02021R2116 — EN — 26.08.2022 — 001.001

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REGULATION (EU) 2021/2116 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

of 2 December 2021

on the financing, management and monitoring of the common agricultural policy and repealing Regulation (EU) No 1306/2013







TITLE I

SCOPE AND DEFINITIONS

Article 1

Scope

This Regulation lays down rules on the financing, management and monitoring of the common agricultural policy (CAP), and in particular on:

(a) the financing of expenditure under the CAP;

(b) the management and control systems to be put in place by the Member States;

(c) clearance and conformity procedures.

Article 2

Definitions

For the purposes of this Regulation, the following definitions apply:

(a) ‘irregularity’ means an irregularity within the meaning of Article 1(2) of Regulation (EC, Euratom) No 2988/95;

(b) ‘governance systems’ means the governance bodies referred to in Title II, Chapter II, of this Regulation and the basic Union requirements, including Member States’ obligations with regard to the effective protection of the financial interests of the Union referred to in Article 59 of this Regulation as well as the implementation, in accordance with Article 9 of Regulation (EU) 2021/2115, of their CAP Strategic Plans as approved by the Commission, and the reporting system put in place for the purposes of the annual performance report referred to in Article 134 of that Regulation;

(c) ‘basic Union requirements’ means the requirements laid down in Regulation (EU) 2021/2115, in this Regulation, in the Financial Regulation and in Directive 2014/24/EU of the European Parliament and of the Council ( 1 );

(d) ‘serious deficiencies in the proper functioning of the governance systems’ means the existence of a systemic weakness, taking into account its recurrence, gravity and compromising effect on the correct declaration of expenditure, the reporting on performance, or the respect of Union law;

(e) ‘output indicator’ means an output indicator as referred to in Article 7(1), point (a), of Regulation (EU) 2021/2115;

(f) ‘result indicator’ means a result indicator as referred to in Article 7(1), point (b), of Regulation (EU) 2021/2115;

(g) ‘action plan’ means, for the purposes of Articles 41 and 42 of this Regulation, a plan established by a Member State, on the request of, and in consultation with, the Commission, in the event that serious deficiencies in the proper functioning of the governance systems of that Member State are identified or in the circumstances referred to in Article 135 of Regulation (EU) 2021/2115, containing the necessary remedial actions and the relevant timeframe for its implementation in accordance with Articles 41 and 42 of this Regulation.

Article 3

Exemptions in cases of force majeure and exceptional circumstances

1. For the purposes of the financing, management and monitoring of the CAP, force majeure and exceptional circumstances may, in particular, be recognised in the following cases: (a) a severe natural disaster or severe meteorological event gravely affecting the holding; (b) the accidental destruction of livestock buildings on the holding; (c) an epizootic, a plant disease outbreak or the presence of a plant pest affecting part or all of the beneficiary’s livestock or crops; (d) expropriation of all or a large part of the holding if that expropriation could not have been anticipated on the day of lodging the application; (e) the death of the beneficiary; (f) long-term professional incapacity of the beneficiary.

2. Where a severe natural disaster or severe meteorological event as referred to in paragraph 1, point (a), gravely affects a well-determined area, the Member State concerned may consider that whole area to be gravely affected by that disaster or event.







TITLE II

GENERAL PROVISIONS ON AGRICULTURAL FUNDS







CHAPTER I

Agricultural funds

Article 4

Funds financing agricultural expenditure

The financing of the various interventions and measures falling under the CAP from the general budget of the Union (‘the Union budget’) shall be made by:

(a) the European Agricultural Guarantee Fund (EAGF);

(b) the European Agricultural Fund for Rural Development (EAFRD).

Article 5

EAGF expenditure

1. The EAGF shall be implemented either under shared management between the Member States and the Union in accordance with paragraph 2, or under direct management in accordance with paragraph 3.

2. The EAGF shall finance the following expenditure under shared management: (a) measures regulating or supporting agricultural markets laid down in Regulation (EU) No 1308/2013 of the European Parliament and of the Council ( 2 ); (b) the Union’s financial contribution to interventions in certain sectors as referred to in Title III, Chapter III, of Regulation (EU) 2021/2115; (c) interventions in the form of direct payments to farmers under the CAP Strategic Plan referred to under Article 16 of Regulation (EU) 2021/2115; (d) the Union’s financial contribution to information and promotion measures for agricultural products on the internal market of the Union and in third countries which are undertaken by Member States and which are selected by the Commission; (e) the Union’s financial contribution to the specific measures for agriculture in the outermost regions of the Union laid down in Regulation (EU) No 228/2013 and to the specific measures for agriculture in favour of the smaller Aegean islands laid down in Regulation (EU) No 229/2013.

3. The EAGF shall finance the following expenditure under direct management: (a) the promotion of agricultural products either directly by the Commission or through international organisations; (b) measures taken in accordance with Union law to ensure the conservation, characterisation, collection and utilisation of genetic resources in agriculture; (c) the establishment and maintenance of agricultural accounting information systems; (d) agricultural survey systems, including surveys on the structure of agricultural holdings.

Article 6

EAFRD expenditure

The EAFRD shall be implemented under shared management between the Member States and the Union. It shall finance the Union’s financial contribution to the interventions for rural development referred to in Title III, Chapter IV, of Regulation (EU) 2021/2115 as specified in the CAP Strategic Plans and to actions referred to in Article 125 of that Regulation.

