not necessarily
                  limited to expenditure on investments in favour of Ireland for the
                  improvement of inspection work.
 ---pagebreak---      7.2 Breakdown by type of measure
                                            Commitment appropriations in ECU million
                                                                     (at 1996 prices)
              Type of measure                        Total budget over five years
         1. Investment in equipment                            140
         2. Operating expenditure (Ireland)                     10
         3. Information networks                                50
         4. Training and exchanges                               5
             Total                                             205
A more detailed breakdown of expenditure is not possible since it is up to the Member States to
submit applications. Priority should nevertheless be given to new technology and to seagoing
inspection equipment for those Member States which are still underequipped.
     7.3 Operating expenditure on studies, meetings of experts, etc. included in Part B
           The nature of this heading excludes operating expenditure of this type.
     7.4 Schedule to be completed for multiannual operations whose basic instrument contains
           "an amount deemed necessary"
           -    period: 1996 to 2000
           Commitment appropriations / payment appropriations in ECU million
                                                                      (at 1996 prices)
                                          Indicative plan
               1996       1997       1998      1999       2000        2001      Total
  CA               30       45        45        45         40                      205
  PA               10       40        40        40         40            35        205
 ---pagebreak--- 8. Fraud-prevention measures;resultsof measures taken
   Under the scheme, the Commission must take a decision every year on the Community
   contribution to expenditure incurred by the Member States. A prior appraisal is made of
   the proposals submitted by the Member States and the Commission decides on the
   eligibility of applications on the basis of the documentation submitted. Each year, after
   an interdepartmental consultation, the selected proposals are examined by the
   Management Committee for Fisheries and Aquaculture. The Commission then decides on
   the eligibility of the applications and the size of the Community contribution.
   Payment of the Commission contribution is made on presentation of duly receipted
   invoices relating to eligible expenditure actually incurred and on presentation of the duly
   completed "public contract questionnaire".
   To enable the best use to be made of assistance granted from the Community budget, the
   Member States must ensure the effectiveness of all their arrangements for controls and
   penalties and complete transparency of all procedures.
   The importance of inspection missions carried out by officials on behalf of the
   Commission in the Member States should be stressed. They enable verification of the
   conformity of equipment with the administrative documents which the authorities of the
   Member States are obliged to submit to the Commission and the effective use of all the
   control facilities part-financed by the Community. Joint missions by the Authorizing
   Office and Financial Control are planned in the beneficiary Member States.
   The above provisions will enable the Commission to evaluate the actual application of the
   Decision which will succeed Decision 89/631/EEC.
9. Elements of cost-effectiveness analysis
   Expenditure on fisheries enforcement must be set against the value of fish stocks and the
   damage caused by non-declaration (estimated at 10% of the value of the catches landed)
   and poor management (resulting in the loss of an estimated potential annual revenue of
   ECU 3 000 million).
   9.1     Specific and quantifiable objectives; target population
           Specific objectives: links with general objective
                 To provide inspection authorities with efficient, modern equipment.
                 To set up the mechanisms and computer networks necessary for the exchange
                 of information relating to enforcement operations.
                 To promote the training of those involved in enforcement operations.
 ---pagebreak---     Target population: distinguish as applicable for each objective; indicate the end-
    beneficiaies of the Community's financial contribution and the intermediaries
    involved.
    The direct targets are the national fisheries inspection authorities, but it is all those
    involved in fishing and related activities, often in regions where other economic
    activities are limited, who will benefit from efficient fisheries enforcement. It is
    not only the fisheries sector which is concerned - the ecological impact of poorly
    controlled fishing activities affects the whole of the Union as do the diplomatic
    consequences when there are inadequate controls in international or third country
    waters.
9.2 Grounds for the operation
            Need for Community financial assistance
             If the inadequacies in fisheries inspection are to be overcome, the
             Commission must take political, regulatory and budgetary action. None of
             these areas can be neglected; they are in any case linked. Progress has
             been made on regulatory provisions, essentially at the initiative of the
             Commission. The corresponding political decisions have financial
             consequences which the Commission cannot ignore.
             The existence of the common fisheries policy and the interdependence of
             the fisheries sectors in the different Member States resulting from the
             movement of fish stocks makes fisheries control a Community problem.
             Cost-benefit analyses of fisheries control cannot be carried out at Member-
             State level. Community financial solidarity is therefore essential and the
             budget heading permitting assistance towards expenditure incurred by the
             Member States is the expression and the instrument of that solidarity.
             Furthermore, the growth of that heading is the result of decisions already
             taken.
              Choice of ways and means
              *       advantages over alternative measures (comparative advantages),
              *       analysis of any simila" measures implemented at Community or
                     national level.
              The budget required for effective control is small when set against the
              economic importance of fisheries, the losses from fraud and the waste
              arising from the current ineffectiveness of the CFP. It is also small
              compared with the amounts spent in this area by other countries.
 ---pagebreak---             The Community budget for control will remain small compared with the
            expenditure of Member States, but that budget is the key to any progress.
            Reference has been made to the obligations arising from the decisions
            taken since 1991, particularly those taken by the Council. Assistance with
            the expenditure incurred by the Member States is essential.
