Article 1This Regulation lays down specific measures to remedy the difficulties caused by the remoteness, insularity and outermost location of the Azores and Madeira in respect of certain agricultural products.

TITLE ISPECIFIC SUPPLY ARRANGEMENTS

Article 2Specific supply arrangements are hereby introduced for the agricultural products listed in Annexes I and II to this Regulation, which are essential for human consumption, for processing and as agricultural inputs in the Azores and Madeira.A forecast supply balance shall be drawn up stating the quantity of the agricultural products listed in Annexes I and II needed to meet supply requirements each year. A separate forecast balance may be drawn up for the requirements of the industries processing and packaging products intended for the local market, for export under certain conditions to third countries or for traditional consignment to the rest of the Community.

Article 31.No duties shall apply to direct imports into the Azores and Madeira of products covered by the specific supply arrangements if they originate in third countries, within the limit of the quantities determined in the supply balance.Products which have entered the Community's customs territory under inward processing or customs warehousing arrangements shall be considered as direct imports for the purposes of this Title.2.To ensure coverage of the requirements established in accordance with Article 2 in terms of quantity, price and quality, while taking care to maintain the Community's share in supplies, aid shall be granted to supply the Azores and Madeira with Community products held in public intervention storage or available on the Community market.Such aid shall be fixed to take account of the additional cost of transport to the Azores and Madeira and the prices applied to exports to third countries and, in the case of agricultural inputs and products intended for processing, the additional costs of insularity and outermost location.3.In implementing the specific supply arrangements, account shall be taken, in particular, of the following:the specific requirements of the Azores and Madeira and, in the case of products intended for processing and agricultural inputs, the specific quality requirements,trade flows with the rest of the Community,the economic aspect of the proposed aid.4.Entitlement under the specific supply arrangements shall be subject to the condition that the economic advantage derived either from exemption from import duties or from aid in the case of supply from the rest of the Community is actually passed on to the end user.5.Products covered by the specific supply arrangements may be re-exported to third countries or re-dispatched to the rest of the Community only on the conditions laid down by the Commission under the procedure referred to in Article 35(2). These conditions shall include in particular reimbursement of the aid received under the specific supply arrangements for the products referred to in paragraph 2 or payment of import duties on the products referred to in paragraph 1.The restriction referred to in the first subparagraph shall not apply to products which are processed in the regions of the Azores or Madeira and contain raw materials covered by the special supply arrangements, where those products:(a)are exported in the context of traditional exports or regional trade from the Azores or Madeira to third countries, or(b)are dispatched in the context of:(i)traditional consignments from the Azores or Madeira to the rest of the Community, or(ii)trade flows between the Azores and Madeira.No export refund shall be granted for the products referred to in the second subparagraph.6.Detailed rules for applying this Title shall be adopted in accordance with the procedure referred to in Article 35(2). These shall include:the fixing of aid for supply from the rest of the Community,provisions to ensure that the advantages granted are actually passed on to the end user,introduction if necessary of a system of import or delivery licences.The Commission shall draw up supply balances in accordance with the procedure referred to in Article 35(2). It may revise those balances, and the list of products in Annexes I and II, in accordance with the same procedure, in the light of changes in the Azores' and Madeira's requirements.When determining the Azores' raw sugar requirements, account shall be taken of the development of local production of sugar beet. The quantities covered by the supply arrangements shall be determined so as to ensure that the total volume of sugar refined in the Azores each year does not exceed 10000 tonnes.Article 9 of Regulation (EEC) No 2038/1999Council Regulation (EEC) No 2038/1999 of 13 September 1999 on the common organisation of the markets in sugar (OJ L 252, 25.9.1999, p. 1). Regulation as last amended by Commission Regulation (EC) No 907/2001 (OJ L 127, 9.5.2001, p. 28). shall not apply to the Azores.

TITLE IIMEASURES TO ASSIST LOCAL PRODUCTSCHAPTER IMEASURES COMMON TO BOTH REGIONSSECTION 1Livestock

Article 41.In the livestock sector, aid shall be granted for the supply to the Azores and Madeira of pure-bred animals, animals of commercial breeds and livestock products, originating in the Community, excluding pure-bred bovine animals to the Azores.2.The terms for granting aid shall be laid down taking account, in particular, of the supply requirements of the Azores and Madeira for starting up production and genetic improvement of livestock and the need for the breeds best suited to local conditions. The aid shall be paid for the delivery of goods which fulfil the requirements specified in Community rules.3.The following shall be taken into account when aid is being fixed:the conditions and in particular the costs of supply to the Azores and Madeira resulting from their geographical situation;the price of products on the Community market and on the world market;whether or not duties are charged on imports from third countries;the economic aspect of the proposed aid.4.Article 3(4) and (5) shall apply to goods qualifying for aid under paragraph 1 of this Article.5.The list of products covered, the level of the aid referred to in paragraph 1 of this Article and the detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 2Fruit, vegetables, plants and flowers

