United Kingdom Statutory Instruments

(a) maintain a direct sales register; and

(b) send to each direct seller a copy of the entry in the direct sales register relating to him.

    (2) The direct sales register must contain an entry in respect of each direct seller setting out in particular - 

(a) his name;

(b) his trading address;

(c) a reference number which serves to identify him;

(d) the direct sales quota available to him for the quota year; and

(e) the details of his direct sales.

    (3) The Secretary of State must - 

(a) maintain a wholesale register;

(b) send to each wholesale producer a copy of the entry in the wholesale register relating to him; and

(c) send to each purchaser named in the list referred to in paragraph (4)(e) a copy of that part of the entry relating to his purchaser quota.

    (4) The wholesale register must contain an entry in respect of each wholesale producer setting out in particular - 

(a) his name;

(b) his trading address;

(c) a reference number which serves to identify him;

(d) the wholesale quota available to him for the quota year; and

(e) a list of the name and address of each purchaser whose purchaser quota will be calculated to take into account all or part of that wholesale producer's total wholesale quota, and of the wholesale quota registered with each purchaser, showing the representative fat content base of that quota calculated in accordance with Article 7 of the Commission Regulation.

    (5) The Secretary of State must - 

(a) maintain a register of purchasers; and

(b) send to each purchaser a copy of the purchaser entry relating to him.

    (6) The register of purchasers must contain an entry in respect of each purchaser setting out in particular - 

(a) his name; and

(b) his purchaser quota.

    (7) For the purposes of paragraphs (1) to (4), where the holding of a quota holder comprises more than one dairy enterprise, that quota holder may, after submitting to the Secretary of State a consent or sole interest notice in respect of that holding, agree with the Secretary of State the partition of the quota available to that quota holder relating to that holding between separate direct sales register entries or separate wholesale register entries, as the case may be.

    (8) The Secretary of State - 

(a) may make such enquiries as she reasonably considers necessary for the purposes of ensuring the accuracy of the registers which she is required to maintain under this regulation;

(b) must amend the registers - 


(i) to record any allocation or adjustments made under or by virtue of these Regulations, or

(ii) to make any correction or amendment which she reasonably considers to be necessary; and



(c) must notify any person affected by any correction or amendment made by her.

    (9) Notwithstanding that a person is no longer a producer, he must - 

(a) remain registered pursuant to this regulation; and

(b) for the purposes of this regulation and regulations, 6, 7(a) and 33(1), continue to be regarded as a producer,

until the start of the quota year following the year in which the quota available to him has been transferred or until the quota has been withdrawn under Article 15 of the Council Regulation.

    (10) The obligation under paragraphs (1)(b), (3)(b) and (c) and (5)(b) is an obligation to send a copy of - 

(a) an entry; or

(b) part of an entry,

(a) a notice of transfer in such form; and

(b) such other information relating to the transfer,

as the Secretary of State may reasonably require.

    (3) The notice of transfer must reach the Secretary of State - 

(a) in the case of a transfer made by lease, no later than 1st March in the quota year in which the transfer takes place; and

(b) in the case of a transfer made otherwise than by lease, no later than 31st March in the quota year in which the transfer takes place.

    (4) The information referred to in paragraph (2)(b) must reach the Secretary of State within such time as the Secretary of State may reasonably require.

    (5) The notice of transfer must include - 

(a) statements from the transferor and transferee specifying the amounts of used and unused quota transferred;

(b) in the case of a transfer of part of a holding - 


(i) statements from the transferor and transferee to the effect that they have agreed that the quota is to be apportioned taking account of the areas used for milk production as specified in the notice of transfer or that no such apportionment has been agreed, and

(ii) where such an apportionment has been agreed, a consent or sole interest notice, provided by the transferor in respect of the holding; and



(c) in the case of a transfer of the whole of a holding, a consent or sole interest notice, provided by the transferor in respect of the holding.

