CELEX: 51977PC0077
Language: en
Date: 1977-03-17
Title: Proposal for a COUNCIL REGULATION (EEC) concerning Community aid for financing cyclical stocks of hard coal, coke and patent fuel (submitted to the Council by the Commission)

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DOCUMENTS "COM"
COM (77) 77
Vol. 1977/0031
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 ---pagebreak--- COMMISSION OF THE EUROPEAN COMMUNITIES
                                          COM(77)77 final.
                                          Brussels . 17 March 1977 *
                            Proposal for a
                       COUNCIL REGULATION (EEC )
           concerning Community aid for financing cyclical stocks
                   of hard coal , coke and patent fuel
             ( submitted to the Council by the Commission )
                                           21                 fs
                                           3       « V.jT &
  CCM(77 ) 77 final .
 ---pagebreak---                                                                      XVII/20/77 e
                                 EXPLANATORY MEMORANDUM
I. Energy and coal policy objectives
   At its meeting on 17 December 1974 on Community energy policy objectives
   for 1985 \ "the Council decided that the Community's coal production should
   be maintained at its then level ( approximately 25O million tee) under satis­
   factory economio conditions .
   In order to aohieve this objective , measures will have to be taken to ensure
   continuity of production and to facilitate the smooth implementation of in­
   vestment plans which will only pay off in the long term and of all correspon­
   ding internal measures by undertakings ( manpower policy , rationalization , etc).
                    2
   In January 1976 the Commission proposed a number of measures to the Council
   in respect of coal } these concerned aid for the stockpiling of coal and the
   sale of coking coal to the steel industry and of steam coal to power stations .
   Aid for coal stocks plays a major role in the Community 's energy policy strategy.
   Because of the structural conditions , it is difficult to adapt coal production
   to short-term market fluctuations . It is essential to build up pithead stocks
   to a certain level to enable the mines to offset fluctuations in production
   caused by technical factors . However , very unfavourable economic circumstances
   may inorease these stocks to an exceptionally high level , as is the case at
   present } financing such a level of stocks involves a financial burden exceeding
   the normal economic conditions of coal production ^ Finally , the burden of this
   expenditure could lead to the premature closure of production capacities if the
   undertakings do not have sufficient financial resources to maintain stocks
   until the markg picks up again .
     OJ No 153 , 9 July 1975 » Page 4
   2
     See document COM ( 76) 20 of 16 January 1976 on the implementation of the
     energy policy guidelines drawn up by the European Council at its meeting
     in Rome on 1 and 2 December 1975 «
                                                                   9
 ---pagebreak--- This would however jeopardize the aim of maintaining Community production
at its 1973/74 level* Moreover , only production capacities actually ope­
rating can contribute to the security of supply.
Moreover , it should be noted that pithead stocks are a useful buffer en­
suring secure energy supplies to Community consumers regardless of any
fluctuation in demand . In the last 25 years large coal stocks have played
a very beneficial part in satisfying energy demand in four periods of
prosperous economio activity.
In view of the long and short-term factors involved in security of supplies
for all coal consumers , the interests of the Community require that a Community
solution be found to this problem .
The problems involved in setting up a new Community system of aid to finance
part of the storage costs
At the end of 1974 the stocks held by Community producers of coal and coke
totalled some 16 million tonnes , or about 6.2$ of normal production for 1974 *
                                                                               2
In the space of two years , i.e. by the end of 1976 , the corresponding stocks
had risen to some 55 million tonnes of coal and coke or 22.3$ of production for
1976 . In relative terms , therefore , stocks have reached their highest level in
the postwar period. Capital of some 2.5 thousand million EUA is tied up in the
stocks . The annual storage costs amount between seven and eight EUA per tonne of
stocks put down , which means that undertakings have to spend about 400 million EUA
on stocks each year . These charges must be seen in the light of the general finan­
cial position of the coal undertakings . In 1976 the Governments of the four coal-
produoing Member States paid the coal industry totalling some 600 million EUA in
order to keep the undertakings economically viable . These aids are the bare minimum
because even with the subsidies the undertakings still make financial losses in
coal production .
