Council Regulation (EC) No 942/98 of 20 April 1998 amending Regulation (EC) No 724/97 determining measures and compensation relating to appreciable revaluations that affect farm incomes
6. 5. 98 ‹ EN ‹ Official Journal of the European Communities L 132/1 I (Acts whose publication is obligatory) COUNCIL REGULATION (EC) No 942/98 of 20 April 1998 amending Regulation (EC) No 724/97 determining measures and compensation relating to appreciable revaluations that affect farm incomes THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, Having regard to Council Regulation (EEC) No 3813/92 of 28 December 1992 on the unit of account and the conversion rates to be applied for the purposes of the common agricultural policy (1), and in particular Article 9 thereof, Having regard to the proposal from the Commission, Whereas Regulation (EC) No 724/97 (2) determines measures and compensation relating to appreciable re- valuations of the agricultural conversion rate that affect farm incomes; whereas that Regulation does not apply to appreciable revaluations that may occur after 30 April 1998; whereas it should therefore be amended to cover any revaluations which may occur in the period up to the introduction of the single currency; Whereas Article 4(3) of Regulation (EC) No 724/97 the maximum amount of aid shall be provides that reduced or cancelled if necessary as a function of the effect on income of the development of agricultural conversion rates recorded during a certain observation period; whereas, in order to avoid compensation which is income actually excessive in relation to the loss of incurred, it is also necessary to take account of the market situation; the single currency on Whereas the introduction of 1 January 1999 will put an end to fluctuations in agricul- tural conversion rates for the Member States particpating in the euro; whereas it is therefore appropriate to end the observation period on 31 December 1998; those Member States for helpful to extend the observation period to nine months instead of six, and to provide for a further extension if a subsequent appreciable revaluation occurs during the observation period for the preceding appreciable revalu- ation; that Whereas application of Article 4 of Regulation (EEC) No 3813/92 means the agricultural conversion rate may not decline by less than 2,56 %; whereas, to limit the risk of excessive compensation in cases of small appreciable revaluations, aid should not be granted for the amount corresponding to an appreciable part of less than 2,6 %; Whereas decisions to reduce or cancel the second and third tranches should also be taken in the light of the market situation; Whereas the method of taking the market situation into account should be defined; whereas this method may involve, on the one hand, comparing the development of market prices in the Member State whose currency has been appreciably revalued with that in the Member States whose currencies have not been appreciably revalued during the observation period and, on the other, consid- ering how far operative events in the various sectors have already occurred on the date of the appreciable revalu- ation, HAS ADOPTED THIS REGULATION: Article 1 Whereas the observation period for the other Member States may extend beyond 31 December 1998; whereas, since the market situation is to be taken into account, it is 1. the first subparagraph of Article 1(1) shall be replaced by the following: Regulation (EC) No 724/97 is hereby amended as follows: (1) OJ L 387, 31. 12. 1992, p. 1. Regulation as last amended by Regulation (EC) No 150/95 (OJ L 22, 31. 1. 1995, p. 1). (2) OJ L 108, 25. 4. 1997, p. 9. ‘1. This Regulation shall apply in the event of appreciable revaluations occurring from 1 January 1997 and before 1 January 1999. ’; L 132/2 ‹ EN ‹ Official Journal of the European Communities 6. 5. 98 2. Article 4 shall be amended as follows: (a) paragraph 3 shall be replaced by the following: The maximum amount referred to in para- ‘3. graph 2 shall be reduced or cancelled if necessary as a function of the effect on income of the de- velopment of agricultural conversion rates recorded during a certain observation period and taking account, in the amount calculated in accordance with the first subparagraph of paragraph 2, of the market situation during that period. shall expire obeservation For the currencies of the Member States which adopt the single currency pursuant to the Treaty, on the period 31 December 1998. For the other currencies, it shall expire at the end of the ninth month fol- revaluation. lowing However, where an appreciable revaluation occurs in the course of the observation period for an earlier appreciable revaluation, the entire observa- tion period shall not expire until the end of the third month following that of the last revaluation. appreciable that the of However, no aid shall be granted for that portion of the amount calculated in accordance with the first subparagraph of paragraph 2 and the first subpara- graph of this paragraph equal to not more than 2,6 % in total of the appreciable revaluation oc- curring between 1 May 1998 and 31 December 1998. ’; (b) paragraph 4 shall be replaced by the following: ‘4. The amounts paid out under the second and third tranches shall each be reduced, vis- -vis the level of the previous tranche, by at least a third of the amount paid out in the first tranche. However, in cases where the amount of the first tranche of aid is calculated by applying paragraph 4a, second subparagraph, section (b), the reduction of at least one third shall be calculated on the basis of the amount of the first tranche which would have been granted had paragraph 4a, second subparagraph, section (b), not been applied. The amounts paid out under the second and third tranches of compensatory aid shall be reduced or cancelled as a function of the effect on incomes of the development of agricultural conversion rates recorded until the beginning of the month pre- ceding the first month of the relevant tranche and, in the case of appreciable revaluation occurring from 1 May 1998, taking account, in the amount calculated in accordance with the first subpara- graph of paragraph 2, of the market situation during that period. ’; (c) the following paragraph shall be inserted: In the case of appreciable revaluation oc- ‘4a. curring from 1 May 1998, the market situation shall be taken into account pursuant to the first subparagraph of paragraph 3 and the second subpa- ragraph of paragraph 4 in accordance with the following method. The amount of one or more tranches in one or more sectors may be reduced when it has been observed that: (a) over the observation period referred to in para- graph 3 or over the period between the begin- ning of the preceding tranche and the begin- ning of the month preceding the first month of the tranche concerned, the market price for the Member State concerned was on average equal to, or higher than, the average market prices in the Member States whose currencies had not been appreciably revalued during the same period. Market prices shall be compared using an index of base 100 for market prices in national currency on the date of the appreciable revaluation; or (b) the relation between the dates of operative events in the sector concerned and the date of the appreciable revaluation is such that there is no justification for concluding that the revalu- ation had an impact the period considered. ’. throughout Article 2 This Regulation shall enter into force on the day fol- lowing that of its publication in the Official Journal of the European Communities. It shall apply to appreciable revaluations occurring from 1 May 1998. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Luxembourg, 20 April 1998. For the Council The President J. CUNNINGHAM