(a) the total volume of deliveries to purchasers; and

(b) the total volume of such deliveries after an adjustment for butterfat content in accordance with Article 10(1) of the Commission Regulation.

    (2) The determination under paragraph (1) must be made by reference to the summaries purchasers are required to submit to the Secretary of State for the purposes of Article 8(2) of the Commission Regulation.

    (3) If for any quota year a purchaser has not submitted the summaries so required or is unable to provide such proof of the volume of milk delivered to him in that year as the Secretary of State may reasonably require for the purposes of these Regulations, the Secretary of State must for the purposes of paragraph (1) - 

(a) make her own determination of that volume of milk based on all the information available to her for the purposes of calculating any levy payable on deliveries made to that purchaser; and

(b) inform the purchaser of her determination.

    (4) If the volume referred to in paragraph (1)(a) exceeds that referred to in paragraph (1)(b), the Secretary of State must calculate the proportionate reduction required to be made in all downward butterfat adjustments that have previously been made in order to increase the volume referred to in paragraph (1)(b) so that it equals the volume referred to in paragraph (1)(a).

    (5) If paragraph (4) applies, the Secretary of State must - 

(a) notify all purchasers that any downward butterfat adjustments made by them in the deliveries to them are reduced; and

(b) specify the reduction.

(a) for such periods; and

(b) in such form,

as the Secretary of State may reasonably require.

    (4) The information referred to in paragraph (2) must be submitted so as to reach the Secretary of State before the expiry of the period of three working days beginning with the end of the period to which the information relates or within seven working days beginning with the date of notification of the requirement, whichever is the later.

    (5) Each purchaser must provide the Secretary of State with a list of those quota holders registered with that purchaser at 31^st March in each quota year (whether they have been so registered for the whole or part of that quota year) who - 

(a) hold quota in respect of that quota year that has not been acquired by temporary transfer for that quota year; and

(b) have not made deliveries to that purchaser during that quota year,

and ensure that the list reaches her no later than 14th May following the end of that quota year.

    (6) The Secretary of State must provide each purchaser with a copy of such information as the purchaser may reasonably require for the purposes of - 

(a) that purchaser's registration obligations under regulation 6; and

(b) Article 8 of the Commission Regulation (which concerns the submission of summaries of producers' statements of deliveries or declarations that no deliveries have been received).

(a) an application, statement or declaration concerning the adjustment of purchaser quota in accordance with regulation 23(2) to (4);

(b) information in accordance with regulation 33(2) to (4); or

(c) a confirmation or amendments relating to a revised version of a summary in accordance with regulation 35(2),

he is liable to pay to the Secretary of State a penalty equivalent to the theoretical amount of levy that would be due on 0.01% of the quantity by volume of milk covered by that application, statement, declaration or revised version, or that information, for each day of the period of delay in the submission reaching the Secretary of State.

    (3) Where a purchaser fails to maintain accurate and updated records pursuant to Article 24(2) of the Commission Regulation and regulation 34, he is liable to pay to the Secretary of State a penalty equivalent to the theoretical amount of the levy that would be due on 0.5% of the quantity by volume of milk concerned.

    (4) For the purposes of the third sub-paragraph of Article 11(3) of the Commission Regulation (which requires member States to impose proportionate penalties where producers submit incorrect declarations), and subject to the provisions of Article 11(5) of that Regulation (which authorises member States not to impose penalties in certain circumstances) and to paragraph (5), where a direct seller submits an annual declaration which overstates or understates the volume of direct sales for the quota year covered by that declaration, he is liable to pay to the Secretary of State - 

(a) in the case of an overstatement, a penalty equivalent to the theoretical amount of levy that would be due on 0.5% of the quantity by volume of the milk which comprises the overstatement;

(b) in the case of an understatement, a penalty equivalent to the theoretical amount of levy that would be due on 0.5% of the quantity by volume of the milk which comprises the understatement,

except in any case where, for the quota year covered by the declaration, he is liable to pay to the Secretary of State levy which exceeds that amount.