  Actual production was below normal because of a strike
2
  Including about 5 million tonnes of coal stored by producers on consumers'
  premises
 ---pagebreak--- For financial and practical reasons , it would be neither possible nor ex­
pedient to finance these costs completely from Community resources .
As regards the level of stocks , it is to be assumed that the undertakings*
must in any case keep a certain level of "working" stocks and should them­
selves solve some of the cyclical problems of adjusting supply to demand*
Experience has shown that the requisite quantity is about one month 's produc­
tion . Taking the Community total as a yardstick , this would amount to approxi-
                           2
mately 20 million tonnes • No aid would therefore be granted for this volume
of stocks .
It is above the 20 million tonne level that producers are really faced with
cyclical adjustment problems . In the Commission 's opinion , the Community
system of aid should therefore come into play as from this level ) care should
also be taken , however , to ensure that the subsidized stocks do not exceed a certain
limit . Once stocks have reached this upper limit , the undertakings must decide
whether and to what extent production should be cut back in line with demand . In
the light of the last twenty years' experience it would seem appropriate to put
the upper limit - measured against total Community production - at around 40
million tonnes . Consequently , only part (max. 20 million tonnes) of the total
stocks put down would be inoluded in the Community aid system.
The estimated annual cost to undertakings of keeping 20 million tonnes of
stocks is 150 million EUA. The sum of 5° million EUA    seems appropriate as
Community aid , i.e. , one-third of the costs would be covered by the subsidy .
With 20 million tonnes and 50 million EUA the rate of aid would be 2.50 EUA
per tonne per year. Under the Community aid system proposed in the draft
Decision , this average amount would be uniformly applied to all recipients .
^Reference will be made only to coal producers below. It should, however ,
  be pointed out that the Decision also includes independent coke and
  briquette producers in the aid system in order to take into account the
  question of steady and secure coal supplies .
2
  The annual Community production lies between 240 and 250 million tonnes .
 ---pagebreak--- The Commission has carefully studied the possibility of using different
subsidy rates varied according to the value of the coal stocked , instead
of a uniform subsidy per tonne . The value per tonne of coal stored and the
resultant costs ( e.g. interest , depreciation , etc .) vary from one Member
State to another *
Such a system would , however , not be feasible for the following reasons :
( 1) Detailed statistical information would have to be obtained from all
     those eligible for aid about the production value per tonne , the rate
     of interest for bank loans used to finance the stocks , rate of depre­
     ciation , the costs of stockholding and stocklifting etc .
( 2) The information thus collected would have to be regularly reviewed
     since the values per tonne , interest rates , etc . are constantly
     changing.
( 3) The differences in the production value of the coal extracted in
     the individual Member States are partly offset by the differences
     in interest rates ) this means that there are only slight differen­
     ces between the annual storage costs per tonne in the various Member
     States .
( 4) The administrative costs would be di sport ionately high in relation
     to the advantage to be gained from a more equitable allocation of aid .
For these reasons the Commission prefers a uniform subsidy of 2.50 EUA
per tonne . The calculations contained in tables 1-4       which are appended
will serve as example . The relevant Articles of the appended draft re­
gulation to which they refer are given at the top of each table .
 ---pagebreak---                                         - 5 -
                                                                     A,
      In the light of the points of view expressed above :
      - that stocks increase energy supply security in periods of rising demand ,
      - that the financial burdens of large stocks must not endanger the stability
         of Community production , which favours supply security ,
      the Commission is proposing a financial arrangement in line with the interests
      of the Community . The corresponding amount      would have to be made available
      from the Community budget , pursuant to Article 235 of the EEC Treaty . The relevant
      entertainments     between the Commission and the Parliament have already been
      conducted. At its sitting on 16 December 1976 Parliament allocated a token entry
      to item 322 of the 1977 budget . As the proposed Community aid is a multiannual
      operation , appropriations for commitment would also be entailed
III . General principles of the Community aid system
      The draft Regulation treats independent coke and briquette producers as eligible
      for aid in addition to Community coal producers . If they use Community coal the
      independent coke and briquette producers are just as involved in the conversion
      of coal as the ooal producers with their colliery coke-ovens and briquetting
      plants } they enoounter the same marketing difficulties and their stocks contribute
      towards a steady and secure coke and briquette supply . For these reasons , and in
      order to avoid discrimination , they have been included in the aid system .
