CELEX: 51976PC0531
Language: en
Date: 1976-10-14
Title: PROPOSAL FOR A COUNCIL REGULATION (EEC) AMENDING THE EWCHANGE RATE TO BE APPLIED TO THE IRISH POUND AND THE POUND STERLING FOR AGRICULTURAL PURPOSES. (submitted to the Council by the Commission)

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COM (76) 531
Vol. 1976/0163
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 ---pagebreak---       COMMISSION OF THE EUROPEAN COMMUNITIES
                                                             COM(76)531 final.
                                                                 Brussels . 4th October 1976'
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                             PROPOSAL FOR A COUNCIL REGULATION ( EEC )
                                                               /
                             AMENDING THE EWCHANGE RATE TO BE APPLIED
                             TO THE IRISH POUND AND TUB POUND STERLING
                 V:       , FOR AGRICULTURAL PURPOSES . .    ;       ...  ,
            -, • ■
                              _                    - «   t .
                      (/ submitted
                                •  . J A. ^
                                       to the Council    by theV Commission
                                                                  /I     J __ _ _? \
                                                                                   ) .    .
                                                                                                \
                                                                                              £
     CCM(76) 531 final .
•j
   f
 ---pagebreak---                     EXPLANATORY MEMORANDUM
 Council Regulation (EEC ) No 557/ 76 of 15 March 197^ on 'the exchange rates
 to be applied in agriculture (OJ No L 67 , 15 March 1976 , p. l ) fixed a
new representative rate for the Irish pound and retained unchanged the
representative rate for the pound sterling which had been applied since
27 October 197%
In recent weeks f these two currencies have depreciated sharply , with
the result that the differences used to . calculate monetary compensatory
                    V
amounts have widened appreciably .
These amounts are used to compensate in the short term for fluctuations in
the exchange rates of  currencies in relation to the rates used to fix
agricultural prices .  When the difference between the "green" rr.te and "the
real rate widens , the monetary compensatory amounts , instead of preventing
distortions , actually give rise to serious imbalances , thus preventing
a return to a normal balance .
Differences in the region of 30% have rarely been recorded before .
Moreover , the financial implications for the Community ar ^ very serious :
If the monetary compensatory amounts were to be maintained at a rate based
on the provisional average for the present week and remained unchanged for
the whole of 1977 , appropriations totalling 900 million u.a. would be
required , whereas the estimate for the EAGGP Guarantee Section budget for
1977 is 582 million u.a .
It would therefore be appropriate to change the representative rates for
these currencies so as to bring about :
       a substantial adjustment in the case of Ireland , and
       in the case of the United Kingdom ail adjustment to prevent the
       difference in relation to the real rate from widening still
       further by maintaining the monetary compensatory amounts s,t
       the previous week*s level .
The table below shows the implications of the proposed measure :
 ---pagebreak---                                                  - 2 -
                                                                                  Effects of
Member State       Old rate            new rate         devaluation in % price        monetary c                , t aav
                                                                         increase     amounts * calculate-*'  '
                                                                         in %         on the basis of the
                                                                                      average between 22.9
                                                                                      and 1.10.1976
Ireland        £1=1 . O 9653 u.a . £1=1.56773 u.a .          7.589        8.212         20.3 applies - •
               1 u.a . = £0.589438 1 u.a – £0.637345                                    21.8 real
                                                                             7
United Kingdom £1=1.75560 u.a .    £1=1 . O 7642 "u.a .                   4.723
                                                                                        28.7  applied *"     -    %
                                                             4.510                      30.2 real
               1 u.a . =£0.569606  I u.a . =£0.596509
 ---pagebreak---                            COUNCIL REGULATION ( EEC )
                           amending the exchange rate to be applied
                           to the Irish pound and the pound sterling
                           for agricultural purposes
 THE COUNCIL OP THE EUROPEAN COMMUNITIES ,
 Having regard to the Treaty establishing the European Economic Community ,
 Having regard to Council Regulation No 129 on "the value of the unit of account
 and the exchange rates to be anplied for the purposes of the common agricultural
 policy      , as last amended by Regulation (EEC ) No 2543/73  , and in particular
 Article 3 thereof ,
 Having regard to the proposal from the Commission ,
Vfhereas Council Regulation (EEC ) NO 5137/76 of IS March 1976 on the exchange
rates to be applied in agriculture and repealing Regulation (EEC ) No 475/7'          t
as last enended by Regulation (EEC) No 145l/76^\ fixed representative rates
 for the Irish pound and the pound sterling ; whereas the movement of these two curren­
cies indicates the advisability of fixing new representative rates which rcf_ect
more closely the present economic situation ; whereas it would be appropriate to
bring them into force in principle on the dates on which a price change occurs ?
Whereas the Monetary Committee will be consulted and whereas , in view of the
urgency of the matter , the proposed measures should be adopted under the
conditions laid down in Article 3(2 ) of Regulati on No 129 »
HAS ADOPTED THIS REGULATION :
                                     Article 1
In Article 2(l ) of Regulation (EEC ) No 557/76 , points (e ) and ( h ) are arnenc.ec   .
as follows :
"( e ) for the Irish pound :
        £1 Ir = I.56778 units of account
  ( h ) for the pound sterling :
        £1 = 1.67&42 units of account ;"
( 1 ) OJ N.i 106 , 30 October 1962 , p . 2553
( 2 ) OJ No L 263 , 19 September 1973 , P * 1
( 3 ) OJ Ho L 67 , 15 foarch 1976 , p. 1
( 4 ) OJ iTo L lb3, 24 June 1976 , p * 5
 ---pagebreak---                                   Article 2
This Regulation shall enter into force on 11 October 197° •
However , for the purooses of calculating monetary compensatory amounts ar.i
factors for determining differential amounts applicable to colza and rap^
seed , it shall take effect from 4 October 1976 *
This Regulation shall be binding in its entirety and directly applicable in
all Member States .                          _
Done at Brussels .                                  For the Commission
 ---pagebreak---                 INCl DKNOKîi KTMANOX
 1 » La présente proposition amene,par rapport aux pourcentages
     MCM , qui résulteraient tels récente évolution monétaire , à
     une réduction de CCÎS pourcentages rie    - 6,2 points pour le i- St
                                               - 10 pointe pour lo      Irlandais .
     Comme il s' agit d' une modification du taux reprôsentati fn , il y      ,
     a également un effet de double taux .
2 » L' incidence financière 66 chiffrç comme suit :                        ....... j
                                                 Variatio n de s dép enses
                                                 ( 12 mois en Hue )
     U.K. - réduction des MCM de 6,2 points            - 1o6
                          ( 6,2 x - JO Mue )
           - effet de double taux Fur les
             dépenses autres que les MCM               +   8
     Irlande •* réduction des MCM de 10 points
                 ( 10 χ + 9,2 )                        +  92
           - effet do double taux sur les dépenses
             autres que les MCM                        +  20
     TOTAL                                             -  66
3.   Compte tenu de la date d' entrée en vigueur et des délais de
     paiement , l' incidence au titre du budget 1976 sera limitée à
     environ - 10 MUC .