
Article 1 
Regulation (EC) No 2792/1999 is hereby amended as follows:

1.. the following paragraph shall be added to Article 1:
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3. Measures adopted pursuant to paragraphs 1 and 2 shall not increase fishing effort.'
2.. Article 2 shall be replaced by the following:
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Article 2 
The Financial Instrument for Fisheries Guidance, hereafter referred to as the “FIFG” may, under the conditions laid down in Article 16 of Council Regulation (EC) No 2371/2002 of 20 December 2002 on the conservation and sustainable exploitation of fisheries resources under the Common Fisheries Policy, provide assistance for the measures defined in Titles II, III and IV of this Regulation within the fields covered by the Common Fisheries Policy as defined in Article 1 of Regulation (EC) No 2371/2002.'
3.. Article 3 shall be amended as follows:

((a)) paragraph 1 shall be replaced by the following:
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1. Programming, defined in Article 9(a) of Regulation (EC) No 1260/1999, shall be in accordance with the objectives of the Common Fisheries Policy and in particular with the provisions of Chapter III of Regulation (EC) No 2371/2002. To this end, programming shall be revised as necessary and in particular in application of fishing effort limits decided under Article 5 of Regulation (EC) No 2370/2002.Programming shall cover all the fields referred to in Titles II, III and IV.'
((b)) paragraph 3 shall be replaced by the following:
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3. The development plans defined in Article 9(b) of Regulation (EC) No 1260/1999 shall demonstrate that public aid is necessary with regard to the objectives pursued, in particular that, without public aid, the fishing vessels concerned could not be modernised, and that the planned measures will not jeopardise the sustainability of fisheries.The contents of the plans shall be as set out in Annex I.'
((c)) paragraph 4 shall be deleted;
4.. Articles 4 and 5 shall be deleted;
5.. the heading of Title II shall be replaced by the following:
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Title II'
6.. Article 6 shall be deleted;
7.. Article 7 shall be amended as follows:

((a)) paragraph 1 shall be replaced by the following:
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1. Member States shall take appropriate measures to comply with the relevant provisions of Regulation (EC) No 2371/2002.Where necessary, this shall be achieved either by stopping fishing vessels' fishing activities permanently, in accordance with the applicable provisions of Annex III, or by restricting them or by a combination of both.'
((b)) paragraph 3 shall be replaced by the following:
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3. The permanent cessation of fishing vessels' fishing activities may be achieved by:
(a) the scrapping of the vessel;
(b) until 31 December 2004, permanent transfer of the vessel to a third country, including in the framework of a joint enterprise within the meaning of Article 8, after agreement by the competent authorities of the country concerned, provided all the following criteria are met:
((i)) there exists a fisheries agreement between the European Community and the third country of transfer as well as appropriate guarantees that international law is not likely to be infringed, in particular with respect to the conservation and management of marine resources or other objectives of the Common Fisheries Policy and with respect to working conditions of fishermen.
Derogations may be granted by the Commission on a case by case basis for permanent transfers in the framework of joint enterprises to third countries, where Community interests do not justify the conclusion of a fisheries agreement and the other conditions for transfer would be fulfilled;
((ii)) the third country to which the vessel is to be transferred is not a country which is a candidate for accession;
((iii)) the transfer results in a reduction of fishing effort on the resources previously exploited by the vessel transferred; however, this criterion shall not apply when the vessel transferred has lost fishing possibilities under a fisheries agreement with the Community or under another agreement;
((iv)) if the third country to which the vessel is to be transferred is not a contracting or Cooperating Party to relevant regional fisheries organisations, that country has not been identified by such organisations as one which permits fishing in a manner which jeopardises the effectiveness of international conservation measures. The Commission shall publish a list of the countries concerned on a regular basis in the C series of the Official Journal of the European Communities;
(c) permanent reassignment of fishing vessels for non-profitable purposes other than fishing.'
((c)) paragraph 4 shall be deleted;
((d)) in paragraph 5, points (b), (c) and (d) shall be replaced by the following:
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 premiums for permanent transfer within the framework of a joint enterprise: the amounts referred to in Article 8(3); however, no public aid for this purpose can be given for vessels with a tonnage less than 20 GRT or 22 GT, or of 30 years old or more;
 premiums for other permanent transfer to a third country: the maximum amounts for the scrapping premiums referred to in (a), less 70 %. However, no public aid for this purpose may be given for vessels with a tonnage less than 20 GRT or 22 GT, or of 30 years old or more;
 premiums for permanent reassignment of the fishing vessel for non-profitable purposes other than fishing: the amounts for the scrapping premiums referred to in (a).'
((e)) paragraphs 6 and 7 shall be deleted;
8.. Article 8(5) shall be replaced by the following:
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5. Each year for five consecutive years from the date of constitution of the joint enterprise or the date on which the Community partner acquired holdings in the enterprise, applicants shall submit to the management authority a report on the implementation of the activity plan, including data on catches and markets of fisheries products, in particular products landed in or exported to the Community, with supporting documents, together with the enterprise's balance sheet and a statement of its net worth. The management authority shall forward the report to the Commission for information.The balance of the premium shall be paid to applicants after five years of activity and after the fifth report has been received.'
9.. Article 9 shall be replaced by the following:
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Article 9 

