Presentation by Mr. PAT IVORY , IDIA, Ireland

1. The EU Common Market Organisation for Milk Domestic support and intervention: « regulatory and operational aspects » Presentation by Mr. PAT IVORY, IDIA, Ireland CEEC's seminars

2. Regulatory and operational aspects of internal support programs • Butter • Butter for pastry and ice-cream (Reg.2571/97) • Aid for concentrated butter (Reg. 429/90) • Aid for butter for collectivity (Reg. 2191/81) • SMP • Aid for incorporation in feed (Reg. 2799/99) • Skim milk • Aid for the production of casein and caseinates (Reg. 2921/90) School milk Programm • Aid for the consumption of milk, yoghurts and cheese (Reg. 2707/2000) CEEC's seminars

3. Regulatory and operational aspects of internal support programs:Butter • Butter for pastry and ice-cream (Reg.2571/97) = the aid granted for using butter, concentrated butter and cream for use in backery products, ice-cream and other specified food stuffs • Eligible products: only the following may qualify for aid: • Butter produced directly and exclusively from pasteurised cream, meeting the “national quality class” requirements • Concentrated butter entirely obtained from butter or cream or butter issued from public stocks. They must have been produced in approved establishments. • Cream meeting specific requirements CEEC's seminars

4. Regulatory and operational aspects of internal support programs:Butter (Reg.2571/97) • Level of the aid • Administration • The intervention butter shall be sold and the aid shall be granted by means of a standing invitation to tender organized by each intervention agency • Evolution of the use of the scheme • Presently being revised in view of its • Simplification • Codification with the other butter schemes CEEC's seminars

5. Regulatory and operational aspects of internal support programs:Butter (Reg.2571/97) • Incorporation timing : • After the tender, maximum timings are specified for product processing (4 months) and for the final use of the eligible products • 2 formulas for tendering : • Formulas A and B, depending on the final products in which the eligible products are incorporated CEEC's seminars

6. Regulatory and operational aspects of internal support programs:Butter (Reg.2571/97) • Use of tracers : • large users can use non traced products under the control of the Intervention Agency • tracers are mandatory for all aided products sold to medium or small users • Two securities : • a tendering security, released after deposit of the processing security • a processing security, released after the final control of aided product use CEEC's seminars

7. Regulatory and operational aspects of internal support programs:Butter (Reg.2571/97) • Establishments must be approvedfor all operations under this regulation : • processing of concentrated butter, • processing of butter into concentrated butter, • tracers addition, • repacking of concentrated butter, • incorporation in intermediate products, • incorporation of eligible products in final products • Controls : • The intervention agency must be informed for all operations of processing and deliveries of aided products until the final purchasers if the purchased quantities per user exceed a certain weight. CEEC's seminars

8. Regulatory and operational aspects of internal support programs:Butter • Aid for concentrated butter (Reg. 429/90) • Obtained from market butter and cream and meant for direct consumption in the EU • Approved establishments for processing • Permanent tender • Aid level: 97€/100 kg (17.10.03) • Guarantee: 112€/100 kg(17.10.03) • Processing and tracing within 90 days after the tendering offer CEEC's seminars

9. Regulatory and operational aspects of internal support programs:Butter • Aid for butter for collectivities (Reg. 2191/81) • Aided butter specific for consumption in non profit collectivities and institutions (schools…) • Maximum quantity: 2kg/month/consumer • Specific packaging required • Aid level: 205€/100 kg • The collectivity must be registrered at the intervention agency. CEEC's seminars

10. Regulatory and operational aspects of internal support programs:SMP for feed Aid for incorporation in feed (Reg. 2799/99) = the grant of aid for SM and SMP intended for animal feed and the sale of SMP from intervention for feed. • This Regulation lays down detailed rules for: • the grant of aid for skimmed milk, skimmed-milk powder, buttermilk and buttermilk powder intended for use as animal feed • the sale of SMP from intervention stocks intended for use as animal feed CEEC's seminars

11. Regulatory and operational aspects of internal support programs:SMP for feed • Aid level: • the aid is fixed per 100kg of SMP, according to the protein content • a reduction will be applied if the moisture is > 5%Payment of the aid: • the amount of aid = that applicable either on the day on which the SM or SMP is processed into compound feeding stuffs or on the day on which the SMP is denatured. • payment of the aid is subject to controls in the processing plant. • MS are authorised to pay an advance on the aid if a security has been lodged for 110% of the amount of the advance. CEEC's seminars

12. Regulatory and operational aspects of internal support programs:SMP for feed Controls: • Inspection measures are specified. • The reference methods to be used for the analyses provided are determined. • The Member State may set up a system of self checking for certain approved undertakings. CEEC's seminars

13. Regulatory and operational aspects of internal support programs:SMP Eligibility: • The facility must have been approved • The SMP may not have benefitted from any other support • The packaging must comply with specifications • If in bulk, the delivery of the feed compounds to the final user is done under administrative control. CEEC's seminars

14. Regulatory and operational aspects of internal support programs:SMP • Sales from Intervention for feed (reg. 2799/99): • Tender procedure • Offers are to be lodged before 12:00 the 2nd and 4th Tuesday of each month • Minimum quantity: 10 tons per offer CEEC's seminars

15. Regulatory and operational aspects of internal support programs:Casein & Caseinates Regulation (EC) N. 2921/90 Aid for the production of casein and caseinates from SM. • Aid is granted to producers only if these products: • Have been produced from skimmed milk of Community origin or raw casein extracted from milk of Community origin • Meet the composition requirements of Annex I, II, or III • Are packaged as stipulated in Article 3 CEEC's seminars