Article 51.Aid shall be granted in respect of the fruits, vegetables, flowers and live plants listed in Chapters 6, 7 and 8 of the Combined Nomenclature, tea falling within CN code 0902, honey falling within CN code 040900 and fruits of the genus Capsicum and the genus Pimenta falling within CN code 0904, harvested or produced locally and intended to supply the markets of the respective production regions. This aid shall not be granted for bananas grown in Madeira.The aid shall be granted for products which conform to common standards fixed by Community legislation or, where no such standards exist, to specifications written into the supply contracts.Grant of the aid shall be subject to the conclusion of supply contracts lasting one or more years between individual producers or producer groups, or producer organisations as referred to in Articles 11, 13 and 14 of Regulation (EC) No 2200/96Council Regulation (EC) No 2200/96 of 28 October 1996 on the common organisation of the market in fruit and vegetables (OJ L 297, 21.11.1996, p. 1). Regulation last amended by Regulation (EC) No 2826/2000 (OJ L 328, 23.12.2000, p. 2). and the food industry or distributors, restaurants and the like or local authorities.The aid shall be paid out to the abovementioned individual producers, producer groups or producer organisations within the limits of annual quantities established for each product category.The amount of the aid shall be fixed on a flat-rate basis for each of the product categories to be determined, based on the average value of the products covered. The amount of aid shall be differentiated according to whether or not the beneficiary is one of the producer organisations referred to in Articles 11, 13 and 14 of Regulation (EC) No 2200/96.2.This Article shall not apply to pineapples produced in the Azores.3.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2). The product categories and amounts of aid referred to in paragraph 1 shall be fixed in accordance with the same procedure.

Article 61.Aid shall be granted for the conclusion of annual contracts concerning the marketing of fresh and processed products included in the products referred to in Article 5(1). In the case of plants and flowers, aid shall not be subject to the conclusion of an annual contract.This aid shall be paid up to a limit of a volume of 3000 tonnes per product per year for each of the two regions.The contracts shall be concluded between individual producers or producer groups or producer organisations referred to in Articles 11, 13 and 14 of Regulation (EC) No 2200/96 which are established in the islands and natural or legal persons established in the rest of the Community.2.The amount of the aid shall be 10 % of the value of the production marketed, free at destination.3.The aid shall be granted to sellers who have concluded a contract as referred to in paragraph 1 with an operator established in the rest of the Community.4.Where the measures provided for in paragraph 1 are undertaken by joint ventures constituted, with the aim of marketing produce from the regions concerned, by producers or producer organisations or associations in those regions and natural or legal persons established in the rest of the Community, and where the partners undertake to pool the knowledge and know-how required to achieve the objective of the joint venture over a minimum period of three years, the amount of the aid specified in paragraph 2 shall be increased to 13 % of the value of the annual production marketed jointly.5.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

Article 71.The Community shall contribute up to a maximum of EUR 100000 towards the financing of two economic analyses and forward studies of the fresh and processed fruit and vegetable sector in each of the two regions, paying particular attention to tropical produce.The study shall produce an economic and technical assessment of the sector in each region. It shall pay particular attention to supply data and processing costs and examine the conditions and scope for development and sales at regional and international level, having regard to competition on the world market.2.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 3Wine

Article 8Chapter II of Title II and Chapters I and II of Title III of Regulation (EC) No 1493/1999Council Regulation (EC) No 1493/1999 of 17 May 1999 on the common organisation of the market in wine (OJ L 179, 14.7.1999, p. 1). Regulation as last amended by Regulation (EC) No 2826/2000 (OJ L 328, 23.12.2000, p. 2). and Chapter III of Regulation (EC) No 1227/2000Commission Regulation (EC) No 1227/2000 of 31 May 2000 laying down detailed rules for the application of Council Regulation (EC) No 1493/1999 on the common organisation of the market in wine, as regards production potential (OJ L 143, 16.6.2000, p. 1)., shall not apply to the Azores and Madeira.

Article 91.A flat-rate aid per hectare shall be granted for the continued cultivation of vines for the production of quality wines psr in the traditional production zones.The following areas shall be eligible for aid:(a)areas planted to vine varieties included among the varieties classified by the Member States as being suitable for the production of each of the quality wines psr produced in their territory, as referred to in Article 19 of Regulation (EC) No 1493/1999, and(b)areas where the yield per hectare is lower than a maximum to be fixed by the Member State, expressed as quantities of grapes, grape musts or wine, under the terms of Annex VI(I) to Regulation (EC) No 1493/1999.2.The amount of the aid shall be EUR 650 per hectare per year. The aid shall be paid to producer groups or their associations. However, the aid shall also be granted to individual producers during a transitional period. During that period, all the aid shall be paid through the Wine Institute of Madeira and the Wine-growing Commission of the Azores, in accordance with rules to be laid down in accordance with the procedure referred to in Article 35(2).3.Detailed rules for applying this Article shall be adopted as necessary in accordance with the procedure referred to in Article 35(2).