      Since such a system has never before been introduced at Community level , there
      is no experience in this field . In view of the very high level of stocks at
      present the system should be introduced as soon as possible for a period of not
      more than three years .
      The other principles concerning the calculation of eligible quantities , the
      arrangements for payments into and out of the common Fund , etc . are all to be
      found in the draft Regulation .
 ---pagebreak---                             Proposal for a
                           COUNCIL REGULATION             H,' .
        concerning Community aid for financing cyclical stocks
                  of hard coal - coke and patent fuel
THE COUNCIL OF THE EUROPEAN COMMUNITIES ,
Having regard to the Treaty establishing the European Economic Community ,
and particular Article 235 thereof ;
  »                                             »
Having regard to the proposal from the Commission ;
Having regard to the Opinion of the European Parliament ;
Having regard to the Opinion of the Economic and Social Committee ;
Whereas the establishment of a common energy policy is one of the objectives
which the Communities have set themselves and whereas it is for the Commission
to propose the measures to be taken to that end ;
Whereas the Coucil resolution of 17th December 1974 , decided that the pattern
of energy consumption should be altered by progressively increasing the use of
reliable energy sources and that Community coal production      should be main­
tained at a level of 180 million toe under satisfactory economic conditions .
Whereas the Council resolution of 13th February 1975 , decided , with regard
to the coal mining industry , that measures would be necessary to compensate
the effect of fluctuations in demand and to overcome supply difficulties .
Whereas coal production is necessarily inflexible because of the geological
and technical conditions , the Community coal industry has to build up stocks
of hard coal , coke and patent fuel when a cyclical fall in demand occurs and
whereas this entails expenditure and ties up capital so that current investment
programms   for production installations and rationalization are jeopardized
and that competiti vity is reduced .
              *
 ---pagebreak--- Whereas these negative elements influence the development of production
and supply and are , therefore , contrary to the long-term requirement of
all consumers in the Community and whereas , in the short-term view , pithead
stocks are a suitable form of buffer stocks to smooth out divergent trends
production and disposals and hence to help to guarantee energy supplies to
all consumers in the Community regardless of any fluctuations in demand .
Whereas the Treaty does not provide the powers necessary for the introducti
of Community financial measures to improve supply .
HAS ADOPTED THIS REGULATION
                                SECTION I
                             General objectives
                                Article 1
The Commission is authorized , subject to the conditions set out below , to
grant to the beneficiaries listed under article 3.1 , aids to cover part of
the costs borne in the holding of stocks of hard coal ,      hard coke and
patent fuel .
                      »
                                SECTION II
                         Criteria for the grant of aid
                                Article 2
Aid shall be granted subject to the conditions detailed in articles 3 to 7.
                                Article 3
 ( 1 ) Aid shall .be granted to ;
       ( a ) the following undertakings 1f their place of production is in the
                 •*                       •
             Community ;
 ---pagebreak---                                  ( 1 ) coal undertakings
                               ( ii ) independant coking pl-ants
                             ( iii ) independant producers of patent fuel
                                      I
      ( b ) Organizations of the undertakings covered under point Ca ) if they
            have corporate personality and are responsible for stockholding ;
      ( c ) the Governments of the Member States , if they bear all or part of
            the costs of buffer stocks designed to even out cyclical fluctua­
            tions in supply and demand .
( 2 ) Where the undertakings with organizations of undertakings OP the Govern­
      ment of the Member State in question jointly bear the costs of , or
       jointly manage certain stocks , the undertaking shall be the beneficiary.
( 3 ) aid shall only be granted upon request .
                                        Article 4
( 1 ) Aid shall be granted for stocks of Community hard coal and of coke
      and patent fuel produced from Community hard coal .
( 2 ) Aid shall be granted only on the basis of coal equivalence ; for that
      reason stocks of coke and patent fuel produced from Community hard
      coal shall be converted into coal equivalent by applying a, factor of
      1.33 for coke and 1 for patent fuel .