    (5) Notwithstanding anything in paragraphs (2) to (4), the penalties referred to in those paragraphs - 

(a) in the case of purchasers and direct sellers, are not to be less than £60;

(b) in the case of purchasers, are not to exceed £60,000; and

(c) in the case of direct sellers, are not to exceed £600.

    (6) Subject to paragraph (7), if a purchaser fails to submit a summary required to be submitted under Article 8(2) of the Commission Regulation before 1^st July in the year in which it is required to be submitted, he is liable to pay to the Secretary of State a penalty equivalent to the theoretical amount of levy that would be due on 0.01% of the quantity by volume of milk covered by that declaration for each day of the period of the delay in the submission reaching the Secretary of State.

    (7) A purchaser is not liable to pay a penalty under paragraph (6) if, in the opinion of the Secretary of State, the failure - 

(a) was neither deliberate nor the result of serious negligence;

(b) is negligible in terms of the functioning of the scheme or the effectiveness of the checks; or

(c) is attributable to force majeure.

(a) where regulation 11(1)(b) or (4)(b) applies, by agreement between the occupier of the relevant holding and any other interested party, or, in default, by the President on an application by the occupier; and

(b) where regulation 12(3) applies, by the President.

(a) details of each producer making deliveries to him, including - 


(i) that producer's name and address,

(ii) the wholesale quota available to that producer at the beginning and end of each quota year,

(iii) the representative fat content (butterfat base) of the milk delivered by that producer, and

(iv) the total quota available for all the producers who make deliveries to the purchaser and the weighted butterfat of that quota;



(b) details, in terms of each delivery and each month, of the quantities of milk which each producer has delivered to him;

(c) details of the cumulative total of the quantities delivered to him each month by all producers;

(d) details of the average fat content of each producer's deliveries per month;

(e) details of the weighted average fat content of the cumulative total referred to in sub-paragraph (c);

(f) a list of purchasers and other undertakings which supply treated or processed milk or milk products to him;

(g) details, in terms of each such purchaser or undertaking and each month, of the quantities supplied to him by that purchaser or undertaking;

(h) details of the use to which milk and milk products collected from him has been put;

(i) records of individual deliveries and supplies and accompanying collection documents identifying each delivery or supply by producer, purchaser or other undertaking; and

(j) all books, registers, accounts, correspondence, commercial data, vouchers and supporting documents relating to his business activities.



Records to be kept by producers

     2.  - (1) In respect of each quota year, a direct seller must keep, and retain for the relevant period, records comprising - 

(a) details of the quota held by him, including any permanent and temporary transfers of quota if appropriate;

(b) his herd records (comprising number and breed of cows and calved heifers in dairy herd with details of number of cows in milk and number of cows dry);

(c) daily records of milk produced;

(d) invoices of any feed purchased;

(e) details recorded as a result of his participation in the National Milk Recording Scheme or other similar recording scheme;

(f) details of quantities of milk processed, methods of processing and quantities and type of milk products produced;

(g) details of quantities of whole milk used in the production of milk products (with conversion rates applied);

(h) details of quantities and types of milk and milk products which are produced and used on his holding for stock feeding and human consumption;

(i) details of quantities and types of milk and milk products which are disposed of (other than under paragraph (h)) or wasted on the holding;

(j) without prejudice to paragraph (i), details of any milk or milk products which - 


(i) were transported from his holding to be destroyed elsewhere for sanitary purposes pursuant to a decision of the Secretary of State or the Secretary of State for Health,

(ii) were so destroyed, and

(iii) as a consequence, are to be excluded from the levy calculation,



including information about the reason why such destruction was necessary and details of where, when and how such destruction occurred;

(k) details of quantities and types of milk and milk products sold directly to the consumer or transferred free of charge from his holding (including milk and milk products sold on his holding);

(l) details of quantities and types of milk and milk products purchased, exchanged or otherwise received by him, and records relating to their disposal; and

(m) details of stocks of milk and milk products held by him on a monthly basis.

