CELEX: 51988PC0817
Language: en
Date: 1988-12-15
Title: Proposal for a COUNCIL REGULATION (EEC) derogating from Regulation (EEC) No 797/85 as regards certain investment aids in the pig production sector (presented by the Commission)

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Vol. 1988/0269
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                            COM(88 ) 817 final
                                           Brussels , 15   December 1988
                              Proposai for a
                       COUNCIL REGULATION ( EEC )
         derogating from Regulation ( EEC ) No 797 / 85 as regards
         certain investment aids in the pig production sector
                   ( presented by the Commission )
 ---pagebreak---                                                                           £rr> f'i't'f.
                      INVESTMENT AIDS IN THE PIG PRODUCTION SECTOR
    I. INTRODUCTION
        Investment ait’ for pig farming is limited by Regulation ( EEC ) No 797 / 85
       on improving the efficiency of agricultural structures . When the Council
        took its Decision of 29 March 1988 on the amendment of that Regulation ,
        the Belgian , Greek and Spanish delegations raised the question of
       applying the condition contained in the last subparagraph of Article 3(4 )
       of Regulation ( EEC ) No 797 / 85 restricting the granting of investment aid
       to holdings of a minimum area .
       As Coranunity legislation currently stands , pig farms are not eligible for
       national or Community aid unless the size of the holding concerned is
       great enough to allow at least 35% of the feed consumed by the pigs to be
       produced on site ; this is what is termed the " 35% clause ".
       The Council has undertaken to draw up a report together where appropriate
       with suitable proposals . This is the reason for this communication .
  II . ORIGIN, NATURE AND AIMS OF THE " 35% CLAUSE "
       The clause which provides that a holding must be able to produce at least
       35% of the feed consumed by its pigs in order to qualify for investment
       aid was introduced into Community regulations from the outset of
       arrangements for Community aid for investment in farm holdings , and is
       contained in Article 9(2 ) of Council Directive 72 / 159 / EEC of 17 April
       1972 on the modernization of farms ( 1 ).
( 1 ) OJ No L 96 , 23.4.1972 .
                                                                                        2
 ---pagebreak---                                               - 2 -
        The reason behind the clause was that measures to encourage investment in
        pig production had to take account of the production aims of the
        Community and therefore not encourage the development of intensive
        production units which had no link with the land . In order to comply with
        this clause , pig farms must have a sufficient agricultural area
        ( approximately 4 hectares for the equivalent of 100 fattening pig
        places ); such an area is furthermore necessary for rational spreading of
        the waste produced by the pigs (manure * dung liquor and slurry ) while
        safeguarding the quality of the environment and particularly water
        resources . Limits on the aid to this sector were subsequently tightened
       under Council Regulation ( EEC ) No 1945 / 81 of 30 June 1981 ( 2 ), which
       generally limits to 550 the maximum number of pig places eligible for
        the aid .
       Régulation ( EEC ) No 797 / 85 ( 3 ) confirma the restrictions on investment
       aid for pig production by both limiting the number of pig places and
       introducing the " 35% clause " to take account of the aira of achieving
       balance on the market . Régulation ( EEC ) No 1137 / 88 ( 4 ) tightens the
       restrictions on the number of pig places .
       Since 1972 , therefore , successive Community investment aid schemes have
       restricted the development of intensive pig rearing in industrial-style
       units which are not linked to the land ; this was intended to promote
       market balance but has also served to safeguard the quality of the
       environment .
III . THE SITUATION IN PIG FARMINO
       In 1977 , pigs were farmed on 32.9% of holdings in the Community of Ten , a
       figure which had dropped to 20.3% in 1985 .
       In contrast , holdings with 400 or more pigs accounted for 1.5% of the
       total number of holdings with pigs in 1977 , a figure which rose to 3.9%
       in 1985 ; these holdings had 23.6% of the herd in 1973 and 57.9% in 1986 .
       Despite restrictions on investment aid , therefore , pig production became
       heavily concentrated . The average number of pigs per holding engaging in
       pig production is particularly high in five of the Member States , as is
       shown by the 1986 figures : Netherlands ( 343 ), United Kingdom ( 336 ),
       Denmark ( 205 ), Belgium ( 179 ) and Ireland ( 140 ); in the remaining
       Member States the average is below 70 .
