(1)

Regulation (EC) No 3223/94 lays down, pursuant to the outcome of the Uruguay Round multilateral trade negotiations, the criteria whereby the Commission fixes the standard values for imports from third countries, in respect of the products and periods stipulated in the Annex thereto.

(2)

In compliance with the above criteria, the standard import values must be fixed at the levels set out in the Annex to this Regulation,

(1)

Article 31(1) of Regulation (EC) No 1255/1999 provides that the difference between prices in international trade for the products listed in Article 1(a), (b), (c), (d), (e) and (g) of that Regulation and prices within the Community may be covered by an export refund.

(2)

Commission Regulation (EC) No 1520/2000 of 13 July 2000 laying down common implementing rules for granting export refunds on certain agricultural products exported in the form of goods not covered by Annex I to the Treaty, and criteria for fixing the amount of such refunds (2), specifies the products for which a rate of refund should be fixed, to be applied where these products are exported in the form of goods listed in Annex II to Regulation (EC) No 1255/1999.

(3)

In accordance with the first subparagraph of Article 4(1) of Regulation (EC) No 1520/2000, the rate of the refund per 100 kg for each of the basic products in question must be fixed for each month.

(4)

However in the case of certain milk products exported in the form of goods not covered by Annex I to the Treaty, there is a danger that, if high refund rates are fixed in advance, the commitments entered into in relation to those refunds may be jeopardised. In order to avert that danger, it is therefore necessary to take appropriate precautionary measures, but without precluding the conclusion of long-term contracts. The fixing of specific refund rates for the advance fixing of refunds in respect of those products should enable those two objectives to be met.

(5)

Article 4(3) of Regulation (EC) No 1520/2000 provides that, when the rate of the refund is being fixed, account should be taken, where necessary, of production refunds, aids or other measures having equivalent effect applicable in all Member States in accordance with the Regulation on the common organisation of the market in the product in question to the basic products listed in Annex A to Regulation (EC) No 1520/2000 or to assimilated products.

(6)

Article 12(1) of Regulation (EC) No 1255/1999 provides for the payment of aid for Community-produced skimmed milk processed into casein if such milk and the casein manufactured from it fulfil certain conditions.

(7)

Commission Regulation (EC) No 2571/97 of 15 December 1997 on the sale of butter at reduced prices and the granting of aid for cream, butter and concentrated butter for use in the manufacture of pastry products, ice-cream and other foodstuffs (3), lays down that butter and cream at reduced prices should be made available to industries which manufacture certain goods.

(8)

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

(1)

Regulation (EC) No 312/2003 implements for the Community the tariff provisions laid down in the Agreement establishing an association between the Community and its Member States, of the one part, and the Republic of Chile, of the other part (2).

(2)

By Council Decision 2005/106/EC (3) has approved a Protocol to the Association Agreement between the European Community and its Member States, of the one part, and the Republic of Chile, of the other part, to take account of the accession of the Czech Republic, the Republic of Estonia, the Republic of Cyprus, the Republic of Hungary, the Republic of Latvia, the Republic of Lithuania, the Republic of Malta, the Republic of Poland, the Republic of Slovenia, and the Slovak Republic to the European Union (hereinafter referred to as the Protocol). The Protocol includes new Community tariff concessions, some of which are limited by tariff quotas. Implementation of these tariff quotas requires the amendment of Regulation (EC) No 312/2003.

(3)

The volume of the tariff quotas for garlic (order No 09.1925), table grapes (order No 09.1929) and kiwifruit (order No 09.1939) should be increased annually by five percent of the original quantity.

(4)

For 2004, the volume of the new Community tariff quotas should be limited in proportion to the period during which the new tariff quotas are open.

(5)

Since the Protocol provides that the new Community tariff concessions have to be applied from 1 May 2004, this Regulation should apply from the same date and enter into force as soon as possible.

(6)

The measures provided for in this Regulation are in accordance with the opinion of the Customs Code Committee,

(1)

Annex I to Regulation (EC) No 138/2004 of the European Parliament and of the Council sets out the methodology of the economic accounts for agriculture in the Community (hereinafter referred as the EAA methodology). Paragraphs 3.056 and 3.064 of that Annex provide examples of, respectively, subsidies on products and other subsidies on production, with reference to specific budget lines. Some of those references are no longer valid, and an update of both paragraphs is necessary.

(2)

The task of updating the EAA methodology is assigned to the Commission.

(3)

Regulation (EC) No 138/2004 should therefore be amended accordingly.

