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Common Organisation of Agricultural Markets

02 December 2009
by Ina Dimireva -- last modified 22 December 2009

The common organisation of agricultural markets in the European Union provides a single legal framework governing the domestic market, trade with third countries and rules regarding competition.



Council Regulation (EC) No 1234/2007 of 22 October 2007 establishing a common organisation of agricultural markets and on specific provisions for certain agricultural products (Single CMO Regulation).


A common market organisation (CMO) in the agricultural sector governs 21 sectors which until 2007were individual CMOs.


Market intervention

This Regulation governs public intervention on the agricultural products market. In particular, this includes the definition of reference prices and methods for fixing intervention prices in relation to the reference price, opening periods for buying-in and maximum quantities. Prices are specified for cereals, paddy rice, white and raw sugar, beef and veal, milk, butter, skimmed milk powder and pigmeat.

The disposal of products from intervention stocks must ensure market stability, equal access to goods and equal treatment of buyers.

Furthermore, private storage aid is specified for certain products (cream and certain butters and cheeses). It is also possible for other products (white sugar, olive oil, fresh or chilled meat from adult bovine animals, skimmed milk powder, cheeses and pigmeat, sheepmeat and goatmeat).

Special intervention measures

The EU may take special intervention measures. These may be of a general nature, i.e. to finance half the expenditure borne by Member States in the event of animal diseases and loss of consumer confidence. Certain sectors (cereals, rice and sugar) benefit from specific measures. In certain sectors (particularly live plants, beef and veal, pigmeat, sheepmeat and goatmeat, eggs and poultry), Community measures may be taken to encourage the adjustment of supply to market requirements.

Quota and aid schemes

National production quotas are fixed for sugar and milk. Member States then distribute these between the producing undertakings. This Regulation particularly specifies the methods of transfer for quotas between several undertakings and management of surplus production. This includes producer assessments by Member States.

Aid is provided for the following activities:

  • Processing in sectors relating to dried fodder and flax grown for fibre;
  • Starch and sugar production (production refund measures);
  • Milk and milk products, olive oil and table olives as well as apiculture products;
  • Community Tobacco Fund;
  • Silkworm rearing.


The Commission may establish standards for the marketing or sale of olive oil and table olives, bananas and live plants. Specific marketing standards may also be introduced for milk and milk products, oils and fats, eggs and poultrymeat, hops, olive oils and olive-pomace oils, cheeses and ethyl alcohol. This Regulation defines the methods of adoption, implementation and derogation.

Producer and interbranch organisations

Producer organisations may be set up in the hops, olive oil and table olives sectors. Interbranch organisations, which bring together representatives of economic activities associated with production, commerce and/or product processing, may be formed in the olive oil and table olives and tobacco sectors. The formation of these organisations is subject to compliance with certain conditions.


In principle, the levying of any charge having equivalent effect to a customs duty and the application of any quantitative restriction or measure having equivalent effect are prohibited in trade with third countries.


The Commission can require the presentation of import licences for products from certain sectors: cereals, rice, sugar, seed, olive oil and table olives, flax and hemp, bananas, live plants, beef and veal, pigmeat, sheepmeat and goatmeat, poultrymeat, milk and milk products, eggs and agricultural ethyl alcohol.

The import duties in the Common Customs Tariff apply to these products, although specific provisions are provided for some of them. Furthermore, in certain cases, these duties may be suspended or additional duties may be applied.

Import tariff quotas are managed by the Commission and administered so as to avoid any discrimination.

Particular provisions apply to imports of mixtures of cereals, rice or cereals and rice and the import duty is established according to the composition of the mixtures. In addition, preferential arrangements are set up for sugar and certain import conditions are fixed for hemp and hops.

The Commission may also take safeguard measures with regard to imports. In certain cases, it may also suspend recourse to the inward processing arrangements for products in the cereals, rice, sugar, olive oil and table olives, beef and veal, milk and milk products, pigmeat, sheepmeat and goatmeat, eggs, poultrymeat and agricultural ethyl alcohol sectors.


The Commission may require the presentation of export licences for products in the sectors pertaining to cereals, rice, sugar, olive oil and table olives, beef and veal, pigmeat, sheepmeat and goatmeat, poultrymeat, milk and milk products, eggs and agricultural ethyl alcohol.

The export of certain products may be supported by export refunds which cover the difference between global and EU market prices. These may be differentiated according to the destination and are fixed periodically by the Commission, taking account of Community and global market developments. Specific provisions govern export refunds for malt in storage, cereals and beef and veal.

Management of export quotas in the milk and milk products sector and special import treatment by third countries are also regulated. Particular provisions are also laid down with regard to exporting live plants and suspension of the outward processing arrangements.


In principle, the Community procedures as regards competition and State aid are applicable. Nevertheless, specific rules regarding competition have been adopted for undertakings. In the same way, there are also specific rules as regards State aid for the milk and milk products sector.

Committee procedure

The Commission is assisted by the Management Committee for the Common Organisation of Agricultural Markets.


Community standards have governed the CMOs since the end of the 1960s, based on the Treaty of Rome. This legal framework simplifies and unifies the ruling of the 21 CMOs without making any changes to policy.

These 21 CMOs, gradually repealed up to October 2008, are the CMOs relating to cereals, rice, sugar, dried fodder, seed, hops, olive oil and table olives, flax and hemp, fruit and vegetables, processed fruit and vegetables, bananas, wine, live trees and other plants, bulbs, roots and the like, cut flowers and ornamental foliage, raw tobacco, beef and veal, milk and milk products, pigmeat, sheepmeat and goatmeat, eggs, poultrymeat and other products.

The fresh and processed fruit and vegetables and wine sectors will be included in a second-stage single CMO.


Regulation (EC) No 1234/2007 - 23.11.2007 - OJ L 299, 16.11.2007