Additional levy in the milk and milk products sector

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Additional levy in the milk and milk products sector

Outline of the Community (European Union) legislation about Additional levy in the milk and milk products sector


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Agriculture > Markets for agricultural products

Additional levy in the milk and milk products sector (milk quotas)

The additional milk levy scheme, introduced in 1984, is designed to reduce the imbalance between supply and demand for milk and milk products and consequently the resulting structural surpluses. Member States pay the levy to the European Agricultural Guarantee Fund (EAGF) when they exceed their national reference quantity or national quota.

Document or Iniciative

Council Regulation (EC) No 1788/2003 of 29 September 2003 establishing a levy in the milk and milk products sector [See amending acts].


Cow’s milk and other milk products marketed as of 1 April 2008 are governed by the common organisation of agricultural markets.

Reference quantities

For each Member State, the Regulation sets reference quantities for the production of cow’s milk and other milk products for 11 consecutive periods of twelve months, starting on 1 April 2004. These quantities are then allocated among the producers in each Member State.

Principle of the levy

Each year, where the quantities of cow’s milk or other marketed products exceed the reference quantities, Member States collect a levy from farmers on the additional quantities produced.

The levy for 100 kilograms of milk is set at EUR 33.27 for the period 2004/05, EUR 30.91 for 2005/06, EUR 28.54 for 2006/07 and EUR 27.83 for 2007/08 and periods thereafter.

If a producer exceeds the quantity allocated by the Member State, he/she then pays his/her contribution to the levy. The Member States transfer these levies to the European Agricultural Guarantee Fund (EAGF).

Member States, which are the bodies deemed to be primarily liable to the Community, are obliged to pay 99% of the amount due to the EAGF in the course of a period between 16 October and 30 November following the twelve-month period in question.

Producers may have one individual reference quantity, or two individual reference quantities – one for direct sales to consumers and one for deliveries. The Member States established before 1 June 2004 the individual quantities (quotas) allocated to each producer on the basis of his/her production between 1 April 2003 and 31 March 2004. For Finnish producers this reference quantity may be increased up to a maximum national quantity of 200 000 tonnes. In the case of the Member States which joined the European Union in 2004 and 2007, the twelve-month periods for establishing the reference quantities vary depending on the country and lie between 1 April 2004 and 31 March 2007.

Management and calculation of the levy

The levy is managed separately for deliveries and for direct sales. For milk deliveries, each producer is assigned a reference fat content for his/her quota. Where the real fat content differs from the reference content, the deliveries are adjusted accordingly. The contribution of producers to payment of the levy is established by decision of the Member State after any unused part of the national quota allocated to deliveries has or has not been re-allocated. The processing undertaking collects the levies from the producers and pays them to the competent body in the Member State. In the case of direct sales, the producers pay the levy directly to the bodies in the Member States. In all cases, where the contribution collected from the producers is greater than that due by the Member State to the EAGF, the Member State may reimburse the amount collected in excess or allocate it for the restructuring of the sector or environmental improvement.

National reserve

Each Member State establishes a national reserve made up of quotas consisting mainly of those released as a result of inactivity on the part of producers and retaining part of transfers between producers. The Member States may then re-allocate these unused quantities to producers of their choice on the basis of objective criteria.


Where a producer fails to produce milk during a twelve-month period and does not prepare to produce again, his/her quantities revert to the national reserve before 1 April of the following calendar year. Where the producer once again becomes a producer before the end of the following twelve-month period, all or part of the individual reference quantity will be returned to him/her. Where producers do not market at least 70% of their reference quantity during a twelve-month period, the Member State may decide to return all or part of the unused quantities to the national reserve.

Temporary transfers

The Member States may agree in accordance with rules adopted by them to temporary transfers of quotas between producers.

Transfers of quotas with land

Reference quantities are transferred by sale, inheritance or any other means in accordance with rules to be laid down by the Member States, account being taken of the areas used for milk production. Where transfer takes place by lease or any comparable means, the Member State may decide that the quotas will be allocated exclusively to producers and refuse to transfer them at the same time as the holding. Where a transfer is made to the public authorities or for non-agricultural purposes, the Member State must ensure that steps are taken to protect the interests of the parties, including the right of the producer to continue production.

Special transfer measures

To facilitate the restructuring of the sector and protect the environment, the Member States may provide, among other things, for transfers without land by granting an allowance to producers who give up all or part of their production, by centralising and supervising offers and requests for transfers without land, or by determining, on the basis of objective criteria, the regions and collection areas within which transfers of reference quantities without land are authorised, with the aim of improving the structure of production.


The Commission is assisted by the Management Committee for Milk and Milk Products (FR), comprising a representative of the European Commission and representatives of the Member States.


Since 2 April 1984, a national production threshold for milk has been imposed on all Member States under a Community quota system. The system also introduced a levy to be paid on the quantities of milk collected or directly sold over and above the guarantee threshold. The regime has been extended several times, in particular by Regulation (EEC) No 3950/92 and Regulation (EC) No 1255/1999. Regulation (EC) No 1788/2003 introduced a simplified procedure consolidating the experience gained.


Act Entry into force – Date of expiry Deadline for transposition in the Member States Official Journal
Regulation (EC) No 1788/2003 28.10.2003 OJ L 270 of 21.10.2003
Amending act(s) Entry into force Deadline for transposition in the Member States Official Journal
Regulation (EC) No 2217/2004 23.12.2004 OJ L 375 of 23.12.2004
Protocol concerning the conditions and arrangements for admission of the Republic of Bulgaria and Romania to the European Union 1.1.2007 OJ L 157 of 21.06.2005
Regulation (EC) No 1406/2006 27.9.2006 OJ L 265 of 26.09.2006
Regulation (EC) No 336/2007 1.4.2007 OJ L 88 of 29.03.2007
Regulation (EC) No 1186/2007 14.11.2007 OJ L 265 of 11.10.2007

The successive amendments and corrections to Regulation (EC) No 1788/2003 have been incorporated into the basic text. This consolidated version (PDF ) is for reference only.

 related Acts

Commission Regulation (EC) No 607/2007 of 1 June 2007 on the division between deliveries and direct sales of national reference quantities fixed for 2006/2007 in Annex I to Council Regulation (EC) No 1788/2003 [Official Journal L 141 of 02.06.2007].

Commission Regulation (EC) No 927/2006 of 22 June 2006 on the release of the special restructuring reserve provided for in Article 1(4) of Council Regulation (EC) No 1788/2003 [Official Journal L 170 of 23.06.2006].

Commission Regulation (EC) No 595/2004 of 30 March 2004 laying down detailed rules for applying Council Regulation (EC) No 1788/2003 establishing a levy in the milk and milk products sector [Official Journal L 94 of 31.03.2004].
See consolidated version (PDF ).


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