(4)

The measures provided for in this Regulation are in accordance with the opinion of the Standing Committee on Agricultural Statistics set up by Council Decision 72/279/EEC (2),

(1)

Article 39(1) of Regulation (EC) No 1260/2001 provides that, during the marketing years 2001/02 to 2005/06 and in order to ensure adequate supplies to Community refineries, a special reduced rate of duty is to be levied on imports of raw cane sugar originating in States with which the Community has concluded supply agreements on preferential terms. At present such agreements have been concluded by Council Decision 2001/870/EC (2) with the African, Caribbean and Pacific States (ACP countries) listed in Protocol No 3 on ACP sugar attached to Annex V to the ACP-EC Partnership Agreement (3) and with the Republic of India.

(2)

Under the agreements in the form of an exchange of letters concluded by Decision 2001/870/EC the refiners in question must pay a minimum purchase price equal to the guaranteed price for raw sugar, less the adjustment aid set for the marketing year concerned. This minimum price should therefore be set by taking account of the factors applicable in the 2004/05 marketing year.

(3)

The quantities of special preferential sugar to be imported are calculated in accordance with Article 39 of Regulation (EC) No 1260/2001 on the basis of an annual Community forecast supply balance.

(4)

This supply balance indicated the need to import raw sugar and open at this stage for the 2004/05 marketing year tariff quotas at a special reduced rate of duty provided for in the above agreements so that the Community refineries’ supply needs can be met for part of the year. Quotas have been opened therefore, by Commission Regulation (EC) No 1213/2004 (4), for the period from 1 July 2004 to 28 February 2005.

(5)

Since the production estimates for raw cane sugar are available for the 2004/05 marketing year, a quota should be opened for the second part of the year.

(6)

It should be stipulated that Commission Regulation (EC) No 1159/2003 of 30 June 2003 laying down detailed rules of application for the 2003/04, 2004/05 and 2005/06 marketing years for the import of cane sugar under certain tariff quotas and preferential agreements and amending Regulations (EC) No 1464/95 and (EC) No 779/96 (5) applies to the new quota.

(7)

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

(1)

Commission Regulation (EC) No 581/2004 of 26 March 2004 opening a standing invitation to tender for export refunds concerning certain types of butter (2) provides for a permanent tender.

(2)

Pursuant to Article 5 of Commission Regulation (EC) No 580/2004 of 26 March 2004 establishing a tender procedure concerning export refunds for certain milk products (3) and following an examination of the tenders submitted in response to the invitation to tender, it is appropriate to fix a maximum export refund for the tendering period ending on 22 February 2005.

(3)

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

(1)

Commission Regulation (EC) No 582/2004 of 26 March 2004 opening a standing invitation to tender for export refunds for skimmed milk powder (2) provides for a permanent tender.

(2)

Pursuant to Article 5 of Commission Regulation (EC) No 580/2004 of 26 March 2004 establishing a tender procedure concerning export refunds for certain milk products (3) and following an examination of the tenders submitted in response to the invitation to tender, it is appropriate to fix a maximum export refund for the tendering period ending on 22 February 2005.

(3)

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

(1)

Article 13(1) of Regulation (EC) No 1784/2003 and Article 14(1) of Regulation (EC) No 1785/2003 provide that the difference between quotations of prices on the world market for the products listed in Article 1 of each of those Regulations and the prices within the Community may be covered by an export refund.

(2)

Commission Regulation (EC) No 1520/2000 of 13 July 2000 laying down common implementing rules for granting export refunds on certain agricultural products exported in the form of goods not covered by Annex I to the Treaty, and the criteria for fixing the amount of such refunds (3), specifies the products for which a rate of refund should be fixed, to be applied where these products are exported in the form of goods listed in Annex III to Regulation (EC) No 1784/2003 or in Annex IV to Regulation (EC) No 1785/2003 as appropriate.

(3)

In accordance with the first subparagraph of Article 4(1) of Regulation (EC) No 1520/2000, the rate of the refund per 100 kilograms for each of the basic products in question must be fixed for each month.

(4)

The commitments entered into with regard to refunds which may be granted for the export of agricultural products contained in goods not covered by Annex I to the Treaty may be jeopardised by the fixing in advance of high refund rates. It is therefore necessary to take precautionary measures in such situations without, however, preventing the conclusion of long-term contracts. The fixing of a specific refund rate for the advance fixing of refunds is a measure which enables these various objectives to be met.

(5)

Taking into account the settlement between the European Community and the United States of America on Community exports of pasta products to the United States, approved by Council Decision 87/482/EEC (4), it is necessary to differentiate the refund on goods falling within CN codes 1902 11 00 and 1902 19 according to their destination.