Article 7

Other expenditure, including technical assistance

The EAGF and EAFRD may, either on the initiative of the Commission or on its behalf, each directly finance the preparatory, monitoring, administrative and technical support activities, and the evaluation, audit and inspection, required to implement the CAP. That includes, in particular:

(a) measures required for the analysis, management, monitoring, information exchange and implementation of the CAP, including assessing its impacts, environmental performance and progress towards Union targets, as well as measures relating to the implementation of control systems and technical and administrative assistance;

(b) the acquisition by the Commission of satellite data required for the area monitoring system in accordance with Article 24;

(c) the actions taken by the Commission through remote-sensing applications used for the monitoring of agricultural resources in accordance with Article 25;

(d) measures required to maintain and develop methods and technical means for information, interconnection, monitoring and control of the financial management of the funds used to finance the CAP;

(e) the provision of information on the CAP in accordance with Article 46;

(f) studies on the CAP and evaluations of measures financed by the EAGF and EAFRD, including the improvement of evaluation methods and the exchange of information on best practices under the CAP and consultations with the relevant stakeholders, as well as studies carried out with the European Investment Bank (EIB);

(g) where relevant, contribution to executive agencies that are set up in accordance with Council Regulation (EC) No 58/2003 ( 3 ) and act in connection with the CAP;

(h) contribution to measures which relate to the dissemination of information, raising awareness, promoting cooperation and exchanging experiences with the relevant stakeholders at Union level, and which are taken in the context of interventions for rural development, including the networking of the parties concerned;

(i) information technology networks focusing on information processing and exchange, including corporate information technology systems, needed in connection with the management of the CAP;

(j) measures required for the development, registration and protection of logos within the framework of the Union quality schemes in accordance with Article 44(2) of Regulation (EU) No 1151/2012 of the European Parliament and of the Council ( 4 ) and for the protection of intellectual property rights linked to it, and the necessary developments in information technology.







CHAPTER II

Governance bodies

Article 8

Competent authority

1. Each Member State shall designate a competent authority at ministerial level responsible for: (a) the issuing, reviewing and withdrawing of accreditation of paying agencies referred to in Article 9(2); (b) the designation and the issuing, reviewing and withdrawing of the accreditation of the coordinating body referred to in Article 10; (c) designating and withdrawing the designation of a certification body as referred to in Article 12, and ensuring that there is always a certification body designated; (d) carrying out the tasks assigned to the competent authority under this Chapter.

2. On the basis of an examination of the minimum conditions to be adopted by the Commission in accordance with Article 11(1), point (a), the competent authority shall, by way of a formal act, decide on the issuing or, following a review, the withdrawal of the accreditation of the paying agency and on the designation and accreditation and the withdrawal of the accreditation of the coordinating body.

3. The competent authority shall, by way of a formal act, decide on the designation, and the withdrawal of the designation, of the certification body, while ensuring that there is always a certification body designated.

4. The competent authority shall inform the Commission without delay of all accreditations and withdrawals of accreditation of the paying agency and of the designation and accreditation and withdrawal of accreditation of the coordinating body, as well as of the designation, and the withdrawal of the designation, of the certification body.

Article 9

Paying agencies

1. Paying agencies shall be departments or bodies of the Member States and, where applicable, of their regions responsible for the management and control of expenditure referred to in Article 5(2) and Article 6.

With the exception of making payment, paying agencies may delegate performance of the tasks referred to in the first subparagraph.

2. Member States shall accredit, as paying agencies, departments or bodies which have an administrative organisation and a system of internal control which provide sufficient guarantees that payments are legal, regular and properly accounted for. To that end, paying agencies shall comply with minimum conditions for the accreditation with regard to the internal environment, control activities, information and communication and monitoring laid down by the Commission pursuant to Article 11(1), point (a).

Each Member State shall, taking into account its constitutional provisions, restrict the number of its accredited paying agencies:

(a) to a single paying agency at national level or, where applicable, one per region; and

(b) to a single paying agency for the management of both EAGF and EAFRD expenditure where paying agencies exist only at national level.

Where paying agencies are established at regional level, Member States shall, in addition, either accredit a paying agency at national level for aid schemes which, by their nature, have to be managed at national level, or confer the management of those schemes on their regional paying agencies.

By way of derogation from the second subparagraph of this paragraph, Member States may maintain the paying agencies which have been accredited before 15 October 2020, provided that the competent authority, by means of the decision referred to in Article 8(2), confirms that they comply with the minimum conditions for accreditation referred to in the first subparagraph of this paragraph.

Paying agencies which have not managed EAGF or EAFRD expenditure for at least three years shall have their accreditation withdrawn.

Member States shall not accredit any new additional paying agency after 7 December 2021, except for cases referred to in the second subparagraph, point (a), where, taking into account the constitutional provisions, additional regional paying agencies may be necessary.

3. For the purposes of Article 63(5) and (6) of the Financial Regulation, the person in charge of the accredited paying agency shall, by 15 February of the year following the agricultural financial year (‘financial year’) concerned, draw up and provide the Commission with the following: (a) the annual accounts on the expenditure incurred in the execution of the tasks entrusted to that accredited paying agency, as provided for in Article 63(5), point (a), of the Financial Regulation, accompanied by the requisite information for the clearance in accordance with Article 53 of this Regulation; (b) the annual performance report referred to in Article 54(1) of this Regulation and Article 134 of Regulation (EU) 2021/2115 showing that the expenditure was effected in accordance with Article 37 of this Regulation; (c) an annual summary of the final audit reports and of controls carried out, an analysis of the nature and extent of errors and weaknesses identified in governance systems, as well as corrective action taken or planned, as provided for in Article 63(5), point (b), of the Financial Regulation; (d) a management declaration as provided for in Article 63(6) of the Financial Regulation as to: (i) the fact that the information is properly presented, complete and accurate, as provided for in Article 63(6), point (a), of the Financial Regulation, (ii) the proper functioning of the governance systems put in place, with the exception of the competent authority referred to in Article 8, the coordinating body referred to in Article 10 and the certification body referred to in Article 12 of this Regulation, ensuring that the expenditure was effected in accordance with Article 37 of this Regulation, as provided for in Article 63(6), points (b) and (c), of the Financial Regulation.

The deadline of 15 February referred to in the first subparagraph of this paragraph may be extended on an exceptional basis by the Commission to 1 March, upon communication by the Member State concerned, as provided for in Article 63(7), second subparagraph, of the Financial Regulation.

