Proposal for a Council Regulation laying down specific measures for agriculture in the outermost regions of the Union - Montesquieu Instituut

 

COUNCIL OFBrussels, 30 May 2005 (06.06)

(OR. fr)

THE EUROPEAN UNION

7476/05

Interinstitutional File:

2004/0247 (CNS)

AGRI 94 AGRIFIN 21 POSEICAN 1 POSEIDOM 1 POSEIMA 1

NOTE

from:

Presidency

to: Working Party on the Outermost Regions

Nos prev. docs : 15916/04 AGRI 335 AGRIFIN 111 POSEICAN 17 POSEIDOM 17

POSEIMA 19 15039/04 AGRI 310 AGRIFIN 104 POSEICAN 16 POSEIDOM 16 POSEIMA 18

No. Cion prop. : 14126/04 AGRI 280 AGRIFIN 85 POSEICAN 15 POSEIDOM 15 POSEIMA 17 Subject :

Proposal for a Council Regulation laying down specific measures for agriculture in the outermost regions of the Union

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ANNEX

Proposal for a

COUNCIL REGULATION

laying down specific measures for agriculture

in the outermost regions of the Union

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community, and in particular Articles 36, 37

and 299(2) 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 European Economic and Social Committee,

Having regard to the opinion of the Committee of the Regions,

(1) The particular geographical situation of the outermost regions imposes additional transport

costs in supplying products which are essential for human consumption, for processing or as

agricultural inputs. In addition, objective factors arising as a result of insularity and

remoteness impose further constraints on economic operators and producers in the outermost

regions that severely handicap their activities. These handicaps can be alleviated by

lowering the price of these essential products. It is therefore appropriate to introduce specific

supply arrangements to guarantee supply to the outermost regions and compensate for the

additional costs arising from their remoteness, insularity and distant location.

(2) To that end, notwithstanding Article 23 of the Treaty, imports of certain agricultural

products from third countries should be exempt from the applicable import duties. To take

account of their origin and the customs treatment accorded to them under the Community

provisions, products which have entered the Community's customs territory under inward

processing or customs warehousing arrangements should be considered as direct imports, for

the purpose of granting the benefits of the specific supply arrangements.

(3) In order to achieve the goal of lowering prices in the outermost regions and mitigating the

additional costs of their remoteness, insularity and distant location while maintaining the

competitiveness of Community products, aid should be granted for the supply of products of

Community origin to the outermost regions. Such aid should take account of the additional

cost of transport to the outermost regions and the prices applied to exports to third countries

(4) Since the quantities covered by the specific supply arrangements are limited to the supply

requirements of the outermost regions, those arrangements do not impair the proper

functioning of the internal market. Nor should the economic advantages of the specific

supply arrangements provoke diversions of trade in the products concerned. Dispatching or

exportation of those products from the outermost regions should therefore be prohibited.

However, dispatch or exportation of those products should be authorised where the

advantage resulting from the specific supply arrangements is reimbursed or, in the case of

processed products, to permit regional trade or trade between the two Portuguese outermost

regions. Account should also be taken of traditional trade flows with third countries in all

the outermost regions, and exports of processed products corresponding to traditional

exports for all those regions should accordingly be authorised. Nor should the restriction

apply to the traditional dispatching of processed products. For the sake of clarity, the

reference period for defining those traditionally exported or dispatched quantities should be

specified.

(5) In the case of C sugar to supply the Azores, Madeira and the Canary Islands, the

Commission arrangements for exemption from import duties should continue to apply

for the period laid down in Article 10(1) of Council Regulation (EC) No 1260/2001 1.

(6) Up to now the Canary Islands have been supplied under the specific supply

arrangements with milk-based preparations falling within codes 1901 9099 and

2106 9092 intended for industrial processing. Supply of those products should be

(7) In order to achieve the objectives of the specific supply arrangements, the economic

advantages of the arrangements must be in terms of production costs and must cut prices up

to the end-user stage. They should therefore be granted only on condition that they are

actually passed on, and appropriate checks must be carried out.

(8) Community policy to assist local production in the outermost regions has involved a

multitude of products and measures for their production, marketing or processing. These

measures have proved effective and ensured that agriculture continues and develops. The

Community should continue to support these lines of production, which are a key factor in

the environmental, social and economic equilibrium of the outermost regions. Experience

has shown that, as in the case of rural development policy, a closer partnership with the local

authorities can help to address the particular issues affecting the regions concerned in a more

targeted way. Support for local production should thus continue through general

programmes at the most appropriate geographical level, to be submitted by the Member

State concerned to the Commission.

(9) To help achieve the goals of developing local agricultural production and the supply of

agricultural products, the level of programming of supplies to the regions concerned should

be harmonised and the approach of partnership between the Commission and the Member

States should be systematic. The supply programme should therefore be established by the

authorities designated by the Member State and submitted to the Commission for approval.