(6)

Pursuant to Article 4(3) and (5) of Regulation (EC) No 1520/2000, a reduced rate of export refund has to be fixed, taking account of the amount of the production refund applicable, pursuant to Commission Regulation (EEC) No 1722/93 (5), for the basic product in question, used during the assumed period of manufacture of the goods.

(7)

Spirituous beverages are considered less sensitive to the price of the cereals used in their manufacture. However, Protocol 19 to the Act of Accession of the United Kingdom, Ireland and Denmark provides that the necessary measures must be decided to facilitate the use of Community cereals in the manufacture of spirituous beverages obtained from cereals. Accordingly, it is necessary to adapt the refund rate applying to cereals exported in the form of spirituous beverages.

(8)

The Management Committee for Cereals has not delivered an opinion within the time limit set by its chairman,

(1)

Article 13 of Regulation (EC) No 1784/2003 and Article 13 of Regulation (EC) No 3072/95 provide that the difference between quotations or prices on the world market for the products listed in Article 1 of those Regulations and prices for those products within the Community may be covered by an export refund.

(2)

Article 13 of Regulation (EC) No 3072/95 provides that when refunds are being fixed account must be taken of the existing situation and the future trend with regard to prices and availabilities of cereals, rice and broken rice on the Community market on the one hand and prices for cereals, rice, broken rice and cereal products on the world market on the other. The same Articles provide that it is also important to ensure equilibrium and the natural development of prices and trade on the markets in cereals and rice and, furthermore, to take into account the economic aspect of the proposed exports, and the need to avoid disturbances on the Community market.

(3)

Article 4 of Commission Regulation (EC) No 1518/95 (3) on the import and export system for products processed from cereals and from rice defines the specific criteria to be taken into account when the refund on these products is being calculated.

(4)

The refund to be granted in respect of certain processed products should be graduated on the basis of the ash, crude fibre, tegument, protein, fat and starch content of the individual product concerned, this content being a particularly good indicator of the quantity of basic product actually incorporated in the processed product.

(5)

There is no need at present to fix an export refund for manioc, other tropical roots and tubers or flours obtained therefrom, given the economic aspect of potential exports and in particular the nature and origin of these products. For certain products processed from cereals, the insignificance of Community participation in world trade makes it unnecessary to fix an export refund at the present time.

(6)

The world market situation or the specific requirements of certain markets may make it necessary to vary the refund for certain products according to destination.

(7)

The refund must be fixed once a month. It may be altered in the intervening period.

(8)

Certain processed maize products may undergo a heat treatment following which a refund might be granted that does not correspond to the quality of the product; whereas it should therefore be specified that on these products, containing pregelatinised starch, no export refund is to be granted.

(9)

The Management Committee for Cereals has not delivered an opinion within the time limit set by its chairman,

(1)

Article 13 of Regulation (EC) No 1784/2003 provides that the difference between quotations or prices on the world market for the products listed in Article 1 of that Regulation and prices for those products within the Community may be covered by an export refund.

(2)

Commission Regulation (EC) No 1517/95 of 29 June 1995 laying down detailed rules for the application of Regulation (EC) No 1784/2003 as regards the arrangements for the export and import of compound feedingstuffs based on cereals and amending Regulation (EC) No 1162/95 laying down special detailed rules for the application of the system of import and export licences for cereals and rice (2) in Article 2 lays down general rules for fixing the amount of such refunds.

(3)

That calculation must also take account of the cereal products content. In the interest of simplification, the refund should be paid in respect of two categories of ‘cereal products’, namely for maize, the most commonly used cereal in exported compound feeds and maize products, and for ‘other cereals’, these being eligible cereal products excluding maize and maize products. A refund should be granted in respect of the quantity of cereal products present in the compound feedingstuff.

(4)

Furthermore, the amount of the refund must also take into account the possibilities and conditions for the sale of those products on the world market, the need to avoid disturbances on the Community market and the economic aspect of the export.

(5)

The current situation on the cereals market and, in particular, the supply prospects mean that the export refunds should be abolished.

(6)

The Management Committee for Cereals has not delivered an opinion within the time limit set by its chairman,

(1)

Commission Regulation (EEC) No 1722/93 of 30 June 1993 laying down detailed rules for the application of Council Regulations (EEC) No 1766/92 and (EEC) No 1418/76 concerning production refunds in the cereals and rice sectors respectively (2) lays down the conditions for granting production refunds. The basis for calculating the refund is laid down in Article 3 of that Regulation. The refund thus calculated, differentiated where necessary for potato starch, must be fixed once a month and may be amended if the price of maize and/or wheat changes significantly.