                                        Article 5
The following shall rank as stocks :
( 1 ) Hard coal held :
      ( a ) By producers of hard coal :
            - Total producer 's stocks ( including quantities in towers , washeries ,
               wagons etc ., and Including low-grade coal );
 ---pagebreak---               - Stocks held by consumers in excess of a normal stock      level ; these
                shall be added to the hard coal producer 's  stocks if such stocks
                belong to the hard coal producers or are directly or indirectly
                held or financed by them .
       Total stocks shall be expressed in tonne for tonne ( t / t ).
       < b ) By independent coking plants and independent patent fuel producers :
            . stocks of Community coal ;
       ( c ) By the Governments of the Member States ; stocks of Community coal . .
              Stocks managed jointly by Governments and undertaking shall be ascribes,
              to the total stocks of the undertakings under ( a ) or ( b ) of this ar­
              ticle ;
( 2 ) Hard coke and patent fuel
       Only stocks of hard coke and of patent fuel produced from Community coal .
       To determine these quantities , a quantity corresponding to the share of
       non-Community coal in the preceding year 's total coal input shall be deduc­
       ted from the actual total stocks of hard coal or patent fuel in the cur­
       rent aid year .
       The principles set out for hard coal     in  paragraph    1  of
      .this article shall apply to coke and patent fuel mutatis mutandis .
( 3 ) For the purpose of the application of the provisions of article 6 , the
       stocks determined under 1 and 2 of this article shall be consolidated
       into a total quantity of coal for each undertaking .
 ---pagebreak---                                     Article 6
( 1 ) Aid shall be granted for stocks totalling no more than 20 million
      tonnes of coal < t / t ) for the Community as a whole between a lower
      and an upper limit ( eligible range ). Stocks below the lower or above
      the upper limit shall not qualify for aid .
( 2 ) These limits are defined as follows :
      - The lower limit shall be uniform for all beneficiaries and set at
           one-twelfth of annual production ( coal producers ) or one-twelfth
           of annual input of Community coal ( independent coking plants and
          patent fuel producers ).
          Annual production and annual input of Community coal shall be
          measured ( t / t ) in the year preceding the current aid year .
      - The upper limit shall be obtained by adding , for the Community
           as a whole 20 million tonnes of coal to the lower limit . The stocks
         • calculated in this way shall be related to the sum of Community
          production and input of Community coal ( independent coking plants
       • and patent fuel producers ) in the year preceding the current aid
           year ; the resulting percentage for the Community shall be applied
           uniformly to all undertakings . The Commission shall make the cal­
           culations at the beginning of each year and shall communicate the
           results to the Member State government and to all the beneficiaries .
                                    Article 7
( 1 ) The aid per tonne is uniform for each beneficiary and amounts to 2,50
      EUA per year ( Rate of aid per tonne ).
 ---pagebreak--- ( 2 ) The rate of aid per tonne may not exceed the actual cost of
      holding stocks . In this connection the rate of aid per tonne may
      be proportionally reduced should the need arise .
                                              *
( 3 ) The amounts of aid actually payable to the beneficiaries shall be
      obtained by applying the rate per tonne laid down in paragraph 1
      of this article exclusively to the eligible quantities of stocks
      defined in article 6 .
( A ) Aid shall be paid quarterly and in arrears for one-quarter of the
      annual amount of aid per tonne in each case and shall relate to the
      eligible stocks on 31 March , 30 June , 30 September and 31 December
      respectively ( the reference dates for stocks ).
      If the last day of the quarter falls on a Sunday or a public holiday
      the last working day before that day shall rank as the reference date
      for stocks .
( 5 ) The payment of aid shall be subject to the presentation of all
      required supporting documents and information .
 ---pagebreak---                                  SECTION III
                              Community financing
                                 Article 8
      The funds necessary for the grant of aid shall be provided in the
      budget of the Community.
                                                 *
                                 SECTION IV
                          General and final provisions
                                 Article 9
      If the sum of national aids for stockholding - granted on a per-ton
      basis under article 9 of Decision     528/ 76/ ECSC - and aids per tonne
      granted under the present regulation should exceed the actual per-ton ne
      costs of stockholding , then the aid on the base of the present regulation
      shall be proportionally reduced .