(11) Council Regulation (EC) No 1257/1999 of 17 May 1999 on support for rural development

from the European Agricultural Guidance and Guarantee Fund (EAGGF) and amending and

repealing certain Regulations 1 defines the rural development measures eligible for

Community support and the conditions for obtaining that support. The structures of certain

farms or processing and marketing firms in the outermost regions are seriously defective and

face specific difficulties. Provision should accordingly be made for the possibility of

derogations for certain types of investment from the provisions restricting the grant of some

structural aid provided for in Regulation (EC) No 1257/1999.

(12) Article 29(3) of Regulation (EC) No 1257/1999 restricts the grant of forestry support to

forests and wooded areas belonging to private owners and municipalities and associations

thereof. Parts of the forests and wooded areas located in the outermost regions belong to

public authorities other than municipalities. Under these circumstances, the conditions laid

down in the said Article should be made more flexible.

(13) Article 24(2) of Regulation (EC) No 1257/1999 and the Annex thereto determine the

maximum amounts per year eligible for Community agri-environmental aid. To take into

account the specific environmental situation of certain very sensitive pasture areas in the

Azores and the preservation of the landscape and traditional features of agricultural land, in

particular the areas of terrace cultivation in Madeira, provision should be made for the

possibility, in the case of certain specific measures, of increasing those amounts up to

(14) A derogation may be granted from the Commission's consistent policy of not authorising

State operating aid for the production, processing and marketing of agricultural products

covered by Annex I to the Treaty in order to mitigate the specific constraints on farming in

the outermost regions as a result of their remoteness, insularity and distant location, small

area, mountainous terrain and climate and their economic dependency on a small number of

products.

(15) The plant health of agricultural crops in the French overseas departments is subject to

particular problems associated with the climate and the inadequacy of the control measures

hitherto applied there. Programmes should therefore be implemented to combat harmful

organisms, including by organic methods. The Community's financial contribution towards

such programmes should be specified.

(16) The maintenance of vineyards, which are the most widespread crop in the regions of

Madeira and the Canary Islands and a very important one for the Azores, is an economic and

environmental imperative. To help support production, neither abandonment premiums nor

market mechanisms should be applicable in these regions, but nonetheless, in the Canary

Islands, it should be possible to apply crisis distillation measures in the event of exceptional

market disturbance arising from quality problems. Similarly, technical and socio-economic

difficulties have prevented the complete conversion within the time limits set of the areas in

the regions of Madeira and the Azores planted to vines of hybrid varieties prohibited by the

(17) The restructuring of the milk sector is not yet complete in the Azores. In line with the high

dependence of the Azores on milk production, combined with other handicaps connected

with their distant location and the absence of profitable alternative lines of production, the

derogation from certain provisions of Council Regulation (EC) No 1788/2003 of 29

September 2003 establishing a levy in the milk and milk products sector1,introduced by

Article 23 of Council Regulation (EC) No 1453/2001 of 28 June 2001 introducing specific

measures for certain agricultural products for the Azores and Madeira and repealing

Regulation (EEC) No 1600/92 (Poseima)2 and renewed by Council Regulation (EC)

No 55/2004 of 17 December 2003 amending Regulation (EC) No 1453/2001 introducing

specific measures for certain agricultural products for the Azores and Madeira and repealing

Regulation (EEC) No 1600/92 (Poseima) with respect to the application of the

supplementary levy in the milk and milk products sector in the Azores.

(18) Support for the production of cows' milk in Madeira has not succeeded in maintaining the

balance between domestic and external supply, chiefly because of the serious structural

difficulties affecting the sector and its poor capacity to adapt to new economic

environments. Consequently, authorisation to produce reconstituted UHT milk from milk

powder of Community origin should continue, with a view to covering local consumption

more fully.

(19) The need to maintain local production by means of incentives justifies not applying

(20) Traditional livestock farming activities should be supported. In order to meet the local

consumption needs of the French overseas departments and Madeira, duty-free imports from

third countries of male bovine animals intended for fattening should be authorised subject to

certain conditions and up to a maximum annual limit. The possibility opened under

Regulation (EC) No 1782/2003 to enable Portugal to transfer rights to the suckler cow

premium from the mainland to the Azores should be renewed and that instrument should be

adjusted in line with the new support arrangements for the outermost regions.

(21) Tobacco growing is of historical importance in the Canary Islands. Economically speaking,

tobacco preparation continues to be one of the chief industrial activities in the region. In

social terms, tobacco cultivation is very labour-intensive and carried out by small farms.

Since the crop is not sufficiently profitable, however, it is in danger of dying out. Tobacco is

currently cultivated on only a small area on the island of La Palma, for the small-scale

manufacture of cigars. Spain should therefore be authorised to continue to grant aid in

addition to Community aid so that this traditional crop can be maintained with a view to

supporting the artisanal activity associated with it. In addition, to maintain the manufacture

of tobacco products, imports into the Canary Islands of raw and semi-manufactured tobacco

should continue to be exempt from customs duty, up to an annual limit of 20 000 tonnes of

stripped raw tobacco equivalent.

