CELEX: 51976PC0074
Language: en
Date: 1976-07-13
Title: Proposal for a COUNCIL REGULATION amending Council Regulation (EEC) N° 2306/70 on the financing of intervention expenditure in respect of the internal market in milk and milk products (submitted to the Council by the Commission)

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COM (76) 74
Vol. 1976/0028
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 ---pagebreak---     COMMISSION OF THE EUROPEAN COMMUNITIES
                                                       COM(76)74 final
                                                       Brussels , 13 July 1976
                                 Proposal for a
                             ■ COUNCIL REGULATION
        amending Council Regulation ( EEC ) N° 2306/70 on the financing
        of intervention expenditure in respect of the internal market
                          in milk and milk products
                  ( submitted to the Council by the Commission )
COM(76 ) 7k final
 ---pagebreak---                               EXPLANATORY KtttfORA^DLTM
              Proposal for a Council Regulation amending Council
               Regulation (EEC) Wo 2306/70 on the' financing of
            intervention expenditure in respect of the internal
                      market in milk and milk products
         • 1 . The present system of financing intervention stocks is based on the
 financing "by the Guidance Section of the EAGCF , of net losses incurred "by intervention
 agencies as a result of obligations stemming from Community regulations . Those net
 losses which are determined by annual accounts , by product and by Member State , include
 in addition to any sales losses and costs connected with storage operations , the
 interest on f\inds immobilized by the intervention agency for the purchase of goods .
                   t                                                              •
                                                                  \
            2 . When intervention products are sold for export , particularly in the milk
products serttor , if the purchaser is allowed to defer payment until after removal of
the goods , it sometimes leads to better Rales conditions or increases the fru ant. i ties
disposed of . However , according to present EAGGF rules no provision is made to cover .
                •»                                                     .
interest costs resulting from deferment of oayment after removal of the goods .
            3 . It is therefore proposed to amend Council Regulation (EEC ) 2306/70 on
the financing of intervention expenditure in respect of the internal mprket in milk
and milk products to permit EAGGF to assume the interest cost arising from the
 m
immobilization by the intervention agency of the funds required to grant, the purchaser
deferred payment facilities . Assumption of the interest cost would be restricted to
intervention stocks sold for export . Deferred payment for such sales would b« grentcd
                       '                                      >
on a case-by-case basis according to the procedure provided for in' Article 30 pf ,
Regulation (EEC ) No 804/68 ( Commission decision after Opinion of the T'pnag^mpnt
Committee ). It must not be granted for more than twelve months after rcnoval of the
product .
 ---pagebreak---             4. With regard to financing procedure , as with sales with no deferred
payment , sales receipts should "be entered, in the accounts provided for in
                                                        1
Regulation (EEC ) NO 2306/70 on J;he day the product is removed by the nnrch?teerj
Then , to enable deferred payment to be granted , the intervention agproi^R would
continue as during the period of intervention storage , to nrovido the re<Tuirftd
funds . The interest cost in respect of these immobilized fur.ds , calculated
according to a method and rate to be decided in accordance with the procedure
provided for in Article 13 of Regulation (EEC ) No 729/70 ( Goran issi on decision
after Opinion of the EAGGF Committee ), would be borne by EAOGF . It, should be
noted that for the last two years the interest rate has been 8fo for funds
immobilized during a storage period . Any risks of non-payment must be covered by
provision of a security or bank guarantee by the purchaser , or by other means o* a
             i                                        .            I      .
                                                          !'    ' . . .   '   .    ·
national level . Risks of changes in exchange rates ofen be avoided by providing +h<?t
the price is expressed in the currency of the Member State to which the interven­
tion agency selling the product belongs ,
             5 » In applying the proposed provisions account will be taken 'of the
Community 's international commitments .
 ---pagebreak---                                   Proposal for Council Regulation
                                              of
              amending Council Regulation (EEC.) No 2306/70 on the financing
              of intervention expenditure in respect of the, interna^. markrt
                                       in milk and milk produits
 THE COUNCIL OP THE EUROPEAN COMMUNITIES ,
 Having regard to the Treaty establishing the European Economic Community ,
 Having regard to Council Regulation (TEC ) No 729/70 of 21 Aoril 1?70 on + he
 financing of the common agricultural policy                as last amended by Regulation
 (EEC ) NO 2788/72            and in particular Article 3 ( 2 ) thereof,    ,
 Having regard to the proposal from the Commission ,
 Whereas Council Regulation (EEC ) No 2306/70 of 10 November 1970 on the financing
 of intervention expenditure in respect of the internal market in milk and milk
 products         as last amended by Regulation (EEC ) No 330/74             provides , in
respect of the purchase , storage and sale of produots held in intervention storage
 for annual accounts by product to determine net losses incurred by ^ intervention
agencies ; whereas the interest cost in respect of funds immobilized b" the inter­
vention agency for the purohase of products constitutes one of the elements in
these accounts ;                                                                           <
Whereas in the case of a sale where payment is deferred until after removal from
intervention storage , as provided for in Community rules , the costs arising from
the extended immobilization of funds by the intervention agency should aleo bo
taken into account in calculating net losses borne by the intervention agency ;
HAS ADOPTED THIS REGULATION i
( 1 ) O.T No L 94 , 28.4.1970 , p.13 .
