TRAINING SESSION III EU Market Intervention EU Private Storage Technical Assistance for Development of a Strategy for Alignment with Common Market Organisation (CMO) Requirements TR2014/AG/10-A1-01/001 This Project is co-financed by the European Union and the Republic of Turkey TRAINING SESSION III EU Market Intervention EU Private Storage Ankara, 14 May, 2018

Initiating a selling from intervention - the Committee for the Common Organization of Agricultural Markets delivers a positive opinion on a Commission proposal to open intervention sales, - the Commission Implementing Regulation appears in the Official Journal and enters into force, - the first closing date for submission of tenders shall be fixed not earlier than six days after the publication of the Regulation.

The Commission Regulation on selling includes: - the products covered by the tender with their CN codes, - the period covered by the tender, - each deadlines when applications can be submitted to the Member States intervention agencies (in case of public holiday – the preceding working day is the deadline), - the indication if the tender is restricted to some uses (e.g. export, bioethanol), - usually an Annex contains all the coordinances of Member States intervention agencies.

The ARDA Notice Based on the Commission Regulation ARDA publishes its Notice on its website a the latest 4 working days before the first deadline for the submission of tenders. The ARDA Notice must contain: (a) the name and address of the intervention agency issuing the notice to tender; (b) the reference to the Regulation opening the sale; (c) the closing dates for the submission of tenders for each partial invitation to tender;

The ARDA Notice (d) the storage places, the names and addresses of the storekeepers, the quantities available; (i) the quality parameters for each sales lot; (f) any facilities at the storage place for loading onto a means of transport; (g) in the case of tendering for export, the port or place of exit which may be reached at the lowest transport costs and which has adequate technical equipment for exporting the products put up for tender.

Example of information in the ARDA Notice

Example of a sale bid

Sale with tendering procedure Bids must be sent to the ARDA Central Office. ARDA registers the tenders – date of submission is the date of arrival (here we had to alter from the common rule in Hungary – which is the date of postage) Bids are definitive – no change allowed (here also we had to alter from the Hungarian law)

Sale with tendering procedure Bids must contain the proposed price in EUR/t rounded to no more than two decimal places, exclusive of VAT, Bids must also contain a reference to the Commission Regulation opening the tender, the exact indication for the lots tendered and the overall quantity, A proof that the security of (10) EUR/t has been placed at the bank account of ARDA, In case of a bid for export, an application for an export-licence must also be enclosed to the bid.

Sale with tendering procedure Responsible committee: „Committee for the Common Organisation of Agricultural Markets” Representatives from all 28 Member States Representatives from the European Commission DG AGRI Commission puts forward proposals, MS representatives are voting on the proposals Meetings once a month – but weekly (on Thursdays) in case of intervention purchases/disposals

Decisions about tenders/bids/offers in Brussels Wednesday 12:00 Member States authorities send local market prices to the European Commission Thursday 12:00 deadline for market operators to send their bids to ARDA Thursday 13:00 deadline for ARDA to send bids to the European Commission

Decisions about tenders/bids/offers in Brussels Thursday 13:00-15:00 Lunch break + Commission colleagues prepare proposals on bids taking into account local prices Thursday 15:00-18:00 Meeting of the Committee for the Common Organisation of Agricultural Markets (EU Commission proposes price limits on bids, Member States vote)

Example decision in Brussels (maize sale) Bidder Lot. No. Bidding price (EUR/t) Quantity (t) 3 14 116,95 5 000 4 28 116,51 4 000 1 31 116,01 5 000 5 04 115,75 4 500 1 12 113,21 10 000 6 17 113,11 5 000 2 02 112,35 15 000 2 36 112,35 12 000

Example decision in Brussels (maize sale) Cereal price reporting 12/10/2006 - HUNGARY

Example decision in Brussels (maize sale) Bidder Lot. No. Bidding price (EUR/t) Quantity (t) 3 14 116,95 5 000 4 28 116,51 4 000 1 31 116,01 5 000 5 04 115,75 4 500 1 12 113,21 10 000 6 17 113,11 5 000 2 02 112,35 15 000 2 36 112,35 12 000