                                 Article 10
                  «
( 1 ) In an emergency , and otherwise at the end of each calendar year , the
      Commission is authorized to modify the following by means of a regulation
                    - the rate per tonne of aid for stocks ,
                     - the upper or lower limits for the quantities of stocks ,
( 2 ) The Commission shall revoke aid unduly granted or , particularly ,
      where granted as a result of inaccurate declarations on the part of
      the applicants .
 ---pagebreak---                               •- 8 •-
                             Article 11
If at the request of a Member State or on its own initiative the Commission
finds that :
( 1 ) the application of this regulation is likely to give rise to serious
      disturbances in the common market for coal or difficulties which may
      result in the deterioration of the general coal supply situation , or
      that
( 2 ) appreciable changes are taking place in the conditions or volume of
      intra-Community trade on the market for coal because the economic condi­
      tions which prompted the adoption of this resolution have changed ,
the Commission may suspend application of this regulation wholly or partial'.
The Commission shall report the matter to the European Parliament and the
Council forthwith .
                            Article 12
The Commission shall report to the European Parliament and the Council regu­
larly on the application of this regulation .
                            Article 13
After consulting the Council , the Commission can take all the measures
required for the application of this regulation .
                            Article 14
This regulation shall enter into force on 1 January 1978. It shall cease
to be operative after 31 December 1980.
                                *
                          *             *
This regulation shall be binding in its entirely and directly applicable
in all Member States .                '
Done at Brussels
 ---pagebreak---                                                                                                                                                                              XVi:/20/77
                                                                                Estimated stocks en 31 Karoh 1977                                                  Table 1
                                                                                      (total stooka under
                                                                                           Article 5)                                                         ( '000 t )
I                                                                 1  Federal Rep.
                                                                     of Cornany
                                                                                   Franco           Belgiua
                                                                                                                        Be t he iv.
                                                                                                                           landa
                                                                                                                                       United
                                                                                                                                       Rinrdom
                                                                                                                                                 Ireland
                                                                                                                                                           Luxem­
                                                                                                                                                           bourg
                                                                                                                                                                         Denaark
                                                                                                                                                                                   Coaau–
                                                                                                                                                                                   nity
    (A ) Total atcckc held by coal prodacera
         1 . Hard coal ( t/t )                                         12.200      5.300             1.300                             12.900       7                              ji.eor
IPlus£I           Excessively large atooka bold by oonauaare
                  Government atocka
                                                                                                                                        4.500                                        4.500
I            Total COŒjnuni"tj coal                                    12.300      5.300             1.300                             17.400       7                              36.307
I        2. Hard-coal coka
Il (a) Tctal coït» stock* (t/t)
            lb ) Of which ■ coke fron Coonunlty coal  ,                11.000
                                                                       11.C00
                                                                                   1.500
                                                                                    1.500                   L :              :
                                                                                                                                        1.800
                                                                                                                                        1.800       :       :        lL_           14.300
                                                                                                                                                                                   14 . ÎCO
|( c)            Conversion into coal equivaleat (x 1*33)
             Total Ccnmunitr coal (l ♦ ?( o )) (irtiolo s(i)}
                                                                       14.630
                                                                       26.930
                                                                                    1.993
                                                                                   7.295         ]
                                                                                                   r=
                                                                                                     1.300
                                                                                                                  -
                                                                                                                       rr–
                                                                                                                                     I  2.394
                                                                                                                                       10.794       7       -
                                                                                                                                                                     '
                                                                                                                                                                           -
                                                                                                                                                                                 ■           ■
I (l) Tctal ctccko held by independent coking planta
I        1 » Total hard-coal stocka (t/t )                                                       ι
