Explanatory Memorandum to COM(2008)27 - Amendment of Regulation (EC) No 1234/2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products (Single CMO Regulation) - Main contents
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| dossier | COM(2008)27 - Amendment of Regulation (EC) No 1234/2007 establishing a common organisation of agricultural markets and on specific ... |
|---|---|
| source | COM(2008)27  |
| date | 29-01-2008 |
- Grounds for and objectives of the proposal
The CMO for flax and hemp, Council Regulation (EC) No 1673/2000, does not foresee the granting of any aid for the production of short flax fibre and hemp fibre as of the marketing year 2008/2009. However, in its Article 15 i, it provides for the presentation of a report in which the Commission is called upon to assess whether that regime should be prolonged. The report is under preparation and will be presented as foreseen before the start of the marketing year 2008/2009. However, the Commission considers that any substantive amendments to the current policies should only be decided as part of the health check. Therefore, the Commission considers that the current aid scheme should be prolonged for another marketing year and final decisions only be taken as of the following marketing year in the framework of the policy reviews to be undertaken under the health check.
Regulation (EC) No 1673/2000 will be repealed by Regulation (EC) No 1234/2007 (the Single CMO Regulation) with effect from 1 July 2008 which is the start of the marketing year 2008/2009 for that sector. The amendments contained in the attached proposal therefore concern the Single CMO Regulation.
- General context
The overall assessment of the present organisation of the flax and hemp sector seems positive and points to the conclusion that the current common market organisation is working well. The most significant consequence of the introduction of the processing aid for fibres has been that it has eliminated speculative production. The reform undertaken in 2000 has led to a significant reduction in Community expenditure and stabilisation of the budget at about EUR 20 million. In addition, the reform has resulted in growth of the economically viable outlets and generally safeguarded or, in some cases, improved producers' income over the period concerned.
The processing aid has supported EU production of flax and hemp fibres, materials which have a positive impact on environment (preservation of biodiversity). Moreover, the CMO processing aid has helped to preserve and create jobs in traditionally producing regions and other areas and to support investments in R&D to improve processing methods and develop new products containing vegetable fibres.
Among the new Member States which acceded to the European Union since 2004, seven of them are producers of flax fibres and four producers of hemp fibres. The flax production tends to decrease in the new Member States while the production of hemp is growing.
- Existing provisions in the area of the proposal
Council Regulation (EC) No 1673/2000 has been replaced by Regulation (EC) No 1234/2007 establishing a single common organisation of agricultural markets ("Single CMO").
- Consistency with the other policies and objectives of the Union
Not applicable.
CONSULTATION OF INTERESTED PARTIES AND IMPACT ASSESSMENT
- Consultation of interested parties
The proposal was consulted with the stakeholders of the sector in the framework of the Advisory Group on Flax and Hemp, the Management Committee for Natural Fibres and during the bilateral meeting between the representatives of the flax and hemp sectors with the AGRI Cabinet
- Collection and use of expertise
Scientific/expertise domains concerned
agro-economics and statistics
Methodology used
Update of a study realised by independent experts (Ernst&Young and AND-International) finalised in November 2007.
Main organisations/experts consulted
See above.
Means used to make the expert advice publicly available
The report will be available on: ec.europa.eu/agriculture/eval/index_en.
- Impact assessment
Not applicable.
- Summary of the proposed action
The proposal to amend the Regulation establishing 'Single CMO' means that until the 2008/2009 marketing year the aid for long flax fibre will remain at the current level of EUR 160 per tonne and the aid for short flax and hemp fibres would be kept at EUR 90 per tonne. As for the national guaranteed quantities, the present levels would continue to apply.
As regards the maximum content of impurities and shives, considering that most Member States make use of the derogation from the 7.5% limit and that certain end-uses require a high level of impurities, the current system should be maintained in order to permit the Member States to grant aid for short flax fibre containing a maximum of 15% of impurities and shives and hemp fibre containing a maximum of 25%.
The additional aid granted to primary processors of long flax fibre in certain traditional production areas of the Netherlands, Belgium and France will remain unchanged, that is aid of EUR 120 per hectare in zone I and of EUR 50 per hectare in zone II, as laid down in Regulation (EC) No 1673/2000.
- Legal basis
Council Regulation (EC) No 1673/2000 and Council Regulation (EC) No 1234/2007 ("Single CMO Regulation)
- Subsidiarity principle
The proposal leaves the important elements under the responsibility of the Member States:
- Controls of THC content and the use of authorised varieties of hemp;
- Accountancy control of authorised primary processors;
- Controls of stocks.
- Proportionality principle
The proposal complies with the proportionality principle because it corresponds to the general objectives of the common agricultural policy.
- Choice of instruments
Proposed instruments: Council Regulation amending Council Regulation (EC) No 1234/2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products.
The extra cost of this extension is an estimated EUR 4,64 million. On the basis of estimated quantities the total expenditure with the prolongation of the current aid would be EUR 20,82 million.