(1)

The current regime for the fruit and vegetables sector is laid down in Council Regulation (EC) No 2200/96 of 28 October 1996 on the common organisation of the market in fruit and vegetables (2), Council Regulation (EC) No 2201/96 of 28 October 1996 on the common organisation of the markets in processed fruit and vegetable products (3) and Council Regulation (EC) No 2202/96 of 28 October 1996 introducing a Community aid scheme for producers of certain citrus fruits (4).

(2)

In the light of experience it is necessary to change the regime for the fruit and vegetables sector in order to achieve the following objectives: improving the competitiveness and market orientation of the sector so as to contribute to achieving sustainable production that is competitive both on internal and external markets; reducing fluctuations in producers’ income resulting from crises on the market; increasing the consumption of fruit and vegetables in the Community; and continuing the efforts made by the sector to maintain and protect the environment.

(3)

Since those objectives cannot be sufficiently achieved by the Member States due to the common nature of the market in fruit and vegetables and can therefore, by reason of the need for further common action, be better achieved at Community level, the Community may adopt measures, in accordance with the principle of subsidiarity, as set out in Article 5 of the Treaty. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve those objectives.

(4)

The Commission has submitted a separate proposal for a Council Regulation establishing a common organisation of agricultural markets which could initially incorporate certain provisions of a horizontal nature covering the fruit and vegetables sector and applying to a range of other agricultural products, in particular provisions on a management committee. It is appropriate to leave such provisions in Regulations (EC) No 2200/96 and (EC) No 2201/96. Those provisions should however be updated, simplified and streamlined so as to allow for their easy incorporation into the Regulation establishing a common organisation of agricultural markets.

(5)

As regards other provisions specific to the fruit and vegetables sector, the scope of the changes to the current regime make it necessary, in the interests of clarity, to incorporate all such provisions into a separate Regulation. Where such provisions are to some extent also of a horizontal nature and apply to a range of other agricultural products, such as those on marketing standards and trade with third countries, they should also be updated and simplified so as to allow for their easy incorporation, at a later date, into the abovementioned Regulation establishing a common organisation of agricultural markets. This Regulation should not, therefore, repeal or change existing instruments of a horizontal nature unless they have become obsolete, redundant or should not, by their very nature, be dealt with at Council level.

(6)

The scope of this Regulation should be products covered by the common market organisations of the markets in fruit and vegetables and processed fruit and vegetables. However, the provisions on producer organisations and interbranch organisations and agreements apply only to products covered by the common market organisation for fruit and vegetables and this distinction should be maintained. The scope of the common market organisation in fruit and vegetables should also be extended to certain culinary herbs to allow them to benefit from that regime. Thyme and saffron are currently covered by Council Regulation (EEC) No 827/68 of 28 June 1968 on the common organisation of the market in certain products listed in Annex II to the Treaty (5), from which they should therefore be removed.

(7)

Marketing standards, in particular relating to definition, quality, grading into classes, sizing, packaging, wrapping, storage, transport, presentation, marketing and labelling, should apply in respect of certain products to permit the market to be supplied with products of uniform and satisfactory quality. Moreover, special measures, in particular up-to-date methods of analysis and other measures to determine the characteristics of the standards concerned, may need to be adopted to avoid abuses as regards the quality and authenticity of the products presented to the consumers and the significant disturbances on the markets to which such abuses may give rise.

(8)

Currently, Council Directive 2001/112/EC of 20 December 2001 relating to fruit juices and certain similar products intended for human consumption (6) and Council Directive 2001/113/EC of 20 December 2001 relating to fruit jams, jellies and marmalades and sweetened chestnut purée intended for human consumption (7) lay down specific provisions regarding production, composition and labelling of these products. However, those rules are not fully updated to take account of developments in relevant international standards and should therefore be modified to allow for such updating.

(9)

The production and marketing of fruit and vegetables should take full account of environmental concerns, including cultivation practices, the management of waste materials and the disposal of products withdrawn from the market, in particular as regards the protection of water quality, the maintenance of biodiversity and the upkeep of the countryside.

(10)

Producer organisations are the basic actors in the fruit and vegetables regime, the decentralised operation of which they ensure at their level. In the face of ever greater concentration of demand, the grouping of supply through these organisations continues to be an economic necessity in order to strengthen the position of producers in the market. Such grouping should be effected on a voluntary basis and prove its utility by the scope and efficiency of the services offered by producer organisations to their members. Since producer organisations act exclusively in the interests of their members, they should be deemed as acting in the name and on behalf of their members in economic matters.

(11)

Experience shows that producer organisations are the proper tool for grouping supply. However, the spread of producer organisations in different Member States has been uneven. In order to further improve the attractiveness of producer organisations, provision should be made for more flexibility in their operation wherever possible. Such flexibility should concern in particular the product range of a producer organisation, the extent of direct sales permitted and the extension of rules to non-members as well as permitting associations of producer organisations to carry out any of the activities of their members and permitting the outsourcing of activities, including to subsidiaries, in both cases subject to necessary conditions.

