Explanatory Memorandum to COM(2022)179 - Amending Regulation 508/2014 as regards measures to alleviate the consequences of war in Ukraine on fishing activities and disruption on the supply chain of fishery products - Main contents
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| dossier | COM(2022)179 - Amending Regulation 508/2014 as regards measures to alleviate the consequences of war in Ukraine on fishing activities and ... |
|---|---|
| source | COM(2022)179  |
| date | 13-04-2022 |
1. CONTEXT OF THE PROPOSAL
• Reasons for and objectives of the proposal
The military aggression of Russia against Ukraine since 24 February 2022 is impacting on operators of the fishery and aquaculture sector in the Union. The disruption of trade flows of key commodities for the fishery and aquaculture sector from Russia and Ukraine abruptly intensified the increase in prices of key inputs such as energy and raw materials. Trade between Ukraine and the Union is also severely affected by the unavailability of transport, as Ukrainian airports were rendered inoperable because of the Russian attack and all commercial shipping operations in Ukrainian ports have been suspended. The current crisis is likely to have serious consequences for the supply of grain, vegetable oils and white fish from Ukraine and Russia to the Union, leading to a substantial increase in fish feed prices and to shortages of key raw materials. Part of the Union fleet has ceased fishing because of the decrease in profitability of that activity and the impossibility of offsetting the increase in input costs such as soaring prices for energy. The combined impact of the cost increases and shortages is also being felt by the seafood farming and processing sectors. There is therefore significant market disruption, caused by substantial cost increases, and trade disruptions, requiring effective and efficient action.The military aggression of Russia against Ukraine also jeopardises the security of fishing activities carried out by Union fishers in neighbouring areas. This has led to a precautionary interruption of activities in certain areas.
In the light of the above, the Commission is proposing an amendment to Regulation (EU) No 508/2014 on the European Maritime and Fisheries Fund (EMFF) by introducing specific measures to alleviate the consequences of the military aggression of Russia against Ukraine on fishing activities and to mitigate the effects of the market disruption caused by that military aggression on the supply chain of fishery and aquaculture products. Expenditure is still eligible for a contribution from that Fund until 31 December 2023.
This proposal complements Commission Implementing Decision (EU) 2022/500 of 25 March 2022 establishing the military aggression of Russia against Ukraine as the occurrence of an exceptional event causing a significant disruption of markets, thereby triggering crisis support measures under the European Maritime, Fisheries and Aquaculture Fund (EMFAF). Packages of measures under both the EMFF and the EMFAF maximise the use of available financial resources to support the fisheries, aquaculture and seafood processing sectors in the current crisis.
• Consistency with existing policy provisions in the policy area
The proposal is consistent with Regulation (EU) No 1380/2013 on the common fisheries policy and with Regulation (EU) No 1303/2013 on common provisions for Union Funds implemented under shared management.
• Consistency with other Union policies
The proposal is limited to a targeted and exceptional amendment of Regulation (EU) No 508/2014 and maintains consistency with other Union policies.
2. LEGAL BASIS, SUBSIDIARITY AND PROPORTIONALITY
• Legal basis
Articles 43(2) and 175 of the Treaty on the Functioning of the European Union.
• Subsidiarity (for non-exclusive competence)
Provisions of the proposal are implemented within the framework of shared management, in accordance with the Financial Regulation.
• Proportionality
The proposed provisions comply with the proportionality principle as they are appropriate, necessary and no other less restrictive measures are available to obtain the desired policy objectives.
• Choice of the instrument
Proposed instrument: Regulation of the European Parliament and of the Council.
3. RESULTS OF EX-POST EVALUATIONS, STAKEHOLDER CONSULTATIONS AND IMPACT ASSESSMENTS
• Ex-post evaluations/fitness checks of existing legislation
• Stakeholder consultations
The challenges arising from and the need to alleviate the consequences of the military aggression of Russia against Ukraine on fishing activities and to mitigate the effects of the market disruption caused by that military aggression on the supply chain of fishery and aquaculture products have been raised by various stakeholders of the fishery and aquaculture sector and Member States representatives. All operators, stakeholders and concerned Member States have emphasised the need to secure financial support for the fishery and aquaculture sector.