4. Where an accredited paying agency does not meet or no longer meets one or more of the minimum conditions for accreditation referred to in paragraph 2, first subparagraph, the Member State concerned, acting on its own initiative or at the request of the Commission, shall withdraw the accreditation of that paying agency unless the paying agency makes the necessary changes within a period to be determined by the competent authority of that Member State depending on the severity of the problem.

5. The paying agencies shall manage, and ensure the control of, the operations linked to public intervention for which they are responsible and they shall retain overall responsibility in that field.

Where support is provided through a financial instrument which is implemented by the EIB or another international financial institution in which a Member State is a shareholder, the paying agency shall rely on a control report supporting the payment applications submitted. Those institutions shall provide the Member States with the control report.

6. For the purposes of Article 33, for EAFRD expenditure, an additional performance report shall be provided, by 30 June 2030, in accordance with paragraph 3 of this Article and with Article 10(3), covering the period until 31 December 2029.

Article 10

Coordinating bodies

1. Where more than one paying agency is accredited in a Member State, that Member State shall designate a public coordinating body, to which it shall assign the following tasks: (a) to collect the information to be provided to the Commission and to send that information to the Commission; (b) to supply to the Commission the annual performance report referred to in Article 54(1) of this Regulation and Article 134 of Regulation (EU) 2021/2115; (c) to take or coordinate actions with a view to resolving any deficiencies of a common nature and to inform the Commission of any follow-up; (d) to promote and, where possible, ensure the harmonised application of Union rules.

2. As regards the processing of the information of a financial nature referred to in paragraph 1, point (a), the coordinating body shall be subject to specific accreditation by the Member State.

3. The annual performance report referred to in paragraph 1, point (b), of this Article shall be covered by the scope of the opinion referred to in Article 12(2) and it shall be submitted to the Commission together with a management declaration covering the compilation of the entire report.

Article 11

Commission powers relating to paying agencies and coordinating bodies

1. The Commission is empowered to adopt delegated acts in accordance with Article 102 to ensure the sound operation of the paying agencies and coordinating bodies provided for in Articles 9 and 10, supplementing this Regulation with rules on: (a) the minimum conditions for the accreditation of the paying agencies referred to in Article 9(2), first subparagraph, and for the designation and accreditation of the coordinating bodies referred to in Article 10; (b) the obligations of the paying agencies as regards public intervention, as well as the rules on the content of their management and control responsibilities.

2. The Commission shall adopt implementing acts laying down rules on: (a) the procedures for issuing, withdrawing and reviewing accreditation of paying agencies and for designation and issuing, withdrawing and reviewing accreditation of coordinating bodies, as well as the procedures for the supervision of the accreditation of paying agencies; (b) the arrangements and procedures for the checks underlying the management declaration of the paying agencies referred to in Article 9(3), first subparagraph, point (d), as well as its structure and format; (c) the functioning of the coordinating body and the submission of information to the Commission in accordance with Article 10.

Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 12

Certification bodies

1. The certification body shall be a public or private audit body designated by the Member State for a period of at least three years, without prejudice to national law. Where it is a private audit body and where the applicable Union or national law so requires, it shall be selected by the Member State by means of a public tendering procedure.

A Member State that designates more than one certification body may appoint a public certification body at national level to be responsible for coordination.

2. For the purposes of Article 63(7), first subparagraph, of the Financial Regulation, the certification body shall issue an opinion, drawn up in accordance with internationally accepted audit standards, which shall establish whether: (a) the accounts give a true and fair view; (b) the Member States’ governance systems put in place function properly, in particular: (i) the governance bodies referred to in Articles 9 and 10 of this Regulation and Article 123 of Regulation (EU) 2021/2115, (ii) the basic Union requirements, (iii) the reporting system put in place for the purposes of the annual performance report referred to in Article 134 of Regulation (EU) 2021/2115; (c) the performance reporting on output indicators for the purposes of the annual performance clearance referred to in Article 54 of this Regulation and the performance reporting on result indicators for the multiannual performance monitoring referred to in Article 128 of Regulation (EU) 2021/2115, demonstrating that Article 37 of this Regulation is complied with, is correct; (d) the expenditure for the measures laid down in Regulations (EU) No 228/2013, (EU) No 229/2013 and (EU) No 1308/2013 and in Regulation (EU) No 1144/2014 of the European Parliament and of the Council ( 5 ) for which reimbursement has been requested from the Commission is legal and regular.

That opinion shall also state whether the examination calls into question the assertions made in the management declaration referred to in Article 9(3), first subparagraph, point (d). The examination shall also cover the analysis of the nature and extent of errors and weaknesses identified in governance systems by audit and controls, as well as corrective action taken or planned by the paying agency, referred to in Article 9(3), first subparagraph, point (c).

Where support is provided through a financial instrument which is implemented by the EIB or another international financial institution in which a Member State is a shareholder, the certification body shall rely on the annual audit report drawn up by the external auditors of those institutions. Those institutions shall provide the Member States with the annual audit report.

3. The certification body shall have the necessary technical expertise, as well as knowledge of the CAP. It shall be operationally independent from the paying agency and the coordinating body concerned as well as from the competent authority which has accredited that paying agency and the bodies responsible for the implementation and the monitoring of the CAP.

4. The Commission shall adopt implementing acts laying down rules on the functioning of the certification bodies, including the checks to be carried out and the bodies subject to those checks, and on the certificates and the reports, together with the documents accompanying them, to be drawn up by those bodies.

The implementing acts shall also set out:

(a) the audit principles on which the opinions of the certification bodies are based, including an assessment of the risks, internal controls and the level of audit evidence required;

(b) the audit methods to be used by the certification bodies, having regard to international standards on auditing, to deliver their opinions.

Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 13

Exchange of best practices

The Commission shall promote the exchange of best practices between the Member States, in particular as regards the work of the governance bodies under this Chapter.







TITLE III

FINANCIAL MANAGEMENT OF THE EAGF AND EAFRD







CHAPTER I

EAGF







Section 1

Budgetary discipline

Article 14

Budget ceiling

1. The annual ceiling for EAGF expenditure shall be constituted by the maximum amounts set for it under Regulation (EU, Euratom) 2020/2093.