Article 101.Notwithstanding Article 19(1) of Regulation (EC) No 1493/1999, grapes from prohibited direct-producer hybrid vine varieties (Noah, Othello, Isabelle, Jacquez, Clinton and Herbemont) harvested in the Azores and Madeira may be used for the production of wine which must remain within those regions.2.By 31 December 2006 Portugal shall have gradually eliminated vineyards planted with prohibited direct-producer hybrid vine varieties, with, where appropriate, the support provided for in Chapter III, Title II, of Regulation (EC) No 1493/1999.3.Portugal shall notify the Commission, each year, of the progress made in converting and restructuring areas planted with prohibited direct-producer hybrid vine varieties.

SECTION 4Graphic symbol

Article 111.The conditions for using the graphic symbol introduced with a view to ensuring greater awareness and consumption of quality agricultural products, whether natural or processed, specific to the Azores and Madeira as outermost regions, shall be proposed by the professional organisations. The Portuguese authorities shall forward such proposals, with their opinion, to the Commission for approval.Use of the symbol shall be monitored by an official authority or a body approved by the competent Portuguese authorities.2.Detailed rules for applying this Article shall be adopted as necessary in accordance with the procedure referred to in Article 35(2).

CHAPTER IIMEASURES TO ASSIST LOCAL PRODUCTS IN MADEIRASECTION 1Livestock and milk products

Article 121.Until the local numbers of young male bovines reach a level sufficient to maintain traditional beef production, and within the limit of the balance referred to in Article 12:(a)the customs duties referred to in Article 30 of Regulation (EC) No 1254/1999Council Regulation (EC) No 1254/1999 of 17 May 1999 on the common organisation of the market in beef and veal (OJ L 160, 26.6.1999, p. 21). shall not be applied to imports of bovine animals from third countries for on-site fattening and consumption in the islands;(b)aid shall be granted for the supply of animals as referred to in (a) originating in the Community, up to a limit of 1000 head. Priority shall be given to producers holding animals for fattening at least 50 % of which are of local origin.Article 3(4) and (5) shall apply to goods qualifying for the measures referred to in the first subparagraph of this Article.2.The numbers of animals qualifying for the measures referred to in paragraph 1 of this Article shall be determined in a periodic forecast supply balance, taking account of the development of local production. These numbers, the amount of the aid referred to in paragraph 1(b) of this Article and detailed rules for applying this Article, including in particular the minimum duration of the fattening period, shall be fixed in accordance with the procedure referred to in Article 35(2).

Article 131.In case of application of the exclusion provided for in Article 70 of Council Regulation (EC) No 1782/2003 of 29 September 2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmersOJ L 270, 21.10.2003, p. 1., the Portuguese Republic shall present to the Commission a programme to assist traditional activities connected with beef and veal, as well as sheep and goat production and measures to improve product quality, within the limits of the consumption needs of Madeira.The programme shall be prepared and implemented by the competent authorities designated by the Member State.2.The Community shall finance the programme up to an annual amount equal to the sum of premiums actually paid in 2003 pursuant to Regulation (EC) No 1254/1999OJ L 160, 26.6.1999, p. 21. Regulation as last amended by Regulation (EC) No 806/2003 (OJ L 122, 16.5.2003, p. 1)., to this Regulation and to Regulation (EC) No 2529/2001OJ L 341, 22.12.2001, p. 3. for producers established in Madeira.The Commission shall increase such amount in order to take into consideration the development of the local production. However, the annual amount shall in no case be higher than the sum of the ceilings applicable in 2003 for beef premiums pursuant to Regulation (EC) No 1453/2001 multiplied by the base and complementary premiums and payments applicable in 2003 and the sum of all premiums rights held by producers established in Madeira at the date of 30 June 2003 pursuant to Regulation (EC) No 2529/2001 and the pertinent proportion of the national reserve multiplied by the premiums and payments applicable in 2003.3.The Commission shall adopt the implementing arrangements, approve and modify the programme as well as fix and increase the amount provided for in paragraph 2, first subparagraph, of this Article in accordance with the procedure referred to in Article 144(2) of Regulation (EC) No 1782/2003. The Commission may, in accordance with the same procedure, revise the limit set forth in paragraph 2, second subparagraph.4.Before 15 April every year, the Portuguese Republic authorities shall present a report on implementation of the programme.

Article 141.During the period 2002—2006, aid shall be granted to implement a comprehensive programme to support the production and marketing of local produce in the livestock and milk products sectors in Madeira.The programme may include measures to encourage improved quality and hygiene, marketing, sector structuring, the rationalisation of production and marketing structures, local communication relating to quality products and the provision of technical assistance. The programme may not include the grant of aid in addition to the premiums paid under Articles 13 and 15.The programme shall be prepared and implemented by the competent authorities designated by the Member State, working in close collaboration with the most representative producer organisations or their associations in the sectors concerned.2.Detailed rules for applying this Article shall be laid down in accordance with the procedure referred to in Article 35(2). Draft programmes, to run for no more than five years, shall be presented to the Commission by the competent authorities; the Commission shall approve them in accordance with the procedure referred to in Article 35(2).3.Each year the Portuguese authorities shall present a report on implementation of the programme. Before the end of 2005, the Commission shall submit to the European Parliament and to the Council an evaluation report on the application of the measure referred to in this Article, accompanied if applicable by appropriate proposals.