(22) Implementation of this Regulation must not jeopardise the level of special support from

which the outermost regions have benefited up to now. For that reason, so that they can

carry out the appropriate measures, the Member States should have at their disposal sums

equivalent to the support already granted by the Community under Council Regulation (EC)

No 1452/2001 of 28 June 2001 introducing specific measures for certain agricultural

products for the French overseas departments, amending Directive 72/462/EEC and

repealing Regulations (EEC) No 525/77 and (EEC) No 3763/91 (Poseidom)1, Council

Regulation (EC) No 1453/2001 and Council Regulation (EC) No 1454/2001 of 28 June 2001

introducing specific measures for certain agricultural products for the Canary Islands and

repealing Regulation (EEC) No 1601/92 (Poseican)2 and sums granted to farmers

established in those regions under Council Regulation (EC) No 1254/1999 of 17 May 1999

on the common organisation of the market in beef and veal3, Council Regulation (EC)

No 2529/2001 of 19 December 2001 on the common organisation of the market in

sheepmeat and goatmeat4, Council Regulation (EC) No 1784/2003 of 29 September 2003 on

the common organisation of the market in cereals5 and sums granted for the supply of rice to

the French overseas department of Réunion under Article 5 of Council Regulation (EC)

No 1785/2003 of 29 September 2003 on the common organisation of the market in rice6.

The new system of support for agricultural production in the outermost regions established

by this Regulation must be coordinated with the support for the same lines of production in

force in the rest of the Community.

(23) Commission Regulations (EC) Nos 1452/2001, 1453/2001 and 1454/2001 should be

repealed. Council Regulation (EC) No 1782/2003 of 29 September 2003 establishing

common rules for direct support schemes under the common agricultural policy and

establishing certain support schemes for farmers and amending Regulations (EEC)

No 2019/93, (EC) No 1452/2001, (EC) No 1453/2001, (EC) No 1454/2001, (EC)

No 1868/94, (EC) No 1251/1999, (EC) No 1254/1999, (EC) No 1673/2000, (EEC)

No 2358/71 and (EC) No 2529/20011, and Regulation (EC) No 1785/2003 should also be

amended to ensure coordination of the respective arrangements. The measures necessary for

the implementation of this Regulation should be adopted in accordance with Council

Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of

implementing powers conferred on the Commission2.

(24) The programmes provided for by this Regulation should start to apply at the beginning of

2006. However, to enable the programmes to start on that date, the Member States and the

Commission should be permitted to take all the preparatory measures between the date of

entry into force of this Regulation and that of its application,

HAS ADOPTED THIS REGULATION:

TITLE 1

SUBJECT

TITLE II

SPECIFIC SUPPLY ARRANGEMENTS

Article 2

Forecast supply balance

• 1. 

  Specific supply arrangements are hereby introduced for the agricultural products listed in

Annex I to the Treaty establishing the EC, which are essential in the outermost regions

for human consumption, for the manufacture of other products or as agricultural inputs.

• 2. 

  A forecast supply balance shall be drawn up stating the quantity of the agricultural

products referred to in paragraph 1 needed to meet supply requirements each year. A

separate forecast balance may be drawn up for the requirements of undertakings packaging

and processing products intended for the local market, for traditional consignment to the

rest of the Community or for export as part of regional trade or traditional trade flows.

Article 3

Operation of the arrangements

• 1. 

  Within the limit of the quantities determined in the forecast supply balance, no duties shall

apply to direct imports from third countries into the outermost regions of products covered

by the specific supply arrangements.

• 2. 

  To ensure coverage of the requirements established in accordance with Article 2(2) in

terms of price and quality, while taking care to maintain the Community's share in

supplies, aid shall be granted to supply the outermost regions with Community products

held in public intervention storage or available on the Community market.

Such aid shall be determined for each type of product concerned to take account of the

additional cost of transport to the outermost regions and the prices applied to exports to

third countries and, in the case of products intended for processing and agricultural inputs,

the additional costs of insularity and distant location.

• 3. 

  In implementing the specific supply arrangements, account shall be taken, in particular, of

the following:

(a) the specific requirements of the outermost regions and, in the case of products

intended for processing and agricultural inputs, the quality requirements;

(b) trade flows with the rest of the Community;

(c) the economic aspect of the proposed aid.

• 4. 

  Entitlement under the specific supply arrangements shall be subject to the condition that

the economic advantage derived either from exemption from import duties or from aid is

actually passed on to the end user.

Those conditions shall include payment of import duties on the products referred to in

Article 3(1) or reimbursement of the aid received under the specific supply arrangements

for the products referred to in Article 3(2).

Those conditions shall not apply to trade flows between French overseas departments.

• 2. 

  The restriction provided for in paragraph 1 shall not apply to products processed in the

outermost regions from products having benefited from the specific supply arrangements

which are:

(a) exported to third countries or dispatched to the rest of the Community within the

limits of traditional exports and traditional dispatches. Those quantities [...] shall be

specified by the Commission in accordance with the procedure laid down in

Article 26(2), on the basis of the average of exports or dispatches during the years

1989, 1990 and 1991;

(b) exported to third countries as part of regional trade flows in accordance with

destinations and conditions specified under the procedure referred to in

Article 26(2);

(c) dispatched from the Azores to Madeira or vice versa.