2. Where Union law provides for sums to be deducted from, or added to, the amounts referred to in paragraph 1, the Commission shall adopt implementing acts without applying the procedure referred to in Article 103 setting the net balance available for EAGF expenditure on the basis of the data referred to in Union law.

Article 15

Compliance with the ceiling

1. Where Union law provides for a financial ceiling in euros for agricultural expenditure in respect of a Member State, such expenditure shall be reimbursed subject to that ceiling, and, where Articles 39 to 42 apply, with any necessary adjustments.

2. Member States’ allocations for interventions in the form of direct payments referred to in Article 87 of Regulation (EU) 2021/2115, corrected by the adjustments laid down in Article 17 of this Regulation, are financial ceilings in euros for the purposes of paragraph 1 of this Article.

Article 16

Agricultural reserve

1. A Union agricultural reserve (‘the reserve’) shall be established at the beginning of each year in the EAGF to provide additional support for the agricultural sector for the purpose of market management or stabilisation and to respond promptly in the case of crises affecting the agricultural production or distribution.

The appropriations for the reserve shall be entered directly in the Union budget. Funds from the reserve shall be made available, in the financial year or years for which additional support is required, for the following measures:

(a) measures to stabilise agricultural markets under Articles 8 to 21 of Regulation (EU) No 1308/2013;

(b) exceptional measures under Articles 219, 220 and 221 of Regulation (EU) No 1308/2013.

2. The amount of the reserve shall be EUR 450 million in current prices at the beginning of each year of the period 2023-2027, unless a higher amount is set in the Union budget. The Commission may adjust the amount of the reserve during the year, when appropriate, in view of market developments or perspectives in the current or following year and taking into account available appropriations under the EAGF sub-ceiling.

If those available appropriations are not sufficient, financial discipline may be used in accordance with Article 17 of this Regulation, as a last resort, to fund the reserve up to the initial amount referred to in the first subparagraph of this paragraph.

By way of derogation from Article 12(2), third subparagraph, of the Financial Regulation, non-committed appropriations of the reserve shall be carried over to finance the reserve in the following budgetary years until the year 2027.

Moreover, by derogation from Article 12(2), third subparagraph, of the Financial Regulation, the total unused amount of the reserve for crises in the agricultural sector, established by Regulation (EU) No 1306/2013, available at the end of the year 2022 shall be carried over to the year 2023 without being fully returned to the budgetary lines which cover the actions referred to in Article 5(2), point (c), of this Regulation and made available to the extent necessary for the financing of the reserve established by this Article after taking into account appropriations available under the EAGF sub-ceiling. Any appropriations of the reserve for crises in the agricultural sector that remain available after financing the reserve established by this Article shall be returned to the budgetary lines which cover the actions referred to in Article 5(2), point (c), of this Regulation.

Article 17

Financial discipline

1. An adjustment rate for interventions in the form of direct payments referred to in Article 5(2), point (c), of this Regulation and for the Union financial contribution to direct payments under Chapter IV of Regulation (EU) No 228/2013 and Chapter IV of Regulation (EU) No 229/2013 for the specific measures referred to in Article 5(2), point (e), of this Regulation (‘the adjustment rate’) shall be determined by the Commission where the forecasts for the financing of the interventions and measures financed under the corresponding sub-ceiling for a given budgetary year indicate that the applicable annual ceilings will be exceeded.

The adjustment rate shall apply to payments to be granted to farmers for the interventions and specific measures referred to in the first subparagraph of this paragraph exceeding EUR 2 000 for the corresponding calendar year. For the purposes of this subparagraph, Article 17(4) of Regulation (EU) 2021/2115 shall apply mutatis mutandis.

The Commission shall, by 30 June of the calendar year in respect of which the adjustment rate applies, adopt implementing acts fixing the adjustment rate. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

2. Until 1 December of the calendar year in respect of which the adjustment rate applies, the Commission may, on the basis of new information, adopt implementing acts adapting the adjustment rate set in accordance with paragraph 1 of this Article. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

3. Where financial discipline has been applied, the appropriations carried over in accordance with Article 12(2), point (d), of the Financial Regulation shall be used to finance expenditure under Article 5(2), point (c), of this Regulation, to the extent necessary to avoid the repeated application of financial discipline.

Where appropriations to be carried over in accordance with the first subparagraph remain available and the overall amount of non-committed appropriations available for reimbursement represents at least 0,2 % of the annual ceiling for EAGF expenditure, the Commission may adopt implementing acts setting out per Member State the amounts of non-committed appropriations to be reimbursed to final beneficiaries. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

4. The amounts set by the Commission in accordance with paragraph 3, second subparagraph, shall be reimbursed to final beneficiaries by Member States in accordance with objective and non-discriminatory criteria. Member States may apply a minimum threshold of amounts of reimbursement per final beneficiary. That reimbursement shall apply only to final beneficiaries in those Member States where financial discipline applied in the preceding financial year.

5. The Commission is empowered to adopt delegated acts in accordance with Article 102 which are necessary in order to ensure the coherent application of the financial discipline in the Member States, supplementing this Regulation with rules for calculating the financial discipline to be applied by Member States to farmers.

Article 18

Budgetary discipline procedure

1. Where, upon drawing up the draft budget for budgetary year N, there appears to be a risk that the amount referred to in Article 14 of this Regulation for budgetary year N will be exceeded, the Commission shall propose the measures necessary to ensure compliance with that amount. Those measures are to be adopted by the European Parliament and the Council where the legal basis of the relevant measure is Article 43(2) TFEU or by the Council where the legal basis of the relevant measure is Article 43(3) TFEU.

2. If at any time the Commission considers that there is a risk that the amount referred to in Article 14 of this Regulation will be exceeded and that it cannot take adequate measures to remedy the situation, it shall propose other measures to ensure compliance with that amount. Those measures are to be adopted by the European Parliament and the Council where the legal basis of the relevant measure is Article 43(2) TFEU or by the Council where the legal basis of the relevant measure is Article 43(3) TFEU.