(12)

A producer organisation should not be recognised by its Member State as able to contribute to the achievement of the objectives of the common market organisation unless its articles of association impose certain requirements on it and its members. The establishment and proper functioning of operational funds require that producer organisations should in general take charge of the whole of the relevant fruit and vegetable production of their members.

(13)

Producer groups in Member States which acceded to the European Union on 1 May 2004 or after that date and wishing to acquire the status of producer organisations in accordance with this Regulation should be allowed the benefit of a transitional period during which national and Community financial support can be given against certain commitments by the producer group.

(14)

In order to give producer organisations greater responsibility for their financial decisions in particular and to gear the public resources assigned to them towards future requirements, terms should be set for the use of these resources. Joint financing of operational funds set up by producer organisations is an appropriate solution. Additional scope for financing should be permitted in particular cases. In order to control Community expenditure, there should be a cap on assistance granted to producer organisations that establish operational funds.

(15)

In regions where the organisation of production is weak, the grant of additional, national, financial contributions should be allowed. In the case of Member States which are at a particular disadvantage with regard to structures, those contributions should be reimbursable by the Community.

(16)

In order to simplify and reduce the cost of the scheme it could be helpful to align, where possible, the procedures and rules for the eligibility of expenditure under operational funds with those of rural development programmes by requiring Member States to establish a national strategy for operational programs.

(17)

In order to further boost the impact of producer organisations and associations thereof and ensure the market as much stability as is desirable, Member States should be allowed on certain conditions to extend to non-member producers in their region the rules, particularly on production, marketing and environmental protection, adopted for its members by the organisation or association for the region concerned. Where proper justification is given, certain costs arising from the extension of the rules should be chargeable to the producers concerned since they will benefit from the extension. However, organic producers should not be subject to the extension of the rules without the consent of a substantial part of such producers. It is necessary to permit the rapid extension of such rules for crisis prevention and management measures in order to deal promptly with crises.

(18)

A number of heterogeneous aid schemes for certain fruit and vegetables were set out in Regulations (EC) No 2200/96, (EC) No 2201/96 and (EC) No 2202/96. The number and variety of those schemes have made them complex to administer. Whilst they were targeted at certain specific fruits and vegetables, they have not been able to fully take into account regional conditions of production, and have not covered all fruit and vegetables. It is therefore appropriate to seek a different tool for supporting fruit and vegetable producers.

(19)

Furthermore, the aid schemes for fruit and vegetables were not fully integrated into Council Regulation (EC) No 1782/2003 of 29 September 2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers (8). This had led to certain complexities and rigidities in the administration of those schemes.

(20)

In the interests of a more targeted but flexible system of support for the fruit and vegetables sector and in the interests of simplification, it is therefore appropriate to abolish the existing aid schemes and fully include fruit and vegetables in the scheme established by Regulation (EC) No 1782/2003. To this end it is necessary to provide that farmers who produced fruit and vegetables in the reference period should be eligible for the single payment scheme. Provision should also be made for the establishment by Member States of reference amounts and eligible hectares under the single payment scheme on the basis of a representative period appropriate to the market of each fruit and vegetable product and of appropriate objective and non-discriminatory criteria. Areas planted with fruit and vegetables, including permanent fruits and vegetables as well as nurseries should be eligible for the single payment scheme. National ceilings should be amended accordingly. In order to provide time for the sectors concerned to adapt to their integration into the single payment scheme, transitional periods should be provided for. In particular, provision should be made for decoupled fruit and vegetables payments and temporary coupled area aids for certain products intended for processing, which were eligible under the existing aid schemes, as well as strawberries and raspberries. For the latter products a national top-up to the Community aid may also be granted. Provision should also be made for the Commission to adopt detailed implementing rules and any necessary transitional measures with regard to the above.

(21)

The production of fruit and vegetables is unpredictable and the products are perishable. Surplus on the market, even if it is not too great, can significantly disturb the market. Some schemes for market withdrawals have been operated but have proved somewhat complex to administer. A number of further measures for crisis management should be introduced in a manner as easy to apply as possible. Integration of all such measures into the operational programmes of producer organisations appears the best approach in these circumstances, and should also provide for increased attractiveness of producer organisations for producers. However in order to allow crisis management measures to be extended to non-members of producer organisations, Member States should be authorised for a transitional period to grant a state aid in such cases. The aid should however be less than that received by members of the producer organisation in order to make membership attractive. The operation of this state aid should be reviewed at the end of the transitional period.

(22)

The integration of ware potatoes into the scheme set out in Regulation (EC) No 1782/2003 implies that, in order to safeguard the proper working of the single market based on common prices, the provisions of the Treaty governing State aid should also apply to ware potatoes, subject to a transitional period to allow for the adaptation of the sector.

(23)

Council Regulation (EC) No 2826/2000 of 19 December 2000 on information and promotion actions for agricultural products on the internal market (9) provides for a Community contribution to certain promotion actions of up to 50 %. In order to promote the consumption of fruit and vegetables amongst children in educational establishments, that percentage should be increased for promotion of fruit and vegetables in this case.

