CELEX: 51989PC0061
Language: en
Date: 1989-02-06
Title: Proposal for a COUNCIL REGULATION (EEC) establishing a system of transitional aids to agricultural income (presented by the Commission)

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COM (89) 61
Vol. 1989/0022
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                             COM(89 ) 61 final
                                             Brussels , 9 February 1989
                                                                        /
                            Proposal for a
                       COUNCIL REGULATION ( EEC )
    establishing a system of transitional aids to agricultural
                                income
                   ( presented by the Commission )
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                                                                          : 9 :
                         Consolidated text of a proposal for a
                          COUNCIL REGULATION ( EEC ) No   / 89
                                    of
          establishing a system of transitional aids to agricultural income
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 ),
                                 Ί
Having regard to the opinion of the Economic and Social Committee ( 3 ),
Whereas the Community 's policy on agricultural structures has been
supplemented by certain measures designed , in particular , to make it easier
for farmers to adapt to the new circumstances obtaining on agricultural
markets in the context of the current reform of the common agricultural policy
and in particular of the adjustment of the market organizations ;   whereas ,
however , such measures may not provide sufficient assistance for certain
categories of family holdings ;
( 1 ) OJ No C 180 , 9.7.1988 , p. 9 .
( 2 ) OJ No C 290 , 14.11.1988 , p.
( 3 ) OJ No C
 ---pagebreak---                                            2
 Whereas , this being the case , and in accordance with the conclusions of the
 European Council held in February 1988 in Brussels , Member States should have
 the option of granting transitional aids to agricultural income to provide
backing for the efforts of weak agricultural holdings , which would otherwise
not be able to adapt successfully owing to their economic and structural
 situation , to adjust ; whereas such aids also contribute towards maintaining a
fair standard of living for the agricultural community in accordance with the
objective laid down in Article 39(l)(b ) of the Treaty and therefore towards
safeguarding the balances necessary to the vitality of rural society , given
 the requirements relating to the protection of the landscape and of the
environment ;
Whereas , in order to ensure the necessary transparency of such temporary aids
and compliance with Community conditions laid down to prevent any jeopardizing
of the Community 's objectives as regards market reform in particular , the aids
to income under consideration should be granted subject to prior approval by
the Commission of programmes of agricultural income aids drawn up by the
Member States planning to introduce such measures ;    whereas , in order to avoid
distortion of competition between agricultural producers , such programmes rm. . . :
in particular establish and comply with the link existing between the aid
provided for and the prejudice resulting from the adjustment of conditions on
the markets ;
Whereas account should also be taken of the fact that the holdings of the type
concerned are unevenly distributed in the Community and are relatively
concentrated in the Member States where budget funds and , consequently , the
possibilities for granting transitional aids are much more restricted than in
other Member States ; whereas the cohesion sought by the Single Act therefore
requires , in the latter cases in particular , a Community contribution towards
the income aids granted to persons practising farming as their main
occupation ; whereas the level of the Community contribution must be varied
according to the requirements and the financial resources available in the
various regions of the Community ;
 ---pagebreak---                                            - 3 -
 Whereas the Community contribution is to be financed from appropriations
 entered in a special chapter of the general budget of the Community ;      whereas ,
 in order to facilitiate the management and financial execution of the system ,
 the financing rules should be those applying to the EAGGF Guarantee Section
 under Council Regulation ( EEC ) No 729 / 70 of 21 April 1970 on the financing of
 the common agricultural policy ( 1 ), as last amended by Regulation ( EEC ) No
 3183 / 87 ( 2 ),
HAS ADOPTED THIS REGULATION :
                                         Article 1
1.    To assist family holdings to overcome income difficulties as a result of
      the new circumstances obtaining on the markets in the context of the
      reform of the common agricultural policy , a Community system is hereby
      instituted whereby the Member States may be authorized to grant
      transitional aids to agricultural income , hereinafter referred to as
      " income aids ".
      Articles 92 , 93 and 94 of the Treaty shall not apply to the aids granted
      in conformity with this Regulation .