3. Where, at the end of budgetary year N, reimbursement requests from the Member States exceed or are likely to exceed the amount referred to in Article 14, the Commission shall: (a) consider the requests submitted by Member States pro rata subject to the budget available, and adopt implementing acts setting provisionally the amount of the payments for the month concerned; (b) determine for all Member States, on or before 28 February of budgetary year N + 1, their situation with regard to Union financing for the budgetary year N; (c) adopt implementing acts setting the total amount of Union financing broken down by Member State, on the basis of a single rate of Union financing, subject to the amount which was available for the monthly payments; (d) effect, at the latest when the monthly payments are made for March of budgetary year N + 1, any compensation to be carried out with respect to Member States.

The implementing acts provided for in the first subparagraph, points (a) and (c), of this paragraph shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

Article 19

Early-warning and monitoring system

In order to ensure that the budget ceiling referred to in Article 14 is not exceeded, the Commission shall implement a monthly early-warning and monitoring system in respect of EAGF expenditure.

To that end, at the beginning of each budgetary year, the Commission shall determine monthly expenditure profiles based, where appropriate, on average monthly expenditure during the previous three years.

The Commission shall periodically submit a report to the European Parliament and to the Council in which the development of expenditure effected in relation to the profiles is examined and which contains an assessment of the forecasted implementation for the current budgetary year.







Section 2

Financing of expenditure

Article 20

Monthly payments

1. The appropriations necessary to finance the expenditure referred to in Article 5(2) shall be made available to Member States by the Commission in the form of monthly payments on the basis of the expenditure effected by the accredited paying agencies during a reference period.

2. Until the Commission transfers the monthly payments, the resources required to effect expenditure shall be mobilised by the Member States according to the needs of their accredited paying agencies.

Article 21

Procedure for monthly payments

1. Without prejudice to Articles 53, 54 and 55, monthly payments shall be made by the Commission for expenditure effected by accredited paying agencies during the reference month.

2. Monthly payments shall be made to each Member State on or before the third working day of the second month following that in which the expenditure is effected, taking account of the reductions or suspensions applied under Articles 39 to 42 or any other corrections. Expenditure effected by Member States between 1 and 15 October shall count as having been made in the month of October. Expenditure effected between 16 and 31 October shall count as having been made in the month of November.

3. The Commission shall adopt implementing acts determining the monthly payments which it makes on the basis of a declaration of expenditure from the Member States and the information supplied in accordance with Article 90(1). Those implementing acts shall be adopted without applying the procedure referred to in Article 103.

4. The Commission may adopt implementing acts determining supplementary payments or deductions adjusting the payments made in accordance with paragraph 3. Those implementing acts shall be adopted without applying the procedure referred to in Article 103.

5. The Commission shall inform the Member State forthwith of any overrun of financial ceilings by the Member State.

Article 22

Administrative and personnel costs

Expenditure relating to administrative and personnel costs effected by Member States and by beneficiaries of aid from the EAGF shall not be borne by the EAGF.

Article 23

Public intervention expenditure

1. Where, within the framework of the common organisation of the markets, a sum per unit is not determined in respect of a public intervention, the EAGF shall finance the measure concerned on the basis of uniform standard amounts, in particular as regards funds originating in the Member States used for buying in products, for material operations arising from storage and, where appropriate, for the processing of the products eligible for public intervention referred to in Article 11 of Regulation (EU) No 1308/2013.

2. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with rules on: (a) the type of measures eligible for Union financing and the reimbursement conditions; (b) the eligibility conditions and calculation methods based on the information actually observed by the paying agencies, on flat rates determined by the Commission, or on flat-rate or non-flat-rate amounts provided for by the agricultural legislation in specific sectors; (c) the valuation of operations in connection with public intervention, the measures to be taken in the case of loss or deterioration of products under the public intervention, and the determination of the amounts to be financed.

3. The Commission shall adopt implementing acts fixing the amounts referred to in paragraph 1. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

Article 24

Acquisition of satellite data

The list of satellite data required for the area monitoring system referred to in Article 66(1), point (c), shall be agreed by the Commission and the Member States in accordance with the specification prepared by each Member State.

In accordance with Article 7, point (b), the Commission shall supply that satellite data free of charge to the authorities competent for the area monitoring system or to suppliers of services authorised by those authorities to represent them.

The Commission shall remain the owner of the satellite data.

The Commission may entrust specialised bodies to carry out tasks relating to techniques or working methods in connection with the area monitoring system referred to in Article 66(1), point (c).

Article 25

Monitoring of agricultural resources

1. The actions financed pursuant to Article 7, point (c), shall aim to give the Commission the means to: (a) manage Union agricultural markets in a global context; (b) ensure agri-economic and agri-environmental-climate monitoring of agricultural land use and agricultural land use change, including agro-forestry, and monitoring of the condition of soil, crops, agricultural landscapes and agricultural land so as to enable estimates to be made, in particular as regards yields and agricultural production and agricultural impacts associated with exceptional circumstances, and to enable the assessment of the resilience of agricultural systems and progress towards the achievement of the relevant United Nations Sustainable Development Goals; (c) share the access to the estimates referred to in point (b) in an international context, such as the initiatives coordinated by United Nations organisations, including the constitution of greenhouse gas inventories under the United Nations Framework Convention on Climate Change, or other international agencies; (d) contribute to specific measures increasing the transparency of world markets, taking account of Union objectives and commitments; (e) ensure technological follow-up of the agri-meteorological system.

2. Pursuant to Article 7, point (c), the Commission shall finance the actions concerning: (a) the collection or purchase of data needed to implement and monitor the CAP, including satellite data, geo-spatial data and meteorological data; (b) the creation of a spatial data infrastructure and a website; (c) the carrying out of specific studies on climatic conditions; (d) remote sensing used to assist in the monitoring of agricultural land use change and soil health; and (e) the updating of agri-meteorological and econometric models.