No export refund shall be granted for the products thus exported.

Article 6

Sugar

• 1. 

  During the period referred to in Article 10(1) of Council Regulation (EC)

No 1260/2001 1, C sugar referred to in Article 13 of that Regulation, exported in

accordance with the relevant provisions of Commission Regulation (EC) No 2670/81 2

and brought in to be consumed in Madeira and in the Canary Islands in the form of

white sugar falling within CN code 1701 and to be refined and consumed in the Azores

in the form of raw sugar falling within CN code 17011210, shall benefit, under the

conditions set out in this Regulation, from the exemption from import duties within the

limit of the forecast supply balance referred to in Article 2.

• 2. 

  When determining the Azores' raw sugar requirements, account shall be taken of the

development of local production of sugar beet. The quantities covered by the supply

arrangements shall be determined so as to ensure that the total volume of sugar refined in the

Azores each year does not exceed 10 000 tonnes.

Article 6a

Milk-based preparations

By way of derogation from Article 2, for the period from 1 January 2006 to 31 December 2009

Article 7

Imports of rice into Réunion

No customs duties shall be charged in the French overseas department of Réunion on products

falling within CN codes 1006 10 and 1006 40 00 imported for consumption there.

Article 8

Detailed rules for the application of the arrangements

Detailed rules for the application of this Title shall be adopted in accordance with the procedure

referred to in Article 26(2). Such rules shall in particular define the conditions under which the

Member States may amend the product quantities and the resources allocated each year to the

various products eligible under the specific supply arrangements and, where necessary, establish a

system of import licences or delivery certificates.

TITLE III

MEASURES TO ASSIST LOCAL AGRICULTURAL PRODUCTS

Article 9

Support programmes

• 3. 

  Only one Community support programme per outermost region may be submitted.

Article 10

Measures

Community support programmes shall contain the measures needed to ensure continuity and

development of local lines of agricultural production in each outermost region.

Article 11

Compatibility and consistency

• 1. 

  Measures taken under support programmes must comply with Community law and be

consistent with other Community policies and with the measures taken under those

policies.

• 2. 

  Consistency of the measures taken under support programmes with measures implemented

under other instruments of the common agricultural policy, and in particular the common

organisations of markets, rural development, product quality, animal welfare and

protection of the environment, must be ensured.

In particular, no measure under this Regulation may be financed as:

(b) support for research projects, measures to support research projects or measures

eligible for Community financing under Council Decision 90/424/EEC1;

(c) support for measures within the scope of Regulation (EC) No 1257/1999 and

Council Regulation (EC) No 2 on support for rural development from the

European Rural Development Fund (EARDF).

Article 12

Content of Community support programmes

A Community support programme shall contain:

(a) a quantified description of the current agricultural production situation taking into account

the results of available evaluations, showing disparities, gaps and potential for

development, the financial resources deployed and the main results of operations

undertaken under Council Regulations [...] (EC) Nos 1452/2001, 1453/2001 and

1454/2001;

(b) a description of the strategy proposed, the priorities selected, its quantified objectives, and

an appraisal showing the expected economic, environmental and social impact, including

employment effects;

(d) a schedule for the implementation of the measures and a general indicative financing table

-

showing the resources to be deployed;

(e) proof of the compatibility and consistency between the various measures under the

programmes and the criteria and quantitative indicators to be used for monitoring and

evaluation;

(f) the steps taken to ensure the programmes are implemented effectively and appropriately,

including the arrangements for publicity, monitoring and evaluation, and a specified set of

quantified indicators for use in programme evaluation and the provisions for checks and

penalties;

(g) the designation of competent authorities and bodies responsible for implementing the

programme and the designation at the appropriate levels of authorities or associated bodies

and socio-economic partners, and the results of consultations held.

Article 13

[...]

TITLE IV

ACCOMPANYING MEASURES

Article 15

Graphic symbol

• 1. 

  A graphic symbol shall be introduced with a view to ensuring greater awareness and

consumption of quality agricultural products, whether natural or processed, specific to the

outermost regions.

• 2. 

  The conditions for using the graphic symbol provided for in paragraph 1 shall be proposed

by the trade organisations concerned. The national authorities shall forward such

proposals, with their opinion, to the Commission for approval.

Use of the symbol shall be monitored by an official authority or a body approved by the

competent national authorities.

Article 16

Rural development

• 1. 

  Notwithstanding Article 7 of Regulation (EC) No 1257/1999, in the case of the outermost
• 2. 

  Notwithstanding Article 28(2) of Regulation (EC) No 1257/1999, in the case of the

outermost regions, the total value of the aid for investments in enterprises engaged in

processing and marketing agricultural products consisting mainly of local produce in

sectors to be defined in the programme complements referred to in Articles 18(3) and 19(4)

of Regulation (EC) No 1260/1999, expressed as a percentage of the volume of eligible

investments, shall not exceed 65%. The total value of the aid for small and medium-sized

enterprises, otherwise subject to the same conditions, shall not exceed 75%.

• 3. 