(24)

Interbranch organisations set up on the initiative of individual or already grouped operators can, if they account for a significant proportion of the members of the various occupational categories of the fruit and vegetable sector, contribute to behaviour taking closer account of market realities and facilitate a commercial approach that will improve production reporting, in particular as regards the organisation of production, product presentation and marketing. Since the work of these organisations is able to contribute in general to attaining the objectives of Article 33 of the Treaty, and in particular those of this Regulation, it should, once the relevant forms of action are defined, be possible to grant specific recognition to those organisations which provide proof of sufficient representativeness and carry out practical action in regard to those objectives. The provisions on extending the rules adopted by producer organisations and their associations and on sharing the costs resulting from such extension should, given the similarity of the objectives pursued, also apply to interbranch organisations.

(25)

The creation of a single Community market involves the introduction of a trading system at the external borders of the Community. That trading system should include import duties and should, in principle, stabilise the Community market. The trading system should be based on the undertakings accepted under the Uruguay Round of multilateral trade negotiations.

(26)

The application of the entry price system for fruit and vegetables requires the adoption of specific provisions to take account of the international commitments of the Community.

(27)

Monitoring the volume of trade in agricultural products with third countries may, in respect of certain products, require the introduction of licensing systems for imports and exports including the lodging of a security to ensure that the transactions for which such licences are issued are actually carried out. The Commission should, therefore, be empowered to introduce licensing systems in respect of such products.

(28)

In order to prevent or counteract adverse effects on the Community market which could result from imports of certain agricultural products, imports of such products should be subject to payment of an additional duty, if certain conditions are fulfilled.

(29)

It is appropriate, under certain conditions, to confer on the Commission the power to open and administer tariff quotas resulting from international agreements concluded in accordance with the Treaty or from other acts of the Council.

(30)

The customs duty system makes it possible to dispense with all other protective measures at the external frontiers of the Community. The internal market and duty mechanism could, in exceptional circumstances, prove to be inadequate. In such cases, in order not to leave the Community market without defence against disturbances that might ensue, the Community should be able to take all necessary measures without delay. Such measures should comply with the international commitments of the Community.

(31)

To ensure that those trading arrangements can function properly, provision should be made for regulating or, when the situation on the market so requires, prohibiting the use of inward or outward processing arrangements.

(32)

To continue to provide for a legal base for export refunds for sugar incorporated into certain processed fruit and vegetables products as provided for in Article 16(1)(b) of Regulation (EC) No 2201/96, the list of products concerned should be added to that contained in Annex VII to Council Regulation (EC) No 318/2006 of 20 February 2006 on the common organisation of the markets in the sugar sector (10).

(33)

Directives 2001/112/EC and 2001/113/EC and Regulations (EEC) No 827/68, (EC) No 2200/96, (EC) No 2201/96, (EC) No 2826/2000, (EC) No 1782/2003 and (EC) No 318/2006 should therefore be amended accordingly.

(34)

Since the common markets in agricultural products are continuously evolving, the Member States and the Commission should keep each other informed of relevant developments.

(35)

The proper working of the single market based on common prices would be jeopardised by the granting of national aid. Therefore, the provisions of the Treaty governing State aid should, as a general rule, apply to the products covered by this Regulation. However, provision should be made for a one-off State aid for the tomato processing sector in Italy and Spain in order to support its adaptation to the provisions of this Regulation.

(36)

Expenditure incurred by the Member States as a result of the obligations arising from the application of this Regulation should be financed by the Community in accordance with Council Regulation (EC) No 1290/2005 of 21 June 2005 on the financing of the common agricultural policy (11).

(37)

The fruit and vegetables regime provides for compliance with certain obligations. To guarantee compliance with those obligations, there is a need for controls and the application of penalties in case of non-compliance with such obligations. Power should therefore be conferred on the Commission to introduce the corresponding rules, including those concerning the recovery of undue payments and the reporting obligations of the Member States. The special corps of inspectors in the fruit and vegetables sector will no longer be necessary under the new regime and should therefore be abolished.

(38)

The aid scheme established by Regulation (EC) No 2202/96 is to be abolished. That Regulation will thus no longer have any purpose and should therefore be repealed.

(39)

The measures necessary for the implementation of this Regulation should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission (12).

(40)

In the interests of simplification, the separate committees for fresh fruit and vegetables, and processed fruit and vegetables should be abolished and replaced by a single committee for fruit and vegetables to be established under Regulation (EC) No 2200/96.

(41)

The change-over from the existing arrangements to those provided for by this Regulation could give rise to difficulties which are not dealt with in this Regulation. In order to deal with such difficulties, the Commission should be enabled to adopt transitional measures. Furthermore, provision should be made for continued recognition of producer organisations and associations of producer organisations recognised under Regulation (EC) No 2200/96 and the possible continuation of operational programmes approved under that Regulation, as well as similar provisions for producer groups recognised under Regulation (EC) No 2200/96 and their recognition plans.

(42)

This Regulation should, as a general rule, apply from 1 January 2008. However, in order to avoid the interruption of the aid schemes for processed fruit and vegetable products and citrus fruits part-way through a marketing year, such aid schemes should be allowed to run until the end of the 2007/2008 marketing year,