• Collection and use of expertise
• Impact assessment
An impact assessment is not needed, due to the exceptional and critical nature of the military aggression of Russia against Ukraine, which requires immediate mitigating Union measures.
• Regulatory fitness and simplification
• Fundamental rights
This proposal has no consequence for the protection of fundamental rights.
4. BUDGETARY IMPLICATIONS
The proposed modification does not imply any changes in the Multiannual Financial Framework annual ceilings for commitments and payments.
With fishing, aquaculture and processing activities significantly impacted by the crisis, the current EMFF measures and operational programmes are not implemented normally. Therefore, to avoid losing financial resources for countering the crisis effectively, it should be made possible for Member States to reallocate financial resources within their operational programme to the specific measures, and to do so at short notice. That possibility will be limited by the budget allocations that Member States have already received, which they cannot exceed.
The available payment appropriations in the 2022 budget for the EMFF can accommodate a shift between Union Priorities within operational programmes. The new measures will in fact to a large extent replace initially planned measures, which have now to be reconsidered due to the general disruption of the supply chain. Consequently, the proposed measures aim to ensure effective implementation of the 2022 budget and the 2014-2020 allocation for the EMFF.
The Commission will carefully monitor the impact of the proposed modification on payment appropriations in 2022 taking into account both the implementation of the budget and revised Member State forecasts.
5. OTHER ELEMENTS
• Implementation plans and monitoring, evaluation and reporting arrangements
The implementation, monitoring, evaluation and reporting requirements established in Regulation (EU) No 508/2014 and Regulation (EU) No 1303/2013 apply.
• Explanatory documents (for directives)
• Detailed explanation of the specific provisions of the proposal
The proposal introduces the following measures to alleviate the consequences of the military aggression of Russia against Ukraine on fishing activities and to mitigate the effects of the market disruption caused by that military aggression on the supply chain of fishery and aquaculture products:
·Financial compensation for the temporary cessation of fishing activities where the military aggression of Russia against Ukraine jeopardises the security of fishing operations. This compensation is subject neither to the financial ceiling established in Article 25(3) of the EMFF Regulation, nor to the 6 months’ maximum duration set out in Article 33(2) of that Regulation. It is supported with the standard Union co-financing rate of 75 % of the eligible public expenditure.
·Financial compensation to recognised producer organisations and associations of producer organisations which store fishery or aquaculture products in accordance with the storage mechanism of Regulation (EU) No 1379/2013 (common organisation of the markets).
·Financial compensation to operators of the fishery and aquaculture sector (including the processing sector) for their income forgone, and for additional costs they incurred due to the market disruption caused by the military aggression of Russia against Ukraine and its effects on the supply chain of fishery and aquaculture products.
The proposal introduces these compensation schemes in existing EMFF measures to facilitate their quick implementation. Using an existing framework obviates the need for significant amendments to the template of the operational programmes and facilitates reprogramming by Member States. However, it will be necessary to make minor technical adjustments to the template of the operational programmes and to the reporting and monitoring system. The adjustments concerning the reporting and monitoring system are not urgent, as Member States have 1 year before they are next required to provide cumulative data on operations selected for funding pursuant to Article 97(1)(a) of the EMFF Regulation.
The proposal also introduces flexibility mechanisms to facilitate the quick implementation of these new measures:
·A simplified procedure for amending the operational programmes of Member States as regards the introduction of these measures, including the reallocation of financial resources thereto.
·Retroactive eligibility of expenditure as of 24 February 2022 for these measures.
·The possibility of reallocating the fixed amounts initially reserved for certain EMFF measures (i.e. control and enforcement, data collection) to the new measures.
The proposal also corrects a technical mistake in Article 96 of the EMFF Regulation, in which ‘income foregone’ should be replaced by ‘income forgone’.