Article 1 
Compensation on the terms set out in this Regulation shall be granted to those producers who were transferees of the whole or part of a holding subject to an undertaking given pursuant to Regulation (EEC) No 1078/77 (‘SLOM holding’) and who have suffered loss as a result of a restriction in levels of deliveries or sales of milk or milk products by virtue of that undertaking during the reference year selected by the Member State concerned under the additional levy scheme in the milk and milk product sector.
Article 2 
An application for compensation shall be deemed eligible if it is submitted by a producer who has been allocated a special reference quantity pursuant to Article 1(1) of Regulation (EEC) No 2055/93, or who, pursuant to Article 1(2) of that Regulation, has been allocated a share of a special reference quantity previously allocated by virtue of Article 3a of Regulation (EEC) No 857/84, or an equivalent quantity emanating from the national reserve referred to in Article 5 of Council Regulation (EEC) No 3950/92 of 28 December 1992 establishing an additional levy in the milk and milk products sector ( 10 ) where a Member State has decided pursuant to Article 1(2), third subparagraph of Regulation (EEC) No 2055/93 to fulfil the rights of the transferee in that way.
Article 3 
The application shall be submitted by the person to whom the special reference quantity referred to in Article 2 has been allocated or by his or her heir or heirs, without prejudice to the application of the provisions of Member States' national law.
Article 4 
By way of derogation from Article 2, an application shall not be accepted if the producer who received the special reference quantity pursuant to Regulation (EEC) No 2055/93 participated before 1 October 1996 in any measure regarding the definitive abandonment of reference quantities or sold or leased the whole of his holding before that date.
Article 5 
1. The competent authority referred to in Article 9 shall determine the annual quantity in respect of which compensation is due on the basis of the quantity used to calculate the premium granted pursuant to Regulation (EEC) No 1078/77, increased by 1 % and reduced by a percentage representing the reductions applied in each Member State to the reference quantities of producers established in accordance with Articles 2 and 6 of Regulation (EEC) No 857/84. 2. For producers who were transferees of the whole of a SLOM holding the annual quantity shall be that calculated in accordance with paragraph 1 reduced, where appropriate, in accordance with paragraph 4. 3. For producers who were transferees of a part of a SLOM holding, the annual quantity shall be that calculated in accordance with paragraph 1 reduced in proportion to the area of the original SLOM holding which was not transferred. Where the original SLOM holding was a mixed holding, the reduction shall be calculated on the basis of the areas of the original SLOM holding which were used directly or indirectly for milk production provided that such use can be established to the satisfaction of the competent authority. The resulting quantity shall be further reduced, where appropriate, in accordance with paragraph 4. 4. If the producer has given up a part of the SLOM holding, or of the part of the SLOM holding transferred to him, prior to the allocation of a special reference quantity pursuant to Regulation (EEC) No 2055/93 including the period of the non-marketing undertaking, the annual quantity in respect of which compensation is due as referred to in paragraphs 2 and 3 respectively shall be reduced in proportion to the area given up. Where the original SLOM holding was a mixed holding, the reduction shall be calculated taking account only of the areas which were used directly or indirectly for milk production provided that such use can be established to the satisfaction of the competent authority.
Article 6 
If part of the holding of the producer was sold or leased after the allocation of the special reference quantity and before 1 October 1996, the annual quantity in respect of which compensation is due, determined in accordance with Article 5, shall be reduced by the amount of the special reference quantity returned to the national reserve.
Article 7 
1. Compensation shall only be offered for the period for which the right to compensation is not time-barred. 2. For the purpose of determining the period for which compensation shall be offered: (a) the date of interruption of the five-year time bar laid down by Article 43 of the State of the Court of Justice shall be the earliest of the following events: — in the case of an action brought before the Court of Justice or the Court of First Instance, the date on which the application is entered in its register, — in the case of an application addressed to a Community institution, the date of reception of such application by the Council or the Commission (whichever was the earlier) provided either that the applicant subsequently brought an action before the Court of First Instance within the two-month delay stipulated in Article 43 of the Statute of the Court of Justice, or that the Community institution accepted in writing that such application interrupted the time bar; the date of interruption of the five-year time bar laid down by Article 43 of the State of the Court of Justice shall be the earliest of the following events: — in the case of an action brought before the Court of Justice or the Court of First Instance, the date on which the application is entered in its register, — in the case of an application addressed to a Community institution, the date of reception of such application by the Council or the Commission (whichever was the earlier) provided either that the applicant subsequently brought an action before the Court of First Instance within the two-month delay stipulated in Article 43 of the Statute of the Court of Justice, or that the Community institution accepted in writing that such application interrupted the time bar; (b) the starting date of the compensation period shall be five years before the date of interruption of the time bar, but not before 2 April 1984 nor before the date on which the non-marketing or conversion undertaking expired; (c) the closing date of the compensation period shall be 1 August 1993 or the date when the producer received a special reference quantity if earlier.