                                                                                                        BO       260 ι     100            400                                           840
I        2. Total coka atocka ( t/t )                                                                   50       900         25           500                                        1.475
I        1. Conversion of total coke atooka into ooal eauivalent                                        <6   I 1.197         32            665           L_=                         ι.ΐίΐ   I
             (* 1.33 )                                                                                                              i
                                                                                                                                    i
I        4. Total coal (l ♦ 3 )                                                                        146   I 1.457       133       I 1-065             !  =                        2.eoi   1
I        5. Of which I ComnunitT coal'                                                             Γ3τ~          363         29         1.065            r:                                  I
    (C ) Total stccka held by independent briguotte producers
         1 . Total bard-coal stocks ( t/t )                                            40                0        20                                                                     60
I        2 . Total hricraatta stocka ( t/t )                                           50                0        15                                                                     «2_J
         3 . Total coal ( 1+2 )                                                        90                0  IΓ^ΊΓΊ                                   rn                                 m    1
I        4. Of which t Cosuaunity coal^                                                55                0        16                 n:              rn     .              -J            nJ
I (D) Government stocks                                                                                                                        1
         (Tcken entry )                                                                >· .       ι                                                                                      ii_l
    (E) Total for each country (A«3 ♦         ♦ C«4 ♦ 9)               26.930        7.350           1.337       399         29        20.859       T                               56.911
    * It has been acsuaed that only Community coal waa used In tho manufacture of ooke *
    ? Proportion calculated by reference to tho percentages in Table 2, b4»     #
    * Proportion ealoulated by referenoe to the percentage* i» Table 19 ©4#
 ---pagebreak---                                                                                                                            Tabla 2
                                                               Calculation of qyintltles under Article 6
                                                                (Estiaates , llluotratlve calculation )                    (*000 t | t/t )
                                                 Fed . Ro p.                                 Kothor- Ur. itcd             Luxem­             I Conynu–    1
                                                 of Genaa-     Fronça   Bolgiua      i Italy lands   KinrUoo     Ireland  bourg     Dcrunark   nity
                                                 -J5JC
( A ) Basis quantities
      ( a ) Produotion 1976 (t/t )                  97.000      22.500    7.200                      125.000       50                          251.750
      (b ) Hard-coal input of the indepen­
             dent coking plant * 1976 ( t/t )
             b . Community coal                                             150          750  170        1.200                                    2.270
             feg Kon Coaaunlty eoal                                         450      2.100    600                                                 3.150
             bj Total                                        ~ΞΔ            600      2 . £50  770        1.200
                                                                                                                         lz_                      5.420
             b , Proportion «f Coaaunlty
               4 oo»l (*)                                                     25,0   ! 26,3   22,1       100,0                                     41,9
      ( o ) Hard-coal input of the indepen­ I                                        1
             dent briquette producers 1976 ( tv t )
             0^ Coaaunlty eoal                        m            400         0          40                                                       440
             0j Hon-Coaaunity eoal                                 250                    50                                                       300
                  Total                                      I      650 I      °   I      90                                                       740
             o . Proportion of Community
               4 eoal (*)                                          61,5                44,4                                                        59,5
      (d) Total basis quantity (A ♦             ) 97.000       22.9CO     7.350        . 790  170    126.200        50                         254.460
(B ) Calculatlon of ctocka for tha
      Community finxncir ;;
      arrancgnonts in 1977
      1 . Hard-coal producers
           (a ) Lover liait                          Β.0Θ3      1.875        £00                      10.416         4                          20.978
           (b) Maximum eligible stocks
                  (o - a)                            7 . «4     1.769        566 '                       9.825       4      m                    19.788
           (0 ) Oppar liait 2                       15.707      3.644     1.166                       20.241         I                           40.766
                                                                                                               I
      2 . Indépendant coklnr planta
           (a) lowar liait ^                                                  12         ©3     14          100                                      169
           (b) Maximum eligible stocks
                  (c - a)                                                     12         58     13           95             m                        178
           (o ) Upper liait                                                   24       121     27           195                                      367
      3 * Indépendant briquette produce r»
           (a) Lover liait ^                          m             33         0          4                                                            37
           (b ) Kaxiaua eligible stooks
                  (o - a)                             m             33                    1                                                            34
           (e ) Upper liait                                         <6                    5                                                            71
      4« Total calculation ( 14 2 4 3 )                                                                                                               I ")
            (a) Lover liait                         6.06}       1.908        612         67     14     IO. 516       4                           21.204
            (b) Kaxiaua eligible stoeks             7.624       1.802        578         59     13       9-920       4                           20.000
            ( e ) Upper limit                     15.707        3.710     1.190         126     27     20.436        8                           41.204
        (toe-twelfth of 1976 production ( see A.a«)«
      *Ifce upper limit for all beneficiaries is 16*19336 of the basis quantity (for calculation see footnote 4)*
      ^One-twelfth of the Input of Community coal in 1976 (see A*b^ and A«e^).
