CELEX: 51992PC0275
Language: en
Date: 1992-07-08
Title: Proposal for a COUNCIL REGULATION (EEC) on the unit of account and the conversion rates to be applied for the purpose of the common agricultural policy

25 . 7 . 92                               Official Journal of the European Communities                                 No C 188 / 23
     (a) does not grant Community undertakings effective                 (c) grants undertakings from other third countries
          access comparable to that granted by the                           more favourable treatment than Community
          Community undertakings from that country;                          undertakings,
                                                                         the Commission shall initiate negotiations in order to
     (b) does not grant Community undertakings national                  remedy the situation .'
          treatment or the same competitive opportunities as
          are available to national undertakings ; or                    [Paragraphs 4 and 5 are unchanged .]
                 Proposal for a Council Regulation (EEC) on the unit of account and the conversion rates to be
                                     applied for the purposes of the common agricultural policy
                                                           (92 /C 188 /09)
                                                         COM(92) 275 final
                                           (Submitted by the Commission on 10 July 1992)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,                              — Council Regulation (EEC) No 1678 / 85 of 11 June
                                                                          1985 fixing the conversion rates to be applied in agri­
Having regard to the Treaty establishing the European                     culture (4), as last amended by Regulation (EEC) No
Economic Community, and in particular Articles 42 and
43 thereof,
Having regard to the proposal from the Commission,                   — Council Regulation (EEC) No 129/78 of 24 January
                                                                          1978 on the exchange rates to be applied for the
Having regard to the opinion of the European                              purposes of the common agricultural structures
Parliament,                                                              policy (5),
Having regard to the opinion of the Economic and
Social Committee ,
                                                                     requires checks at the Community's internal frontiers ;
Having regard to the opinion of the Monetary                         whereas, therefore, agromonetary arrangements must be
Committee .                                                          etablished which are compatible with the internal market
                                                                     and the Regulations in question should be repealed ;
Whereas the internal market provided for in Article 8 a of
the Treaty will constitute from 1 January 1993 an area
without internal frontiers ; whereas application of the              Whereas the ecu is defined by Council Regulation (EEC)
agrimonetary arrangements on the basis of :                          No 3180/78 of 18 December 1978 changing the value of
                                                                     the unit of account used by the European Monetary
— Council Regulation (EEC) No 1676/ 85 of 11 June                    Cooperation Fund ('), as last amended by Regulation
      1985 on the value of the unit of account and the
                                                                     (EEC) No 1971 /89 (7); whereas this unit of account
     conversion rates to be applied for the purposes of the          should be used to fix and express the prices or amounts
     common agricultural policy ('), as last amended by              established under the common agricultural policy ;
     Regulation (EEC) No 2205 /90 (2),
— Council Regulation (EEC) No 1677/ 85 of 11 June
      1985 on monetary compensatory amounts in agri­                 Whereas, prior to the achievement of economic and
     culture (J), as last amended by Regulation (EEC) No             monetary union, prices and amounts fixed in ecus must
     2205 / 90 ,
                                                                     be     paid       in       national       currency  and    the
                                                                     (4) OJ  No  L  164, 24. 6 . 1985, p. 11 .
(') OJ No L 164 , 24 . 6 . 1985 , p. 1 .                             C)  OJ  No  L 20 , 25 . 1 . 1978 , p. 16.
O OJ No L 201 , 31 . 7 . 1990 , p . 9 .                              (') OJ  No  L 379, 30 . 12 . 1978 , p. 1 .
O OJ No L 164 , 24 . 6 . 1985 , p . 6 .                              O   OJ  No  L  189, 4. 7 . 1989, p. 1 .