Article 8 
If during the compensation period, and prior to the allocation of the special reference quantity, production was increased by the producer in excess of the reference quantity available to him, the quantity in respect of which compensation is due shall be reduced for the period concerned by the quantities delivered or sold directly which exceed that reference quantity. The quantities delivered or sold directly, and the reference quantity available, for a part of a twelve month period, shall be determined as a proportion of the total deliveries or direct sales, and the reference quantity available, for the whole of the twelve month period. The reference quantities referred to in the second subparagraph of Article 2 of Regulation (EEC) No 2055/93 are not taken into account for the purposes of determining the reference quantity available.
Article 9 
Each application for compensation must be addressed to the competent authority designated for that purpose in each Member State concerned using a form drawn up in accordance with the procedure laid down in Article 30 of Regulation (EEC) No 804/68 ( 11 ) . It must be received by the competent authority by 31 January 1999 at the latest in order to be admissible.
Article 10 
The competent authority referred to in Article 9 shall check the accuracy of the information provided by the producer and shall calculate the amount of the compensation on the basis of the quantity and the period in respect of which compensation is due, using the amounts specified in the Annex.
Article 11 
Interest shall be added to the amount of the compensation at the rate of 6 % per year from 9 December 1997 to the date of payment of the compensation. However, in the event that payment of compensation is delayed because of a failure by the producer to provide information or documents relating to the application for compensation requested by the competent authority, or the proof of the withdrawal of the proceedings referred to in Article 13(3) second subparagraph, interest shall not be paid for the period of the delay.
Article 12 
The total amount of compensation shall be converted into national currency using the agricultural conversion rate applicable on the date on which this Regulation enters into force.
Article 13 
1. Within four months of receipt of an application for compensation, the competent authority referred to in Article 9 shall transmit an offer of compensation calculated in accordance with this Regulation to the applicant, accompanied by a receipt in full and final settlement. This period may be extended by the Commission in accordance with the procedure referred to in Article 16 at the duly justified request of a Member State. The offer shall be made in the name and on behalf of the Council and the Commission. 2. Where the applicant is the transferee of part of a SLOM holding and the special reference quantity allocated pursuant to Articles 1(1) or 1(2) of Regulation (EEC) No 2055/93 is subject to re-assessment by the national authorities, the time limit in paragraph 1 shall be four months from the date of the final decision of the national authorities on the re-assessment of the special reference quantity, where that decision is later than the receipt of the application for compensation. 3. The offer shall be accepted by the return to the competent authority of the duly signed receipt. It must be received by the competent authority not later than three months following the date of transmission of the offer in order to be binding. The compensation shall be paid on acceptance of the offer. However, in the case of producers who have instituted proceedings against the Community institutions, proof of the withdrawal of the proceedings must also be presented to the competent authority before payment of the compensation. Failure to accept the offer within the time limit laid down shall mean that it shall cease to be binding on the Council and Commission. Acceptance of the offer shall imply the relinquishment of any claim of whatever nature against the Community in respect of any loss within the meaning of Article 1, including interest and costs.
Article 14 
The limitation period pursuant to Article 43 of the Statute of the Court of Justice shall start to run again from 1 February 1999 for all producers referred to in Article 1 who have not presented an application for compensation in accordance with Article 9 unless it was interrupted by the institution of proceedings which are still pending. For producers who have received an offer of compensation by virtue of Article 13(1) or (2), the limitation period shall start to run again on the day following the expiry of the period for acceptance of the offer set out in Article 13(3) unless it was interrupted by the institution of proceedings which are still pending.
Article 15 
The Commission may decide in accordance with the procedure referred to in Article 16 to authorise the transmission of offers of compensation to producers whose circumstances are such as to satisfy the requirements for establishing the liability of the Community, but who have not obtained compensation pursuant to Regulation (EEC) No 2187/93 or under the preceding provisions of this Regulation. The amount of compensation offered shall be calculated in accordance with the provisions of Regulation (EEC) No 2187/93 or of this Regulation or in accordance with the criteria which may be laid down in the judgment on damages by the Court of Justice in joined cases C-104/89 and C-37/90, as appropriate. The rate of interest to be added and the period for which it is to be calculated may be adapted to take account of specific circumstances. The necessary time limits relating to the offers of compensation and their acceptance shall also be fixed.
Article 16 
Detailed rules for the application of this Regulation, and in particular the provisions regarding payment of the costs of producers' agents, shall be adopted by the Commission in accordance with the procedure laid down in Article 30 of Council Regulation (EEC) No 804/68.
Article 17 
The financing of the payments made pursuant to this Regulation shall be deemed to be intervention within the meaning of Article 3 of Regulation (EEC) No 729/70 ( 12 ) .
Article 18 
This Regulation shall enter into force on the third day following its publication in the Official Journal of the European Communities . This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Luxembourg, 22 October 1998. For the Council The President W. MOLTERER This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Luxembourg, 22 October 1998. For the Council The President W. MOLTERER For the Council The President W. MOLTERER