Where necessary, those actions shall be carried out in collaboration with the European Environment Agency, the Joint Research Centre, national laboratories and bodies or with the involvement of the private sector.

Article 26

Implementing powers relating to Articles 24 and 25

The Commission may adopt implementing acts laying down:

(a) rules relating to the financing pursuant to Article 7, points (b) and (c);

(b) the procedure under which the measures referred to in Articles 24 and 25 are to be carried out in order to meet the objectives assigned;

(c) the framework governing the acquisition, enhancing and use of satellite data and meteorological data, and the applicable deadlines.

Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).







CHAPTER II

EAFRD







Section 1

General provisions concerning the EAFRD

Article 27

Provisions applying to all payments

1. Payments by the Commission of the EAFRD contribution referred to in Article 6 shall not exceed the budgetary commitments.

Without prejudice to Article 34(1), those payments shall be assigned to the earliest open budgetary commitment.

2. Article 110 of the Financial Regulation shall apply.







Section 2

EAFRD financing under the CAP Strategic Plan

Article 28

Financial contribution from the EAFRD

The financial contribution from the EAFRD towards expenditure under CAP Strategic Plans shall be determined for each CAP Strategic Plan within the ceilings established by Union law concerning support for CAP Strategic Plan interventions by the EAFRD.

Article 29

Budgetary commitments

1. The Commission’s implementing decision approving a CAP Strategic Plan shall constitute a financing decision within the meaning of Article 110(1) of the Financial Regulation and, once notified to the Member State concerned, a legal commitment within the meaning of that Regulation. That implementing decision shall specify the contribution per year.

2. The Union’s budgetary commitments in respect of each CAP Strategic Plan shall be made in annual instalments between 1 January 2023 and 31 December 2027. By way of derogation from Article 111(2) of the Financial Regulation, for each CAP Strategic Plan, the budgetary commitments for the first instalment shall be made after the Commission approves that CAP Strategic Plan and notifies the Member State concerned thereof. The budgetary commitments for subsequent instalments shall be made by the Commission before 1 May of each year, on the basis of the implementing decision referred to in paragraph 1 of this Article, except where Article 16 of the Financial Regulation applies.







Section 3

Financial contribution to interventions for rural development

Article 30

Provisions applying to payments for interventions for rural development

1. The appropriations necessary to finance the expenditure referred to in Article 6 shall be made available to Member States in the form of prefinancing, interim payments and the payment of a balance, as described in this Section.

2. The combined total of prefinancing and interim payments shall not exceed 95 % of the EAFRD’s contribution to each CAP Strategic Plan.

When the ceiling of 95 % is reached, the Member States shall continue transmitting requests for payments to the Commission.

Article 31

Prefinancing arrangements

1. Following its implementing decision approving the CAP Strategic Plan, the Commission shall pay an initial prefinancing amount to the Member State for the entire duration of the CAP Strategic Plan. This initial prefinancing amount shall be paid in instalments as follows: (a) in 2023: 1 % of the amount of support from the EAFRD for the entire duration of the CAP Strategic Plan; (b) in 2024: 1 % of the amount of support from the EAFRD for the entire duration of the CAP Strategic Plan; (c) in 2025: 1 % of the amount of support from the EAFRD for the entire duration of the CAP Strategic Plan.

If a CAP Strategic Plan is approved in 2024 or later, the instalments from previous years shall be paid without delay following such approval.

2. The total amount paid as prefinancing shall be reimbursed to the Commission if no expenditure is effected and no declaration of expenditure for the CAP Strategic Plan is sent within 24 months of the date on which the Commission pays the first instalment of the prefinancing amount. That prefinancing shall be offset against the earliest expenditure declared for the CAP Strategic Plan.

3. No additional prefinancing shall be paid or recovered where a transfer to or from the EAFRD has taken place in accordance with Article 103 of Regulation (EU) 2021/2115.

4. Interest generated on the prefinancing shall be used for the CAP Strategic Plan concerned and deducted from the amount of public expenditure indicated on the final declaration of expenditure.

5. The total prefinancing amount shall be cleared in accordance with the procedure referred to in Article 53 before the CAP Strategic Plan is closed.

Article 32

Interim payments

1. Interim payments shall be made for each CAP Strategic Plan. They shall be calculated by applying the contribution rate referred to in Article 91 of Regulation (EU) 2021/2115 to the public expenditure effected for each type of intervention, excluding payments made from the additional national financing referred to in Article 115(5) of that Regulation.

Interim payments shall also include the amounts referred to in Article 94(2) of Regulation (EU) 2021/2115.

2. Subject to the availability of resources, the Commission shall, taking account of reductions or suspensions applied under Articles 39 to 42, make interim payments in order to reimburse the expenditure effected by accredited paying agencies in implementing the CAP Strategic Plans.

3. Where financial instruments are implemented in accordance with Article 59(1) of Regulation (EU) 2021/1060, the declaration of expenditure shall include the total amounts disbursed or, in the case of guarantees, set aside for guarantee contracts by the managing authority to, or for the benefit of, final recipients as referred to in Article 80(5), first subparagraph, points (a), (b) and (c) of Regulation (EU) 2021/2115.

4. Where financial instruments are implemented in accordance with Article 59(2) of Regulation (EU) 2021/1060, the declaration of expenditure that includes expenditure for financial instruments shall be submitted in accordance with the following conditions: (a) the amount included in the first declaration of expenditure shall have been previously paid to the financial instrument and may be up to 30 % of the total amount of the eligible public expenditure committed to the financial instruments under the relevant funding agreement; (b) the amount included in subsequent declarations of expenditure submitted during the eligibility period defined in Article 86(4) of Regulation (EU) 2021/2115 shall include the eligible expenditure referred to in Article 80(5) of that Regulation.

5. Amounts paid in accordance with paragraph 4, point (a), of this Article shall be considered to be advances for the purposes of Article 37(2). The amount included in the first declaration of expenditure, referred to in paragraph 4, point (a), of this Article, shall be cleared from Commission accounts no later than in the annual accounts for the last implementation year for the relevant CAP Strategic Plan.