      ^Ttae lower liait of 21 204 000 tonnes is increased by the aaziaua eligible quantity of 20 aillion tonnes yielding a total
         quantity of 41 204 000 tonnes as the upper limit for the finanoing arrangements , Relating the upper liait to the basis
         quantity (41 204 000 1 254 460 000 ) yielde a rate of 16.1935&-
 ---pagebreak---                                                                                                                         Tafc>\.e  s
                                                      Calculation of the maximum aid payments
                                                                  under Article 6 and 7
                                                       ( Estimates , illustrative calculation )
                                   Fed . Rep. France                             Nether­ United                  Luxem-               Commu-
                                                          Belgium      Italy                        Ireland               Denmark
                                   of Germ .                                     lands ^ Kingdom                 burq                 nity
A. Maximum eligible stocks
     under Table 2 in 1977
     ( '000 t ; t / t )
     1 . Hard-coal producers        7.624       1.769         566                         9.825          4                            19.788
   " 2 . Independent coking plants                             12        58        13          95                              mm
                                                                                                                                          178
     3 . Independent briquette                     33                   * 1                                 I                              34
          producers                                                                                         I
                                                                                                             I
     4 . Member Governments
                                                                                                             I
     5 . Total                      7.624       1.802         578        59        13     9.920          4  i                          20.000
                                                                               i
B. Rate of aid per tonne
     ( u.a .)
     1 . Hard-coal producers         2,50        2,50       2,50                            2,50      2,50                              2,50
     2 . Independent coking plants                          2,50       2,50       2,50      2,50                                        2,50
     3 . Independent briquette                .  2,50                  2,50                                    *                        2,50
         producers
                                                                    I
     4 . Member Governments                                                                                                         ι
                                                                  _ I
                                                                                                  1
C. Maximum aid payments 1977
     to : ( '000 u.a . A x B )                                                                                                               *
     1 . Hard-coal producers       19.060       4.422      1.415                         24 . 562       10                            49.469
     2. Independent coking plants                              30      145         32         238                                         445
     3 . Independent briquette                     83                     3                                                                86
          producers
     4 . Member Governments
     5 . Total                     19.060       4.505      1.445      148          32    24.800        10    _l J                     50.000 I
 ---pagebreak---                                                                                                                  Table 4
                                                       Actual aid payments under Article 7 ( 3)
                                                 ( Unlike the Table for Artlele 7(4) this Table
                                                   depicts not quarterly payments , by undertaking ,
                                                   but yearly payments, by country)
                                                        red . Rep.                              Nether­ United I            Commu­
                                                        of Gern.l  France  Belgium   Italy      lands
                                                                                                                    Ireland
                                                                                                        Kingdom I           nity
 A. Hard-coal producers                              I                            Ί
     1 , Upper limit of stocks ( '000 t )
         ( Table ?. b.1.c .)                            15.707     3.644   1.166                        20.241           B  40.766  I
     2. Actual stocks ( '000 tHTable 1.4.5 )            26.930     7.295   1.300                        19. 794          ?  55.326
     5, eligible quantity ( 'COO t >                     7.624     1.769     566                         9.378           3  19.340
     4. lut » of aïs per tonne of coat ( u.a .)          2,50      2,50    2,50               L -        2,50     I 2'5° I   2,50
L    5. Actual yaerly Aid payments ( '000 u. a.)