Article 151.The aid provided for in paragraph 2 below shall be granted to assist traditional activities connected with cow's milk production and measures to improve product quality, within the limits of the consumption needs of Madeira as assessed in the context of a periodic supply balance. The balance shall take account of the milk products covered by the supply arrangements referred to in Article 2.2.Aid shall be granted for the human consumption of locally produced fresh cow's milk products, within the limits of the consumption needs of Madeira as assessed periodically.The amount of the aid shall be EUR 12/100 kg of whole milk delivered to a dairy in order to ensure the regular disposal of the aforementioned products on the local market. The aid shall be paid to the dairies.3.The additional levy scheme applicable to producers of cow's milk provided for in Regulation (EEC) No 3950/92Council Regulation (EEC) No 3950/92 of 28 December 1992 establishing an additional levy in the milk and milk products sector (OJ L 405, 31.12.1992, p. 1). Regulation as last amended by Regulation (EC) No 1256/1999 (OJ L 160, 26.6.1999, p. 73). shall not apply in Madeira, within the limit of local production of 4000 tonnes of milk.4.Notwithstanding Articles 2 and 3 of Regulation (EC) No 2597/97Council Regulation (EC) No 2597/97 of 18 December 1997 laying down additional rules on the common organisation of the market in milk and milk products for drinking milk (OJ L 351, 23.12.1997, p. 13)., the production in Madeira of UHT milk reconstituted from milk powder originating in the Community shall be authorised within the limits of local consumption requirements, insofar as this measure ensures that locally produced milk is collected and finds outlets. This product shall be intended for local consumption only.5.The Commission shall review the aid referred to in paragraph 2 of this Article and adopt detailed rules for applying this Article in accordance with the procedure referred to in Article 35(2). The detailed rules shall determine, in particular, the quantity of locally produced fresh milk to be incorporated into the reconstituted UHT milk referred to in paragraph 4 of this Article.

SECTION 2Potatoes

Article 161.Aid per hectare shall be granted for the cultivation of potatoes for human consumption falling within CN codes 07019050 and 07019090.The annual amount of the aid shall be EUR 596,9 per hectare per year.The aid shall be paid up to a limit of 2000 hectares cultivated and harvested per year.2.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 3Cane-sugar-rum

Article 171.Flat-rate area aid shall be granted each year to sugar-cane growers.2.The amount of the aid shall be EUR 500 per hectare planted and harvested per year. The aid shall be paid for up to 100 hectares.

Article 181.Aid shall be granted for the direct processing of sugar cane produced in Madeira into sugar syrup (mel de cana) or agricultural rum as defined in Article 1(4)(a) of Regulation (EEC) No 1576/89Council Regulation (EEC) No 1576/89 of 29 May 1989 laying down general rules on the definition, description and presentation of spirit drinks (OJ L 160, 12.6.1989, p. 1). Regulation as last amended by Regulation (EC) No 3378/94 of the European Parliament and of the Council (OJ L 366, 31.12.1994, p. 1)..The aid shall be paid to manufacturers of sugar syrup or to distillers on condition that they have paid the sugar cane producer a minimum price, to be determined.2.The aid shall be granted for the production of an annual quantity of 250 tonnes of sugar syrup and 2500 hectolitres of alcohol at 71,8o in the case of agricultural rum.

Article 19The amount of the aid provided for in Articles 17 and 18, the minimum price to be paid to producers and the detailed rules for applying the above Articles shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 4Wine

Article 201.The aid provided for in this Article shall be granted to assist the preparation of Madeira liqueur wines within the limits of the requirements arising from the methods traditionally used in the region.2.Aid shall be granted to purchase rectified concentrated musts in the rest of the Community for use in wine-making to sweeten the liqueur wines concerned.3.Aid shall be granted for the purchase of wine alcohol.Terms for this specific outlet shall be laid down to ensure that the markets for alcohol and spirit drinks in the Community are not disturbed.4.The following shall be taken into account when the amount of aid is being fixed:(a)the conditions and in particular the costs of supply to Madeira resulting from its geographical situation;(b)the price of products on the Community market and on the world market;(c)the economic aspect of the proposed aid.No refund shall be granted on exports from Madeira of musts and wine alcohol.5.Aid shall be granted for the ageing of Madeira liqueur wines up to a maximum of 20000 hectolitres each year. The aid shall be paid for liqueur wines which require five years' ageing or more. It shall be paid for each lot during three marketing years.The amount of the aid shall be EUR 0,040 per hectolitre per day.6.Temporary aid shall be granted each year for the shipment of Madeira wine and its marketing on Community markets.The aid shall amount to EUR 0,2 per bottle, up to a limit of 2,5 million litres per year.7.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 5Wicker

Article 211.Flat-rate area aid shall be granted each year to wicker growers.2.The amount of the aid shall be EUR 575 per hectare of area planted and harvested, up to a limit of 200 hectares.3.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

CHAPTER IIIMEASURES TO ASSIST LOCAL PRODUCTSSECTION 1Livestock and milk products in the Azores

