CELEX: 51974PC0050
Language: en
Date: 1974-01-18
Title: Proposal for REGULATION (EEC) N°/74 OF THE COUNCIL on certain measures to be taken in agriculture for Italy as a result of the fixing, with effect from 28 January, 1974 of a new representative rate for the Italian lire Proposal for REGULATION (EEC) N° OF THE COUNCIL Amending in particular the Regulation on the exchange rate applied in agriculture for the Italian lire.

ARCHIVES HISTORIQUES
DE LA COMMISSION
COLLECTION RELIEE DES
DOCUMENTS "COM"
COM (74) 50
Vol. 1974/0012
 ---pagebreak--- Disclaimer
Conformément au règlement (CEE, Euratom) n° 354/83 du Conseil du 1er février 1983
concernant l'ouverture au public des archives historiques de la Communauté économique
européenne et de la Communauté européenne de l'énergie atomique (JO L 43 du 15.2.1983,
p. 1), tel que modifié par le règlement (CE, Euratom) n° 1700/2003 du 22 septembre 2003
(JO L 243 du 27.9.2003, p. 1), ce dossier est ouvert au public. Le cas échéant, les documents
classifiés présents dans ce dossier ont été déclassifiés conformément à l'article 5 dudit
règlement.
In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983
concerning the opening to the public of the historical archives of the European Economic
Community and the European Atomic Energy Community (OJ L 43, 15.2.1983, p. 1), as
amended by Regulation (EC, Euratom) No 1700/2003 of 22 September 2003 (OJ L 243,
27.9.2003, p. 1), this file is open to the public. Where necessary, classified documents in this
file have been declassified in conformity with Article 5 of the aforementioned regulation.
In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1.
Februar 1983 über die Freigabe der historischen Archive der Europäischen
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,
S. 1), geändert durch die Verordnung (EG, Euratom) Nr. 1700/2003 vom 22. September 2003
(ABI. L 243 vom 27.9.2003, S. 1), ist diese Datei der Öffentlichkeit zugänglich. Soweit
erforderlich, wurden die Verschlusssachen in dieser Datei in Übereinstimmung mit Artikel 5
der genannten Verordnung freigegeben.
 ---pagebreak---   COMMISSION OF THE EUROPEAN COMMUNITIES
                                                      COM(74)50 final
                                                 Brussels , 18 January 197^
                                    Proposal for
    REGULATION ( EEC ) N°              /74 OF THE COUNCIL
on certain measures to be taken in agriculture for Italy
as a result of the fixing , with effect from 28 January, 1974 of
a new representative rate for the Italian lire
                               Proposal for
                 REGULATION ( EEC ) N°        OF THE COUNCIL
   Amending in particular the Regulation
   on the exchange rate applied in agriculture for the
   Italian lire .
            ( submitted by the Commission to the Council )
   COM ( 7*0 50 final
 ---pagebreak---                         EXPLANATORY MEMORANDUM
1.  Italy recently requested that the representative rate for the
Italian lira, fixed by Regulation (EEC ) NO 295^/73 (OJ No L 303,
1.11.1973 , p. l ) and applied since 1 January 1974 , he further devalued
to Taring it closer rates ruling on the market .
To this end the Commission presents to the Council a proposal to amend
that Regulation by a devaluation of 5$. The Italian request should
in fact be acceded to because the fixing of this new representative rate
for the conversion into lira of amounts fixed in units of account within
the framework of the common agricultural policy should mean , in theory at
any rate , that prices and other amounts fixed in Ttfiits of account aji*d
expre'ssed in lira will be automatically increased by 5$« This would
represent an important step towards the re-establishment of single prioee
within the Community .                              //
2.  It was felt that , with the application of the representative rate for
the lira on 1 January 1974 , the incidence of this rate should not be
allowed to reflect immediately on Italian prices . Generally speaking,
prices in Italy are to remain at their 31 December 1973 level until the
beginning of the 1974/73 marketing year . Exceptions to the general rule
are tobacco ( tobacco prices are fixed for a crop rather than for a year )
and sugar ( delivery contracts between beet growers and manufacturers
had already been signed in the autumn) ( cf . Regulation '(EEC ) No 3450/73.