(2)

The production refunds fixed in this Regulation should be adjusted by the coefficients listed in the Annex II to Regulation (EEC) No 1722/93 to establish the exact amount to be paid.

(3)

The Management Committee for Cereals has not delivered an opinion within the time limit set by its chairman,

(a)

EUR 0,00/tonne for starch from maize, wheat, barley and oats;

(b)

EUR 8,75/tonne for potato starch.

(1)

Article 14 of Regulation (EC) No 1785/2003 provides that the difference between quotations or prices on the world market for the products listed in Article 1 of that Regulation and prices for those products within the Community may be covered by an export refund.

(2)

Article 14 of Regulation (EC) No 1785/2003, provides that when refunds are being fixed, account must be taken of the existing situation and the future trend with regard to prices and availability of rice and broken rice on the Community market on the one hand and prices for rice and broken rice on the world market on the other. The same Article provides that it is also important to ensure equilibrium and the natural development of prices and trade on the rice market and, furthermore, to take into account the economic aspect of the proposed exports and the need to avoid disturbances of the Community market with limits resulting from agreements concluded in accordance with Article 300 of the Treaty.

(3)

Commission Regulation (EEC) No 1361/76 (2) lays down the maximum percentage of broken rice allowed in rice for which an export refund is fixed and specifies the percentage by which that refund is to be reduced where the proportion of broken rice in the rice exported exceeds that maximum.

(4)

The maximum export refund for rend, medium and long A rice was fixed at a relatively low level. Consequently, it is not justified for the moment to fix a common right to refund for rice.

(5)

Article 14(5) of Regulation (EC) No 1785/2003 defines the specific criteria to be taken into account when the export refund on rice and broken rice is being calculated.

(6)

The world market situation or the specific requirements of certain markets may make it necessary to vary the refund for certain products according to destination.

(7)

A separate refund should be fixed for packaged long grain rice to accommodate current demand for the product on certain markets.

(8)

The refund must be fixed at least once a month; whereas it may be altered in the intervening period.

(9)

It follows from applying these rules and criteria to the present situation on the market in rice and in particular to quotations or prices for rice and broken rice within the Community and on the world market, that the refund should be fixed as set out in the Annex hereto.

(10)

For the purposes of administering the volume restrictions resulting from Community commitments in the context of the WTO, the issue of export licences with advance fixing of the refund should be restricted.

(11)

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

(1)

Article 13 of Regulation (EC) No 1784/2003 provides that the difference between quotations or prices on the world market for the products listed in Article 1 of that Regulation and prices for those products in the Community may be covered by an export refund.

(2)

The refunds must be fixed taking into account the factors referred to in Article 1 of Commission Regulation (EC) No 1501/95 of 29 June 1995 laying down certain detailed rules under Council Regulation (EEC) No 1766/92 on the granting of export refunds on cereals and the measures to be taken in the event of disturbance on the market for cereals (2).

(3)

As far as wheat and rye flour, groats and meal are concerned, when the refund on these products is being calculated, account must be taken of the quantities of cereals required for their manufacture. These quantities were fixed in Regulation (EC) No 1501/95.

(4)

The world market situation or the specific requirements of certain markets may make it necessary to vary the refund for certain products according to destination.

(5)

The refund must be fixed once a month. It may be altered in the intervening period.

(6)

It follows from applying the detailed rules set out above to the present situation on the market in cereals, and in particular to quotations or prices for these products within the Community and on the world market, that the refunds should be as set out in the Annex hereto.

(7)

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

(1)

An invitation to tender for the refund for the export of barley to certain third countries was opened pursuant to Commission Regulation (EC) No 1757/2004 (2).

(2)

Article 7 of Commission Regulation (EC) No 1501/95 of 29 June 1995 laying down certain detailed rules for the application of Council Regulation (EEC) No 1766/92 on the granting of export refunds on cereals and the measures to be taken in the event of disturbance on the market for cereals (3), and in particular Article 13(3) thereof,

(3)

On the basis of the criteria laid down in Article 1 of Regulation (EC) No 1501/95, a maximum refund should not be fixed.

(4)

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

(1)

An invitation to tender for the refund for the export of oats produced in Finland and Sweden for export from Finland and Sweden to all third countries, with the exception of Bulgaria, Norway, Romania and Switzerland was opened pursuant to Regulation (EC) No 1565/2004.

(2)

On the basis of the criteria laid down in Article 1 of Regulation (EC) No 1501/95, a maximum refund should not be fixed.