         (3 x 4 )
                                                        19.060     4.422   1.415                        23.445           8  48.350
     Independent coking plants
     1 . Upper Unit of stocks < '000 t )
         ( Table 2 2.B.2 . C. )                                                24     121         27        195                367
     2. Actual stocks ( '000 tHTable 1.B.5 )                                   57     383         29     1.065               1.514
         Eligible quantities ( '000 t)              I                          12      58         13          95                178
    4. Rate of aid per tonne (u.a.)                 I                      2,50       2,50       2,50     2,50
     5* Actual yearly aid payments ( '000 u.a .)                               30     145         32        238                445
         (3 x 4 )
h7 Independent      briquette producers             I
     1 . Upper liait of stocks ( '000 t )           I
         ( Table 2.B.3.C. )                                           66                S                                        M
    12* Actual stocks ( 9 000 tHTable 1.C.4 )       I      m          $5     »         16                                    .   71
     3. Eligible quantity ( '000 t )                I                 22                1                                        23
     4, Kate of aid per tonne (u.a.)                I      :       2,50      *
                                                                                      2,5°                  *
                                                                                                                             2,50
L    5* Actual yearly aid payments ( '000 u.a.)
         (3 x A )               •
                                                                      55                3                                       58
Κ   Renber Governments                              I
L (token entry)                                     I
Ε    Total actual yearly aid payments
     ( '000 u.a .) ( A. 5 ♦ 8.5 ♦ C.5 )
                                                        19.060     4.477   1.445       148        32    23.683           8  48.853
r For comparison :                                  I
    Nulaium possible payaient * ( '000 u.a. )       I   19.060     4.505 I 1.445       148        32    24.800          10  50.000
     ( Table 3.C. )                                 I
  Where the actual stocks are above the upper limit the nas1.ua eligible quantities of stocks under Table 2.B , l.b, 2.b, and
  3.b apply. Where the actual stocks are below the lower llait only the stocks above the lower limit qualify for aid ( see
  Table 2.B, l.a , 2.a , and 3.a >;
                                                                   »
 ---pagebreak---                                                           COM (77 ) 77
               FINANCIAL RECORD SHEET
Part One : Assistance appropriations
(1 ) Budget line : 322 •
( 2 ) Wording of Budget line : "Measures for Community financing of
      stocks of coal , coke and coal briquettes due to market circumstances ."
( 3 ) Legal basis : Article 235 EEC
(4 ) 4*1 Description . Non-repayable aids to reduce heavy expense to
          collieries in consequence of producer stocks of coal , coke
          and briquettes .   Aid accorded only in respect of tonnages
          of producer stocks between a lower and an upper limit :      costs
          of tonnages outside those limits payable by collieries .
      4*2 Purp6ses .   To reduce expense to collieries , covering roughly
          33$ of it , as a means of enabling them to attain objective
          of stabilizing production by 1985 I in accordance with long-term
          guidelines .
      4.3 Justification .   Will make for secure energy supply , particularly
          important as concerns supply of power stations and steel industry.
( 5 ) Financial implications of scheme
      5.0.1 Expenditure .   Annual amount of aid is calculated at 50 million
            EUA : could work out lower according to actual movement of
            producer stocks .
            Aid payable quarterly, at end of quarter , to collieries
            qualifying for it .
 ---pagebreak---       5.0.2 Mode of calculation . Total cost to collieries of holding
             stocks is approximately 7«5 EUA per tonne p.a . on Community
             average : cost actually varies from colliery to colliery.
             Aid is 2.5 EUA per tonne p. a .
             Aid per tonne is payable for a maximum of 20 million tonnes
             of stocks for Community overall . Tonnages aidable are between
             a lower and an upper limit , tonnages outside these limits not
             qualifying. When producer stocks reach upper limit , 50 million
             EUA would have to be paid out in respect of the 20 million tonnes .
             The stocks being due to market circumstances and the tonnages
             aidable being between a lower and an upper limit , it is hard
             to estimate the amount of aid to be paid annually, which should
             not exceed 50 million EUA .
(6 ) Monitoring arrangements . Usual checks by Commission in accordance with
     Financial Regulation in force .
Part Two : Further particulars for new scheme
(7 ) Total cost calculated at 150 million EUA : probable duration three
     years at 50 million EUA p. a .
(8) Chargeable to Commission Budget . If proposed Regulation is definitively
     made operative by Council in 1 977 9 payments would start from 1 January 197
(9) Management of fund by Commission departments requires engagement of a new
     Grade B official .