Article 221.The aid provided for in this Article shall be granted to support essential traditional economic activities in the beef and veal and milk sectors in the Azores.2.In case of application of the exclusion provided for in Article 70 of Council Regulation (EC) No 1782/2003 +, the Portuguese Republic shall present to the Commission a programme to assist traditional activities connected with beef and veal, as well as sheep and goat production and measures to improve product quality.The programme shall be prepared and implemented by the competent authorities designated by the Member State.3.The Community shall finance the programme up to an annual amount equal to the sum of premiums actually paid in 2003 pursuant to Regulation (EC) No 1254/1999, to this Regulation and to Regulation (EC) No 2529/2001 for producers established in the Azores.The Commission shall increase such amount in order to take into consideration the development of the local production. However, the annual amount shall in no case be higher than the sum of the ceilings applicable in 2003 for beef premiums pursuant to this Regulation multiplied by the base and complementary premiums a and payments applicable in 2003 and the sum of all premiums rights held by producers established in the Azores at the date of 30 June 2003 pursuant to Regulation (EC) No 2529/2001 and to Regulation (EC) No 1254/1999 for suckler cows premiums, and the pertinent proportions of the national reserves thereof multiplied by the premiums and payments applicable in 2003.In case of application of Article 68(a)(i) of Regulation (EC) No 1782/2003 the Portuguese Republic authorities may increase the ceiling for suckler cow for the Azores by transferring suckler cow premium rights from the national ceiling. In this case, the corresponding amount shall be transferred from the ceiling fixed in application of Article 68(a)(i) of Regulation (EC) No 1782/2003 to the ceiling referred to in the second subparagraph of paragraph 3 of this Article.4.The Commission shall adopt the implementing arrangements, approve and modify the programme as well as fix and increase the amount provided for in paragraph 3, first subparagraph of this Article, in accordance with the procedure referred to in Article 144(2) of Regulation (EC) No 1782/2003. The Commission may, in accordance with the same procedure, revise the limit set forth in paragraph 2, second subparagraph.5.Before 15 April every year the Portuguese Republic authorities shall present a report on implementation of the programme.6.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2). They shall cover any reviews to take account of changing requirements and shall provide for:(a)as regards the special premium for male bovine animals:the "freezing", within the regional ceiling set in Article 4 of Regulation (EC) No 1254/2000, of the number of animals for which the special premium was granted in the Azores for the year 2000,(b)as regards the slaughter premium:the "freezing", within the ceiling set in Article 38(5) of Regulation (EC) No 2342/2000, of the number of animals for which the slaughter premium was granted for the year 2000.The detailed implementing rules may include additional conditions for granting supplementary premiums.The Commission may review the ceilings fixed in paragraph 5 in accordance with the same procedure.7.A specific premium shall be granted to maintain the dairy herd, up to a maximum of 78000 head.The premium shall be paid to producers. The amount of this premium shall be EUR 96,6 per cow held by the producer on the day on which the application is submitted.8.Aid shall be granted for the private storage of traditionally manufactured cheeses:S. Jorge, at least three months old,Ilha, at least 45 days old.The amount of the aid shall be fixed in accordance with the procedure referred to in paragraph 10.9.Aid shall be introduced to dispose of young male bovine animals born in the Azores in other regions of the Community.The aid shall amount to EUR 40 per head shipped, and shall be granted for up to 20000 animals to producers who have kept those animals for at least three months before shipment.10.Detailed rules for applying this Article shall be adopted, as appropriate, in accordance with the procedure referred to in Article 35(2).

Article 231.As from marketing year 1999/2000, for the purposes of sharing the additional levy between the producers referred to in the second sentence of Article 2(1) of Regulation (EEC) No 3950/92, only producers as defined in Article 9(c) of that Regulation, established and producing in the Azores, who market quantities exceeding their reference quantity increased by the percentage referred to in the third subparagraph shall be deemed to have contributed to the overrun.The additional levy shall be due on quantities exceeding the increased reference quantity after reallocation of the unused quantities within the margin resulting from this increase among the producers referred to in the first paragraph and in proportion to the reference quantity available to each producer.The percentage referred to in the first paragraph shall be equal to the ratio between the quantities respectively of 73000 tonnes for the period 1999/2000 to 2004/2005 and 23000 tonnes as from marketing year 2005/2006 and the total of the reference quantities available on each holding on 31 March 2000. It shall apply for each producer only to the reference quantities available to that producer on 31 March 2000.2.The quantities of milk or milk equivalent marketed which exceed the reference quantities but which comply with the percentage referred to in paragraph 1 of this Article, after the reallocation referred to in that same paragraph, shall not be taken into account in establishing any overrun in Portugal as calculated in accordance with the first sentence of Article 2(1) of Regulation (EEC) No 3950/92.

Article 241.Prior to their entry into force, the Portuguese Republic shall notify the Commission of measures taken pursuant to Article 23.

Article 251.In accordance with the procedure provided for in Article 35(2), the Commission shall, where necessary, adopt the measures necessary for the application of Article 23.