6. Each interim payment shall be made by the Commission, subject to compliance with the following requirements: (a) transmission to the Commission of a declaration of expenditure signed by the accredited paying agency, in accordance with Article 90(1), point (c); (b) no overrun of the total EAFRD contribution to each type of intervention for the entire period covered by the CAP Strategic Plan concerned; (c) transmission to the Commission of the documents to be submitted in accordance with Article 9(3) and Article 12(2).

7. If any of the requirements laid down in paragraph 6 is not met, the Commission shall forthwith inform the accredited paying agency, or the coordinating body where one has been designated. If any of the requirements laid down in paragraph 6, point (a) or point (c), is not fulfilled, the declaration of expenditure shall be deemed inadmissible.

8. Without prejudice to Articles 53, 54 and 55, the Commission shall make interim payments within 45 days of registering a declaration of expenditure which meets the requirements laid down in paragraph 6 of this Article.

9. Accredited paying agencies shall establish interim declarations of expenditure relating to CAP Strategic Plans and send these to the Commission, either directly or via the coordinating body, where one has been designated, within periods to be set by the Commission. The Commission shall adopt implementing acts laying down those periods. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Declarations of expenditure shall cover expenditure that the paying agencies have effected during each of the periods concerned. They shall also cover the amounts referred to in Article 94(2) of Regulation (EU) 2021/2115. However, if expenditure referred to in Article 86(3) of that Regulation cannot be declared to the Commission in the period concerned due to the pending approval by the Commission of an amendment to the CAP Strategic Plan in accordance with Article 119(10) of that Regulation, that expenditure may be declared in subsequent periods.

Interim declarations of expenditure in respect of expenditure effected from 16 October onwards shall be booked to the following year’s budget.

10. Where the authorising officer by sub-delegation requires further verification owing to incomplete or unclear information provided or arising from disagreement, differences of interpretation or any other inconsistency relating to a declaration of expenditure for a reference period, arising in particular from a failure to communicate the information required under Regulation (EU) 2021/2115 and Commission acts adopted pursuant to that Regulation, the Member State concerned shall, upon request by the authorising officer by sub-delegation, provide additional information within a period set in that request according to the seriousness of the problem.

The time limit for interim payments laid down in paragraph 8 may be interrupted, for all or part of the amount for which payment is claimed, for a maximum period of six months from the date on which the request for information is sent until receipt of the information requested which is deemed satisfactory. The Member State may agree to extend the interruption period for a further period of three months.

Where the Member State concerned fails to respond to the request for additional information within the period set in that request or where the response is considered unsatisfactory or indicates that the applicable rules have not been complied with or that Union funds have been improperly used, the Commission may suspend or reduce payments in accordance with Articles 39 to 42.

Article 33

Payment of the balance and closure of the interventions for rural development in the CAP Strategic Plan

1. After receiving the last annual performance report on the implementation of a CAP Strategic Plan, the Commission shall pay the balance, subject to the availability of resources, on the basis of the financial plan in force at the level of the types of EAFRD intervention, of the annual accounts for the last implementation year for the relevant CAP Strategic Plan and of the corresponding clearance decisions. Those accounts shall be presented to the Commission no later than six months after the final eligibility date of expenditure provided for in Article 86(4) of Regulation (EU) 2021/2115 and shall cover the expenditure effected by the paying agency up to the last eligibility date of expenditure.

2. The balance shall be paid no later than six months from the date on which the information and documents referred to in paragraph 1 of this Article are considered to be admissible by the Commission and the last set of annual accounts has been cleared. Without prejudice to Article 34(5), the amounts still committed after the balance is paid shall be decommitted by the Commission within a period of six months.

3. If, by the time limit set out in paragraph 1 of this Article, the Commission has not received the last annual performance report and the documents needed for clearance of the annual accounts for the last implementation year of the CAP Strategic Plan, the balance shall be automatically decommitted in accordance with Article 34.

Article 34

Automatic decommitment for CAP Strategic Plans

1. The Commission shall automatically decommit any portion of a budgetary commitment for interventions for rural development in a CAP Strategic Plan that has not been used for the purposes of prefinancing or for making interim payments or for which it has received no declaration of expenditure fulfilling the requirements laid down in Article 32(6), points (a) and (c), in relation to expenditure effected by 31 December of the second year following that of the budgetary commitment.

2. The part of budgetary commitments that is still open on the last eligibility date for expenditure as referred to in Article 86(4) of Regulation (EU) 2021/2115 for which no declaration of expenditure has been made within six months of that date shall be automatically decommitted.

3. In the event of legal proceedings or of an administrative appeal having suspensory effect, the period for automatic decommitment referred to in paragraph 1 or 2 shall, in respect of the amount relating to the operations concerned, be interrupted for the duration of those proceedings or that administrative appeal, provided that the Commission receives a reasoned notification from the Member State by 31 January of year N + 3.

4. The following shall be disregarded in calculating the automatic decommitment: (a) that part of the budgetary commitments for which a declaration of expenditure has been made but for which reimbursement has been reduced or suspended by the Commission on 31 December of year N + 2; (b) that part of the budgetary commitments which a paying agency has been unable to disburse for reasons of force majeure seriously affecting the implementation of the CAP Strategic Plan; national authorities claiming force majeure shall demonstrate the direct consequences on the implementation of all or part of the interventions for rural development in the CAP Strategic Plan.

By 31 January of each year, the Member State shall send to the Commission information on the exceptions referred to in the first subparagraph concerning the amounts declared by the end of the preceding year.

5. The Commission shall inform Member States in good time if there is a risk of automatic decommitment. It shall inform them of the amount involved as indicated by the information in its possession. The Member States shall have two months from the date upon which they receive that information to agree to the amount concerned or to submit comments. The Commission shall carry out the automatic decommitment not later than nine months after the expiry of the last time-limit referred to in paragraphs 1, 2 and 3.

