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ANNEX IIPURCHASE TERMS FOR BEET

POINT I

For the purposes of this Annex ‘Contracting Parties’ means:

(a)

sugar undertakings (hereinafter referred to as ‘manufacturers’),

and

(b)

beet sellers (hereinafter referred to as ‘sellers’).

POINT II

1.

Delivery contracts shall be made in writing for a specified quantity of quota beet.

2.

Delivery contracts shall specify whether an additional quantity of beet may be supplied, and under what terms.

POINT III

1.

Delivery contracts shall indicate the purchase prices for the quantities of beet referred to in the first indent and, if appropriate, second indent, of Article 6(3). In the case of the quantities referred to in the first indent of Article 6(3), those prices may not be lower than the minimum price for quota beet referred to in Article 5(1).

2.

Delivery contracts shall lay down a fixed sugar content for beet. They shall include a conversion scale showing the different sugar contents and factors for converting the quantities of beet supplied into quantities corresponding to the sugar content shown in the delivery contract.

The scale shall be based on the yields corresponding to the different sugar contents.

3.

Where a seller has signed a delivery contract with a manufacturer for the delivery of beet as referred to in the first indent of Article 6(3), all deliveries by that seller, converted in accordance with paragraph 2 of this Point, shall be considered to be deliveries within the meaning of the first indent of Article 6(3), up to the quantity of beet specified in the delivery contract.

4.

Manufacturers producing a quantity of sugar lower than their quota beet for which they have signed pre-sowing delivery contracts under the first indent of Article 6(3), shall distribute the quantity of beet corresponding to any additional production up to the amount of their quota among the sellers with whom they have signed pre-sowing delivery contracts within the meaning of the first indent of Article 6(3).

Agreements within the trade may derogate from this provision.

POINT IV

1.

Delivery contracts shall contain provisions concerning the staggering and normal duration of beet deliveries.

2.

Provisions referred to in paragraph 1 shall be those applicable during the previous marketing year, taking account of the level of actual production; agreements within the trade may derogate therefrom.

POINT V

1.

Delivery contracts shall provide for beet collection places.

2.

Where sellers and manufacturers have already signed a delivery contract for the previous marketing year, the collection places agreed upon by them for deliveries during that marketing year shall remain in operation. Agreements within the trade may derogate from this provision.

3.

Delivery contracts shall provide that loading and transport costs from the collection places are to be borne by the manufacturer subject to special agreements based on local rules or usages in operation before the previous marketing year.

4.

However, in Denmark, Greece, Spain, Ireland, Portugal, Finland and the United Kingdom, where beet is delivered free-at-factory, delivery contracts shall require manufacturers to contribute to loading and transport costs and shall stipulate the percentage or amounts.

POINT VI

1.

Delivery contracts shall provide for reception points for beet.

2.

Where sellers and manufacturers have already signed a delivery contract for the previous marketing year, the reception points agreed upon by them for deliveries during that marketing year shall remain in operation. Agreements within the trade may derogate from this provision.

POINT VII

1.

Delivery contracts shall provide for the sugar content to be determined using the polarimetric method. A sample of the beet shall be drawn at the time of reception.

2.

Agreements within the trade may provide for samples to be drawn at another stage. In such cases, the delivery contract shall provide for a correction to compensate for any drop in the sugar content between the reception and the drawing of the sample.

POINT VIII

Delivery contracts shall provide for gross weight, tare and sugar content to be determined using one of the following procedures:

(a)

jointly, by the manufacturer and the beet growers' trade organisation, if an agreement within the trade so provides;

(b)

by the manufacturer, under the supervision of the beet growers' trade organisation;

(c)

by the manufacturer, under the supervision of an expert recognised by the Member State concerned, provided the seller defrays the costs thereof.

POINT IX

1.

Delivery contracts shall require manufacturers to do one or more of the following for the whole quantity of beet delivered:

(a)

to return the fresh pulp from the tonnage of beet delivered free of charge to the seller, ex factory;

(b)

to return part of that pulp, pressed, dried or dried and molassed, free of charge to the seller, ex factory;

(c)

to return the pulp, pressed or dried, to the seller, ex factory; in this case, the manufacturer may require the seller to pay the pressing or drying costs;

(d)

to pay the seller compensation which takes account of the possibilities of selling the pulp concerned.

When parts of the whole quantity of beet delivered are subject to different treatment, the delivery contract shall impose more than one of the obligations provided for in the first subparagraph.

2.

Agreements within the trade may provide for pulp to be delivered at a stage other than that referred to in paragraph 1(a), (b) and (c).

POINT X

1.

Delivery contracts shall fix the time limits for any advance payments and for payment of the purchase price for beet.

2.

The time limits referred to in paragraph 1 shall be those valid during the previous marketing year. Agreements within the trade may derogate from this provision.

POINT XI

Where delivery contracts lay down rules covering matters which are dealt with in this Annex, or where they contain provisions governing other matters, their provisions and effects shall not conflict with this Annex.

POINT XII

1.

Agreements within the trade as described in Article 2(11)(b) shall contain arbitration clauses.

2.

Where agreements within the trade at Community, regional or local level lay down rules covering matters which are dealt with in this Regulation, or where they contain provisions governing other matters, their provisions and effects shall not conflict with this Annex.

3.

Agreements referred to in paragraph 2 lay down, in particular:

(a)

rules on the distribution to sellers of quantities of beet which the manufacturer decides to buy prior to sowing, for the manufacture of sugar within the limits of the quota;

(b)

rules on distribution as referred to in Point III(4);

(c)

the conversion scale referred to in Point III(2);

(d)

rules on the choice and supply of seeds of the varieties of beet to be produced;

(e)

the minimum sugar content of beet to be delivered;

(f)

a requirement for consultation between the manufacturer and the sellers' representatives before the starting date of beet deliveries is fixed;

(g)

the payment of premiums to sellers for early or late deliveries;

(h)

details of:

(i)

the part of the pulp referred to in Point IX(1)(b),

(ii)

the costs referred to in Point IX(1)(c),

(iii)

the compensation referred to in Point IX(1)(d);

(i)

the removal of pulp by the seller;

(j)

without prejudice to Article 5(1), rules on how any difference between the reference price and the actual selling price of the sugar is to be allocated between the manufacturer and sellers.

POINT XIII

Where there is no set agreement within the trade as to how the quantities of beet intended for the manufacture of sugar within the quota limits which the manufacturer offers to buy before sowing should be allocated among the sellers, the Member State concerned may itself lay down rules for such allocation.

Those rules may also grant to traditional sellers of beet to cooperatives delivery rights other than those which they would enjoy if they belonged to such cooperatives.