    (2) Where a direct seller also delivers milk or milk products to a purchaser, he must, in respect of each quota year, also keep, and retain for the relevant period, records comprising - 

(a) details of quantities and types of milk and milk products delivered by him and the name and address of any purchaser involved;

(b) the payment slips issued in respect of any such purchaser; and

(c) where there is a discrepancy between a purchaser's payment slip and the relevant tanker receipt, that tanker receipt.

     3. A wholesale quota holder who makes deliveries to a purchaser must, in respect of each quota year, keep, and retain for the relevant period, records, comprising - 

(a) details of the quota held by him, showing permanent and temporary transfers of quota if appropriate;

(b) his herd records (comprising number and breed of cows and calved heifers in dairy herd with details of number of cows in milk and number of cows dry);

(c) daily records of milk produced;

(d) invoices of any feed purchased;

(e) details of quantities of milk delivered by him, and the name and address of the purchaser involved;

(f) the payment slips issued in respect of any such purchaser;

(g) where there is a discrepancy between a purchaser's payment slip and the relevant tanker receipt, that tanker receipt;

(h) details recorded as a result of his participation in the National Milk Recording Scheme or other similar recording scheme;

(i) details of quantities of milk produced and used on his holding for stock feeding and human consumption;

(j) details of quantities of milk which are disposed of (other than under sub-paragraph (i)) or wasted on the holding;

(k) without prejudice to sub-paragraph (j), details of any milk which - 


(i) was transported from his holding to be destroyed elsewhere for sanitary purposes pursuant to a decision of the Secretary of State or the Secretary of State for Health,

(ii) was so destroyed, and

(iii) as a consequence, is to be excluded from the levy calculation,



including information about the reason why such destruction was necessary and details of where, when and how such destruction occurred;

(l) details of quantities and types of milk and milk products transferred free of charge from his holding;

(m) details of quantities of milk purchased, swapped or otherwise received, and records relating to its disposal; and

(n) details of stocks of milk produced on his holding.



Records to be kept by any person undertaking butterfat testing in a laboratory

     4. Any person undertaking butterfat testing for a purchaser in a laboratory must keep, and retain for the relevant period, records comprising details of all samples of milk analysed, showing - 

(a) the time and date the sample was taken on the holding;

(b) the time and date of his receipt of the sample;

(c) the time and date of the analysis;

(d) the identity of the purchaser concerned;

(e) the identity of the producer concerned (by name or reference number);

(f) the butterfat content of each sample recorded to two decimal places;

(g) the method of analysis used; and

(h) the results of any repeat analyses undertaken.

Records to be kept by hauliers

     5. Any haulier collecting milk or milk products on behalf of a purchaser must keep, and retain for the relevant period, records comprising details of all quantities of milk or milk products so collected, showing - 

(a) the time and date of collection from each producer;

(b) the time and date of sampling of the milk or milk products of each producer;

(c) the identity of the producer concerned;

(d) the volume of milk collected (including a copy of the tanker receipt in the cases referred to in paragraphs 2(2)(c) and 3(g));

(e) the identity of the purchaser concerned;

(f) the volume of milk delivered, and the name and address of each reception site;

(g) the sources of all the milk carried on each tanker; and

(h) details of any malfunction in any equipment used by him.

Records to be kept by processors

     6. Any processor in receipt of milk or milk products for processing or treating must keep, and retain for the relevant period, records comprising details of all quantities of milk or milk products received, showing - 

(a) the time and date of their delivery;

(b) their volume or weight per delivery (including copies of tanker receipts and weighbridge tickets in the cases referred to in paragraphs 2(2)(c) and 3(g));

(c) the name and address of the haulier concerned;

(d) the name and address of their vendor or donor;

(e) the quantities of milk processed, types of processing undertaken, and quantities and types of milk products produced;

(f) the quantities of milk used in the production of milk products (if not ascertainable from the information provided under sub-paragraph (e));

(g) the calculated stocks of milk and milk products held by that processor at the end of each month and details of actual stocks physically held as at 31st March each year; and

(h) the quantities of milk or milk products sold or otherwise disposed of, with the date of supply or disposal, and the names and addresses of the buyers or recipients concerned.