 ---pagebreak---  No C 188 / 24                            Official Journal of the European Communities                                  25 . 7 . 92
 conversion rates applicable in the agricultural sector must         tiveness and on coordination of their activities between
 therefore be determined ; whereas such rates must be                themselves and with the operations of the European
 reasonably stable while closely reflecting actual economic          Investment Bank and the other existing financial
 and monetary circumstances ; whereas , without prejudice            instruments (');
 to the rates provided for pursuant to Article 22 of
 Council Regulation ( EEC) No 4253 / 88 ('), specific rates
 may be necessary in certain special cases ;                         Whereas provision must be made to enable aspects of the
                                                                     arrangements governing trade in agricultural products
                                                                     with third countries to be adapted rapidly in the event of
 Whereas , in the event of a monetary realignment, the               changes in the central rates of the currencies of the
 agricultural conversion rates should in principle be                Member States or the exchange rates of the currencies of
 adjusted immediately ; whereas, however, it may be                  certain third countries ;
 worthwhile to make the adjustment gradually in small
 steps in order to avoid market disturbance , or may need
 to be made in stages in order to lessen the impact of               Whereas special rules should be laid down for dealing
 major adjustments ; whereas, in all cases, a permissible            with exceptional situations arising either within the
 bilateral monetary gap must not be overstepped if                   Community or on the world market and requiring
 significant market disturbance is to be avoided ;                   immediate action to ensure that the arrangements estab­
                                                                     lished under the common agricultural policy operate
                                                                     effectively ;
Whereas the conversion rates between the ecu and the
 currencies of third countries used in agriculture should
 be indicated , particularly in order to determine the              Whereas, to facilitate implementation of this Regulation,
 influence of the situation on the world market ;                    provision should be made for a procedure instituting
                                                                     close cooperation between the Member States and the
                                                                     Commission ;
Whereas , if the agricultural conversion rate is changed
 during the period when an operation is being carried
 out, the rate, applicable to the amounts concerned must            Whereas the effects on prices or amounts in national
be determined ; whereas, as a general rule, the operative           currencies of the abolition of the correcting factor
event for the agricultural conversion rate is the event             referred to in Article 6 ( 1 ) of Regulation (EEC) No
whereby the economic objective of the operation is                   1677/ 85 during the transition from the previous system
 attained ; whereas it may be necessary to specify or               to the system provided for in this Regulation must be
derogate from this operative event, while respecting                neutralized by a corresponding increase in their value
certain criteria, and particularly the speed with which the         expressed in ecus ; whereas provision should be made for
 new agricultural conversion rates are actually applied ;           the possibility of interim measures to facilitate the intro­
whereas this automatically excludes the various possi­              duction of the new agrimonetary arrangements,
bilities for advance fixing of the rate ; whereas, as regards
the amounts fixed by the Council in the context of the
agricultural structures policy, a reduction in the aid              HAS ADOPTED THIS REGULATION :
granted before the new agricultural conversion rate takes
effect should be prevented ;
                                                                                                Article 1
Whereas , in the event of a major monetary reevaluation ,
agricultural incomes tend to shrink more rapidly and to a           For the purposes of this Regulation :
greater extent than incomes in other sectors of the
economy ; whereas provision should accordingly be made              (a) 'legal instruments relating to the common agri­
for the granting of temporary, degressive aid to                         cultural policy' means :
accompany the adjustment of agricultural prices in order
to compensate for reevaluations without thereby
hindering the definitive adjustment of agriculture to the                — legal instruments based directly or indirectly on
rules of the economy in general ; whereas the principle of                   Article 43 of the EEC Treaty, with the exception
the cohesion provided for in Article 130a of the Treaty                      of the Common Customs Tariff and other legal
calls for the possibility of a Community contribution                        instruments of customs legislation applicable to
towards the compensatory aid to Farmers ; whereas the                        both agricultural and industrial products,
level of the Community contribution must vary
according to the requirements and the financial resources                — legal instruments applicable to goods processed
available in the various regions of the Community falling                    from agricultural products and subject to specific
within Objective 1 in accordance with Article 1 of                           trade arrangements ;
Council Regulation (EEC) No 2052 / 88 of 24 June 1988
on the tasks of the Structural Fund and their effec­
(') OJ No L 374 , 31 . 12 . 1988 , p. 1 .                           (J) OJ No L 185 , 15 . 7 . 1988, p. 9.