1. Public aid for fleet renewal and for the equipment of fishing vessels, including for the use of more selective fishing techniques and of Vessel Monitoring Systems or for the modernisation of fishing vessels may be granted only on the following conditions and those set out in the second subparagraph of Article 3(3) and in Annex III:
(a) public aid for the renewal of fishing vessels may be granted until 31 December 2004;
(b) public aid for the renewal of fishing vessels may be granted only for vessels under 400 GT;
(c) public aid for the equipment of fishing vessels, including for the use of more selective fishing techniques and of Vessel Monitoring Systems, or for the modernisation of fishing vessels may be granted provided that:
((i)) the aid does not concern capacity in terms of tonnage or of power;
((ii)) the aid does not serve to increase the effectiveness of the fishing gear;
(d) by derogation from point (c)(i), public aid for the modernisation of fishing vessels may be granted subject to the provisions of Article 11(5) of Regulation (EC) No 2371/2002.
2. The effect of granting public aid shall be accounted for in the annual implementation report referred to in Article 21.
3. The indicators relating to the granting of public aid for fleet renewal and modernisation of fishing vessels in the plans, set out in Annex I(2)(d), shall be drawn up in accordance with this Article.
4. Expenditure eligible for public aid as referred to in paragraph 1 may not exceed the following amounts:
(a) construction of fishing vessels: twice the scales in Table 1 in Annex IV;
(b) equipment and modernisation of fishing vessels including, where applicable and until 31 December 2003, the cost of re-measuring tonnage in accordance with Annex I to the 1969 Tonnage Measurement Convention: the scales in Table 1 of Annex IV.'
10.. Article 10 shall be amended as follows:

((a)) paragraph 1 shall be replaced by the following:
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1. Public aid for fleet renewal and for the equipment and the modernisation of fishing vessels may be permitted only where, within the time allowed, the Member State has complied with Council Regulation (EEC) No 2930/86 of 22 September 1986 defining characteristics for fishing vessels.'
((b)) paragraph 2 shall be deleted;
((c)) paragraphs 3 and 4 shall be replaced by the following:
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3. The following provisions shall apply to the accumulation of public aids to the fishing fleet:
(a) expenditure on equipment and modernisation shall not be eligible for aid for five years following the grant of public aid for the construction of the vessel concerned except for equipment in vessel monitoring systems;
(b) permanent withdrawal premiums within the meaning of Article 7(5) and premiums for the creation of joint enterprises within the meaning of Article 8 may not be added to other Community aid granted under this Regulation or Regulations (EEC) No 2908/83, (EEC) No 4028/86 and (EC) No 2468/98. These premiums shall be reduced:
((i)) by a part of the amount previously received in the case of equipment and modernisation aid; this part shall be calculated pro rata temporis for the five-year period preceding the permanent withdrawal or the setting up of the joint enterprise;
((ii)) by the total amount previously received in the case of aid for the temporary cessation of activities within the meaning of Article 16(1) of this Regulation and under Article 14 of Regulation (EC) No 2468/98 paid during the year preceding permanent withdrawal or the setting up of the joint enterprise;
(c) aid for the equipment in vessel monitoring systems may not be added to aid granted under Council Decision 2001/431/EC.
4. Public aid for renewal or for modernisation and equipment, under this Regulation shall be reimbursed pro rata temporis when the fishing vessel concerned is deleted from the fishing vessel register of the Community within ten years from the renewal, or within five years of the modernisation works.'
11.. Article 11 shall be amended as follows:

((a)) paragraph 1 shall be replaced by the following:
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1. For the purposes of this Article, “small-scale coastal fishing” means fishing carried on by fishing vessels of an overall length of less than 12 metres and not using towed gear as listed in table 2, Annex I of Commission Regulation (EC) No 2090/98 of 30 September 1998 regarding the fishing vessels register of the Community.'
((b)) paragraph 4 shall be replaced by the following:
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4. For the purposes of paragraph 3, the following projects, inter alia, may be considered integrated collective projects:
— safety equipment on board and improvement of sanitary and working conditions,
— technological innovations (more selective fishing techniques) that do not increase the fishing effort,
— organisation of the production, processing and marketing chain (promotion and added value of the products),
— professional requalification or training.'
12.. Article 12 shall be amended as follows:

((a)) paragraph 2 shall be replaced by the following:
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2. Member States may take, for fishermen, measures of a socioeconomic nature associated with the adjustment of fishing capacity within the meaning of Article 11 of Regulation (EC) No 2371/2002.'
((b)) point (c) of paragraph 3 shall be replaced by the following:
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 granting non-renewable individual compensatory payments to fishermen who can show that they have worked for at least five years as fishermen, to help them:

((i)) to retrain outside marine fisheries under an individual or collective social plan, on the basis of an eligible cost limited to EUR 50 000 per individual beneficiary; the managing authority shall determine the individual amount according to the scale of the retraining project and the financial commitment entered into by the beneficiary;
((ii)) to diversify their activities outside marine fisheries under an individual or collective diversification project, on the basis of an eligible cost limited to EUR 20 000 per individual beneficiary; the managing authority shall determine the individual amount according to the scale of the diversification project and the investment made by the beneficiary;'
((c)) point (d) of paragraph 4 shall be replaced by the following:
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((i)) that the compensation referred to in paragraph 3(c)(i) for reconversion is refunded on a pro rata temporis basis where the beneficiaries return to their work as fishermen within a period of less than five years after being paid the compensation, and
((ii)) that the compensation for diversification referred to in paragraph 3(c)(ii) contributes to a reduction of the fishing effort developed by the fishing vessels on which the beneficiaries are active;'
((d)) paragraph 6 shall be replaced by the following:
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6. The Member States may introduce nationally financed accompanying measures for crew members of affected fishing vessels in order to facilitate temporary cessation of fishing activities in the framework of plans for protection of aquatic resources.'
13.. Article 16 is hereby amended as follows:

((a)) paragraph 1 is amended as follows:

((i)) point (a) shall be replaced by the following:
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 in the event of unforeseeable circumstances, particularly those caused by biological factors; the granting of compensation may last for no more than three consecutive months or six months over the entire period from 2000 to 2006. The managing authority shall furnish the Commission with scientific proof of these circumstances in advance;'
((ii)) point (c) shall be replaced by the following:
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 where a recovery or management plan is adopted by the Council or where emergency measures are decided by the Commission or by one or more Member States, the granting of compensation by a Member State may last for one year and may be extended by one further year.'
((b)) paragraphs 3 and 4 shall be replaced by the following:
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3. The financial contribution from the FIFG to the measures referred to in paragraphs 1 and 2 per Member State for the entire period from 2000 to 2006 may not exceed the higher of the following two thresholds: EUR 1 million or 4 % of the Community financial assistance allocated to the sector in the Member State concerned.However, in the case of a recovery or management plan adopted by the Council or of emergency measures decided by the Commission, these thresholds may be exceeded on condition that the measure includes a decommissioning scheme with the aim of withdrawing, within two years of the adoption of the measure, a number of fishing vessels with a fishing effort at least equal to the effort of the fishing vessels suspended from fishing activity as a consequence of the plan or emergency measure.To obtain Commission approval for a financial contribution from the FIFG, a Member State shall notify the Commission of the measure and provide it with a detailed calculation of premiums. The measure shall enter into force only after the Commission's approval has been delivered to the Member State.The managing authority shall determine the amount of compensation as provided for in paragraphs l and 2 to be paid in individual cases taking account of relevant parameters such as the real losses suffered, the scale of the conversion effort, recovery plan or technical adjustment effort.
4. Recurrent seasonal suspension of fishing activity shall not be eligible for compensation under paragraphs 1, 2 and 3.'
14.. Article 18 shall be replaced by the following:
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Article 18 
The managing authority shall ensure that the special conditions governing assistance listed in Annex III are complied with.
It shall also satisfy itself as to the technical capacity of beneficiaries and the financial viability of firms as well as their respecting all rules of the Common Fisheries Policy before granting aid. If during the grant period it is found that the beneficiary does not comply with rules of the Common Fisheries Policy, the grant shall be reimbursed in proportion to the gravity of the infringement.
Detailed rules for the implementation of this article may be adopted in accordance with Article 23(2).'
15.. Article 19 shall be replaced by the following:
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Article 19 

1. Without prejudice to paragraph 2, Articles 87, 88 and 89 of the Treaty shall apply to aid granted by Member States to the fisheries and aquaculture sector.
2. Articles 87, 88 and 89 of the Treaty shall not apply to obligatory financial contributions by Member States to measures co-financed by the Community and provided for under the development plans referred to in Article 3(3) of this Regulation and defined in Article 9(b) of Regulation (EC) No 1260/1999 or under Article 5 of Regulation (EC) No 2370/2002 of 20 December 2002 establishing an emergency Community measure for scrapping fishing vessels.
3. Measures which provide for public financing exceeding the provisions of this Regulation or of Regulation (EC) No 2370/2002 concerning obligatory financial contributions, as referred to in paragraph 2, shall be treated as a whole on the basis of paragraph 1.'
16.. Article 22 shall be replaced by the following:
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Article 22 
The measures necessary for the implementation of this Regulation relating to matters referred to in Articles 8, 15, 18 and 21 shall be adopted in accordance with the management procedure referred to in Article 23(2).'
17.. in Article 23(1), points (a) and (b) shall be replaced by the following:
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 for the purpose of the implementation of Articles 8, 15, 18 and 21 by the Committee on structures for fisheries and aquaculture established by Article 51 of Regulation (EC) No 1260/1999; and
 for the purpose of the implementation of Articles 9 and 10 by the Committee for fisheries and aquaculture established by Article 30(1) of Regulation (EC) No 2371/2002.'
Article 2 
Annexes I to IV shall be amended in accordance with the Annex to this Regulation.
Article 3 
This Regulation shall enter into force on 1 January 2003.
This Regulation shall be binding in its entirety and directly applicable in all Member States.Done at Brussels, 20 December 2002.
For the Council
The President
M. FISCHER BOEL
ANNEX
1. 

((a)) point 1(c) is replaced by the following:
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 requirements of the sector.';
((b)) point 2(d)(i) is replaced by the following:
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 indicators concerning the development of the fleet in relation to the objectives of the recovery or management plans;'.

