Commission Delegated Regulation (EU) 2017/891 of 13 March 2017 supplementing Regulation (EU) No 1308/2013 of the European Parliament and of the Council with regard to the fruit and vegetables and processed fruit and vegetables sectors and supplementing Regulation (EU) No 1306/2013 of the European Parliament and of the Council with regard to penalties to be applied in those sectors and amending Commission Implementing Regulation (EU) No 543/2011

TITLE I

INTRODUCTORY PROVISIONS

Article 1

Subject matter and scope

This Regulation supplements Regulation (EU) No 1308/2013 as regards the fruit and vegetables and processed fruit and vegetables sectors as referred to in Article 1(2)(i) and (j) of that Regulation, with the exception of marketing standards, and supplements Regulation (EU) No 1306/2013 as regards penalties to be applied in those sectors.

However, Title II of this Regulation shall only apply to products of the fruit and vegetables sector as referred to in Article 1(2)(i) of Regulation (EU) No 1308/2013 and to such products intended for processing.

TITLE II

PRODUCER ORGANISATIONS

CHAPTER I

Requirements and recognition

Section 1

Definitions

Article 2

Definitions

For the purposes of this Title the following definitions shall apply:

(a) ‘producer’ means a farmer within the meaning of Article 4(1)(a) of Regulation (EU) No 1307/2013 of the European Parliament and of the Council (¹) producing fruit and vegetables as referred to in Article 1(2)(i) of Regulation (EU) No 1308/2013 and such products intended solely for processing;

(b) ‘producer member’ means a producer or legal entity constituted by producers that is a member of a producer organisation or association of producer organisations;

(c) ‘subsidiary’ means a company in which one or more producer organisations or associations of producer organisations have taken shares or constituted capital and which contributes to the objectives of those organisations or associations;

(d) ‘transnational producer organisation’ and a ‘transnational association of producer organisations’ means a producer organisation and an association of producer organisations complying with the definitions laid down in Article 2, points (a) and (b), of Commission Delegated Regulation (EU) 2016/232 (²), respectively;

If not otherwise specified, the reference in this Regulation to producer organisations includes transnational producer organisations and the reference to associations of producer organisations includes transnational associations of producer organisations.

Section 2

Recognition criteria and other requirements

Article 3

Legal status of producer organisations

Member States shall define the legal entities which may apply for recognition pursuant to Article 154 of Regulation (EU) No 1308/2013 in the light of their national legal and administrative structures. Where applicable, they shall also lay down provisions on clearly defined parts of legal entities which may apply for recognition pursuant to that Article. Member States may adopt complementary rules on recognition of producer organisations and on legal entities which may apply for recognition as producer organisations.

Article 4

Product coverage

Article 5

Minimum number of members

For the purposes of Article 154(1)(b) of Regulation (EU) No 1308/2013, Member States shall lay down a minimum number of members.

When laying down the minimum number of members of a producer organisation, Member States may provide that where an applicant for recognition is wholly or partly made up of members which are themselves legal entities or clearly defined parts of legal entities made up of producers, the minimum number of producers may be calculated on the basis of the number of producers associated with each of the legal entities or clearly defined parts of legal entities.

Article 6

Minimum length of membership

Article 7

Structures and activities of producer organisations

Member States shall verify that producer organisations have at their disposal the staff, infrastructure and equipment necessary to fulfil the requirements laid down in Articles 152, 154 and 160 of Regulation (EU) No 1308/2013 and to ensure their essential functioning, in particular as regards:

(a) the knowledge of their members' production;

(b) the technical means for collecting, sorting, storing and packaging the production of their members;

(c) marketing the production of their members;

(d) commercial and budgetary management; and

(e) centralised cost-based accounting and a system of invoicing according to national law.

Article 8

Value or volume of marketable production

Article 9

Minimum value of marketed production

For the purposes of Article 154(1)(b) of Regulation (EU) No 1308/2013, Member States shall, in addition to a minimum number of members, lay down a minimum value of marketed production for producer organisations implementing an operational programme.

Article 10

Provision of technical means

For the purposes of Article 154(1)(c) of Regulation (EU) No 1308/2013 and Article 7(b) of this Regulation, a producer organisation which is recognised for a product for which the provision of technical means is necessary, shall be considered to fulfil its obligation in that regard, where it provides an adequate level of technical means itself or through its members, or through subsidiaries, or through an association of producer organisations of which it is a member or by outsourcing.

Article 11

Producer organisations' main activities

The placing on the market referred to in the first subparagraph shall be carried out by the producer organisation, or under the control of the producer organisation in the case of outsourcing as set out in Article 13. Placing on the market shall include among others the decision on the product to be sold, the way of selling and unless the sale is by means of auction, the negotiation of its quantity and price.