Article 261.During the period 2002—2006, aid shall be granted to implement a comprehensive programme to support the production and marketing of local produce in the livestock and milk products sector in the Azores.The programme may include measures to encourage improved quality and hygiene, marketing, local communication relating to quality products and the provision of technical assistance. The programme may not include the granting of aid in addition to the premiums paid under Article 22.The programme shall be prepared and implemented by the competent authorities designated by the Member State, working in close collaboration with the most representative producer organisations or their associations in the sectors concerned.2.Detailed rules for applying this Article shall be laid down in accordance with the procedure referred to in Article 35(2). Draft programmes, to run for no more than five years, shall be presented to the Commission by the competent authorities. The Commission shall approve them in accordance with the procedure referred to in Article 35(2).3.Each year the Portuguese authorities shall present a report on implementation of the programme. Before the end of 2005, the Commission shall submit to the European Parliament and to the Council an evaluation report on the application of the measure referred to in this Article, accompanied if applicable by appropriate proposals.

SECTION 2Pineapples

Article 27Aid shall be granted to produce pineapples falling within CN code 08043000 up to a limit of 2000 tonnes per year.The amount of the aid shall be EUR 1,20 per kilogram.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 3Sugar

Article 281.Flat-rate area aid shall be granted in order to develop the production of sugar beet, up to the limit of an area corresponding to production of 10000 tonnes of white sugar per year.The amount of the aid shall be EUR 800 per hectare sown and harvested.2.Specific aid shall be granted to process sugar beet harvested in the Azores into white sugar, up to an overall production limit of 10000 tonnes of refined sugar per year.The aid shall amount to EUR 27 per 100 kg of refined sugar. It may be adapted in accordance with the procedure referred to in Article 35(2).3.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 4Tobacco

Article 291.A supplementary premium shall be granted, in addition to the premium introduced by Title I of Regulation (EEC) No 2075/92Council Regulation (EEC) No 2075/92 of 30 June 1992 on the common organisation of the market in raw tobacco (OJ L 215, 30.7.1992, p. 70). Regulation as last amended by Regulation (EC) No 1336/2000 (OJ L 154, 27.6.2000, p. 2)., for the collection of leaf tobacco of the variety Burley P., up to a limit of 250 tonnes. The amount of the supplementary premium shall be EUR 0,24 per kg of leaf tobacco.The detailed rules for applying the premium scheme laid down in Regulation (EC) No 2848/98Commission Regulation (EC) No 2848/98 of 22 December 1998 laying down detailed rules for the application of Council Regulation (EEC) No 2075/92 as regards the premium scheme, production quotas and the specific aid to be granted to producer groups in the raw tobacco sector (OJ L 358, 31.12.1998, p. 17). Regulation as last amended by Commission Regulation (EC) No 385/2001 (OJ L 57, 27.2.2001, p. 18). shall apply to the supplementary premium, except for specific derogations adopted in accordance with the procedure referred to in Article 35(2).2.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

SECTION 5Seed potatoes, chicory and tea

Article 301.Aid shall be granted to produce seed potatoes falling within CN code ex07011000 up to a limit of 200 hectares.The amount of the aid shall be EUR 596,9 per hectare.2.Aid shall be granted to produce chicory falling within CN code 12129910 for up to a maximum area of 200 hectares per year.The amount of the aid shall be EUR 596,9 per hectare.3.Aid shall be granted to conclude annual contracts for the marketing of the potatoes referred to in paragraph 1 of this Article on the same terms as those laid down in Article 6.4.Aid per hectare shall be granted for the cultivation of tea.The amount of the aid shall be EUR 800 per hectare of harvested area per year.The aid shall be paid for up to 100 hectares.5.Detailed rules for applying this Article shall be adopted in accordance with the procedure referred to in Article 35(2).

Article 31Aid shall be granted for the ageing of Azores "verdelho" wine up to a maximum of 4000 hectolitres each year. The aid shall be paid for "verdelho" wine which requires three years' ageing or more. It shall be paid for each lot during three marketing years.The amount of the aid shall be EUR 0,08 per hectolitre per day.

TITLE IIIPLANT-HEALTH MEASURES

Article 321.The competent authorities shall submit to the Commission programmes for the control of organisms harmful to plants or plant products. The programmes shall specify in particular the objectives to be achieved, the measures to be carried out, their duration and their cost. The programmes submitted pursuant to this Article shall not concern protective measures for bananas.2.The Community shall contribute to the financing of such programmes on the basis of a technical analysis of the regional situation.3.The financial participation of the Community and the amount of the aid shall be decided in accordance with the procedure referred to in Article 35(2). The measures eligible for Community financing shall be defined in accordance with the same procedure.4.Such participation may cover up to 75 % of the eligible expenditure. Payment shall be made on the basis of documentation supplied by the competent authorities. If necessary, investigations may be organised by the Commission and conducted on its behalf by experts as referred to in Article 21 of Directive 2000/29/ECCouncil Directive 2000/29/EC of 8 May 2000 on protective measures against the introduction into the Community of organisms harmful to plants or plant products and against their spread within the Community (OJ L 169, 10.7.2000, p. 1). Directive as last amended by Commission Directive 2001/33/EC (OJ L 127, 9.5.2001, p. 42)..

