(1)

The Agreement on Agriculture concluded under the Uruguay Round of multilateral trade negotiations (2) in accordance with Article 300 of the Treaty contains limits on the quantity and value of exports subsidised by the Community. As a result of the conclusions of the World Trade Organisation’s (WTO) Appellate Body of 19 May 2005, exports of C sugar must be taken into account in those limits. The Community has been granted a period ending on 22 May 2006 to comply with its WTO obligations.

(2)

Article 13(1) of Council Regulation (EC) No 1260/2001 of 19 June 2001 on the common organisation of the markets in the sugar sector (3) provides in particular for an obligation to export C sugar not carried forward. Regulation (EC) No 318/2006, which applies from 1 July 2006, no longer includes such an obligation for non-quota sugar produced in respect of the 2006/07 marketing year. Article 44 of that Regulation provides for the possibility of adopting transitional measures to facilitate the transition from the market situation in the 2005/06 marketing year to the market situation in the 2006/07 marketing year, and the derogations required to ensure compliance by the Community with its international obligations with regard to C sugar produced in respect of the 2005/06 marketing year.

(3)

In accordance with Article 44 of Regulation (EC) No 318/2006, Article 2(1) of Commission Regulation (EC) No 493/2006 of 27 March 2006 laying down transitional measures within the framework of the reform of the common organisation of the markets in the sugar sector, and amending Regulations (EC) No 1265/2001 and (EC) No 314/2002 (4), from 1 July 2006 C sugar produced in respect of the 2005/06 marketing year which cannot be carried forward or exported is to be considered non-quota sugar as referred to in Regulation (EC) No 318/2006, produced in respect of the 2006/07 marketing year.

(4)

Article 27(14) of Council Regulation (EC) No 1260/2001 provides that compliance with the restrictions on volume resulting from agreements concluded under Article 300 of the Treaty is to be ensured by means of export licences issued for the reference periods provided for in such agreements.

(5)

As a result, taking into account the obligations of the European Community under the WTO agreements, a derogation from the obligation to export C sugar should be laid down by suspending the lodging of applications for export licences for C sugar from 23 May 2006, and the transitional arrangements provided for in Article 2 of Regulation (EC) No 493/2006 should be applied to C sugar not exported under an export licence issued before 23 May 2006.

(6)

Regulation (EC) No 493/2006 should therefore be amended accordingly.

(7)

The measures provided for in this Regulation are in accordance with the opinion of the Management Committee for Sugar,

1.

Article 2(1) is replaced by the following:

2.

the following sentence is added to the second paragraph of Article 13:

‘Article 2 shall apply from 23 May 2006.’