Records to be kept by persons buying, selling or supplying milk or milk products obtained directly from a producer or purchaser

     7. Any person who in the course of a business buys, sells or supplies milk or milk products obtained directly from a producer or purchaser must keep, and retain for the relevant period, records comprising details of all quantities of milk or milk products received, showing - 

(a) the time and date of their receipt;

(b) their volume or weight per delivery (including copies of tanker receipts or invoices in the cases referred to in paragraphs 2(2)(c) and 3(g));

(c) the name and address of the haulier concerned;

(d) the name and address of their vendor or donor;

(e) the quantities of milk or milk products sold or supplied, with the date of sale or supply, and the names and addresses of the buyers or recipients concerned other than the consumers of such milk or milk products; and

(f) the quantities of milk or milk products returned to the producer or purchaser unsold or unused, and the date of that return.

     8. In this Schedule, in relation to any records - 

"the relevant period" means the remainder of the year of record and a period of at least three years thereafter; and

"the remainder of the year of record" means, following the making of the records, the remainder of the year in which they were made.

(a) Before approving a purchaser, the Secretary of State may oblige the purchaser to lodge such security as the Secretary of State may reasonably require (regulation 5(4)).

(b) Provisions relating to butterfat-adjusted deliveries and the liability of producers for levy on deliveries (regulations 25 and 27).

(c) A direct seller who does not provide a declaration of his sales in a quota year (as defined in regulation 2(1)) by 14^th May immediately following the end of that quota year and who is liable to pay levy in respect of such sales will pay levy at the full rate (regulation 30(14)).

(d) Unless he has already paid levy, in certain circumstances a producer will be liable for the payment of levy to the Secretary of State where his purchaser has failed to do so (regulation 31).

(e) Article 21 of the Commission Regulation requires that checks be made on the compatibility between deliveries and direct sales of milk on the one hand and production capacity on the other. Consequently, a producer is required to keep invoices of feed purchased by him (regulation 34(2) and paragraphs 2(1)(d) and 3(d) of Schedule 2).

(f) Article 6 of the Commission Regulation provides that milk which is destroyed off-farm for sanitary reasons will not be taken into account when calculating levy. Consequently, a producer is required to keep records of such milk (regulation 34(2) and paragraphs 2(1)(j) and 3(k) of Schedule 2).

(g) Where a person has to submit a document to the Secretary of State in accordance with these Regulations, the operative date is the date by when the Secretary of State receives the document, not the date of despatch to the Secretary of State.

(h) New provision is also made - 


(i) enabling a tenant who buys quota to retain that quota at the end of his tenancy in certain circumstances (regulation 14);

(ii) relating to the conversion of quota (regulation 22);

(iii) to prevent the avoidance of levy (regulation 32);

(iv) imposing a penalty for failure to submit a summary under Article 8(2) of the Commission Regulation by 1st July (regulation 36(6)); and

(v) for the confiscation of quota (regulation 38).

A copy of the map referred to in the definition of "Scottish Islands area" is available for inspection at the offices of the Department for Environment, Food and Rural Affairs, Nobel House, 17 Smith Square, London SW1P 3JR.

A regulatory impact assessment of the effect which this instrument will have on the costs of business has been prepared and copies can be obtained from the Department for Environment, Food and Rural Affairs, Area 5d, 9 Millbank, c/o Nobel House, 17 Smith Square, London SW1P 3JR. A copy of the assessment has been placed in each House of Parliament.