( 2 ) OJ No L 295 ,  30.12 . 1972 , p . 1 .
( 3 ) OJ No L 249 ,  17 . 11 . 1970 , p . 4 .
( 4 ) OJ No L   37 , 9.2.1974 , T>. 5 .
 ---pagebreak---                                Article 1                                               *
                                      " " ' J"     *          i                          '
    Artiole  4 (1) (g) and Artiole 5 ' (l). (g), of Regulation (EEC) No 2306/70 are
    amended as follow nj
                < t
    "(g) the financing costs, calculated ty a method and at a rate of interest to
     he determined in accordance «ith the procedure' laid down in Article 13 of
     Regulation (EEC ) No 729/70 :
    - for the period of intervention storage ,
    - for the period during which payment is deferred after the removal from stored
       of products sold for export , such period being granted where necessary for a
       given sale in accordance with the procedure provided for in'Artiole 30 of
      Regulation (EEC ) No 804/68 9 M
                            Article 2                                                .
  The  following is added to Article 4 (2) (a) and Artiole 5. (2) (a) of Reflation
  (EEC ) No 2306/70 j                                                              .
  " this amount shall l, entered in the account on the day of removal from storage"
                           Article }                            \
 This Regulation shall enter into force on th* third day following its publication
 in the Offioial Journal of the European Communities, *
 This Regulation shall be binding in its entirety and directly ajjolioable in all
Member States .
Done at
                                                                   For the Council
                            9
                                                                  The President
 ---pagebreak---                         FINANCIAL                 STATEMENT
                                                                                         [ date » 9.7.1976
     1. BUDGET LINS coiJciflWED : Article 621 , Item 6214 A*11! artiole 622 , Item 6221
     2. ACTION « Proposal for a Council Regulation amending Council Regulation (EEC ) n°
     2306/70 on the financing of intervention expenditure in respect of the internal
    market in milk and mi lk . products .
    3. LEGAL BASIS » Artiole 3 ( 2 ) of Council Regulation 729/70.
    4. OBJECTIVES 1 Financing of the deferment of payment on the sale of intervention goods
     for exportation ,
I 5* FINANCIAL CONSEQUENCE                            FOR THE MARKETING YEAR   CURRENT FINANCIAL YEAR
                                                                                            )          •
                                                                                                          FCLLOWINC FINANCIAL YEAR J
15.0 EXPENDITURE
                                                                                                                  (                 S
        -CHARGED TO THE EC BUDGET
          ( REFUMS/LNTERVENTIONS )                               0                        0                            0
        -CHARGED
        –CHARGED TO NATIONAL ADMI   ADHINISTR .                                     negligible                    negligible
I       -CHARGED TO OTHER NATIONAL CROUPS                                                 mm
I 5.1 RECEIPTS
I       –O'( RLEVIES/CUSTOIS
               FN RESOURCES OFDUTIES
                                T!!E EC)
I       -NATIONAL
                                                                             I
                                                      TEAR .... L97.7          YEAR       197J3          YEAR ....1979-
   5-0.1 PIAJRI ANNUAL PATTERN OF EXPENDITURE                      0                      0                         0
   5.1.1 PLURI ANNUAL PATTERN OF RECEIPTS
   5 .2 KETHOD OF CALCULATION For skimmed milk powder during a deferment lasting 12 months the
 sost of financing would rise to 26 u.a./T ( based on a world' prioe of 325 u.a./T).,
 These expenses would be laid to item 6214 of the budget .                                    On the other hand , this de­
 ferment of payment offered to the exporter for a definite quantity is conducive to tha
 best conditions of sale ( saving under item 6214 ), and will allow a reduction or inhi­
 bit a rise in export refunds ( saving under item 6200). The proposed measure might be
 3apable of enlarging the exported quantities * For the moment it is not possible to
 estimate the quantities which will be exported under this regime and consequently it
 is nox
 ib    not possiDxe
                 possible xo  to evaiuaxe
                                    evaluate une the budgetary        effects oi
                                                         ouagexary enecxs         of xms
                                                                                      this provision
                                                                                              provision ;: îx    it mignx
                                                                                                                    might beDe mnilL
                                                                                                                                   if.
                        :                                                                                      :            _J
  6.0 FINANCING POSSIBLE KITH CREDITS INSCRIBED IN RELEVANT CHAPTER OF CURRENT BUDGET ?                             YES/Sa
                                    TRANSFER BSTA'SEM CHAPTERS OF CURRENT BUDGET ?
  lì " in i        ni Hiii il inni i MIII ÌI IN TT l"T      , w-           r–T7T                                    ii_.nu
                                                                                                   1^5532
  COMKENTS I