 ---pagebreak--- 25 . 7 . 92                            Official Journal of the European Communities                            No C 188 / 25
(b) — 'fixed currencies' means currencies which are              2. In the case of measures Community financing of
          maintained within a maximum spread at any              which under the EAGGF comes solely from the
          given time of 2,25 % of less within the European       Guidance Section, the agricultural conversion rate shall
          Monetary System ,                                      be equal to the rate applying for the entry into the
                                                                 accounts of expenditure to the general budget of the
     — 'floating currencies' means other currencies of           European Communities .
          Member States or of third countries ;
 (c) 'representative market rate' means :                        3 . A specific agricultural conversion rate closely
                                                                 reflecting the economic circumstances may be
     — in the case of a fixed currency, the central rate         determined or, where required, detailed rules for deter­
          for the ecu fixed within the framework of the          mining such a rate may be adopted in accordance with
          European Monetary system with respect to that          the procedure laid down in Article 10 in order to
          currency,
                                                                 forestall risks of market distortion of monetary origin,
                                                                 and in particular ;
     — in the case of a floating currency, the average
          exchange rate for the ecu with respect to that
          currency, recorded over a reference period             — to avoid exceeding the monetary gap characteristic of
          determined in accordance with the procedure laid           the trend in the representative market rate at the time
          down in Article 10 ;                                       the agricultural conversion rate is determined ,
 (d) ' agricultural conversion rate' means the rate used in
     legal instruments relating to the common agricultural       — to convert into ecus amounts relating to world
     policy, to convert :                                            market data and expressed in the national currency
                                                                     of a Member State .
     — amounts expressed in ecus into the national
          currency of a Member State ,
                                                                 4 . The Council or the Commission, by virtue of the
     — amounts expressed in the national currency of a           powers with which they are vested in each individual
          Member State into ecus ;                               case, may provide where necessary for the rate applicable
                                                                 for the entry in the accounts of expenditure under the
(e) 'monetary gap' means the percentage of the agri­             general budget of the European Communities to be used
     cultural conversion rate representing the difference        instead of the agricultural conversion rate .
     between that rate and the representative market rate .
                           Article 2                                                       Article 4
 1.     The unit of account used in legal instruments            1 . The agricultural conversion rate for a floating
relating to the common agricultural policy shall be the          currency shall be adjusted where the monetary gap
ecu as defined in Regulation (EEC) No 3180 / 78 .                exceeds 2,5 points for a significant period of a certain
                                                                 month. In that case, the new agricultural conversion rate
                                                                 shall be fixed so as to reduce that monetary gap by half
2 . The prices and amounts concerned shall be                    and shall take effect from the first day following the
expressed in ecus in administrative documents drawn up           month in question .
by the Community or by the Member States, for the
purpose of applying the instruments referred to in
paragraph 1 .
                                                                 2.    In the case of a monetary realignment affecting the
                                                                 central rates determined for the Member States with
                           Article 3                             fixed currencies, the agricultural conversion rates shall be
                                                                 adjusted immediately so as to :
 1 . Without prejudice to the derogations provided for
in paragraphs 2, 3 and 4, the agricultural conversion rate
shall be fixed by the Commission on the basis of the
representative market rate and in accordance with Article        — eliminate the monetary gaps of the fixed currencies ,
4.                                                                   and
The agricultural conversion rate shall initially be equal to
the representative market rate for a significant period of       — reduce the monetary gaps of the floating currencies
the month preceding the date on which it takes effect.               in accordance with paragraph 1 .