       As regards self-sufficiency in pigmeat , the figures were 100% in 1974 and
       103% in 1987 ; the abovementioned Member States , with the exception of the
       United Kingdom , have large surpluses . In 1985 the figures were as
       follows : Denmark ( 300% ), Netherlands ( 288% ), Belgium ( L57% ) and
       Ireland ( 124% ).
(2)   0J No L   197 , 20.7.1981 , p.  31 .
( 3 ) 0J No L     93 , 30.3.1985 , p.   1.
( 4 ) 0J No L 108 , 29.4.1988 , p.      1.
 ---pagebreak---                                               3
IV . SPECIFIC PROBLEMS RELATED TO THE APPLICATION OF THE " 35% CLAUSE "
     When the Council took its Decision of 29 March 1988 , some delegations
      raised the following specific problems :
      1 . The request from Belgium : encouragina " closed-circult " pie rearing
          The Belgian Government takes the view that the " 35% clause " is an
          obstacle to converting farms which specialize in finishing into
          "closed-circuit " farms , that is holdings on which both farrowing and
          finishing take place . Belgium wishes to encourage "closed-circuit " pig
          production as part of the effort to eradicate classical swine fever .
          It has therefore asked that this limiting clause be waived in cases
          where a finishing unit is converted into a farrow- to -finish unit . The
          case in Belgium is that piglets are generally born in the eastern
          provinces but fattened in the western provinces . In concrete terms ,
          this accounts for a large volume of trade , with numerous middlemen
          involved in transporting the piglets and with many sources of supply
          for a single finishing unit ; this intensive network of trade
          encourages the spread of pig diseases .
     2 . Greece's _problem : small holdings with little land
          The Greek Government considers that the " 35% clause " precludes the
          granting of investment aid to pig farms since pig units in Greece do
          not have enough land to comply with this condition . Nonetheless , the
          sector needs to reduce production costs , improve carcase quality ,
          raise consumption and protect the environment .
     3 . Spain 's problem : modernizing unhygienic units
          The Spanish Government considers that the " 35% clause " is an obstacle
          to putting up modem , hygienic buildings within existing units since
          these units do not have enough land to comply with the clause .
V. CONCLUSIONS
     1 . The Commision considéra that the situation on the pigmeat market
          remains worrying and consequently the limits existing since 1972 on
          investment aid in this sector , tightened up by Régulation ( EEC )
          No 797 / 85 , cannot be abolished . Nevertheless , the Commission
          recognizes the value of improving the animal health situation in
 ---pagebreak---                                       - 4 -
     certain Community areae covered by a plan to eradicate swine fever or
      featuring              small holdings , unproductive land and
     unsatisfactory rearing conditions from the animal health viewpoint .
     Since investment aids may contribute significantly towards improving
     the health situation in these areas and since the " 35Z clause " laid
     down by Regulation ( EEC ) No 797 / 85 constitutes a real curb   such
     improvement , it is proposed to lay down special conditions for the
     granting of such investment aids in those areas . In order to emphasize
     that these provisions are quite exceptional and that the general rule
     on investment aid remains the application of Regulation ( EEC )
    No 797 / 85 , Che Commission considers that these provisions must be the
     subject of an ad hoc Council Regulation and that Regulation ( EEC )
    No 797 / 85 must not be amended .
2 . The Commission proposal therefore provides that the Member States , on
     the basis of an application with supporting documents , may be
    authorized to grant investment aids in the pig production sector by
    way of a derogation from the last subparagraph of Article 3(4 ) of
    Regulation ( EEC ) No 797 / 85 subject to compliance with certain
    conditions . The Commission considers that such authorizations relate
    to the Member States mentioned in the statement included in the
    minutes of the Council of 29 March 1988 , namely Belgium , Greece and
    Spain . The enacting terms distinguish between two types of situation
    depending on whether the animal health problems stem from the
    introduction on the holding of contaminated livestock or from the lack of
    hygienic      conditions on the holding itself .
    In both cases provision is made to replace the obligationon capacity
    to produce at least 351 of the feed consumed by the pigs by an
    obligation to have at least 1 hectare of agricultural area per 100 pig
    fattening places : this represents a substantial relaxation since to
    satisfy the " 351 clause " holdings must have an average of 4 hectares of
    agricultural area for the equivalent of 100 pig fattening places . The
    other restrictive conditions laid down in Regulation ( EEC ) No 797 / 85
    remain applicable ( number of places and amount of aids ). Furthermore ,
    this relaxation of the " 351 clause " is restricted to :
    - areas where the " 35Z clause " is a curb on the necessary improvement
       of the health situation ;
    - investments actually contributing towards improving the health
       situation of the holding ;
    - cases where production capacity is not Increased .