TITLE IVSTRUCTURAL DEROGATIONS

Article 331.Notwithstanding Article 7 of Regulation (EC) No 1257/1999, the total value of the aid, expressed as a percentage of the volume of eligible investments, shall not exceed 75 % for investments intended in particular to encourage diversification, restructuring or a shift towards sustainable agriculture on agricultural holdings of small economic size to be defined in the programme complement referred to in Article 18(3) of Regulation (EC) No 1260/1999.2.Notwithstanding Article 28(2) of Regulation (EC) No 1257/1999, the total value of the aid, expressed as a percentage of the volume of eligible investments, shall not exceed 65 % for investments in enterprises engaged in processing and marketing agricultural products consisting mainly of local produce in sectors to be defined in the programme complement referred to in Article 18(3) of Regulation (EC) No 1260/1999. The total value of the aid for small and medium-sized enterprises, under the same conditions, shall not exceed 75 %.3.The restriction laid down in Article 29(3) of Regulation (EC) No 1257/1999 shall not apply to subtropical forests or wooded areas located in the Azores and Madeira.4.Notwithstanding the third indent of the second subparagraph of Article 47(2) of Regulation (EC) No 1257/1999, the Community contribution to the agri-environmental measures provided for in Articles 22, 23 and 24 of that Regulation shall be 85 %.5.Notwithstanding Article 24(2) of Regulation (EC) No 1257/1999, the maximum amounts per year eligible for the Community aid provided for in the Annex to this Regulation may be increased up to twofold in the case of the measure to protect lakes in the Azores and the measure to preserve the landscape and traditional features of agricultural land, in particular the conservation of the stone walls supporting terraces in Madeira.6.A summary description of the measures planned under this Article shall be included in the operational programmes for these regions referred to in Article 18 of Regulation (EC) No 1260/1999.

TITLE VGENERAL AND FINAL PROVISIONS

Article 34The measures necessary for the implementation of this Regulation shall be adopted in accordance with the management procedure referred to in Article 35(2).

Article 351.The Commission shall be assisted by the Management Committee for Cereals established by Article 22 of Regulation (EEC) No 1766/92Council Regulation (EEC) No 1766/92 of 30 June 1992 on the common organisation of the market in cereals (OJ L 181, 1.7.1992, p. 21). Regulation as last amended by Regulation (EC) No 1666/2000 (OJ L 193, 29.7.2000, p. 1)., or by the management committees established by the other regulations on the common organisation of the markets for the products concerned.In the case of agricultural products covered by Regulation (EEC) No 827/68Regulation (EEC) No 827/68 of the Council of 28 June 1968 on the common organisation of the market in certain products listed in Annex II to the Treaty (OJ L 151, 30.6.1968, p. 16). Regulation as last amended by Regulation (EC) No 3290/94 (OJ L 349, 31.12.1994, p. 105). and products not covered by a common organisation of the market, the Commission shall be assisted by the Management Committee for Hops established by Article 20 of Regulation (EEC) No 1696/71Council Regulation (EEC) No 1696/71 of 26 July 1971 on the common organisation of the market in hops (OJ L 175, 4.8.1971, p. 1). Regulation as last amended by Regulation (EC) No 191/2000 (OJ L 23, 28.1.2000, p. 4)..In the case of the graphic symbol and other cases provided for in this Regulation, the Commission shall be assisted by the Management Committee for Fresh Fruit and Vegetables established by Regulation (EC) No 2200/96.For the purposes of implementing Title III, the Commission shall be assisted by the Standing Committee on Plant Health established by Decision 76/894/EECCouncil Decision 76/894/EEC of 23 November 1976 establishing a Standing Committee on Plant Health (OJ L 340, 9.12.1976, p. 25)..For the purposes of implementing Title IV, the Commission shall be assisted by the Committee for the Development and Conversion of Regions and by the Committee on Agricultural Structures and Rural Development, established respectively by Article 48 and by Article 50 of Regulation (EC) No 1260/1999.2.Where reference is made to this paragraph, Articles 4 and 7 of Decision 1999/468/EC shall apply.However, in the case of Title III, the procedure laid down in Article 18 of Directive 2000/29/EC shall apply.The period provided for in Article 4(3) of Decision 1999/468/EC shall be one month.3.The Committees shall adopt their rules of procedure.

Article 36For the agricultural products covered by Annex I to the Treaty, to which Articles 87, 88 and 89 thereof apply, the Commission may authorise operating aid in the sectors producing, processing and marketing those products, with a view to mitigating the specific constraints on farming in the Azores and Madeira as a result of their remoteness, insularity and outermost location.

Article 37The measures provided for in this Regulation, except for Article 33, shall constitute intervention intended to stabilise the agricultural markets within the meaning of Article 2(2) of Regulation (EC) No 1258/1999Council Regulation (EC) No 1258/1999 of 17 May 1999 on the financing of the common agricultural policy (OJ L 160, 26.6.1999, p. 103)..