          » * » »
0J No L 353 , 22.12.1973 , P » 25 ). This rule prevents the new representative
rate from having repercussions at present on price levels in Italy .
Information now to hand indicates however that it would now be - desirable '
for the new rate to have immediate repercussions on Italian prices .      The
general economic situation calls for a rapid improvement in the. position
of farmers , in view of the potential repercussions on production .    Provisional
action has already been taken under Article 10^ of the Treaty in respect
of besef and veal which was particularly badly hit .
                                              • ¥ P
This provisional measure must now be incorporated into the framework of the - •
common agricultural policy .
 ---pagebreak--- However , a number of exceptions will have to be made .        For tobacco and
 sugar, the reaso^s^whi^h^ led to an exception being made on 1 January 1974
 still hold good , /olive oil must be excluded also ; price levels indicate
that present arrangements may be retained until the beginning of the
next marketing year .
 3*' Although the present situation calls for a further change in price
levels , it does not seem possible to waive the rule , introduced by
Regulation (EEC ) Kb 3450/73 , whereby the            price increase resulting
from the iapplication of the representative rate applied from I. January 1974
is defer^eji until the beginning of the following" marketing year . *It i^s
probafcle that transactions based 6n the texts adopted to this end are
  .■*
already in hand ; they cannot be .jeopardized . Existing arrangements should,
therefore continue to apply , the increase proposed for immediate application
being           Appropriate technical adjustments will be necessary .
                                                           »      *
4*       Prom the financial point of view , the alignment of the representative
rate for the lira on its effective rate will mean :
 (a) a reduction in "monetary" compensatory amounts charged or granted
          in intra-Community trade ;
(b) a reduction in "monetary" compensatory amounts charged or granted
          in £rade with third countries .  In view of the provisions of Article
      " 4a of Regulation (EEC ) No 974/71 this would be translated into an
      V increase in the refunds and levies/customs duties granted or
          charged as the case may be .
(o) an increase in levies , refunds and other expenditure under the
          food aid programme- following the application of a new representative
       ' rate which , in this case , will have the effect of increasing prices
        / expressed in national currency .
•• "                .            .             ■  ■ »
The estimates below have been worked out as follows :
                                                                   •     • •
(a) d 'the quantitative estimates (based on the latest available trade
•' - statistics) are the same as those used for the preparatory work
       . on the 1974 ^Budget and the pluriannual forecasts ;
 ---pagebreak---  (b ) the calculations have been based on a normal year , i.e. on the
            assumption that world prices are such that "monetary " compensatory
  '"V                                                                                      *
            amounts are not limited by the level of the import charge .            Thus ,
            the real drop in expenditure and the real increase in^revenue will
            fall short of these estimates ;
 (c ) * to simplify matters , the calculations for 1974 were based on a 5%
          \ alignment of the representative rate for the li^a on its effective
            rate as from 1 February 1974 *      This simplification should not .
                                                                   T               *     »
            however have any great effect . on the result .        Allowance was made
 ■■■ - ■ r t                    v^           «ina
^ '.■♦for the peculiar* situation of/sugar , tobacco and olive oil . The
       ' calculations for 1975 ? on "the other hand were based on a twelve-month
            period for all sectors .
The table below shows , for 1974 and 197S variations in expenditure and
receipts resulting from the proposed change in the status quo .
      . i .   '
Variations in receipts and expenditure following a 55° alignment of the
                              representative rate for t he li ra on its
                                           effective rate .
                                                                                             i
                                                                   million u.a .