  The restriction provided for in Article 29(3) of Regulation (EC) No 1257/1999 shall not

apply to tropical or subtropical forests or wooded areas situated in the territory of the

French overseas departments, the Azores and Madeira.

• 4. 

  Notwithstanding Article 24(2) of Regulation (EC) No 1257/1999, the maximum amounts

per year eligible for Community aid, as set out in the Annex to that Regulation, may be

increased up to twofold in the case of the measure to protect lakes in the Azores and the

measure to preserve the landscape and traditional features of agricultural land, in particular

the conservation of stone walls supporting terraces in Madeira.

• 5. 

  A description of the measures planned under this Article shall be included, where

appropriate, in the programmes for these regions referred to in Articles 18 and 19 of

Regulation (EC) No 1260/1999.

Article 17

State aid

• 1. 

  For the agricultural products covered by Annex I to the Treaty, to which Articles 87, 88

and 89 thereof apply, the Commission may authorise operating aid in the sectors

producing, processing and marketing those products, with a view to mitigating the specific

constraints on farming in the outermost regions as a result of their remoteness, insularity

and distant location.

• 2. 

  Member States may grant additional financing for the implementation of the Community

support programmes referred to in Title III. In such cases they must notify the Commission

of the state aid and the Commission must approve it in accordance with this Regulation as

part of those programmes. The aid thus notified shall be regarded as being notified within

the meaning of the first sentence of Article 88(3) of the Treaty.

Article 18

Plant health programmes

• 1. 

  France and Portugal shall submit programmes to the Commission for the control of

organisms harmful to plants or plant products in the French overseas departments and the

Azores and Madeira respectively. The programmes shall specify in particular the

• 3. 

  The financial contribution of the Community provided for in paragraph 2 and the amount

of the aid shall be decided in accordance with the procedure referred to in Article 26(3).

The measures eligible for Community financing shall be defined in accordance with the

same procedure.

Such contribution may cover up to 60% of eligible expenditure in the French overseas

departments and up to 75% of eligible expenditure in the Azores and Madeira. Payment

shall be made on the basis of documentation provided by the French and Portuguese

authorities. If necessary, checks may be organised by the Commission and conducted on its

behalf by experts as referred to in Article 21 of Council Directive 2000/29/EC1.

Article 19

Wine

• 1. 

  Chapter II of Title II and Chapters I and II of Title III of Council Regulation (EC)

No 1493/19992 and Chapter III of Commission Regulation (EC) No 1227/20003 shall not

apply to the Azores and Madeira.

• 2. 

  Notwithstanding Article 19(1) of Regulation (EC) No 1493/1999, grapes from prohibited

direct-producer hybrid vine varieties (Noah, Othello, Isabelle, Jacquez, Clinton and

Herbemont) harvested in the Azores and Madeira may be used for the production of wine

which must remain within those regions.

Portugal shall notify the Commission, each year, of the progress made in converting and

restructuring areas planted with prohibited direct-producer hybrid vine varieties.

• 3. 

  Chapter II of Title II and Title III of Regulation (EC) No 1493/1999 and Chapter III of

Regulation (EC) No 1227/2000 shall not apply to the Canary Islands, except for the crisis

distillation referred to in Article 30 of Regulation (EC) No 1493/1999, if there is

exceptional market disturbance caused by problems of quality.

Article 20

Milk

• 1. 

  As from the marketing year 1999/2000, for the purposes of sharing the additional levy

between the producers referred to in Article 4 of Regulation (EC) No 1788/2003, only

producers within the meaning of Article 5(c) of that Regulation, established and producing

in the Azores, who market quantities exceeding their reference quantity increased by the

percentage referred to in the third subparagraph of this paragraph shall be deemed to have

contributed to the overrun.

The additional levy shall be due on quantities exceeding the reference quantity thus

increased by the above-mentioned percentage, after reallocation of the unused quantities

within the margin resulting from this increase among all the producers within the meaning

of Article 5(c) of Regulation (EC) No 1788/2003 established and producing in the Azores,

The percentage referred to in the first subparagraph shall be equal to the ratio between the

quantities respectively of 73 000 tonnes for the marketing years 1999/2000 to 2004/05 and

23 000 tonnes as from the marketing year 2005/06 and the total of the reference quantities

available on each holding on 31 March 2000. It shall apply only to the reference quantities

available on 31 March 2000.

• 2. 

  The quantities of milk or milk equivalent marketed which exceed the reference quantities

but which comply with the percentage referred to in paragraph 1, after the reallocation

referred to in that same paragraph, shall not be taken into account in establishing any

overrun by Portugal as calculated in accordance with Article 1 of Regulation (EC)

No 1788/2003.

• 3. 

  The additional levy scheme applicable to producers of cows' milk provided for in

Regulation (EC) No 1788/2003 shall not apply in the French overseas departments or,

within the limit of local production of 4 000 tonnes of milk, in Madeira.

• 4. 

  Notwithstanding Articles 2 and 3 of Council Regulation (EC) No 2597/971, the production

in Madeira of UHT milk reconstituted from milk powder originating in the Community

shall be authorised within the limits of local consumption requirements, insofar as this

measure ensures that locally produced milk is collected and finds outlets. This product

shall be used for local consumption only.