Article 38The Member States shall take the measures necessary to ensure compliance with this Regulation, in particular as regards controls and administrative penalties, and shall inform the Commission thereof.The detailed rules for applying this Article shall be adopted by the procedure provided for in Article 35(2).

Article 391.Portugal shall present an annual report to the Commission on the implementation of the measures provided for in this Regulation.2.No later than at the end of the fifth year of application of the system the Commission shall submit a general report to Parliament and the Council showing the impact of the action taken under this Regulation, accompanied if applicable by appropriate proposals.

Article 40Regulation (EEC) No 1600/92Council Regulation (EEC) No 1600/92 of 15 June 1992 concerning specific measures for the Azores and Madeira relating to certain agricultural products (OJ L 173, 27.6.1992, p. 1). Regulation as last amended by Regulation (EC) No 2826/2000 (OJ L 328, 23.12.2000, p. 2). is hereby repealed. References to Regulation (EEC) No 1600/92 shall be construed as references to this Regulation and should be read in accordance with the correlation table in Annex III.

Article 41This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Communities.Article 33 shall apply as from 1 January 2000.

This Regulation shall be binding in its entirety and directly applicable in all Member States.ANNEX IList of products covered by the specific supply arrangements provided for in Article 3 for the Azores

Cereals and cereal products intended for human consumption and animal feed:

Description	CN code
Maize seed	100510
Rice	1006
Soya seed	12010090
Sunflower seed	12060099
Hops	1210
Raw sugar	17011210
Fruit juice (raw materials) other than those covered by Article 5 of this Regulation	2009
Olive oil	15091090, 15099000, 15090090

ANNEX IIList of products covered by the specific supply arrangements provided for in Article 3 for Madeira

Cereals and cereal products intended for human consumption and animal feedBeef and veal:Milk and milk products:

Description	CN code
Hops	1210
Dried alfalfa	1214
Soya cake	2304
Rice	1006
Vegetable oil	ex1507 to 1516
Sugar	1701 and 1702 (except isoglucose)
Fruit preserves and concentrated fruit juices (raw materials) other than those covered by Article 5 of this Regulation	200799, 2008 and 2009
Fresh or chilled	0201
Frozen	0202
Pigmeat	0203
Milk powder	ex0402
Liquid milk	0401
Butter	0405
Cheese	0406
Seed potatoes	07011000

ANNEX III

Correlation table

Regulation (EEC) No 1600/92	This Regulation
Article 1	Article 1
Article 2	Article 2
Article 3(1)	First subparagraph of Article 3(1)
Article 3(1)	Second subparagraph of Article 3(1)
Article 3(2)	Article 3(2)
Article 3(3)	Article 3(3)
Article 3(4)	Article 3(6)
Article 4	Article 4
Article 5	Article 12
Article 6	Deleted
Article 7	Article 3(4)
Article 8(1)	First subparagraph of Article 3(5)
Article 8(1)	Second subparagraph of Article 3(5)
Article 8(2)	Third subparagraph of Article 3(5)
Article 9	Fourth subparagraph of Article 3(5)
Article 10	Article 3(6)
Article 11	Deleted
Article 11	Article 5
Article 12	Article 6
Article 13	Article 7
Article 13	Article 10
Article 14(1)	Article 13(1)
Article 14(2)	Deleted
Article 14(3)	Article 13(3)
	Article 13(2)
	Article 13(4)
	Article 13(5)
Article 14(4)	Article 13(6)
Article 14(4)	Article 14
First subparagraph of Article 15(1)	First subparagraph of Article 15(1)
Second and third subparagraph of Article 15(1)	Article 15(2)
	Article 15(3)
	Article 15(4)
Article 15(2)	Article 15(5)
Article 16	Article 16
Article 17	Article 17
Article 18	Article 18
Article 19	Article 19
Article 20	Article 8
Article 21	Article 20
	Article 20(6)
	Article 21
Article 22	Article 9
Article 23	Deleted
Article 24(1)	Article 22(1)
Article 24(2)	Deleted
Article 24(2)	Article 22(2)
Article 24(3)	Article 22(3)
	Article 22(4)
	Article 22(5)
	Article 22(6)
Article 24(4)	Article 22(7)
Article 24(5)	Article 22(8)
Article 24(5)	Article 22(9)
Article 24(6)	Article 22(10)
	Article 23
	Article 24
	Article 25
	Article 26
Article 25	Article 28
Article 26	Article 29
Article 27	Article 30
	Article 30(4)
	Article 31
Article 28	Article 8
Article 29	Article 9
Article 30	Article 27
Article 31	Article 11
Article 32	Article 33
Article 33	Article 32
	Article 34
	Article 35
	Article 36
Article 34	Article 37
	Article 38
	Article 39(1)
Article 35(1)	Deleted
Article 35(2)	Article 39(2)
Article 35(2)	Article 40
Article 36	Article 41
Annex I	Annex I
Annex II	Annex II
Annex II	Annex III

Council Regulation (EC) No 1453/2001 of 28 June 2001 introducing specific measures for certain agricultural products for the Azores and Madeira and repealing Regulation (EEC) No 1600/92 (Poseima)