"               '     . ■            i_                       '                  .     :
                                                                1974                 1975
I.        EXPENDITURE
             "Monetary" compensatory amounts charged
                                                                 - 48                - 48
             or granted m intra-Community trade
             Aids to production                                  +9                  + 25
             Total intervention expenditure                      - 39        -       - 23
                                                       *    ¥
             Export refunds                                      + 3,2               + 3,5
             "Monetary" compensatory amounts affecting
             refunds                                             -(-4,9 )            -(-5,3 )
                           $    *
             Net variation - refunds                             + 8,1     *         + 8,8
                             v
         Total variation - EAGGP/Guarantee                       -30 ,9              -14,2
                 Section expenditure
 ---pagebreak---                                                                 1974       1975
II .   RECEIPTS
       – Levies
                                                                +  9       10
       - "Monetary" compensatory amounts affecting
         levies and customs duties                      .    • -(-46 )     (-50 )
                                                          tr               '
       Net variation - levies and customs duties                       *
     - (own 'resources )            *                           + 55     + 60
 *    ■*
As mentioned earlier these estimates are "based on a normal year . i.e. on the
assumption that world prices are such that "monetary" compensatory amounts
are not limited by the import charge . The fact is however that this is not
true of a number of products at present . If this situation persists , the
factors making for reduced expenditure will be less significant ; by contract
however , the increase in aid expenditure would not change . In this case the
increase in receipts would also be ler,s . In view of all the innonderables ,
it is virtually impossible at the present time to forecast actual savings
in 1974 and 1975 :          7                                 •
           *   »   •
5«    The measures provided for m this Regulation should be adopted by the
Council as early as possible to avoid prejudicing the Italian economy .       Since
the European Parliament must be consulted - the proposal being based inter
alia on Articles 4°> and 235 of the Treaty - the following timetable is
suggested :
Opinion of the European Parliament :   Meeting ijr> be held from 11-15 February
1974 .                                               -
                                                   •  *
Decision by the Council :   February .
 ---pagebreak---                                         Propos al for
         REGULATION ( EEC ) N°              /74 OP THE 'COUITCIL
     on certain measures to be taken in agriculture for Italy
     as a result of the fixing , with effect from 28 January , 1974 of
     a new representative rate for the Italian lire
THE COUNCIL OF THE EUROPEAN COKKUIJITIES ,
Having regard to the Treaty establishing the European Economic
Community , and in particular Articles 28 , 43 , 103 and 235 ;
Having regard to the proposal frora the Commission ; '
                                                            sT
Having regard to the Opinion of the European Parliament ;
         .Council                                                  *■' ' 1
Whereas/Regulation ( EEC ) IT0 2958/73 of 31 October 1973 ( ) on the
exchange rate applied in .-agri culture for the Italian lire , as
             ^       . .    «       «            /  . < »  _ .          _    __
amended by Regulation ( EEC ) N°                /74 ( ), fixed , 'with effect from
28. January 1974 , a representative rate which in principle should load
to a certain increase in the prices of agricultural- products in Italy ;
whereas such a consequence has been avoided , except in the beef and
veal sector , by the provisions of Article 4 ( b ) of Council Regulation
( EEC ) N° 974/71 of 12 Hay 1971 (^). on certain measures of conjunctural
policy to be taken in agriculture following the temporary widening
of the margins of ■ fluctuation for the currencies of certain Llember
States , as last amended by Regulation ( EEC ) N° 3450/73 (^)» according
to which prices are in principle to be maintained at the level ,
applicable on 31 December 1973 ; whereas in the case of the beef and
veal sector Regulation ( EEC ) N°                  /74 provided for immediate .