Example: Decision in Brussels (maize sale) COMMISSION REGULATION (EU) No …/2006 of 13 October 2006 on selling prices for cereals in response to the fifth individual invitations to tender within the tendering procedures opened by Regulation (EU) No 1414/2006 THE EUROPEAN COMMISSION, ………… HAS ADOPTED THIS REGULATION: Article 1 For the fifth individual invitations to tender for selling of cereals within the tendering procedures opened by Regulation (EU) No 1414/2006, in respect of which the time limit for the submission of tenders expired on 11 October 2006, the decisions on the selling price per cereal and Member State are set out in the Annex to this Regulation. Article 2 This Regulation shall enter into force on the day of its publication in the Official Journal of the European Union. This Regulation shall be binding in its entirety and directly applicable in all Member States. Done at Brussels, 13 October 2006. For the Commission, On behalf of the President, José Manuel SILVA RODRÍGUEZ Director-General for Agriculture and Rural Development

Example decision in Brussels (maize sale) Annex to the Commission Regulation

Private storage Aim: helping temporary storage of goods, stabilises the market temporarily by encouraging operators to store goods instead of selling them on the market

Private storage Legal background: - Art. 17-21. REGULATION (EU) No 1308/2013 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL - Commission Reg. 2016/1238/EU (DEL) and 2016/1240/EU (IMP) + specific Commission Regulations on initiating private storage Shall be applied in all Member States.

Private storage Eligible products and periods: - white sugar; open: 1st November – 31th June - olive oil; flax fibre; fresh or chilled meat of bovine animals; butter produced from cow's milk; cheese; skimmed milk powder made from cow's milk; pigmeat; sheepmeat and goatmeat.

Private storage Operation: - for all products: private storage may be opened by the Commission, - a monthly amount of payment is granted to applicants set by the Commission Regulation opening the private storage - for all products: aid may be fixed in Commission regulation opening the measure or a tendering procedure may apply

Private storage Additional conditions to open private storage: - white sugar: the average Community price is below 85% of the reference price 404,4 EUR/t, - beef: the average Community price for carcasses is below 2291 EUR/t

Comm. Reg. opening private storage contains: - the products with CN codes, global quantity; - in the case of aid fixed in advance, the amount of aid per unit; - in the case of tenders, the period covered (‘tendering period’), and in the case of aid fixed in advance the period for submitting an application; - the period of storage; - the minimum quantity per tender or application; - the amount of the security per unit; - the periods of placing into store and of removal from store;

Private storage (steps) 0. Publication of the notice for private storage. 1. Receiving the applications/tenders. 2. Verifying applications/tenders, handling the security placed by tenderers. 3. Sending the applications/tenders to Brussels (decision on tenders made in Brussels). 4. Concluding the contracts with successful applicants/tenderers. 5. Control during storage and removal. 6. Payment, release of the security.

Private storage Decision on tenders – similar procedure as in case of intervention Storage contract is signed between successful operator and ARDA. Elements of the contract is regulated in Art. 51-52 of REGULATION (EU) No 1308/2013.

Private storage Removal: may start on the day following the last day of the contractual storage period. Operator lodges application for payment within 3 months after end of the storage period. Payment shall be made not later than 120 days following the date on which an application for payment is lodged provided that the obligations of the contract have been met.

Losses/destroyed products (intervention and private storage) Legal Base - REGULATION (EU) No 1306/2013 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL - Paragraph 5 (7) of ministerial regulation No 140/2009 - Point 5. and 9. of the „Common Conditions” of the storage contracts

Missing quantities (intervention and private storage) Where the tolerance limits for the storage (wheat, barley – 0,2%/year, maize 0,4%/year) are exceeded, or where quantities are found to be missing due to theft or other identifiable causes: - 105% of the intervention price, or - 105% of the actual market price (applicable on the day the quantities are found to be missing)

Destroyed products (intervention and private storage) Where quality does not meet the intervention/public storage limit. (a) accidents: 95% of the intervention price; (b) natural disasters: determined by specific Commission decision; (c) poor conservation conditions due in particular to unsuitable storage methods: missing quantities; (d) too long storage: the book value of the product shall be determined on the basis of the selling price at the time of sale.

Hungarian procedure ARDA has a „Rules of Procedure” containing all procedures and official forms to be used in case of a missing or damaged quantity is found: - form of reports in connection with missing/damaged goods, - definition of deterioration of quality, - definition of missing quantity, - the procedure of „loss-control management”, - information on the amounts recovered during the „loss-control management”.

Special cases

Special cases If the on-the-spot control shows: - a missing quantity greater than 10% of the stock, - the financial loss due to quality deterioration exceeds 30%. The County Office must send the control report stating the irregularity within 1 working day to the Central Office. Legal Department of ARDA takes on the case immediately.

This publication has been produced with the financial assistance of the European Union The contents of this publication is the sole responsibility of NIRAS IC Sp. z o.o. and can in no way be taken to reflect the views of the European Union