Article 21

Livestock farming

• 1. 

  Until the local numbers of young male bovines reach a level sufficient to ensure the

maintenance and development of local beef production in the French overseas departments

and Madeira, the possibility shall be introduced of importing bovine animals from third

countries, without applying the customs duties referred to in Article 30 of Regulation (EC)

No 1254/1999, for fattening and consumption in the French overseas departments and

Madeira.

Article 3(4) and 4(1) shall apply to animals qualifying for the exemption referred to in the

first subparagraph of this paragraph.

• 2. 

  The numbers of animals qualifying for the exemption referred to in paragraph 1 shall be

determined when the need to import is justified, taking account of the development of local

production. These numbers, and detailed rules for the application of this Article, including

in particular the minimum duration of the fattening period, shall be fixed in accordance

with the procedure referred to in Article 26(2). Priority for such animals shall be given to

producers keeping animals for fattening at least 50% of which are of local origin.

• 3. 

  Where Article 68(2)(a)(i) of Regulation (EC) No 1782/2003 is applied, the Portugal may

Article 22

State aid for tobacco production

Spain is hereby authorised to grant aid for the production of tobacco in the Canary Islands in

addition to the premium provided for in Title I of Regulation (EEC) No 2075/921. The grant of this

aid may not result in discrimination between producers in the islands.

The amount of the aid may not exceed EUR 2 980,62 per tonne. The additional aid shall be paid

for up to 10 tonnes each year.

Article 23

Exemption of tobacco from customs duties

• 1. 

  No customs duties shall be applied to direct imports into the Canary Islands of raw and

semi-manufactured tobacco falling, respectively, within:

(a) CN code 2401,

(b) and the following subheadings:

• - 

  2401 10 Tobacco, not stemmed/stripped,
• - 

  2401 20 Tobacco, partly or wholly stemmed/stripped,
• - 

  ex 24 01 20 Outer coverings for cigars presented on supports, in reels for the

manufacture of tobacco,

The exemption provided for in the first subparagraph shall apply to products intended for

the local manufacture of tobacco products, up to an annual import limit of 20 000 tonnes of

raw stripped tobacco equivalent.

• 2. 

  Detailed rules for the application of this Article shall be adopted in accordance with the

procedure referred to in Article 26(2).

TITLE V

FINANCIAL PROVISIONS

Article 24

Financial resources

• 1. 

  The measures provided for in this Regulation, except for Article 16, shall constitute

intervention intended to stabilise the agricultural markets within the meaning of

Article 2(2) of Council Regulation (EC) No 1258/19991.

• 2. 

  The Community shall finance the measures provided for in Titles II and III of this

Regulation up to an annual maximum as follows:

• - 

  -- - French overseas departments: EUR 84,7 million,
• 3. 

  The amounts allocated annually to the programmes provided for in Title II may not exceed:
• - 

  -- - French overseas departments: EUR 20,7 million,
• - 

  -- - Azores and Madeira: EUR 17,7 million,
• - 

  -- - Canary Islands: EUR 72,7 million.

TITLE VI

GENERAL AND FINAL PROVISIONS

Article 24a

• 1. 

  Member States shall submit a draft supply programme to the Commission in the light

of the financial allocation referred to in Article 24(2) and (3) by 30 September 2005 at

the latest.

The draft programme shall comprise a draft forecast supply balance indicating the

products, the quantities thereof and the amount of aid for supply from the

Community together with a draft programme of support for local production.

• 2. 

  The Commission shall evaluate the programmes proposed and approve them under

the procedure referred to in Article 26(2) within four months of their submission.

Article 25

Implementing rules

The measures necessary for the implementation of this Regulation shall be adopted in accordance

with the procedure referred to in Article 26(2). They shall include in particular:

• - 

  the conditions under which Member States may amend the quantities and levels of aid

for supply and the support measures or the allocation of resources allotted to support

local production.

• - 

  the [...] provisions relating to the minimum specifications of the checks and penalties

which Member States must apply.

Article 26

Management Committee

• 1. 

  The Commission shall be assisted by the Management Committee for Direct Payments

established by Article 144 of Regulation (EC) No 1782/2003, except for the

implementation of Article 16 of this Regulation, for which it shall be assisted by the

Committee on Agricultural Structures and Rural Development set up by Article 50 of

Regulation (EC) No 1260/1999, and for the implementation of Article 18, for which it

• 2. 

  Where reference is made to this paragraph, Articles 4 and 7 of Decision 1999/468/EC shall

apply.

The period provided for in Article 4(3) of Decision 1999/468/EC shall be one month.

• 3. 

  Where reference is made to this paragraph, Articles 5 and 7 of Decision 1999/468/EC

shall apply.

The period provided for in Article 4(3) of Decision 1999/468/EC shall be three

months.

Article 27

National measures

The Member States shall take the measures necessary to ensure compliance with this Regulation, in

particular as regards checks and administrative penalties, and shall inform the Commission thereof.