consenuen+ial effects in vit3" o-P    onr> inrc+nT-al
Whereas the reasons for which an exception was nade for beef and veal
are also valid , although less so , for other agricultural products ;
whereas a similar solution is therefore necessary ; whereas in addition
                                                               - *
the entire system should be brought within the common agricultural
policy and Article 2 of Regulation ( EEC ) N° ' . fl-i should he rene^ied , since
the provisions thereof have been replaced with effect from^f~28 January
1974 7 by identical provisions contained in the present Regulation ;
(1)   OJ N° L 303 , 1.11.1973 , P. 1                                       ,
( 2)  OJ N°                       '
( 3)  OJ N° L 106 , 12.5.1971 , P. 1
(4)   OJ N° L 353 , 22.12.197 ^. p. 25
 ---pagebreak--- Whereas m order' to avoid hindering .the transactions already entered
 into on the basis of the provisions of Article 4 ( b ) of Regulation
 ( EEC ) N° 97^/71 » the system resulting from that Article should be
maintained , while applying the effects of the present Regulation on
the prices resulting from the said Article 4 ( b ); whereas the
 special situations regarding • sugar , wine     for andwhich supnly contracts have
already been concluded , and regards /olive oil , make it desirable to
maintain the level of prices currently applicable ,
HAS 'ADOPTED THIS REGULATION:
                                   Article 1
  •                                                 - .             •_
  1 * The intervention and t>urchases
                              wine
                                      prices annli-
                                                     cable in .Italy0 ■shall ■
                                                                               ,' with- »
      the exceptions those for /olive oil , su^rar and tobaccor "be increased
      by_5^_                                                           '
      - with effect from 28 January -1974 in the beef and veal sector
      - with effect from 15 February 1974 in the other agricultural
        sectors .                                              /           , „   •
                                                                         *
2 . Article 4(b ) of Regulation ( EEC ) N° 974/ 71 shall be applicable ,
      taking into ac-count the provisions of< paragraph 1 .
                                 Article 2
This Regulation shall enter into force on the third day following
its publication in - the Official Journal of the European Communities .
                     * '  •
                  »   •
As from 21 January 1974 it shall replace Article 2 of Regulation
 ( EEC ) N°         /74 .
This Regulation shall be binding in its entirety and directly
applicable in all Member States .
                                                                 ■ •
                                                           • •
Done at 'Brussels ,                                            For the Council
                                                               The President
 ---pagebreak---                            Explanatory Memorandum
Italy recently requested that the representative rate for the Italian
lira, fixed "by Regulation (EEC ) NO . 2958/73 (O.J. No . L 303 , 1.11.1973 ,
p. l ) and applied from 1 January , 1974 be brought closer to the rates
ruling on the market .
The fixing of a representative rate further devalued by 5% for converting
the lira particularly the amounts fixed in units of account within the
framework of the agricultural policy , must in principle have the automatic
effect of raising prices and other amounts fixed in units of account and
expressed in lira by 5$* However , Regulation (EEC ) No . 3450/73 ( O.J. No . L
353 , 22.12.1973 , t>. 25 ) laid down that the nrices^in effect in Italy on
31 December 1973 must , as a general rule , be applied until the beginning
of* the 1974/75 marketing year .
                                                     /
It is however desirable that the influence of the new representative rate
for the lira is felt immediately on the price levels 'in' the beef meat sector .
The market situation is characterised by low prices , large-scale
slaughterings having entailed a sizable decrease in the stock of cattle , which
in the long-term could harm the equilibrium of this branch of production
and have repercussions on the whole economy , particularly the balance of
payments .   To this end , recourse to Article 103 of the Treaty appears
justified in order to take a provisional measure which however should be
integrated into the common agricultural policy .
           *   m
Given the urgency of the situation , it is necessary that the Council adopts
this Regulation at its meeting on 21 January 1974 «
 ---pagebreak---                                      Proposal for
                   REGULATION ( EEC ) N°          OP THE COUÎTCIL
         Amending in particular the Reflation
         on the exchange rate applied in agriculture for the
         Italian lire .