 ---pagebreak---                                - 5 -
 For the sake of consistency with the provisions of the fourth and fifth
subparagraphs of Article 3(4 ) of Regulation ( EEC ) No 797 /85 , which
allow for an adjustment of the investment aid scheme in the pigmeat
sector from 1 January 1991 , the authorizations provided for expire on
31 December 1990 .
 ---pagebreak---                                        Proposai for a
                               COUNCIL REGULATION ( EEC ) No
                                             Of
                derogating from Regulation ( EEC ) No 797 / 85 as regards
                 certain investment aids in the pig production sector
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community , and
in particular Articles 42 and 43 thereof ,
Having regard to the proposal from the Commission ( 1 ),
Having regard to the opinion of the European Parliament ( 2 ),
Whereas the last subparagraph of Article 3(4 ) of Council Regulation ( EEC ) No
797 /85 of 12 March 1985 on improving the efficiency of agricultural structures
( 3 ), as last amended by Regulation ( EEC ) No 1137 / 88 ( 4 ), provides that the
granting of investment aid in the pig production sector is to be subject to
the condition that the equivalent of at least 35% of the feed consumed by the
pigs can be produced on the holding ;
Whereas the investments for improving the health situation of pig farms in
certain Community areas covered by a swine fever eradication plan or a feature
of which is small holdings , unproductive land and unsatisfactory rearing
conditions from the animal health viewpoint cannot in all cases be achieved
while complying with the abovementioned condition ;       whereas , however , national
( 1 ) OJ No 0
( 2 ) OJ No C
( 3 ) OJ No L 93 , 30.3.1985 , p. 1 .
( 4 ) OJ No L 108 , 29.4.1988 , p. 1 .
 ---pagebreak---                                               2
aids should be authorised on application by the Member States with supporting
documents to enable such improvement to be achieved ,
HAS ADOPTED THIS REGULATION :
                                          Article 1
By way of derogation from the last subparagraph of Article 3(4 ) of Regulation
( EEC ) No 797 / 85 , the Commission may , in accordance with the procedure referred
to in Article 25 of that Regulation , authorise a Member State to grant
investment aid to improve the animal health situation in the pig production
sector , subject to compliance with the limits provided for in the last
subparagraph of Article 3(4 ) and in Article 4 of that Regulation together with
the following conditions :
1.   As regards stock ferma fattening piglets front other holdings :
     ( a ) the holding shall be located in an area covered by a swine fever
           éradication plan ;
     (b ) the pig farming system shall be converted into closed-circuit
           breeding , that is a farrow-to-finish system ; it shall entail clear ,
           effective separation between the breeding and fattening units ;
     ( c ) the aid shall relate only to investments actually concerning to the
           conversion of fattening pig places into breeding sow places and to
           investments enabling contact to be prevented between the herd with
           neighbouring herds or with other sources of contamination ; such
           investments must comprise measures to refurbish existing pig housing
           installations with a view to effective animal health protection ;
             J
 ---pagebreak---                                                3
      ( d ) the total number of pig places after the investments have been made
            shall not exceed the number of places before conversion .
 2. As regards pig farms not offering sufficient health guarantees , in
     particular farms with pigs running free outside or in old buildings :
     ( a ) the farm shall be located in an area a feature of which is small
            holdings and unproductive land ;
     ( b ) the aid shall relate only to investments for constructing or
            renovating buildings to improve the existing herd situation as regards
            health , production quality , working conditions and environmental
            protection ;
    ( c ) the total number of pig places after the investments are made shall
            not exceed the number of places required for housing the herd existing
            previously on the holding .
3.  In the two abovementioned cases , the holding shall hâve at least one
    hectare of agricultural area for each 100 fattening pig places .
                                          Article 2
The authorisations referred to in Article 1 shall cease to be applicable after
31 December 1990 at the latest .
                                          Article 3
This Régulation shall enter lnto force on the day following its publication in
the Official Journal of the Européen Communities .
This Regulation shall be binding in its entirety and directly applicable in
all Member States .
                                                            For the Council