(3)

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

(1)

An invitation to tender for the refund for the export of common wheat to certain third countries was opened pursuant to Commission Regulation (EC) No 115/2005 (2).

(2)

In accordance with Article 7 of Commission Regulation (EC) No 1501/95 of 29 June 1995 laying down certain detailed rules for the application of Council Regulation (EEC) No 1766/92 on the granting of export refunds on cereals and the measures to be taken in the event of disturbance on the market for cereals (3), the Commission may, on the basis of the tenders notified, decide to fix a maximum export refund taking account of the criteria referred to in Article 1 of Regulation (EC) No 1501/95. In that case a contract is awarded to any tenderer whose bid is equal to or lower than the maximum refund.

(3)

The application of the abovementioned criteria to the current market situation for the cereal in question results in the maximum export refund being fixed.

(4)

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

(1)

An invitation to tender for the maximum reduction from third countries in the duty on sorghum imported into Spain was opened pursuant to Commission Regulation (EC) No 2275/2004 (2).

(2)

Article 7 of Commission Regulation (EC) No 1839/95 (3), allows the Commission to decide, in accordance with the procedure laid down in Article 25 of Regulation (EC) No 1784/2003 and on the basis of the tenders notified to make no award.

(3)

On the basis of the criteria laid down in Articles 6 and 7 of Regulation (EC) No 1839/95 a maximum reduction in the duty should not be fixed.

(4)

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

(1)

An invitation to tender for the maximum reduction in the duty on maize imported into Spain from third countries was opened pursuant to Commission Regulation (EC) No 2277/2004 (2).

(2)

Pursuant to Article 7 of Commission Regulation (EC) No 1839/95 (3) the Commission, acting under the procedure laid down in Article 25 of Regulation (EC) No 1784/2003, may decide to fix maximum reduction in the import duty. In fixing this maximum the criteria provided for in Articles 6 and 7 of Regulation (EC) No 1839/95 must be taken into account. A contract is awarded to any tenderer whose tender is equal to or less than the maximum reduction in the duty.

(3)

The application of the abovementioned criteria to the current market situation for the cereal in question results in the maximum reduction in the import duty being fixed at the amount specified in Article 1.

(4)

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

(1)

An invitation to tender for the maximum reduction in the duty on maize imported into Portugal from third countries was opened pursuant to Commission Regulation (EC) No 2276/2004 (2).

(2)

Pursuant to Article 7 of Commission Regulation (EC) No 1839/95 (3), the Commission, acting under the procedure laid down in Article 25 of Regulation (EC) No 1784/2003, may decide to fix maximum reduction in the import duty. In fixing this maximum the criteria provided for in Articles 6 and 7 of Regulation (EC) No 1839/95 must be taken into account. A contract is awarded to any tenderer whose tender is equal to or less than the maximum reduction in the duty.

(3)

The application of the abovementioned criteria to the current market situation for the cereal in question results in the maximum reduction in the import duty being fixed at the amount specified in Article 1.

(4)

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

(1)

On 22 January 2002 the Council adopted Decision 2002/60/EC (1) appointing the members and alternate members of the Committee of the Regions.

(2)

Two seats as members of the Committee of the Regions have become vacant following the expiry of the mandates of Ms Barbara RICHSTEIN and Mr Manfred LENZ, notified to the Council on 12 January 2005, one seat as an alternate member of the Committee of the Regions has become vacant following the expiry of the mandate of Mr Wolfgang KLEIN, notified to the Council on 7 December 2004, and one seat as an alternate member of the Committee of the Regions has become vacant following the resignation of Mr Hans-Georg KLUGE, notified to the Council on 21 December 2004,

(a)

as members:

(b)

as alternate members:

(1)

On 22 January 2002 the Council adopted Decision 2002/60/EC (1) appointing the members and alternate members of the Committee of the Regions.

(2)

A seat as an alternate member of the Committee of the Regions has become vacant following the resignation of Mr Pere ESTEVE i ABAD, notified to the Council on 19 January 2005,

(1)

On 22 January 2002 the Council adopted Decision 2002/60/EC (1) appointing the members and alternate members of the Committee of the Regions.