16. Regulatory and operational aspects of internal support programs:Casein & Caseinates • Current aid level: €6,3 per 100 kg of skim milk used • Coefficients are defined for conversion from skim milk to caseins and caseinate • Aid is granted at the rate applicable on the day of production of the casein or caseinates • Periodic checks must cover at least 25% of the total quantity covered by aid applications • Each production site must be checked at least once every six months CEEC's seminars

17. Regulatory and operational aspects of internal support programs:School Milk Regulation (EC) N. 2707/2000 Community aid for supplying milk and certain milk products to pupils in educational establishments. Beneficiaries: pre-, primary and secondary (optional) school pupils Limit:max. 0.25 l milk equivalent per pupil per school day For direct consumption and not asingredients in meals Products:* Whole milk and yoghurts * Semi-skim milk and yoghurts * Skim milk and yoghurts (+ according to derogations for fat in consumption milk) * Cheeses CEEC's seminars

18. Regulatory and operational aspects of intervention in the EU:Butter Public storage for butter (Reg. 2771/99) Precondition The market price must be below 92% of IVP for two consecutive weeks in the member state in order to open sales to intervention The buying price is fixed by the Commission = at least 90% of IVP Timing Today and until end of february 2004, sales to intervention are possible 12 months per year As from 2004: from March 1st to August 31st CEEC's seminars

19. Regulatory and operational aspects of intervention in the EU:Butter • Eligibility • only butter produced directly and exclusively from pasteurised cream, processed in the 23 day period before the offer presentation • in an approved undertaking in the Community • and if the undertaking applies some conditions • Qualityis precisely described • Quantity= min. 10 tons per offer • Packagingin 25 kg is precisely described CEEC's seminars

20. Regulatory and operational aspects of intervention in the EU Ceiling Today: none In 2004: 70.000 tons In 2005: 60.000 tons In 2006: 50.000 tons In 2007: 40.000 tons From 2008: 30.000 tons CEEC's seminars

21. Regulatory and operational aspects of intervention in the EU:Butter • Tender for buying-in • The closing date for submission of tenders for each individual invitation to tender fall on every 2nd and 4th Tuesday of the month at 12:00 hrs (Brussels time). • In the light of the tenders received for each invitation to tender, the Commission fix a maximum buying-in price, by reference to the intervention price applicable. CEEC's seminars

22. Regulatory and operational aspects of intervention in the EU:Butter • Once the ceiling is reached:3 possibilities • Continuation of the buying-in at 90% of IVP, or • Suspension of the buying-in at 90% of IVP and use of the tender system, or • Close of the buying-in for the current year CEEC's seminars

23. Regulatory and operational aspects of intervention in the EU:Butter • Selling out of intervention • Sales of butter to any interested party at IVP + 1€/100 KG • Minimum quantity: 5 tonnes • Age of butter available: published Or • Sales under other support schemes • Butter for pastries and ice-cream (Reg. 2571/97) CEEC's seminars

24. Regulatoryand operational aspects of intervention in the EU:Butter • Butter private storage scheme (Reg. 2771/99) • Eligibility: butter produced in the EU, national quality class • Age of butter: butter processed within the prior 28 days • Entry into storage: 15 March to 15 August • Exit of storage: starting from 16 August • These dates are republished every year CEEC's seminars

25. Regulatory and operational aspects of intervention in the EU:Butter • Butter private storage scheme (cont’d) • Aid (2003 campaign) per Ton : • 24 € for fixed costs • 0.35 € per day of storage • a payment per day of storage calculated from the interest rate of 2.75% per year CEEC's seminars

26. Regulatory and operational aspects of intervention in the EU • Public storage for SMP (Reg. 214/2001) • Precondition: none • Timing: from March 1st to August 31st each year • Price: intervention price (min. 35.6% protein/NFDM) • Ceiling: 109 000 tons per year • What then? • Suspension • Suspension and buying-in via tender procedure • Suspension and opening of the private storage scheme CEEC's seminars

27. Regulatoryand operational aspects of intervention in the EU:SMP • Eligibility • Top quality skimmed milk powder • made by the spray process • obtained in an approved undertaking in the community • directly and exclusively from skimmed milk • which meets a minimum protein content of 35.6% by weight of non-fat dry extract CEEC's seminars

28. Regulatory and operational aspects of intervention in the EU:SMP • Eligibility (cont’d) • manufactured during the 30 days preceding the day on which the intervention agency received the offer to sell. • minimum quantity = 20 tonnes. • packaging: bags of a net weight of 25 kg • Must not contain buttermilk or whey CEEC's seminars

29. Regulatory and operational aspects of intervention in the EU:SMP • Selling out of intervention • Intervention price + 1€/100 kg for « free » use or • Tender system for use in feed according to regulation 2799/99 • Offers to be done for the 2nd and 4th Tuesday of the month CEEC's seminars

30. Regulatory and operational aspects of . . . . . • And some others schemes: • Regulation 2597/1997 covering consumption milk • Regulations on promotions: • Reg. 2826/2000 for the internal market • Reg. 2702/1999 for promotion in 3rd countries • Reg. 2204/1990 for the use of casein in cheese • Reg. 1068/2000 for the private storage of cheese (Emmental) • Reg. 322/1996 on private storage of SMP CEEC's seminars

31. Regulatory and operational aspects of . . . . . • In almost all regulations, provisions are included covering • Guarantees/penalties • Controls CEEC's seminars