 ---pagebreak--- No C 188 / 26                         Official Journal of the European Communities                                  25 . 7 . 92
However, in the case of a monetary realignment leading                                     Article 6
to a monetary gap for a fixed currency :
                                                                 1.    The operative event for the agricultural conversion
                                                                rate shall be :
— less than or equal to 0,5 points, this gap is dismantled
     over a maximum period of 12 months from the date           — the completion of customs import or export
     of realignment, and at the latest at the beginning of          formalities in the case of amounts collected or
     the next marketing year,                                       granted in trade with third countries,
— greater than five points, this gap is, without prejudice      — the event whereby the economic objective of the
     to paragraph 3, immediately reduced to a level of five         operation is attained in all other cases.
     points, and the remaining gap is dismantled over a
     maximum period of 12 months from the date of
     realignment and at the latest at the beginning of the      2 . Where the operative event as referred to in
     next marketing year.                                       paragraph 1 has to be specified or cannot be taken into
                                                                account for reasons peculiar to the market organization
                                                                or the amount in question, a specific operative event may
The adjustments of the agricultural conversion rates,           be determined in accordance with the procedure laid
provided for in the second subparagraph are made by the         down in Article 10 , taking account of the following
Commission in accordance with the procedure laid down           criteria :
in Article 10 .
                                                                (a) actual applicability as soon as possible of adjustments
                                                                     to the agricultural conversion rate ;
3 . All adjustments to agricultural conversion rates
shall be made in such a way that the positive and the
negative gaps between the currencies of two Member              (b) similarity of the operative events for analogous oper­
States shall not exceed five points when combined. To                ations carried out under those different market
that end, the amount by which the monetary gaps for                  organizations ;
each Member State concerned are reduced shall be
increased in line with the size of the gap .
                                                                (c) coherence in the operative events for the various
                                                                     prices and amounts relating to a single market
                                                                     organization ;
                          Article 5
 1 . The representative market rate for the national            (d) practicability and effectiveness of checks on the
currency of a third country shall be used in legal                   application of suitable agricultural conversion rates.
instruments relating to the common agricultural policy to
convert :
                                                                3 . The amounts fixed by the Council in the context of
                                                                aid for which Community financing is provided by the
                                                                EAGGF Guidance          Section   shall be   converted    into
— amounts expressed in ecus into the national currency
     of that third country,                                     national currency at the agricultural conversion rate
                                                                applicable on 1 January of the year during which the aid
                                                                is granted .
— amounts expressed in the national currency of that
     third country into ecus .                                  Where the Community rules stipulate that payment of
                                                                the aid is to be spread over several years, the aid
                                                                instalments shall be converted using the lowest agri­
2.     In order to avoid risks of market distortion of          cultural conversion rate of those applicable on 1 January
monetary origin, the Commission, by virtue of the               of each of the years from that in which the aid is granted
powers with which it is vested in each individual case,         until that for which the instalment in question is to be
may derogate from paragraph 1 to permit the use of              paid .
conversion rates more closely reflecting the actual
economic circumstances .
                                                                                           Article 7
3 . The detailed rules for determining a specific               1 . The Member States affected by monetary revalu­
conversion rate more closely reflecting the actual              ations may grant compensatory aid to farmers if the
economic circumstances may be laid down in accordance           average agricultural conversion rate, for the main basic
with the procedure provided for in Article 10 with a view       products concerned which are covered by a market
to the conversion of amounts expressed in the national          organization, is, during a marketing year, more than
currency of a third country into the national currency of       2 % lower than the average rate for the preceding
a Member State .                                                marketing year.
 ---pagebreak--- 25 . 7 . 92                           Official Journal of the European Communities                            No C 188 /27
2. The maximum compensatory aid for monetary                                                Article 9
reevaluations which may be granted per marketing year
shall be established in terms of the recorded loss of            1 . Where unusual monetary practices are liable to
income due to the average fall in the agricultural              upset the application of the legal instruments relating to
conversion rate less two points per marketing year of           the common agricultural policy, the Commission shall
granting .                                                      adopt suitable protective measures, which may, where
                                                                necessary, derogate from the existing legal instruments
                                                                relating to the common agricultural policy.