(2)

One seat as a member and one seat as an alternate member of the Committee of the Regions have become vacant following the resignation of Mr Frans RAMON, member, notified to the Council on 8 September 2004 and of Mr Jos BEX, alternate member, notified to the Council on 3 February 2005, and five seats as members and seven seats as alternate members of the Committee of the Regions have become vacant following the expiry of the mandates of Mr Paul VAN GREMBERGEN (BE), Mr Bart SOMERS (BE), Mr Stefaan PLATTEAU (BE), Mr Xavier DESGAIN (BE) and Mr Hervé HASQUIN (BE), members, and of Mr Jacques TIMMERMANS (BE), Mr André DENYS, Ms Josée VERCAMMEN, Mr Serge KUBLA, Mr Rudy DEMOTTE, Mr Jean-Marc NOLLET and Mr Bernd GENTGES, alternate members, notified to the Council on 24 January 2005,

a)

as members:

b)

as alternate members:

(1)

The establishment of cooperation with the United Nations Office for Coordination of Humanitarian Affairs (UNOCHA) in the field of civil protection and humanitarian affairs is a reflection of a consistent policy of seeking a stronger relationship and co-operation with the United Nations, as underlined in the Commission’s Communication to the Council and the European Parliament on ‘Building an effective partnership with the United Nations in the fields of Development and Humanitarian Affairs’ of 2 May 2001 (1), as well as the Commission’s Communication to the Council and the European Parliament on ‘the European Union and the United Nations: The choice of multilateralism’ of 10 September 2003 (2),

(2)

Past experience emphasised the need to establish the basic principles for further cooperation and coordination between UNOCHA (including its emergency response system and coordination tools) and the European Commission (in the framework of the activities of the Community Civil Protection Mechanism as set up by the Council Decision 2001/792/EC, Euratom (3) and the activities of ECHO- the European Community Humanitarian Department (4)) when both simultaneously provide or facilitate assistance to a country affected by a natural or man-made disaster, in an attempt to cooperate efficiently, maximise the use of available resources and avoid any unnecessary duplication of effort.

(3)

The Commission and UNOCHA have negotiated a text of an exchange of letters concerning their cooperation in the framework of disaster response (in case of simultaneous interventions in a country affected by a disaster), which is proposed for approval,

(1)

Decision 90/424/EEC provides that the Community is to contribute towards improving the efficiency of veterinary inspections by granting financial aid to reference laboratories. Any reference laboratory designated as such, in accordance with Community veterinary legislation may receive Community aid, subject to certain conditions.

(2)

Commission Regulation (EC) No 156/2004 of 29 January 2004 on the Community’s financial assistance to the Community reference laboratories pursuant to Article 28 of Decision 90/424/EEC (2) provides that the financial contribution from the Community is to be granted if the approved work programmes are efficiently carried out and that the beneficiaries supply all the necessary information within certain time limits.

(3)

The Commission has assessed the work programmes and corresponding budget estimates submitted by the concerned Community reference laboratories for the year 2005.

(4)

Accordingly, Community financial aid should be granted to designed Community reference laboratories for the functions and duties provided for in Council Directive 96/23/EC of 29 April 1996 on measures to monitor certain substances and residues thereof in live animals and animal products and repealing Directives 85/358/EEC and 86/469/EEC and Decisions 89/187/EEC and 91/664/EEC (3).

(5)

Further aid should also be granted for the organisation of workshops in the areas falling under the responsibility of the Community reference laboratories.

(6)

Sound financial management requires that recurring difficulties which have occurred in the operation of the Community reference laboratory in Rome be taken into account when providing the Community financial aid to it. In December 2004, that laboratory has been audited to further verify compliance with the functions, duties and eligibility conditions laid down by Community rules.

(7)

Pursuant to Article 3(2) of Council Regulation (EC) No 1258/1999 of 17 May 1999 on the financing of the common agricultural policy (4), veterinary and plant health measures undertaken in accordance with Community rules are financed under the Guarantee Section of the European Agricultural Guidance and Guarantee Fund. For financial control purposes, Articles 8 and 9 of Regulation (EC) No 1258/1999 apply to this Decision.

(8)

The measures provided for in this Decision are in accordance with the opinion of the Standing Committee on the Food Chain and Animal Health,

(1)

In a Communication adopted on 21 May 2003, the Commission presented its Action Plan ‘Modernising Company Law and Enhancing Corporate Governance in the European Union — A Plan to Move Forward’ (1). The main objectives of the Action Plan are to strengthen shareholders’ rights and protection for employees, creditors and the other parties with which companies deal, while adapting company law and corporate governance rules appropriately for different categories of company, and to foster the efficiency and competitiveness of businesses, with special attention to some specific cross-border issues.

(2)

In its Resolution of 21 April 2004, the European Parliament welcomed the Action Plan and expressed strong support for most of the initiatives announced. The European Parliament called on the Commission to propose rules to eliminate and prevent conflicts of interest, and stressed in particular the need for listed companies to have an audit committee, whose functions should include overseeing the external auditor’s independence, objectivity and effectiveness.