Producer organisations shall keep records, including accounting documents, for at least five years, which demonstrate that the producer organisation concentrated supply and placed on the market members' products for which it is recognised.

However, in case the value of marketed production of a producer organisation decreases by 35 % or more for a given year in relation to the average of the three previous 12-month reference periods due to natural disasters, climatic events, plant diseases or pest infestations falling outside the responsibility and control of the producer organisation, the value of marketed production shall be deemed to represent 85 % of the average value of marketed production in the three previous 12-month reference periods, for the purpose of establishing the economic value of the activity referred to in the first subparagraph.

The producer organisation affected by the events referred to in the second subparagraph and involved in selling products of producers that are not its members, shall prove to the competent authority of the Member State concerned that the decrease in the value of marketed production fell outside its responsibility and control.

Article 12

Marketing of the production outside the producer organisation

Where the producer organisation so authorises in its statutes and where this is in compliance with the terms and conditions laid down by the Member State and the producer organisation, the producer members may:

(a) sell products directly or outside their holdings to consumers for their personal needs;

(b) market by themselves or through another producer organisation designated by their own producer organisation, quantities of products which, in terms of volume or value, are marginal compared to the volume or value of marketable production of their organisation of the products concerned;

(c) market by themselves or through another producer organisation designated by their own producer organisation, products which because of their characteristics or because of the limited production in volume or in value of the producer members, are normally not covered by the commercial activities of the producer organisation.

However, Member States may set a lower percentage of the production that the producer members may market outside the producer organisation than the one set out in the first subparagraph. Member States may increase that percentage up to 40 % in case of products covered by Council Regulation (EC) No 834/2007 (⁴) or where producer members market their production through another producer organisation designated by their own producer organisation.

Article 13

Outsourcing

For the purposes of Article 155 of Regulation (EU) No 1308/2013, the term ‘subsidiary’ includes any entity in a chain of subsidiaries. However, Member States may exclude the outsourcing of activities to an entity within a chain of subsidiaries.

However, the activity shall be considered as carried out by the producer organisation if it is carried out by an association of producer organisations or a cooperative whose members are themselves cooperatives where the producer organisation is a member thereof or by a subsidiary or an entity within a chain of subsidiaries, complying with the 90 % requirement referred to in  Article 31(7) of Delegated Regulation (EU) 2022/126.

The overall management control and supervision referred to in the first subparagraph of paragraph 2 shall be effective and require that the outsourcing contract, agreement or protocol:

(a) enables the producer organisation to issue binding instructions and includes provisions enabling the producer organisation to terminate the contract, agreement or protocol if the service provider does not meet the terms and conditions of the outsourcing contract;

(b) lays down detailed terms and conditions, including regular reporting obligations and deadlines which enable the producer organisation to exercise effective control over the outsourced activities.

Outsourcing contracts, agreements or protocols as well as the reports referred to in point (b) of the first subparagraph shall be kept by the producer organisation for at least 5 years for the purpose of ex-post checks and be accessible to all members on request.

Article 14

Transnational producer organisations

Alternatively, the head office may be established in the Member State where the majority of producer members are located, if the Member States concerned so agree.

However, if at the end of the implementation of that new operational programme, the majority of the value of marketed production is still achieved or the majority of the organisation's members are still located in a Member State other than that where the head office is currently located, the head office shall be transferred to that other Member State, unless the Member States concerned agree that the location of the head office shall not be changed.

The Member State in which the head office of the transnational producer organisation is located shall be responsible for the following:

(a) recognising the transnational producer organisation;

(c) establishing the necessary administrative cooperation with the other Member States in which the members are located with respect to compliance with the terms of recognition and the system of checks and administrative penalties. Those other Member States shall give all necessary assistance to the Member State in which the head office is located in due time; and

(d) providing, on the request of a Member State in which the members are located, all relevant documentation, including any applicable legislation available, translated into the official language or one of the official languages of that Member State.

Article 15

Mergers of producer organisations

The producer organisation resulting from the merger may either operate the programmes in parallel and separately until 1 January of the year following the merger, or merge the operational programmes from the moment of the merger.

Article 34 of this Regulation shall apply to operational programmes that are merged.

Article 16

Non-producer members

The natural or legal persons referred to in paragraph 1 shall not:

(a) be taken into account for the recognition criteria;

(b) benefit directly from the measures financed by the Union.

Member States may restrict or prohibit the natural or legal persons' right to vote on decisions relating to operational funds, in line with the conditions referred to in paragraph 1.