2. Annex II is deleted.

3. 

((a)) the title of point 1 is replaced by the following:
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1.';
((b)) point 1.0 is replaced by the following:
' 1.0. 
For the purpose of this Regulation, the age of a vessel is a whole number defined as the difference between the year of the managing authority's decision to grant a premium or aid and the year of entry into service as defined in Regulation (EEC) No 2930/86.
';
((c)) points 1.3 and 1.4 shall be replaced by the following:
' 1.3. 

((a)) Vessels must be built to comply with the Regulations and Directives governing hygiene, safety, health, product quality and working conditions and the Community provisions concerning the measurement of vessels and the monitoring of fishing activities.
((b)) Vessels shall be entered in the Community fishing fleet register.
((c)) Without prejudice to Article 12(3)(d), the transfer of ownership of a fishing vessel shall not give rise to Community aid.
 1.4. 

((a)) Vessels must have been registered in the fishing vessels register of the Community for at least five years except for equipment in Vessel Monitoring Systems. Changes in vessel characteristics must be communicated to this register and the vessels must be measured in accordance with Community provisions, when they are modernised.
((b)) Investments should relate to:

((i)) the rationalisation of fishing operations by the use of more selective or low impact fishing technologies and methods on board in order to avoid undesirable by-catches, other than those provided for in Community law,
and/or
((ii)) improvement of the quality and safety of products caught and preserved on board, the use of more selective fishing techniques and of better preserving techniques and the implementation of legal and regulatory provisions regarding health,
and/or
((iii)) improvement of working and safety conditions.
Without prejudice to Article 16(2), the replacement of fishing gear shall not be considered eligible expenditure.
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((d)) the following point 1.5 is added:
' 1.5. 
Measures to support the training of fishermen or the diversification of their activities outside marine fisheries must contribute to a reduction of the fishing effort developed by the beneficiaries even if they continue fishing on a part-time basis.
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4. 
' 2. 

((a)) For all the operations referred to in titles II, III and IV, the limits on Community financial participation (A), total State financial participation (national, regional and other) by the Member State concerned (B) and, where applicable, financial participation by private beneficiaries (C) shall be as follows, expressed as a percentage of eligible costs.

 Group 1:
Permanent withdrawal premiums (Article 7), premium for the creation of joint enterprises (Article 8), small-scale coastal fishing (Article 11), socio-economic measures (Article 12), protection and development of aquatic resources (Article 13(1)(a)), fishing port facilities with no financial participation by private beneficiaries (Article 13(1)(c)), measures to find and promote new market outlets with no financial participation by private beneficiaries (Article 14), operations by members of the trade with no financial participation by private beneficiaries (Article 15), temporary cessation premiums and other financial compensation (Article 16), innovative measures and technical assistance including pilot projects carried out by public bodies (Article 17).
 Group 2:
Fleet renewal, equipment and modernisation of fishing vessels (Article 9).
 Group 3:
Aquaculture (Article 13(1)(b)), fishing port facilities with financial participation by private beneficiaries (Article 13(1)(c)), processing and marketing (Article 13(1)(d)), inland fishing (Article 13(1)(e)), measures to find and promote new market outlets with financial participation by private beneficiaries (Article 14), operations by members of the trade with financial participation by private beneficiaries (Article 15(2)).
 Group 4:
Pilot projects other than those carried out by public bodies (Article 17).
((b)) With respect to operations concerning the protection and development of aquatic resources (Article 13(1)(a)), fishing port facilities (Article 13(1)(c)), measures to find and promote new market outlets (Article 14) and operations by members of the trade (Article 15), the managing authority shall determine whether they fall under group l or group 3, in particular on the basis of the following considerations:

— collective versus individual interests,
— collective versus individual beneficiary (producers' organisations, organisations representing the trade),
— public access to the results of the operation versus private ownership and control,
— financial participation by collective bodies, research institutions.
'
