Commission Regulation (EC) No 2771/1999 of 16 December 1999 laying down detailed rules for the application of Council Regulation (EC) No 1255/1999 as regards intervention on the market in butter and cream

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty establishing the European Community,

Having regard to Council Regulation (EC) No 1255/1999 of 17 May 1999 on the common organisation of the market in milk and milk products⁽¹⁾, and in particular Articles 10 and 40 thereof,

Whereas:

1. Regulation EC) No 1255/1999 replaced Council Regulation (EEC) No 804/68⁽²⁾, as last amended by Regulation (EC) No 1587/96⁽³⁾, and also inter alia, Council Regulation (EEC) No 777/87⁽⁴⁾, as last amended by Regulation (EEC) No 1634/91⁽⁵⁾, concerning the intervention arrangements for butter and skimmed-milk powder. In view of those new arrangements and in the light of the experience gained, it is appropriate to amend and, where necessary simplify the detailed rules governing intervention on the market in butter and cream. In the interests of clarity, therefore, the recasting of the specific Regulations governing the various aspects of intervention, namely Commission Regulations (EEC) No 2315/76⁽⁶⁾, as last amended by Regulation (EC) No 1824/97⁽⁷⁾, (EEC) No 1547/87⁽⁸⁾, as last amended by Regulation (EC) No 1802/95⁽⁹⁾, (EEC) No 1589/87⁽¹⁰⁾, as last amended by Regulation (EC) No 124/1999⁽¹¹⁾, and (EC) No 454/95⁽¹²⁾, as last amended by Regulation (EC) No 390/1999⁽¹³⁾, should be undertaken.

2. Article 6(1) of Regulation (EC) No 1255/1999 lays down criteria under which the intervention agencies buy in butter through invitation to tender and under which buying-in is to be suspended. It is necessary, firstly, to specify the cases in which buying-in is to be opened or suspended in the Member State concerned and, secondly, to fix the representative period during which the level of market prices for butter in relation to the intervention price must be recorded. To that end, the ‘market price for butter’ should be defined and arrangements set up for recording those prices at national level. For practical reasons, the Belgo-Luxembourg Economic Union should be considered a single Member State.

3. The intervention agencies may only buy in butter which meets the requirements laid down in Article 6 of Regulation (EC) No 1255/1999 as well as the conditions of quality and presentation, which need to be defined. The methods of analysis and detailed rules governing quality control should also be specified and, if the situation so requires, provision should be made for checks of the radioactivity in butter, the maximum levels of which need to be established, where appropriate, by Community legislation. However, it should be possible for Member States to authorise a system of self checking, subject to certain conditions. For practical reasons, the period during which butter offered for intervention is produced should be extensible when the interval between two invitations to tender is longer than 21 days.

4. To ensure that the intervention arrangements function smoothly, it is necessary to specify the conditions for the approval of manufacturing undertakings and verification of compliance therewith. To ensure that the arrangements are effective, provision should be made for action to be taken if these conditions are not complied with. Since butter may be bought in by an intervention agency belonging to a Member State other than that on whose territory it was produced, the intervention agency which does the buying-in should in such cases be able to verify that the conditions relating to quality and presentation are complied with.

5. Regulation (EC) No 1255/1999 stipulates that buying-in is to be carried out by tendering procedure. To ensure that all interested parties in the Community are treated equally, invitations to tender should be advertised in the Official Journal of the European Communities. The details of the tender, particularly the minimum quantity, deadlines for submission and the maximum buying-in price should be defined. To ensure compliance with the requirements as to the quality and presentation of the butter at the time when the tender is submitted, and after its entry into storage, tenderers should be required to submit a written undertaking to that effect together with their tender. Tenders should also be accompanied by a security, in order to guarantee that the tender will be maintained after the closing date for submission of tenders and that the butter will be delivered within time limits to be laid down.

6. It should be possible to guarantee the quality of the butter, and the terms of buying-in by means of checks at different stages during storage. Failure to comply with the requirements should not impose an additional burden on the Community budget. Provision should therefore be made for sub-standard butter to be taken back by the operator, who should be obliged to bear the storage costs incurred.

7. The Member States' obligations should be specified with a view to the proper management of stocks in storage, by stipulating a maximum distance for the place of storage and the costs to be borne when that distance is exceeded, and requiring, in particular, that stocks be accessible, that batches be identified and that butter in storage be insured against risks. In order to ensure a uniform frequency and level of checks, it is necessary to specify the nature and number of inspections of storage premises to be performed by the national authorities.

8. Proper management of intervention stock requires the butter to be resold as soon as outlets become available. To ensure equal access to butter for sale, all interested parties should be able to buy. In order not to destabilise the market, the selling price should be fixed having regard to the market situation. Conditions for sale, entailing the lodging of a performance bond should be laid down, particularly as regards the taking-over of the butter and the time limits for payment. In order to monitor the situation of stocks, Member States should inform the Commission of the quantities of butter sold.

9. Article 6(3) of Regulation (EC) No 1255/1999 provides for aid to be granted for the private storage of butter and cream. To ensure that the arrangements can be monitored properly, provision should be made for a contract and a set of specifications regarding storage conditions. For the same reason, detailed rules should also be laid down regarding documentation, accounting and the frequency of checks and inspection procedures, particularly in respect of the requirements laid down in Article 6(3). To facilitate checks on the presence of products stored under private storage contracts, there should be provision for them to be removed from storage in lots unless the Member State authorises removal of a smaller quantity.

10. To ensure that the private storage scheme is properly managed, it is appropriate to fix annually, on the basis of the storage period, the amount of the aid, the dates of entry into storage and the dates on which storers may remove from storage all or part of the quantities comprised in the contracts. Such dates, storage periods and aid amounts may be changed to take account of the market situation.

11. In the case of aid for cream, in order to take account of the value of the product and for practical reasons, the amount of aid should be fixed in butter equivalent and according to fat content. It is also justified to require that fat content be checked systematically. To that end, storers should be required to undertake to comply with a minimum fat content, fixed in advance, for the entire storage period. Experience has shown that in some cases it is desirable to ease the administrative burden by providing for checks by sampling. However, since it is impossible to verify exactly the fat content of cream after freezing, where the abovementioned undertaking is not complied with no aid should be paid for any of the lots placed in storage after the most recent satisfactory check.

12. The third subparagraph of Article 6(3) of Regulation (EC) No 1255/1999 provides that the amount of the aid may be increased if changes on the market so warrants. The conditions determining this adjustment, and its scope, should therefore be defined.

13. Since Regulation (EC) No 1255/1999 fixes the intervention price from 1 July 2000, in the interests of clarity the intervention price applicable from the date of entry into force of this Regulation until 30 June 2000 should be specified.

14. The measures provided for in this Regulation are in accordance with the opinion of the Management Committee for milk and milk products,

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