2.    Income aids may contribute in particular to :
      ( a ) safeguarding income at fair levels during a process of adaptation
            which may affect the structure , organization or management of
            agricultural holdings ;
      ( b ) alleviating the impact , in terms of income , arising from the financial
            obligations of agricultural holdings ;
      ( c ) supporting the level of agricultural income during efforts to
            diversify the farmer 's activity outside agriculture .
                                                                              /
      They must not stimulate agricultural production nor bring about distortion
      of competition .
( 1 ) 0J No L 94 , 28.4.1970 , p. 13 .
( 2 ) OJ No L 304 , 27.10.1987 , p. 1 .
 ---pagebreak---                                             - 4
 3.    The Community shall contribute towards the financing of the income aids on
       the terms laid down in Title II .
                                          TITLE I
                                The system of income aids
                                         Artide 2
Income aids may only be authorized within the scope of this system where :
( a ) they are covered by a programme drawn up by the Member State concerned in
      accordance with Article 3 ;
( b ) the recipients meet the conditions laid down in Article 4(1 );
( c ) they do not exceed in amount the level determined in accordance with
      Article 5 ; and
( d ) they are granted in compliance with the special detailed rules referred to
      in Article 6 .
                                         Article 3
1.    Programmes of agricultural income aids ( hereinafter referred to as "PAIA")
      shall constitute the general framework laid down by the Member State
      concerned for granting income aids at national , regional and / or sectoral
      level .
2.    Each PAIA shall include at least the following details :
      ( a ) the actual objectives sought by the introduction of the PAIA ;
      ( b ) the geographical area and , where appropriate , the agricultural sector
            or sectors concerned by the PAIA ;
      ( c ) definition of the potential recipients of the income aid in compliance
            with the concitions laid down in Article 4 ;
 ---pagebreak--- î/.,
                                                 5
         ( d ) detailed rules for granting the aid in compliance with the conditions
               laid down in Articles 5 and 6 , with justifications for the prejudice
               referred to in Article 5 , as intended to serve as a basis for the
               granting of the aid ;
         ( e ) the maximum overall annual amount of estimated expenditure resulting
               from the application of the PAIA , with details of the amount likely to
               qualify for a Community contribution under Articles 8 and 9 .
     3. Where the geographical scope of the PAIA is not the national territory , it
        shall be delimited in terms of the administrative regions of the Member
        State concerned ; however , it may relate only partially to one or more
        administrative regions where the socio-structural characteristics of
        agricultural holdings are broadly homogeneous in the planned area of
        application .
                                            Article 4
     1. The farmers and members of their families working on the holding may
        qualify for income aid only where the overall family income amounts , per
        work unit , to less than a threshold determined by the Member State
        concerned , having regard to the national provisions in force for similar
        measures and the objectives and detailed rules on granting the aid laid
        down in the PAIA in question .
        That threshold may in no case exceed 70% of the national gross domestic
        product or 90% of the regional gross domestic product per member of the
        working population .
        " Overall family income " means the income of the farmer and of those
        members of his family working on the holding , including any
        non-agricul tural resources .
 ---pagebreak---                                           - 6 -
 2.  The agricultural income of the holding to be taken into account shall be
     established by means of accounting figures or other objective criteria
     relating to the holding , to be determined in accordance with the procedure
     laid down in Article 13 .
                                        Article 5
1.   The level of income aid shall be determined on the basis of the prejudice
    arising for potential recipients from the adjustment of the markets in the
    context of the reform of the common agricultural policy and of the
    adjustment of the market organizations ; it shall be established , as the
    Member State concerned so chooses , on a flat-rate or individual basis .
2.  Where the level of the aid is established on a flat-rate basis for the
    PAIA application area :
    ( a ) the prejudice referred to in paragraph 1 shall , in compliance with the
          detailed rules to be adopted in accordance with the procedure provided
          for in Article 13 , be established overall on the basis of a
          multi-annual reference period for the holdings in the area and / or the
          PAIA sector in question , expressed as a total amount ;
    ( b ) the aid granted to individual recipients in the area and / or the sector
          of application may not exceed overall the amount referred to in ( a );
          it may be granted on the basis of objective data relating to the
          holding ( UAA , standard gross margin , etc .).
