Council Regulation (EEC) No 1677/85 of 11 June 1985 on monetary compensatory amounts in agriculture

• Published date: 24 June 1985
• Subject Matter: Agriculture and Fisheries,Monetary measures in the field of agriculture
• Official Gazette Publication: Official Journal of the European Communities, L 164, 24 June 1985,Gazzetta ufficiale delle Comunità europee, L 164, 24 giugno 1985,Journal officiel des Communautés européennes, L 164, 24 juin 1985

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Council Regulation (EEC) No 1677/85 of 11 June 1985 on monetary compensatory amounts in agriculture

Official Journal L 164 , 24/06/1985 P. 0006 - 0010
Spanish special edition: Chapter 03 Volume 35 P. 0151
Portuguese special edition Chapter 03 Volume 35 P. 0151

COUNCIL REGULATION (EEC) N° 1677/85

of 11 June 1985

on monetary compensatory amounts in agriculture

THE COUNCIL OF THE EUROPEAN COMMUNTIES,Having regard to the Treaty establishing the European Economic Community, and in particular Article 43 thereof,Having regard to the proposal from the Commission (1),Having regard to the opinion of the European Parliament (2),Having regard to the opinion of the Economic and Social Committee (3),Having regard to the opinion of the Court of Auditors,Having regard to the opinion of the Monetary Committee,Whereas for several years the common agricultural policy has required the use, for the conversion into national currencies of amounts fixed at Community level in units of account or in ECU, of special conversion rates which differ appreciably from the market exchange rates; whereas, when most currencies were being allowed to float, the fixing of such agricultural conversion rates was the only way of maintaining the common agricultural policy and its price system in being;Whereas, if in a Member State the market rate deviates from the agricultural conversion rate by more than a specified margin, the functioning of the common agricultural policy may be seriously impeded; whereas, since trade to which the market rate applies may then be effected at a price, in national currency, different from the intervention price resulting from the use of agricultural conversion rates; whereas, moreover, the amounts to be granted or charged in trade with non-member countries will differ from one Member State to another;Whereas such effects might jeopardize the proper functioning of the market organization in general and its intervention system in particular; whereas, furthermore, abnormal changes in prices and artificial movements in trade flows might occur;Whereas it is justifiable to forestall these difficulties by providing for the application in trade of a system of monetary compensatory amounts bridging the gap between the market rate and the agricultural conversion rate; whereas these amounts were introduced by Council Regulation (EEC) N° 974/71 of 12 May 1971 on certain measures of conjunctural policy to be taken in agriculture following the temporary

widening of the margins of fluctuation for the currencies of certain Member States

compensatory amounts, the creation of new positive monetary compensatory amounts can be avoided by changing the way these amounts are calculated so as to base the method on the strongest Community currency complying with the 2,25 % fluctuation margin under the European Monetary System; whereas the calculation method can be changed by multiplying the central rates of the currencies complying with the 2,25 % margin by a coefficient expressing the revaluation of that central rate which, on the occasion of a realignment, is revalued most vis-à-vis the ECU; whereas this entails a corresponding increase in the negative monetary compensatory amounts;Whereas, by its very nature, this calculation method will lead to the creation of more negative monetary compensatory amounts; whereas it should therefore be introduced only on a provisional basis for a limited period at the end of which it should be reviewed in the light of experience; whereas, should the Council not have adopted before the beginning of the 1987/88 milk marketing year decisions either to extend the system in force or to introduce a different system, the arrangements applicable since the introduction of the ECU into the common agricultural policy will be re-introduced with effect from the beginning of the 1987/88 marketing year for each of the relevant products;Whereas this system of calculation is also used for the dismantling of existing positive monetary compensatory amounts, by reducing the highest by 3 points; whereas, for this purpose, the central rates of the currencies complying with the 2,25 % fluctuation margin must be multiplied by a coefficient of 1,033651, hereinafter referred to as the 'correcting factor';Whereas the monetary compensatory amounts must be paid or charged only where their absence would endanger distortions in the intervention system and/or in trade;Whereas the monetary compensatory amounts must also be kept down to the levels strictly needed to offset the impact of the gap between the agricultural conversion rate and the market rate on the prices of basic products for which intervention measures have been laid down;Whereas, to simplify administrative procedures, the principle should be laid down that each Member State should grant or charge the monetary compensatory amounts which correspond to the difference between the market rate of its currency and the agricultural conversion rate of its currency; whereas for the same reason, in trade with non-member countries, the monetary compensatory amounts granted on imports should be deducted from the import...