(3)

Non-executive or supervisory directors are recruited by companies for a variety of purposes. Of particular importance is their role in overseeing executive or managing directors and dealing with situations involving conflicts of interests. It is vital to foster that role in order to restore confidence in financial markets. Member States should therefore be invited to adopt measures which would be applicable to listed companies, defined as companies whose securities are admitted to trading on a regulated market in the Community. When implementing this Recommendation, Member States should consider the specificities of collective investment undertakings of the corporate type and prevent the various types of collective investment undertaking from being subjected, unnecessarily, to unequal treatment. As regards collective investment undertakings as defined in Council Directive 85/611/EEC of 20 December 1985 on the coordination of laws, regulations and administrative provisions relating to undertakings for collective investment in transferable securities (UCITS) (2), that Directive already provides for a set of specific governance mechanisms. However, in order to prevent the unnecessarily unequal treatment of those collective investment undertakings of the corporate type not subject to harmonisation at Community level, Member States should take into account whether and to what extent these non-harmonised collective investment undertakings are subject to equivalent governance mechanisms.

(4)

In view of the complexity of many of the issues at stake, the adoption of detailed binding rules is not necessarily the most desirable and efficient way of achieving the objectives pursued. Many corporate governance codes adopted in Member States tend to rely on disclosure to encourage compliance, based on the ‘comply or explain’ approach: companies are invited to disclose whether they comply with the code and to explain any material departures from it. This approach enables companies to reflect sector- and enterprise-specific requirements, and the markets to assess the explanations and justifications provided. With a view to fostering the role of non-executive or supervisory directors, it is therefore appropriate that all Member States be invited to take the steps necessary to introduce at national level a set of provisions based on the principles set out in this Recommendation, to be used by listed companies either on the basis of the ‘comply or explain’ approach or pursuant to legislation.

(5)

If Member States decide to use the ‘comply or explain’ approach (whereby companies are required to explain their practices by reference to a set of designated best practice recommendations), they should be free to do so on the basis of relevant recommendations developed by market participants.

(6)

Any measures adopted by Member States in line with this Recommendation should aim fundamentally at improving the corporate governance of listed companies. Since that objective is relevant to the protection of investors, actual or potential, in all companies listed in the Community, whether or not they are incorporated in one of the Member States, the measures should also cover companies incorporated in third countries but listed in the Community.

(7)

The presence of independent representatives on the board, capable of challenging the decisions of management, is widely considered as a means of protecting the interests of shareholders and other stakeholders. In companies with a dispersed ownership, the primary concern is how to make managers accountable to weak shareholders. In companies with controlling shareholders, the focus is more on how to make sure that the company will be run in a way that sufficiently takes into account the interests of minority shareholders. Ensuring adequate protection for third parties is relevant in both cases. Whatever the formal board structure of a company, the management function should therefore be subject to an effective and sufficiently independent supervisory function. Independence should be understood as the absence of any material conflict of interest; in this context, proper attention should be paid namely to any threats which might arise from the fact that a representative on the board has close ties with a competitor of the company.

(8)

In order to ensure that the management function will be submitted to an effective and sufficiently independent supervisory function, the (supervisory) board should comprise a sufficient number of committed non-executive or supervisory directors, who play no role in the management of the company or its group and who are independent in that they are free of any material conflict of interest. In view of the different legal systems existing in Member States, the proportion of (supervisory) board members to be made up of independent directors should not be defined precisely at Community level.

(9)

The supervisory role of non-executive or supervisory directors is commonly perceived as crucial in three areas, where the potential for conflict of interest of management is particularly high, especially when such matters are not a direct responsibility for shareholders: nomination of directors, remuneration of directors, and audit. It is therefore appropriate to foster the role of non-executive or supervisory directors in these areas and to encourage the creation within the (supervisory) board of committees responsible respectively for nomination, remuneration and audit.

(10)

In principle, and without prejudice to the powers of the general meeting, only the (supervisory) board as a whole has statutory decision-making authority and, as a collegiate body, is collectively accountable for the performance of its duties. The (supervisory) board has the power to determine the number and structure of the committees which it deems to be appropriate to facilitate its own work, but these committees are in principle not to be a substitute for the (supervisory) board itself. As a general rule, therefore, the nomination, remuneration and audit committees should make recommendations aimed at preparing the decisions to be taken by the (supervisory) board. However, the (supervisory) board should not be precluded from delegating part of its decision-making powers to committees when it considers it appropriate and when this is permissible under national law, even though the (supervisory) board remains fully responsible for the decisions taken in its field of competence.

