28.2.2006 Official Journal of the European Union L 58/1 (Acts whose publication is obligatory) COUNCIL REGULATION (EC) No 318/2006 of 20 February 2006 on the common organisation of the markets in the sugar sector THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Commu- nity, and in particular Article 36 and the third subparagraph of Article 37(2) thereof, Having regard to the proposal from the Commission, Having regard to the Opinion from the European Parliament (1), Having regard to the Opinion from the European Economic and Social Committee (2), Whereas: (1)  The operation and development of the common market for agricultural products should be accompanied by the establishment of a common agricultural policy to include, in particular, a common organisation of agricultural mar- kets which may take various forms depending on the product. (2)  The sugar market in the Community is based on principles which for other common market organisations have been substantially reformed in the past. In order to pursue the objectives set out in Article 33 of the Treaty, and notably in order to stabilise the markets and to ensure a fair stan- dard of living for the agricultural community within the sugar sector, it is necessary to fundamentally review the common organisation of the market in the sugar sector. (3)  Inthe light of these developments, Council Regulation (EC) No 1260/2001 of 19 June 2001 on the common organi- sation of the markets in the sugar sector (}) should be repealed and replaced by a new Regulation. (4)  Reference prices should be fixed for standard qualities of white sugar and raw sugar. Such standard qualities should be average qualities representative of sugar produced in (") Opinion delivered on 19 January 2006 (not yet published in the Official Journal). (?) Opinion delivered on 26 October 2005 (not yet published in the Official Journal). (®) OJ L 178, 30.6.2001, p. 1. Regulation as last amended by Commis- sion Regulation (EC) No 39/2004 (O] L 6, 10.1.2004, p. 16). the Community and defined on the basis of criteria used by the sugar trade. It should also be possible to review the standard qualities to take account, in particular, of com- mercial requirements and developments in technical analysis. In order to achieve reliable information on Community market prices for sugar, a price reporting system should be set up on the basis of which market price levels for white sugar should be determined. A minimum price should be fixed for quota beet corre- sponding to a standard quality which should be defined, in order to ensure a fair standard of living for the Com- munity growers of sugar beet and sugar cane. Specific instruments are needed to ensure a fair balance of rights and obligations between sugar undertakings and sugar beet growers. Therefore, standard provisions should be laid down to govern the contractual relations between buyers and sellers of sugar beet. The diversity of natural, economic and technical situations makes it difficult to provide for uniform purchase terms for sugar beet throughout the Community. Agreements within the trade already exist between associations of sugar beet growers and sugar undertakings. Therefore, framework provisions should only define the mini- mum guarantees required by both sugar beet growers and the sugar industry to ensure a smooth functioning of the sugar market with the possibility to derogate from some rules in the context of an agreement within the trade. The reasons which in the past led the Community to adopt a production quota system for sugar, isoglucose and inulin syrup still remain valid. However, due to developments within the Community and internationally, it is necessary to adjust the production system in order to provide for new arrangements and reductions of the quotas. In line with the previous quota system, a Member State should allocate quotas to the undertakings established within its territory. The new common organisation of the markets in the sugar sector should maintain the legal status of the quotas in so far as, according to the case-law of the Court of Justice, the system of quotas constitutes a mechanism for regulating the market in the sugar sector which aims to ensure the attainment of public interest objectives.