Article 17

Democratic accountability of producer organisations

In duly justified cases, Member States may set a higher maximum percentage of shares or capital that a legal person may hold in a producer organisation provided that measures are adopted to ensure that an abuse of power by such legal person is in any case avoided.

By way of derogation from the first subparagraph, in the case of producer organisations implementing an operational programme on 17 May 2014, the maximum percentage of shares or capital set by the Member State pursuant to the first subparagraph shall only apply after the end of that operational programme.

Section 3

Associations of producer organisations

Article 18

Rules on producer organisations applicable to associations of producer organisations

Articles 3, 6, 11(3), 13, 15 and 17 shall apply mutatis mutandis to associations of producer organisations. Where the association of producer organisations sells the products of its member producer organisations, Article 11(2) shall apply mutatis mutandis.

Article 19

Recognition of associations of producer organisations

Article 20

Members of associations of producer organisations who are not producer organisations

Members of a recognised association of producer organisations who are not recognised producer organisations shall not:

(a) be taken into account for the recognition criteria;

(b) benefit directly from the measures financed by the Union.

Member States may permit, restrict or prohibit those members' right to vote on decisions relating to operational programmes.

Article 21

Transnational association of producer organisations

Alternatively, the head office may be established in the Member State where the majority of member producer organisations are located, if the Member States concerned so agree.

However, if at the end of the implementation of that new operational programme, the majority of the value of marketed production is still achieved or the majority of member producer organisations are still located in a Member State other than that where the head office is currently located, the head office shall be transferred to that other Member State, unless the Member States concerned agree that the location of the head office shall not be changed.

The Member State in which the head office of the transnational association of producer organisations is located shall be responsible for the following:

(a) recognising the association;

(c) establishing the necessary administrative cooperation with the other Member States in which the associated organisations are located with respect to compliance with the terms of recognition, the implementation of the operational programme by the member producer organisations and the system of checks and administrative penalties. Those other Member States shall give all necessary assistance to the Member State in which the head office is located; and

(d) providing, on the request of a Member State in which the members are located, all relevant documentation, including any applicable legislation available, translated into the official language or one of the official languages of that Member State.

CHAPTER II

Operational funds and operational programmes

Section 1

Value of marketed production

Section 2

Operational funds

Section 3

Operational programmes

Section 4

Aid

CHAPTER III

Crisis prevention and management measures

Section 1

General provisions

Section 2

Investments making the management of the volumes placed on the market more efficient

Section 3

Support related to mutual funds

Section 4

Replanting of orchards following mandatory grubbing-up

Section 5

Market withdrawals

Section 6

Green harvesting and non-harvesting

Section 7

Harvest insurance

Section 8

Support related to coaching

CHAPTER IV

National financial assistance

CHAPTER V

General provisions

Section 1

Notifications and reports

Article 55

Notification of producer prices of fruit and vegetables on the internal market

Member States shall notify the Commission, by 12.00 hours (Brussels time) each Wednesday, of the producer prices recorded in representative markets of the production areas of the fruit and vegetables concerned during the previous week, where data are available, as follows:

(a) for fruit and vegetables covered by the general marketing standard set out in Part A of Annex I to Commission Delegated Regulation (EU) 2023/2429 (⁵), the price of products meeting that standard;

(b) for products covered by a specific marketing standard set out in Part B of Annex I to Delegated Regulation (EU) 2023/2429, the price of products of class I.

Member States shall only notify prices of fruit and vegetables produced within their territory. The prices shall cover conventional, non-organic fruit and vegetables intended for the fresh market.

Section 2

Monitoring and evaluation of operational programmes and of national strategies

Section 3

Administrative penalties

Article 59

Non-respect of recognition criteria

During the suspension of the recognition, the producer organisation may continue its activity, but aid payments shall be withheld until the suspension of the recognition is lifted. The yearly aid amount shall be reduced by 2 % for each calendar month or part thereof during which recognition is suspended.

The suspension shall end on the day of the check which confirms that the recognition criteria in question have been fulfilled.

However, when a producer organisation delivers to the Member State proof that due to natural disasters, adverse climatic events, diseases or pest infestations, despite having undertaken the risk prevention measures it is not able to respect the recognition criteria laid down in Article 154(1)(b) of Regulation (EU) No 1308/2013 in respect of the minimum volume or value of marketable production laid down by Member States, the Member State may, for the year in question, derogate from the minimum volume or value of marketable production for this producer organisation.

CHAPTER VI

Extension of rules

Article 68

Conditions for the extension of rules