European Parliament Fact Sheets

4.1.1.     The Treaty of Rome and the foundations of the CAP

LEGAL BASIS

Articles 32 to 38 in Title II of the EC Treaty.

OBJECTIVES

  1. Basic raison d’être
    When the Treaty of Rome established the Common Market in 1958, agriculture in the six Member States at the time was strongly affected by State intervention, particularly with regard to what was produced, setting prices, marketing products and farm structures. If agricultural produce was to be included in the free movement of goods while maintaining State intervention in the agriculture sector, national intervention mechanisms which were incompatible with free movement had to be removed, and at least some of them transferred to Community level; this is the basic reason on which the common agricultural policy is founded. Some Member States and all the farmers’ professional organisations wanted to maintain strong State intervention in agriculture.
  2. Particular objectives
    1. Article 33 of the EC Treaty sets out the internal objectives of the CAP:
      • to increase agricultural productivity by promoting technical progress and ensuring the optimum use of the factors of production, in particular labour;
      • to ensure a fair standard of living for farmers;
      • to stabilise markets;
      • to assure the availability of supplies;
      • to ensure reasonable prices for consumers.
    2. Article 131 sets out the objectives of the common commercial policy applicable to trade in agricultural products.

ACHIEVEMENTS

  1. Overall results
    The CAP produced spectacular results. The Community was soon able to overcome the food shortages of the 1950s, achieving self-sufficiency and then generating cyclical and structural surpluses. There were a number of technical, economic and political reasons, in particular the gradual decline of Community preference and the replacement of local products on European markets by products imported on preferential terms. Changes in Community and world agriculture during the 1980s led to the establishment of new priorities. Under guidelines proposed in 1985 in the Green Paper (the Commission's discussion paper on the prospects for the CAP), the measures introduced by the Single Act (1986), decisions adopted by the Council in February 1988 and the 1992 and 1999 reforms (Agenda 2000) (*4.1.2), new foundations were laid for the CAP.
  2. Instruments of the CAP
    1. Overall view
      The main instruments of the CAP are the policy on markets and prices, based on common organisations of the market (COMs) and governing the production and marketing of agricultural products during the marketing year (*4.1.3 and 4.1.4), and the rural development policy (*4.1.5), coordinating the process of adapting farm structures (covering production techniques, farm sizes, training for farmers etc.). The CAP also makes use of the external trade policy (*4.1.7) and the harmonisation of legislation (see below). It has a financing fund (*4.1.6) and implementing machinery (see below).
    2. Legislative harmonisation
      The diversity of national laws related to production of or trade in agricultural and food products, for example with regard to the use of colouring agents and preservatives, the control of diseases or hormone use, etc., was a potential obstacle to intra-Community trade. Community harmonisation of these provisions was therefore essential. This has been achieved partly by laying down common rules, but mainly through mutual recognition of the rules in force in the Member States. It has not yet been completed.
    3. Bodies playing a role in applying the CAP
      1. The ‘committees’ date back to 1961,when the first common organisations of the market were established. The Commission had proposed to give itself wide decision-making powers for running the COMs; some Member States felt, however, that this power should remain with the Council. The committees were a compromise between the two positions: management was entrusted to the Commission, but it had to consult a committee consisting of representatives of the Member States, using the qualified majority procedure. There are three types of committee: advisory, management and regulatory, depending on the different extents to which they allow freedom of decision to the Commission or give the Council a more or less binding role in the procedure (*1.3.8).
      2. Of the professional organisations, the most important are the Committee of Agricultural Organisations of the EU (COPA) and the General Committee for Agricultural Cooperation in the EU (Cogeca).

ROLE OF THE EUROPEAN PARLIAMENT

  1. Scope for action
    • Since the beginning (Treaty of Rome), Parliament has had only advisory powers on agriculture, and some Council decisions do not even require it to be consulted.
    • The only area in which it has decision-making power is the impact of agriculture on human health, since the Amsterdam Treaty gave it the power of codecision with the Council on public health matters.
  2. Influence
    Having no decision-making powers, Parliament has exercised a strong influence over the CAP since the beginning by using non-binding methods.
    1. Own-initiative reports and resolutions
      Following the Stresa conference in 1958, Parliament drew up own-initiative reports marking out the foundations of a common agricultural policy and it has continued to use this method since then, adopting an increased number of reports since it has been directly elected.
    2. Conciliation procedures
      The procedure for budgetary conciliation with the Council, introduced in 1975, has been used on a number of occasions in the agricultural context, particularly on structural policy, in some cases prompting substantial changes to the Council's ‘common position’ for example in 1985 in connection with reform of the wine-growing sector, in 1987 on the new structural policy, in 1988 on the package of agricultural stabilising measures, the proposal for cessation of farming and set-aside, and in 1988 on the reform of the Structural Funds and budgetary discipline applicable to the CAP, which led to an interinstitutional agreement between Parliament, the Council and the Commission.
    3. Consultation procedures
      From 1991 onwards, Parliament has concentrated on reform of the CAP. In its resolution adopted that year on the proposals for the 1992 Reform regulation, it approves the proposed reform while regretting that products from the Mediterranean are not covered by it. In 1994 the Committee on Agriculture debated the proposal to reform the wine-growing sector, which Parliament considered very unpromising, since it over-extended the principle of subsidiarity and was unsupportive in attempting to co-finance structural measures from income when other already reformed sectors were receiving 100% Community funding. The opinion resulted in a better proposal being tabled during negotiations on Agenda 2000 in 1999.

04/07/2003