3.      The basic products referred to in paragraph 1 and
the maximum aid referred to in paragraph 2 shall be
                                                                The Council and the Member States shall be notified
determined, subject to the attainment of minimum
                                                                forthwith of the measures referred to in the first
values, by the Commission in accordance with the
procedure laid down in Article 10 .                             subparagraph .
                                                                Any Member State may refer the Commission's decision
4. The Community contribution to the financing of               to the Council during the three working days following
the compensatory aid for monetary reevaluations shall           that on which they are notified of protective measures.
amount to :
— 50 % of the aid actually granted for holdings located         The Council, acting by a qualified majority, may take a
                                                                different decision within one month of notification of the
     in a region covered by Objective 1 as referred to in
     Article 1 of Regulation (EEC) No 2052 / 88 ,                measures in question .
— 25 % of the aid actually granted in other cases.               2 . Where unusual monetary practices are liable to
                                                                 upset the application of the legal instruments relating to
                                                                 the common agricultural policy, the Commission may, by
For the purposes of the financing of the common agri­           virtue of the powers with which it is vested in each indi­
cultural policy, this contribution shall be deemed inter­       vidual case, derogate from this Regulation, in particular
vention intended to stabilize the agricultural markets .         in the following cases :
                          Article 8                             — where a country uses abnormal exchange techniques
                                                                     such as multiple exchange rates or operates barter
In the case of a monetary realignment within the                     agreements ,
framework of the European Monetary System or of an
abrupt and significant change in the exchange rates
between the ecu and the national currencies of third            — where countries          have currencies which   are not
countries, the following amounts, fixed in the legal                 quoted on official foreign exchange markets or
instruments relating to the common agricultural policy,              where the trend in such currencies is likely to create
                                                                     distortion in trade .
 may, where necessary, be fixed anew by the Commission
 using the new agricultural conversion rates in accordance
with the methods applicable in each case and, where
 appropriate, in light of developments in the market                                        Article 10
 situation :
                                                                 The detailed rules of application for this Regulation shall
                                                                 be laid down in accordance with the procedure provided
— import duties ,                                                for in :
— export duties ,                                                (a) Article 26 of Council Regulation (EEC) No 2727 /75
                                                                      of 29 October 1975 on the common organization of
                                                                      the market in cereals ; or
— export refunds ,
— sluice-gate prices ,                                           (b) the corresponding articles of the other Regulations
                                                                      on the common organization of the markets in agri­
                                                                      cultural or fishery products ; or
— aids fixed on the basis of world market data,
                                                                 (c) the corresponding articles of other Community
— import subsidies .                                                  provisions introducing a similar procedure .
 ---pagebreak--- NoC 188 /28                            Official Journal of the European Communities                               25 . 7 . 92
                          Article 11                             3.    The arrangements laid down in this Regulation
                                                                 shall be reviewed before 31 December 1996 to take
1.      Prices and amounts fixed in ecus under the               account of the introduction of the parities fixed ir­
common agricultural policy, the corresponding value of           revocably under economic and monetary union .
which in national currency is, at 31 December 1992,
subject to the correcting factor referred to in Article 6        4 . Regulations (EEC) No 1676/ 85 , (EEC) No
( 1 ) of Regulation (EEC) No 1677/85, shall be multiplied         1677/ 85, (EEC) No 1678 / 85 and (EEC) No 129/78 are
by 1,145109 .                                                    hereby repealed.
2.     Where transitional measures prove necessary to
facilitate the initial application of this Regulation, such                               Article 12
measures shall be adopted by the Commission in
accordance with the procedure laid down in Article 10            This Regulation shall enter into force on 1 January 1993 .
and shall remain applicable for the period strictly
necessary to facilitate the introduction of the new              This Regulation shall be binding in its entirety and
arrangements .                                                   directly applicable in all Member States .