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France will have to give back aid to fruit and vegetable sector

The EU Court of Justice issued a statement last week in which vindicates the European Commission, declared the aid granted by the French State to the fruit and vegetable sector between 1992 and 2002 illegal. France will have to return the aid that was given.

With the statement issued yesterday, the Sixth Chamber of the EU Court of Justice dismissed the appeal filed by the French Republic against the decision of the European Commission of 2009 and forces France to pay the costs.

That year, the European Commission adopted a decision in which it found that the aid granted in the framework of so-called "Campaign plans" were illegal and incompatible with the common market and ordered the French Republic to ensure that the beneficiaries of these aids return them.

The aid in question was granted between 1992 and 2002 and was intended to finance the campaign plans which included measures to deal with crisis situations in the fruit and vegetable market and specifically the apple and stone fruit sector.
Public funds were paid by the National Interprofessional Office of fruits and vegetables (ONIFHLOR), through the Agricultural Economic Committees. The final beneficiaries of those aids were fruit and vegetable producer organizations.

According to the 2009 Commission's decision "Eight Agricultural Economic Committees (Rhône-Méditerranée, Grand Sud-Ouest, Corse, Val de Loire, Nord, Nord-Est, Bretagne and Normandie) have benefited for many years from public funds provided mainly by ONIFHLOR and used to finance aid under the name of "campaign plans" that include shares in internal and external community markets to facilitate the commercialization of agricultural products harvested in France, especially in times of crisis."

"In foreign markets the aim was to maintain market share of French products, allowing exporters to position themselves in strategic markets and confront the competition in prices. In the domestic market, the aim was to alleviate the market proposing more attractive prices, either destroying a part of the surplus harvest or orienting it toward transformation."

Following the decision of the Commission, the French Republic tried to appeal before the Court which dismissed it in yesterday's judgment. During the court's session, France had been trying to reduce aid that it had to recover from the farmers and the European Commission initially set at 338 million Euro. In this regard, the Commission accepted that the aid that was paid during the period 1992-1997 will not be recovered as a result of the evidence provided by France. The country
proved it was impossible to recover. For the remaining period (1998-2002) France has also had the opportunity to examine case by case, especially those situations where farmers had benefited from a very small amount and these could be covered by the application of the de minimum aid regulation.

Source: Fepex

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