Article 28

Communications and reports

• 1. 

  The Member States shall communicate to the Commission not later than 15 February each
• 3. 

  Not later than 31 December 2009, and thereafter every five years, the Commission shall

submit a general report to Parliament and the Council showing the impact of the action

taken under this Regulation, accompanied if applicable by appropriate proposals.

Article 29

Repeals

Regulations (EC) Nos 1452/2001, 1453/2001 and 1454/2001 are hereby repealed.

References to the repealed Regulations shall be understood as references to this Regulation and

shall be read in accordance with the correlation table in Annex I.

Article 29a

Transitional measures

Under the procedure provided for in Article 26(2), the Commission may adopt the necessary

transitional measures to ensure a smooth transition between the arrangements in force for

2005 and the measures introduced by this Regulation.

Article 30

Amendment of Regulation (EC) No 1782/2003

Regulation (EC) No 1782/2003 is hereby amended as follows:

• 1) 

  Article 70 is amended as follows:

(a) paragraph 1(b) is replaced by the following:

"(b) all other direct payments listed in Annex VI granted to farmers in the reference

period in the French overseas departments, the Azores and Madeira, the Canary

Islands and the Aegean Islands and the direct payments granted in the

reference period under Article 6 of Regulation (EEC) No 2019/93."

(b) paragraph 2, first subparagraph, is replaced by the following:

"2. Without prejudice to Article 6(2) of Regulation (EEC) No 2019/93, Member

States shall grant the direct payments referred to in paragraph 1 of this Article,

within the limit of the ceilings fixed in accordance with Article 64(2) of this

Regulation, under the conditions established in Title IV, Chapters 3, 6 and 7 to

13 of this Regulation and in Article 6 of Regulation (EEC) No 2019/93

respectively."

• 2) 

  The first subparagraph of Article 71(2) is replaced by the following:

"Without prejudice to Article 70(2) of this Regulation, in the transitional period the

Member State concerned shall effect each of the direct payments referred to in Annex VI

under the conditions established in Title IV, Chapters 3, 6 and 7 to 13 of this Regulation

and in Article 6 of Regulation (EEC) No 2019/93 respectively, within the limit of

budgetary ceilings corresponding to the component of these direct payments in the national

ceiling referred to in Article 41 of this Regulation, fixed in accordance with the procedure

referred to in Article 144(2) of this Regulation."

• 3) 

  Annexes I and VI are amended as set out in Annex II to this Regulation.

Article 31

Amendment of Regulation (EC) No 1785/2003

Regulation (EC) No 1785/2003 is hereby amended as follows:

• 1) 

  Article 5 is deleted;
• 2) 

  Article 11(3) is deleted.

Article 32

Entry into force

This Regulation shall enter into force on the twentieth day following that of its publication in the

Official Journal of the European Union.

It shall apply from 1 January 2006. However, Articles 24a, 25 and 26 shall apply from the date of

its entry into force.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels,

For the Council

The President

ANNEX I

[...]

ANNEX I

CORRELATION TABLE

Regulation (EC)

No 1452/2001 Regulation (EC) No 1453/2001 Regulation (EC) No 1454/2001 Regulation (EC)

No 1785/2003 This Regulation

Article 1 Article 1 Article 1 Article 1

Article 2 Article 2 Article 2 Article 2

Article 3 (1) to (4) Article 3 (1) to (4) Article 3 (1) to (4) Article 3

Article 3(5) Article 3(5) Article 3(5) Article 4

Article 5

3rd subparagraph of Article 3(6) Article 6

Article 11(3) Article 7

1st and 2nd 1st and 2nd 1st and 2nd Article 8

subparagraphs subparagraphs of subparagraphs of

of Article 3(6) Article 3(6) Article 3(6)

Article 5

Article 6

Article 8

Article 9

Article 11

Article 12

Article 13

Article 14

Article 15

Article 16

Article 17

Article18

Article 5

Article 25

Article 26

Article 27

Article 28

Article 30

Article 4

Article 5

Article 7

Article 8

Article 9

Article 10

Article 11

Article 13

Article 14

Article 17

Article 31

Article 21(1) and (2) Article 33(1) and (2) Article 19(1) and (2) Article 16(1) and (2)

Article 21(3) Article 33(3) Article 16(3)

Article 33(5) Article 16(4)

Article 21(5) Article 33(6) Article 19(4) Article 16(5)

Article 24 Article 36 Article 22 Article 17(1)

Article 17(2)

Article 20 Article 32 Article 18

Article 8 Article 19(1)

Article 10 Article 19(2)

Article 12 Article 19(3)

Article 23 Article 20(1) and (2)

Article 10(2) Article 15(3) Article 20(3)

Article 15(4) Article 20(4)

Article 7 Article 12 Article 21(1) and (2)

3rd subparagraph of Article 22(3) Article 21(3)

ANNEX II

Annexes I and VI to Regulation (EC) No 1782/2003 are amended as follows:

• 1) 

  Annex I is replaced by the following:

