You have answered your own question in the quote from JAR-FCL 1 that you posted
3.1. Credits for holders of a PPL(A) license
In the case of a PPL(A) or PPL(H) entrant, 50% of the aircraft hours flown by the entrant prior to the course may be credited towards the required flight instruction (JAR-FCL 1.165(a)(1) and Appendix 1 to JAR-FCL 1.165(a)(1), paragraph 13) up to a credit of 40 hours flying experience or 45 hours if an aeroplane night flying qualification has been obtained, of which up to 20 hours may be dual instruction. This credit for the hours flown shall be at the discretion of the FTO and entered into the applicant’s training record.
It is entirely up to the FTO what credit is awarded and how the remaining time is used. As RTN11 stated, even with a credit of flying hours you still have to cover every exercise in the syllabus; you just (hopefully) will need to spend less time on each of the exercises that you have flown before in order to reach the required standard.