3.  Where the level of the aid is established individually , it may at most
    cover the prejudice referred to in paragraph 1 , suffered by the holding
    concerned . That prejudice shall be established on the basis of a
    multi-annual reference period and in compliance with detailed rules to be
    determined in accordance with the procedure laid down in Article 13 .
                                        Article 6
1.  The detailed rules for granting the income aids shall be governed by the
    following special conditions :
    ( a ) they may not be granted on the basis of the prices and / or quantity of
          production of the holding ci-noemed ;
 ---pagebreak---                                         - 7 -
    ( b ) they may be granted to an individual recipient only degressively and
          for no more than a maximum of five years from the first payment ;
    ( c ) the Member States shall exclude from income aids such households where
          farming accounts for a negligible part of the income .
2.  In order to prevent distortion of competition , maximum amounts of aid per
   work unit , expressed as a percentage of the average regional or national
   income shall be fixed in accordance with the procedure laid down in
   Article 13 .
   In no case may aid exceed 2 500 ecu per year per work unit on the holding
   concerned .
3. In order to achieve the objectives in Article 1(2 ),
   ( a ) the amount of the aid to be granted to individual recipients may be
          capitalized ;
   (b ) for the application of the threshold referred to in Article 4(1 ) and
          for the purpose of applying Article 5 , the net agricultural income of
          the holding may be used using accounting figures .
   The detailed rules for the application of this paragraph shall be
   determined in accordance with the procedure laid down in Article 13 .
                                      Article 7
1. Where a Member State plans to introduce or amend a PAIA , it shall notify
   the Commission of the draft programme or the proposed amendment . The
   notification must contain the informations required for assessing whether
   the conditions laid down in this Regulation are met .
   At the request of the Commission , the Member State concerned shall provide
   additional information for assessment purposes .
 ---pagebreak---                                             - 8 -
 22 ..  Member States may not implement the planned measures before the Commission
        has approved the PAIA concerned .
       When making its assessment the Commission shall ensure in particular that
        the planned measures are in accordance with the provisions of this
       Regulation , having regard to its objectives .
3.     Within three months from the date of receipt of a draft PAIA or amendments
        thereto , the Commission , having consulted the Committee provided for in
       Article 13 , shall decide whether to approve the draft PAIA or the
       amendments thereto provided that all the particulars listed in Article 3
       and , where appropriate , the additional information referred to in the
       second subparagraph of paragraph 1 , are provided .
4.     The first subparagraph of paragraph 2 shall be without prejudice to the
       Member State concerned implementing in the framework of a PAIA approved in
       accordance with paragraph 3 income aid measures which are more restrictive
       than those laid down in the PAIA in question as regards in particular :
       -    the geographical or sectoral scope ,
       -    the detailed rules for the grant in accordance with Articles 4 and 5 ,
            and
            the duration of application
       of income aids actually granted .
5.     In accordance with detailed rules to be determined in accordance with the
       procedure laid down in Article 13 , the Member States shall notify the
       Commission periodically of progress in approved PAIAs .
                                          TITLE II
                            Community financing of income aids
                                         Article 8
1.     Income aids which are part of a PAIA approved in accordance with Article
       7(3 ) and which , in addition to the conditions in Articles 4 , 5 and 6 ,
       relate to holdings where the farmer or a member of his family working on
       the holding possesses adequate occupational skill and competence and
       practises farming as his main occupation shall be eligible for Community
       financing .
 ---pagebreak---                                              - 9 -
       For the purposes of applying this condition , Article 2(5 ) and ( 6 ) of
       Council Regulation ( EEC ) No 797 / 85 ( 1 ) shall apply .
 2.    However , only that proportion of income aid shall be eligible for
       Community financing which :
       ( a ) is granted in respect of not more than two work units per holding and
             amounts to not more than 1 000 ecu per work unit per year , and
       ( b ) constitutes , in the second , third , fourth and fifth years of its grant
             to individual recipients , 85% , 70% , 55% and 40% respectively of the
             income aid granted to them in the first year in accordance with
             Articles 4 and 5 . .