"ANNEX I

LIST OF SUPPORT SCHEMES FULFILLING THE CRITERIA SET OUT IN ARTICLE 1

Sector Legal base Notes

Single payment Title III of this Regulation Decoupled payment (see Annex VI) (*)

Single area payment Title IVa, Article 143b of this Regulation Decoupled payment replacing all the direct payments listed in this Annex

Durum wheat Title IV, Chapter 1 of this Regulation Area payment (quality premium)

Protein crop Title IV, Chapter 2 of this Regulation Area payment

Rice Title IV, Chapter 3 of this Regulation Area payment

Nuts Title IV, Chapter 4 of this Regulation Area payment

Energy crops Title IV, Chapter 5 of this Regulation Area payment

Starch potatoes Title IV, Chapter 6 of this Regulation Production aid

Milk and milk products Title IV, Chapter 7 of this Regulation Dairy premium and additional payment

Arable crops in Finland and in certain regions of Sweden Title IV, Chapter 8 of this Regulation (**)(*****) Special regional aid for arable crops

Beef and veal Title IV, Chapter 12 of this Regulation (***), deseasonalisation premium,

(*****) Special premium

suckler cow premium (including when paid for heifers and including the additional national suckler cow premium when part-financed)

(***), slaughter

premium(***), extensification payment, additional

payments

Grain legumes Title IV, Chapter 13 of this RegulationArea payment

(*****)

Specific types of farming and quality production Article 69 of this Regulation

(****)

Dried fodder Article 71(2) second subparagraph of this Regulation

(*****)

Small farmers' scheme Article 2a Regulation (EC)

No 1259/1999Transitional area aid for farmers receiving less than EUR 1 250

Olive oil Title IV, Chapter 10b, of this Regulation Area payment

Silkworms Article 1 Regulation (EEC) No 845/72 Aid to encourage rearing

Bananas Article 12 Regulation (EEC) No 404/93 Production aid

Dried grapes Article 7(1) Regulation (EC) No 2201/96 Area payment

Tobacco Title IV, Chapter 10c, of this Regulation Production aid

Hops Title IV, Chapter 10d of this Regulation

(***)(*****) Area payment

Posei Title III of Council Regulation No .../... Direct payments within the meaning of Article 2,

(******) under measures established in the programmes

Aegean Islands Articles 6 (**)(*****), 8, 11 Sectors: beef and veal; potatoes; olives; honey

and 12 Regulation (EEC)

No 2019/93

Cotton Title IV, Chapter 10a, of this Regulation Area payment

(*) Starting from 1 January 2005 or later in the case of application of Article 71. For 2004, or later on in the case of application of Article 71, the direct payments listed in Annex VI are included in Annex I except for dried fodder.

(**) In the case of application of Article 70.

(***) In the case of application of Articles 66, 67, 68 or 68a.

(****) In the case of application of Article 69.

(*****) In the case of application of Article 71. (******) OJ L ..., ......, p. ."

• 2) 

  Annex VI is replaced by the following:

"ANNEX VI

LIST OF DIRECT PAYMENTS IN RELATION TO THE SINGLE PAYMENT

REFERRED TO IN ARTICLE 33

Sector Legal base Notes

Arable crops Articles 2, 4 and 5 Regulation (EC) No 1251/1999 Area payment, including set-aside payments, grass silage payments, supplementary amounts

(*), durum

wheat supplement and special aid

Potato starch Article 8(2) Regulation (EEC) No 1766/92 Payment for farmers producing potatoes for the manufacture of potato starch

Grain legumes Article 1 Regulation (EC) No 1577/96 Area payment

Rice Article 6 Regulation (EC) No 3072/95 Area payment

Seeds(*) Article 3 Regulation (EEC) No 2358/71 Production aid

Beef and veal Articles 4, 5, 6, 10, 11, 13 and 14 Regulation (EC) No 1254/1999 Special premium, deseasonalisation premium, suckler cow premium (including when paid for heifers and including the additional national suckler cow premium when part-financed), slaughter premium, extensification payment, additional payments

Milk and milk products Title IV, Chapter 7 of this Regulation Dairy premium and additional payments (**)

Sheepmeat and goatmeat Article 5 Regulation (EC) No 2467/98 Article 1 Regulation (EEC) No 1323/90 Articles 4, 5 and 11(1) and (2), 1st, 2nd and 4th indents Regulation (EC) No 2529/2001Ewe and she-goat premium, supplementary premium and certain additional payments

Dried fodder Article 3 Regulation (EC) No 603/95 Payment for processed products (as applied according to Annex VII point D of this Regulation)

Cotton Paragraph 3 of Protocol No 4 on cotton annexed to the Act of Accession of GreeceSupport in the form of payment for unginned cotton

Olive oil Article 5 of Regulation

No 136/66/EEC Production aid

Tobacco Article 3 of Regulation

No 2075/92/EEC Production aid

Hops Article 12 of Regulation (EEC)

No 1696/71 Area payment

Article 2 of Regulation (EEC)

No 1098/98 Aid for temporary resting

(*) Except in the case of application of Article 70.

(**) Starting from 2007, except in the case of application of Article 62."