TIES COUNCIL OF THE EUROPEAN C0I3SUNITIES ,
Having regard to the Treaty establishing the European Economic
Community , and in particular Article 103 thereof ;
Having regard to Council Regulation 11° 129 (^) on the value of the
unit of account and the exchange rate^to be applied for the purposes
of the common agricultural policy , as last amended"'by Regulation
 ( EEC ) N° 2543/73 ( 2 )> and in particular Artfcie 3 thereof :* *
         ^ - ψ ·        *                   ·
Having -regavd to the proposal from the Commission ;
Whereas Article 1 of Council Regulation ( EEC ) N° 2958/73 ( ) of
31 October 1 373 on the exchange rate applied in agriculture for the
Italian lire , as amended by Regulation ( EEC ) N° 2996/73 (^) provided
for the application of representative rates for the Italian lire
with effect from 1 November 1973 nnd 1 January 1974 respectively ;
Whereas the economic situation in Italy necessitates taking another
step towards uniformity of agricultural prices in the Community by
fixing another- "mere realistic representative rate ;
V/hereas the Monetary Committee will be consulted and , in view of the
urgency of the matter , the measures envisaged should be adopted under
the conditions laid down in Article 3 ( 2 ) of Regulation N° 129 ;
Whereas the fixing of such a representative rate results in a change
in the level of prices for agricultural products in.I^aly ; v/hereas
this consequence complies with the fundamental principle of uniformity
of prices in the Community ; whereas this . principle and the consequence
thereof have led to the fixing of precise rules , in' particular in
   Council Regulation ( EEC ) N° 1134/68
( 1 ) OJ N° 106 , 30 . 10 . '1962 , p . 2553/62
( 2 ) OJ N° L 263 , 19,9.1973 , P. 1
( 3) OJ N° L 303 , 1.11 . 1973 , P. 1
( 4 ) OJ N° L 305 , 1.11.1973 , P. 7
 ---pagebreak---   of 30 July 1968 ( 3 ) laying down rules for the implementation of
                                            •         •                    i
 Regulation ( EEC ) N° 653/ 68 on conditions for alterations to the value,
  of the unit of account used for the common agricultural policy ;           j
 whereas these provisions cover only the case of a change in the pari t
  of a currency ; v/hereas their application is also justified in the
  case in question ; whereas the new representative rate should therefor
 be included in Regulation ( EEC ) N° 2958/73 , the other provisions of
 which remain applicable ; '
 Whereas Article 4' ( b ) of Council Regulation ( EEC ) N° 974/71 of
   12 May 1971 (^) on certain measures of conjunctural policy to be
  taken in agriculture following the temporary widening of the margins
  of fluctuation for the currencies of certain Member States , as la?t
  amended by Regulation ( EEC ) N° 3450/73 0 ) provided that in principle
  the intervention and purchase prices applicable in Italy shall be
  fixed , until the end of .the 1973/74 marketing year , at the level
  resulting from the .application oT the provisions in force on .
  31 December 1973 » expressed in Italian lire ;, whereas this concerns
   the beef and veal sector in particular ;
  Whereas in view of the repercussions which the situation on the
  beef and veal market in Italy is already having on the level of
   production and which it may therefore have on the general balance
   of the economy it is necessary that this new representative rate be
  applied immediately in the beef and veal sector ; whereas the basis
   for determining the incidence of the present Regulation should be the
  price level currently applicable in Italy ,           .
                       Φ        '
 HAS ADOPTED $HIS REGULATION:                                  . v "■ J"
                                  Article 1
 The following is added to Article 1 ( 2 ) of Regulation ( EEC ) N° 2958/7
                     *
  "( c ) with effect from 28 January 1974
    .    -,; 100 Italian lire =    0,14©449 units of account V
              ■■ - •              Article 2
• 1 . With effect from 28 January 1974 the intervention price for beef
                                                   ¥
       and veal in Italy shall be increased by 5$ .
 ( 5 ) OJ N° L 188 , 1.8.1968 , p. 1
  . ( ôy.OJ N° L 106 , 12.-5.1971 , p.1
   (7 ) ,0J N° L 353, 22.12.1973 , P. 25
 ---pagebreak---                                                                   m this sector
    Article 4 ( b) of Regulation ( ESC ) N° 974/71 shall be applicabi^'
    taking into account the provisions of paragraph 1 .
            . J- 7
                                            Article 3
      f A.*'-:'-                   '"V
    This Regulation shall enter into force on the day of its publication
    in'the Official Journal of the European Communities .
..            - y v y       & t. .     '                           *
    This Regulation shall be binding m its entirety and directly
    applicable in all Member States .
     . * •.        '.VF *    #
   ' P >-
    Done at Brussels ,                                   For*£he Council
  .$■■ <.>                ■ r"".-
                                         k.           ** The President