Muy Sres

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Seville, January 19, 2007.

Dear Sir/Madam,

I am delighted to be in contact with you for several reasons, First of all, I would like to wish you a very Happy New Year; secondly, I would like to provide some clear explanations about a series of doubts that have arisen in recent months from people and established breeders’ associations outside Spain:

1. ANCCE is the national association in Spain, chosen by the Ministry of

Agriculture, Fisheries and Food to be responsible for the administration of the

PRE Stud Book. This is a two-year concession, as this time span sufficient for a new Royal Decree to be published to the substitute the current law that regulates all Pure Equine Breeds, and their selection, within Spain.

2. ANCCE is ready to handle the Stud Book as of January 1, 2007, but has not requested the collaboration of the Cria Caballar in its administration. What

ANCCE has requested of the Cria Caballar are the entire PRE databases, because the database is essential for an orderly transfer of the breed administration. Turning over the database in full will facilitate the installation of the new and modern computer application that ANCCE has developed, in keeping with the times, to ensure that the Stud Book services are more reliable and flexible. This new computer application strives to serve breeders better so that they receive the documentation for their horses within the shortest possible time.

3. ANCCE seems the importance of Cria Caballar continuing to defend the breed, but it will do so by caring for the Military Stud Farm or, if created, the future National Stud Farm, but not through Stud Book related affairs. In fact, the registration and evaluation of the horses from the current Military Stud Farm will be carried out by the appointed Stud Book veterinarians for the geographical area where those horses are located.

Another, but different aspect is the fact is Cria Caballar will, during the first six months of this year, complete all the pending procedures and petitions for documentation. However, no new requests for service will be attended.

4. ANCCE is fully aware that the administration of the Stud Book must be impartial and unrestricted for everyone. ANCCE, does not found associations anywhere in the world; associations are created by the actual breeders, therefore, ANCCE neither approves nor disapproves of any association, be it

“official” or not.

5. Being a member of ANCCE has always been and will always be of a free and voluntary. With regards to the Stud Book, as has been stated before, no member of ANCCE will have any advantages or privileges over any other breeder.

6. The implementation of the new administrative system outside Spain will begin as of April 1, 2007 ; if a breeder from any country needs some urgent service, this will be carried out from Spain. The reason for this is simple: 80% of all PRE horses are located in Spain. Due to this fact, the Stud Book Office will be working with a greater number of horses and therefore the computer application will be used more. There will be testing in real-time and any problem that might arise will be resolved.

7. It can also be confirmed that:

- During 2007, all of the corresponding registrations and evaluations will be carried out.

- TQBs will be held both within Spain and abroad, with a series of changes; you will be informed of these changes in due course.

- Once all the information has been received from the Cria Caballar, all pending documentation will be sorted out. Work will be simplified if breeders —as members of their associations, or if they are not members, using the means they consider most convenient or, directly to ANCCE — send all pending documentation to ANCCE, including the completed form for “initial status of the Stud Farm”, a copy of which is included herein

- As of the 1 st March 2007, it is hoped that all the changes in the rules and regulations for conformational competitions will be complete. Any competitions taking place before this date will be run under the previous rules and regulations. All applications to hold conformational competitions should be sent to the main ANCCE office.

- In 2007, there will be no changes with regards to coverings, or to the manner in which these are performed. Should there be any changes in the rules, these will be effective for 2008. Other lines for the selection scheme will also be launched during this year.

8. According to the Ministry of Agriculture of Spain, any agreements signed between

Cria Caballar and the “official” Associations are not binding to ANCCE.

9. ANCCE will promote new agreements with associations from the various countries where the PRE is bred. These agreements will be the subject of serious and rigorous criteria; they will be based on reliability, on the technical means available (in each country) and the services provided to breeders.

I hope that all the above will serve to give you a much clearer idea about how

ANCCE will be handling the PRE Stud Book. If any further explanations are required, please do not hesitate to contact ANCCE, and we will be delighted to resolve any further doubts.

Yours Faithfully,

Jose Palma.

President.

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