            Community financial assistance accounts for 2.7% of the 1995 Community
            budget for fisheries and is less than 10% of the almost ECU 230 million
            per year spent by the Member States on inspection and monitoring. Of that
            amount, ECU 54 million is for investment, the rest to cover operating
            costs. That expenditure can be compared with the expenditure on controls
            by certain third countries. The annual estimated cost of enforcement
            operations carried out by Norway is NOK 500 million (ECU 60 million)
            and Canada spends CAD 85 million (ECU 58 million). The 1995 budget
            of the US Coast Guard for policing fishing activities is USD 500 million
            (ECU 390 million). Ihe Community budget for fisheries control is
            therefore modest when measured against a range of criteria.
            Main factors of uncertainty which could affect the specific results of the
            operation
            The most serious risk is that Member States will be unable to meet their
            commitments as regards part-financing and their other obligations
            (organization, personnel, penalties, etc.).
            In order for equipment towards which financial assistance has been granted
            to be used effectively, it must be used in a suitable context. Operating
            budgets, staffing, administrative organization and penalties are, without
            exception, the responsibility of the Member States. If the Member States
            do not adopt the appropriate measures, Community assistance will not
            produce the desired results. National authorities, although well-equipped,
            will not be fully effective.
9.3 Monitoring and evaluation of the operation
    Evaluation of costs
    The major difficulty is that the authorities involved in fisheries enforcement are
    often also carrying out other duties. Costs have therefore to be allocated. The most
    obvious example is operations at sea. Where these involve the armed forces, and
    even where an operation is mainly concerned with fisheries enforcement, they
    could possibly include other activities (sea rescue, demonstrating a security
    presence).
 ---pagebreak--- Whatever the difficulties, the expenditure required for effective controls is such
that appropriate accounting measures must be taken to permit an effective
breakdown of costs.
Assessment of the results
The initial indicators are a measure of the means employed: the number of days
at sea of inspection vessels or flying hours of airplanes and helicopters, the area
covered, the number of inspections carried out on land and at sea. These are
indicators of activity and not a measure of effectiveness. They must nevertheless
be part of any system for monitoring progress in enforcing the CFP.
The second set of indicators is the number of suspected infringements detected
and the penalties imposed. This information, together with the activity indicators
referred to above, are vital for any appraisal of the thoroughness of inspections
and penalties. They do not, however, give a complete picture, since the number
of suspected infringements depends on both the effectiveness of inspections and
the actual number of infringements.
As regards resource-conservation policy, the actual effectiveness of the
enforcement of the CFP should be assessed in the light of two criteria: limits on
the rate of exploitation and protection of the smallest fish (juveniles). This means
making a comparison between actual catches and authorized catches for each
stock and calculating the proportion of undersized fish taken. Paradoxically, this
is technically easier than proving individual infringements on a legally accepted
basis. Procedures can be worked out for carrying out checks to verify the catches
of a group of vessels. However statistically lax the procedures, it will be possible
to assess the reliability of such estimates and to improve that reliability as
required by adjusting the size of the samples taken. It will often be more difficult
to acquire legally acceptable proof against a probable fraudster. On the one hand,
the so-called "law of large numbers" facilitates the estimation of overall quantities,
and, on the other, the burden of proof placed on the prosecution makes the
penalization of individual infringements difficult. This duality must be an element
 in any consideration of the effectiveness of controls. It shows that it is easier than
 it is sometimes thought to measure the actual overall result of infringements.
 Scientists have regularly done this by comparing the official statistics with
estimates based on research work. The unreliability of certain official statistics
forces research institutes to devote a considerable part of their limited resources
to non-scientific work. However, in terms of enforcement, the possibility of
 quantifying fraud permits us not only to have immediate composite indicators of
 efficiency but also to target inspections in the most important areas. It therefore
 ---pagebreak---           becomes possible to rationalize inspections so that the means devoted to
          prevention and dissuasion and to the gathering of evidence necessary for the
          imposition of penalties are concentrated on the most serious problems. Such
          rationalization would not only permit a direct improvement in the effectiveness of
          controls but would also increase the credibility of controls with those working in
          the sector, who are often well-informed about large and recurrent cases of fraud.
          On an operational level, it would be useful if each Member State were able to
          verify certain catches on the basis of random checks. DG XTV should use the
          assessments made by international scientific bodies.
                        (Items for internal information purposes)
   9.4    Consistency with financial programming
          Is the operation incorporated in the DG'sfinancialprogramming for the
          relevant years?
          The operation is to be implemented under a Council Decision covering the
          period 1996 to 2000.
          To which broader objective defined in the DG's financial programming does
          the objective of the proposed operation correspond?
          The question of enforcement concerns the whole of the CFP.
10 Administrative expenditure (paît A of the budget)
   This section of the financial statement must be sent to DGs XIX and IX; DG IX will
   then forward it to DG XIX with its opinion.
   10.1    Will the proposed operation involve an increase in the number of Commission
          staff? If so, how many?
          An increase is necessary to intensify anti-fraud controls, monitoring and
          assessment. The estimated increase is 0.5 A and 1 B grade staff.
 ---pagebreak--- 10.2 Indicate the amount of staff and administrative expenditure involved in the
     proposed operation. Explain the method of calculation.
     Mission expenses: ECU 15 000
     Staffing      - 75% of the time of an A grade official
                  -   150% of the time of a B grade official
                  -  150% of the time of a C grade official
                  -  translation work (correspondence, proposed programmes,
                     Commission Decision)
     In the medium term, after the transitional phase, the additional resources might
     no longer be required.
                                       10
 ---pagebreak---                                                                    ISSN 0254-1475
                                                             COM(95) 515 final
                                              DOCUMENTS
EN                                                                            03
                                     Catalogue number : CB-CO-95-549-EN-C
                                                              ISBN 92-77-94891-4
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