FUTURE OF EC BUTTER DISPOSAL SCHEME IN DOUBT
A 3.6 billion dlr plan to rid the
European Community (EC) of one mln tonnes of surplus butter is
in doubt as Spain and Portugal refuse to drop their opposition
to the scheme, diplomats said.
    The plan, proposed by the Community's executive Commission,
aims to level most of the EC's huge and costly butter mountain
by disposing of a total of 1.04 mln tonnes this year and next.
    But the officials said Spain and Portugal, which joined the
12-nation bloc at the beginning of last year, continued to
oppose the scheme at a meeting of EC finance ministers here.
    They argued they should not have to pay for the disposal of
surpluses created before they became EC members.
    The plan, already approved by farm ministers despite
opposition from Madrid and Lisbon, had been sent to finance
ministers for final approval.
    But the diplomats said the finance ministers instead
referred it back to the Commission, asking it to study possible
ways to solve the row as soon as possible.
    They said Spain and Portugal indicated they may go to the
European Court of Justice over the issue if the Commission did
not come up with a satisfactory solution.
    The scheme has also run into criticism from the EC's
financial watchdog, the Court of Auditors.
    The Court has said the plan is unsound because the
Commission wants member states to foot the bill until it starts
reimbursing them in four annual instalments from 1989.
    Diplomats said Spain and Portugal backed the court's view
and also complained that, under complex financial agreements
worked out when they joined the EC, they would get less back
later than if they were reimbursed now.
    Commission sources said it appeared the two countries were
holding out in a bid to squeeze some form of compensation out
of their partners but it was unclear how much longer they would
continue to block the scheme.
 Reuter