(11)

Since the identification of candidates to fill unitary or dual board vacancies raises issues relevant to the selection of non-executive or supervisory directors who are to oversee management or relevant to the continuation in office of management, the nomination committee should be composed mainly of independent non-executive or supervisory directors. That would leave room on the nomination committee for non-executive or supervisory directors who do not meet the independence criteria. It would also leave room for executive/managing directors (in companies where the nomination committee is created within the unitary board and as long as executive/managing directors do not form a majority on that committee).

(12)

Given the different approaches in the Member States with respect to the bodies responsible for appointing and removing directors, the role of a nomination committee created within the (supervisory) board should essentially be to make sure that, where the (supervisory) board plays a role in the appointment and removal process (either through a power to table proposals or to make decisions, as defined by national law), this role is performed in as objective and professional a way as possible. The nomination committee should therefore essentially make recommendations to the (supervisory) board with respect to the appointment and removal of directors by the body competent under national company law.

(13)

In the area of remuneration, corporate governance codes adopted in Member States tend to focus primarily on the remuneration of executive or managing directors, since the potential for abuse and conflicts of interest is essentially located there. Many codes also recognise that some consideration should be given at board level to the remuneration policy for senior management. Finally, the issue of stock options is granted special attention. Given the different approaches in the Member States with respect to the bodies responsible for setting the remuneration of directors, the role of a remuneration committee created within the (supervisory) board should essentially be to make sure that, where the (supervisory) board plays a role in the remuneration setting process (either through a power to table proposals or to make decisions, as defined by national law), this role is performed in as objective and professional a way as possible. The remuneration committee should therefore essentially make recommendations to the (supervisory) board with respect to those remuneration issues for decision by the body competent under national company law.

(14)

Two key responsibilities of the (supervisory) board seem to ensure that the financial reports and other related information disseminated by the company present an accurate and complete picture of the company’s position and to monitor the procedures established for the evaluation and management of risks. In this context, most corporate governance codes assign to the audit committee an essential role in assisting the (supervisory) board to fulfil these duties. In some Member States, such responsibilities are attributed, wholly or partly, to corporate bodies external to the (supervisory) board. It is therefore appropriate to provide that an audit committee created within the (supervisory) board should, as a general rule, make recommendations to the (supervisory) board with respect to those audit issues, and that such functions may be performed by other structures — external to the (supervisory) board — which would be equally effective.

(15)

In order for non-executive or supervisory directors to play an effective role, they should have the right background and sufficient time for the job. In addition, a sufficient number of them should meet appropriate independence criteria. Before the appointment of non-executive or supervisory directors, adequate information should be provided on these issues and that information should be updated with sufficient frequency.

(16)

With respect to the qualifications of directors, most corporate governance codes insist on the need to have qualified individuals on the board, but at the same time recognise that the definition of what constitutes proper qualifications should be left to the company itself, because such qualifications will depend, inter alia, on its activities, size and environment and because they should be met by the board as a whole. There is nevertheless one issue which usually raises particular concern, namely the need for particular competence in the audit committee where some specific knowledge is deemed to be indispensable. The (supervisory) board should therefore determine the desired composition of the audit committee and evaluate it periodically, devoting specific attention to the experience necessary in that committee.

(17)

With respect to the commitment of directors, most corporate governance codes seek to make sure that directors devote sufficient time to their duties. Some of these codes limit the number of directorships that may be held in other companies: the positions of chairman or of executive or managing director are usually recognised as more demanding than those of non-executive or supervisory director, but the precise numbers of other directorships acceptable vary widely. However, the involvement required from a director may vary widely depending on the company and its environment; in such a situation, each director should undertake to strike a proper balance between his various engagements.

(18)

Generally, corporate governance codes adopted in the Member States recognise the need for a significant proportion of non-executive or supervisory directors to be independent, that is to say, free of any material conflict of interest. Independence is most often understood as the absence of close ties with management, controlling shareholders or the company itself. In the absence of any common understanding of what independence precisely entails, it is appropriate to provide a general statement describing what the general objective is. Provision should also be made to cover a (non-exhaustive) number of situations, involving the relationships or circumstances usually recognised as likely to generate a material conflict of interest, which Member States must duly consider when introducing at national level the criteria to be used by the (supervisory) board. The determination of what constitutes independence should principally be an issue for the (supervisory) board itself to determine. When the (supervisory) board applies the independence criteria, it should focus on substance rather than form.

(19)

In view of the importance attaching to the role of non-executive or supervisory directors with respect to the restoration of confidence, and more generally to the development of sound corporate governance practices, the steps taken for the implementation of this Recommendation in Member States should be monitored closely,