Commission Regulation (EC) No 1973/2004 (repealed)Show full title

SECTION 9 Checks

Article 39 Record keeping

1. The competent authority of the Member State shall specify the records to be kept by processors and the frequency thereof, which shall be at least monthly.

Such records shall comprise at least the following information:

(a) the quantities of different raw materials purchased for processing;

(b) the quantities of raw materials processed and the quantities and types of end products, co-products and by-products obtained therefrom;

(c) wastage during processing;

(d) the quantities destroyed and the reasons for such destruction;

(e) the quantities and types of products sold or transferred by the processor and the prices obtained;

(f) where applicable, the names and addresses of the subsequent processors.

2. The competent authority of the first processor shall check that the contract submitted complies with the conditions laid down in Article 24(1). Where those conditions are not met, the applicants' competent authorities shall be notified.

3. With a view to calculating the economic value of the products referred to in Article 24(1), the competent authorities concerned shall, on the basis of the information referred to in Article 34(2), compare the sum of the values of all energy products with the sum of the values of all other products intended for other uses and obtained from the same processing operation. Each value shall equal the relevant quantity multiplied by the average of the ex-factory prices recorded during the previous marketing year. Where such prices are not available, the competent authorities shall determine the relevant prices, in particular on the basis of the information referred to in Article 34(2).

Article 40 Checks at the premises of processors

1. The competent authorities of the Member States in which processing takes place shall verify compliance with Article 24(1) at the premises of at least 25 % of the processors located in their territory, selected on the basis of a risk analysis. Such checks shall involve at least:

(a) a comparison of the sum of the values of all the energy products with the sum of the values of all other products intended for other uses and obtained from the same processing operation;

(b) analysis of the processor's production system, comprising physical checks and inspections of commercial documents, with a view to verifying, in the case of processors, that deliveries of raw materials, end products, co-products and by-products tally.

For the purpose of the checks referred to in point (b) of the first subparagraph, the competent authorities shall base themselves in particular on the technical processing coefficients for the raw materials concerned. Where such coefficients exist for exports in Community legislation, they shall be applied. Where they do not but other coefficients do exist in Community legislation, they shall be applied. In all other cases, inspection shall rely mainly on the coefficients generally accepted by the processing industry.

2. For the processing operations referred to in Article 25, checks shall be carried out on 10 % of applicants selected on the basis of a risk analysis taking account of:

(a) aid amounts;

(b) the number of agricultural parcels and the area covered by an aid application;

(c) developments since the previous year;

(d) the findings of checks made in past years;

(e) other parameters to be defined by the Member States, based on the representativeness of the declarations submitted.

3. Where the checks referred to in paragraph 2 reveal irregularities in at least 3 % of cases, the competent authority shall carry out additional checks during the year and shall consequently increase the percentage of farmers to be subject to an on-the-spot check the following year.

4. If it has been provided that certain elements of the checks referred to in paragraphs 1 and 2 may be carried out on the basis of a sample, that sample shall guarantee a reliable and representative level of inspection.

5. Every on-the-spot check shall be the subject of an inspection report signed by the inspector giving the details of the checks carried out. The report shall indicate in particular:

(a) the date of the check;

(b) the persons present;

(c) the period checked;

(d) the checking techniques used including, where applicable, reference to sampling methods;

(e) results of the check.

Article 41 Hemp production

The provisions relating to hemp referred to in Article 29 of Commission Regulation (EC) No 795/2004(1) and in Article 33 of Regulation (EC) No 796/2004 shall apply.

Article 42 Additional measures and mutual assistance

1. The Member States shall take all further measures required for the proper application of this Chapter and shall give the mutual assistance needed for the purposes of checks required pursuant to this Chapter. Where this Chapter does not provide for appropriate reductions and exclusions, the Member States may apply appropriate national sanctions against market participants involved in the procedure for granting aid.

2. As far as necessary or as required by this Chapter, the Member States shall assist one another mutually to ensure effective controls, and enable the authenticity of documents submitted and the accuracy of the data exchanged to be verified.

(1)

OJ L 141, 30.4.2004, p. 1.