MOSCOW, September 24 (RIA Novosti) - The European Union (EU) has refrained from aiding cheese producers affected by a Russian import embargo due to possible compensation fraud, an EU Commission spokesman reported Wednesday.
"The Commission has stopped the system of Private Storage Aid for cheese because of the disproportionate volumes notified from certain regions which are not traditionally exporting significant quantities to Russia," an EU Commission spokesman was quoted as saying by AFP.
The EU agreed to issue compensation to dairy farmers in August after Moscow banned milk and cheese imports as countermeasures to sanctions implemented against Russia for its alleged involvement in the situation in Ukraine. The funds are meant to cover cold storage of butter, milk powder and certain cheeses for three to seven months.
According to an EU source, the majority of questionable claims hail from Italy which has requested 74,254 tons of cold storage capability, a massive demand when compared to storage needs in Ireland and the Netherlands. The claims have already used up some 87 percent of the budget saved for compensation.
Finland and Baltic nations which export some 75 percent of dairy products to Russia are the countries suffering the greatest from Russia's import ban set to last one year.
The EU faced similar compensation issues concerning fruit and vegetable farmers earlier this month leading to the suspension of 125 million euros (approximately $160 million) in aid.
In addition to dairy products, the Russian embargo also covers meat, fruit, vegetables, and fish from the EU, United States, Australia, Canada and Norway.
On August 7, Russia imposed a ban on food imports from Western countries that imposed sanctions against it over its alleged involvement in the independence movement in Ukraine which Russia has repeatedly denied.