                                                                        *
3.    To ensure that the appropriations entered in the Community budget are not
      exceeded by expenditure , additional conditions relating to the eligibility
      of PAIAs may be laid down in accordance with the procedure laid down in
      Article 13 , the EAGGF Committee having been consulted on the financial
      aspects .
                                          Article 9
1.    The Community contribution to the financing of the income aids shall
      amount    to :
             70% of the eligible amount where the holding concerned is located in a
             region covered by objective 1 in Article 1 of Regulation ( EEC ) No
             2052 / 88 ( 2 ),
      -      25% of the eligible amount in other cases .
2.    However , in accordance with the procedure laid down in Article 43(2 ) of
      the Treaty , an intermediate rate of Community contribution may be fixed
      for certain areas covered by objective 5(b ) in Article 1 of Regulation
      ( EEC ) No 2052 / 88 .
( 1 ) 0J No L 93 , 30.3.1985 , p. 1 .
( 2 ) 0J No L 185 , 15.7.1988 , p. 9 .
 ---pagebreak---                                        Artide 10
 The measures provided for in Articles 8 and 9 shall be financed from
 appropriations entered in a special chapter of the general budget of the
 Communities . The financing rules shall be those applying to the EAGGF
Guarantee Section .
                                        TITLE III
                                   General provisions
                                       Artide 11
Without prejudice to other specific or sectoral Community provisions ,
agricultural income aids shall be prohibited if the conditions or rules
governing the granting thereof differ from those laid down in this Regulation ,
and in particular if the amount of such aids is determined by reference to
prices , quantities of agricultural products or inputs .
Article 92 , with the exception of paragraphs 1 and 2 thereof , and Article 94
of the Treaty shall not apply to such aids .
                                       Article 12
Detailed rules for the application of this Regulation shall be adopted in
accordance with the procedure laid down in Article 13 .
                                       Article 13
1.  A Management Committee for Agricultural Income Aids , hereinafter referred
     to as the " Committee ", shall be set up comprising representatives from the
    Member States and chaired by a Commission representative .
2.  Within the Committee the votes of the Member States shall be weighted in
    accordance with Article 148(2 ) of the Treaty . The chairman shall not vote .
3.  Where the procedure laid down in this Article is to be followed , the
    chairman shall refer the matter to the Committee either on his own
     initiative or at the request of the representative of a Member State .
 ---pagebreak---                                          11
 4.  The Commission representative shall submit a draft of the measures to be
     adopted . The Committee shall deliver its opinion on the measures within a
     time limit which the Chairman may lay down depending on the urgency of the
     matters submitted for examination . Opinions shall be delivered by a
    majority of 54 votes .
5.  The Commission shall adopt measures which shall apply immediately .
    However , if they are not in accordance with the opinion of the Committee ,
    such measures shall be immediately notified by the Commission to the
    Council .  In this event the Commission may defer application of the
    measures which it has adopted for not more than one month as from such
    notification .
    The Council , acting by a qualified majority , may take a different decision
    within one month .
6.  The Committee may examine any other matter referred to it by its chairman ,
    either on his own initiative or at the request of the representative of a
    Member State .
                                    Article 14
1.  At the end of a three-year period starting from the entry into force of
    this Regulation , the Commission shall submit to the Council and to the
    Parliament a report on the operation of the system provided for in this
    Regulation , on the basis of the information provided by the Member States .
2.  Having examined that report , the Council , acting in accordance with the
    procedure laid down in Article 43(2 ) of the Treaty , may decide , in the
    light of experience and of the development of economic conditions and
    agricultural incomes , to amend this system where necessary .
                                    Article 15
This Regulation shall enter into force on
It shall apply until . [4 years after the entry into force ].
 ---pagebreak---                                        12
No PAIA may be approved after that date pursuant to Article 7 and no income
aid provided for in a PAIA approved before that date may be granted to
individual recipients after . [9 years after the entry into
force ] .
This Regulation shall be binding in its entirety and directly applicable in
all Member States .
Done at Brussels ,                               For the Council
                                                 The President