6. In the event of automatic decommitment, the EAFRD contribution to the CAP Strategic Plan concerned shall be reduced, for the year in question, by the amount automatically decommitted. The Member State concerned shall produce a revised financing plan splitting the reduction of the aid among the types of intervention for approval by the Commission. If it does not do so, the Commission shall reduce the amounts allocated to each type of intervention pro rata.







CHAPTER III

Common provisions

Article 35

Agricultural financial year

Without prejudice to special provisions on declarations of expenditure and revenue relating to public intervention laid down by the Commission pursuant to Article 47(2), first subparagraph, point (a), the financial year shall cover expenditure paid and revenue received and entered in the accounts of the EAGF and EAFRD by the paying agencies in respect of financial year N beginning on 16 October of year N – 1 and ending on 15 October of year N.

Article 36

No double funding

Member States shall ensure that expenditure financed under the EAGF or the EAFRD is not the subject of any other financing from the Union budget.

Under the EAFRD, an operation may receive different forms of support from the CAP Strategic Plan and from the other funds referred to in Article 1(1) of Regulation (EU) 2021/1060 or from other Union instruments only if the total cumulated aid amount granted under the different forms of support does not exceed the highest aid intensity or aid amount applicable to that type of intervention as referred to in Title III of Regulation (EU) 2021/2115. In such cases Member States shall not declare the same expenditure to the Commission for support:

(a) from another fund referred to in Article 1(1) of Regulation (EU) 2021/1060 or from another Union instrument; or

(b) from the same CAP Strategic Plan.

The amount of expenditure to be entered into a declaration of expenditure may be calculated on a pro rata basis, in accordance with the document setting out the conditions for support.

Article 37

Eligibility of expenditure effected by the paying agencies

1. The expenditure referred to in Article 5(2) and Article 6 may be financed by the Union only if it has been effected by accredited paying agencies and if: (a) it has been effected in accordance with the applicable Union rules; or (b) as regards types of intervention referred to in Regulation (EU) 2021/2115: (i) it is matched by a corresponding reported output; and (ii) it has been effected in accordance with the applicable governance systems, not extending to the eligibility conditions for individual beneficiaries laid down in the relevant CAP Strategic Plan.

2. Paragraph 1, point (b)(i), shall not apply to advances paid to beneficiaries under types of intervention referred to in Regulation (EU) 2021/2115.

Article 38

Compliance with payment deadlines

1. Where payment deadlines are laid down by Union law, any payment that a paying agency makes to a beneficiary before the earliest possible date of payment or after the latest possible date of payment shall be ineligible for Union financing.

2. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with rules on the circumstances and conditions in which the payments referred to in paragraph 1 of this Article may be deemed eligible, taking into account the principle of proportionality.

Article 39

Reduction of monthly and interim payments

1. Where the Commission establishes from declarations of expenditure or the information, declarations and documents referred to in Article 90 that financial ceilings set by Union law have been exceeded, the Commission shall reduce the monthly or interim payments to the Member State concerned in the framework of the implementing acts concerning the monthly payments referred to in Article 21(3) or in the framework of the interim payments referred to in Article 32.

2. Where the Commission establishes from declarations of expenditure or the information, declarations and documents referred to in Article 90 that the payment deadlines referred to in Article 38 have not been complied with, it shall inform the Member State concerned thereof and give it the opportunity to submit its comments within a period which shall not be less than 30 days. Where the Member State fails to submit its comments within that period or where the Commission has concluded that the response provided is manifestly insufficient, the Commission may reduce the monthly or interim payments to the Member State concerned in the framework of the implementing acts concerning the monthly payments referred to in Article 21(3) or in the framework of the interim payments referred to in Article 32.

3. Reductions under this Article shall be without prejudice to Article 53.

4. The Commission may adopt implementing acts laying down further rules on the procedure and other practical arrangements for the proper functioning of the mechanism provided for in Article 38. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 40

Suspension of payments in relation to the annual clearance

1. Where Member States do not submit the documents referred to in Article 9(3) and Article 12(2) by the deadlines provided for in Article 9(3), the Commission may adopt implementing acts suspending the total amount of the monthly payments referred to in Article 21(3). The Commission shall reimburse the suspended amounts when it receives the missing documents from the Member State concerned, provided that the date of receipt is not later than six months after the deadline concerned.

As regards the interim payments referred to in Article 32, declarations of expenditure shall be deemed inadmissible in accordance with paragraph 7 of that Article.

2. Where, in the framework of the annual performance clearance referred to in Article 54, the Commission establishes that the difference between the expenditure declared and the amount corresponding to the relevant reported output is more than 50 % and the Member State cannot provide duly justified reasons, the Commission may adopt implementing acts suspending the monthly payments referred to in Article 21(3) or the interim payments referred to in Article 32.

The suspension shall be applied to the relevant expenditure in respect of the interventions which have been subject to the reduction referred to in Article 54(2) and the amount to be suspended shall not exceed the percentage corresponding to the reduction applied in accordance with Article 54(2). The amounts suspended shall be reimbursed by the Commission to the Member States or permanently reduced at the latest by means of the implementing act referred to in Article 54 relating to the year for which the payments were suspended. However, if Member States demonstrate that the necessary corrective actions have been taken, the Commission may lift the suspension earlier in a separate implementing act.

3. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with rules on the rate of suspension of payments.

4. The implementing acts provided for in paragraphs 1 and 2 of this Article shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

Before adopting the implementing acts referred to in paragraph 1 and in paragraph 2, first subparagraph, of this Article, the Commission shall inform the Member State concerned of its intention and shall give the Member State the opportunity to submit its comments within a period which shall not be less than 30 days.

5. The implementing acts determining the monthly payments referred to in Article 21(3) or the interim payments referred to in Article 32 shall take account of the implementing acts adopted under this Article.

Article 41

Suspension of payments in relation to the multi-annual performance monitoring

1. Where, in accordance with Article 135(2) and (3) of Regulation (EU) 2021/2115, the Commission asks the Member State concerned to submit an action plan, that Member State shall establish such an action plan in consultation with the Commission. The action plan shall include the intended remedial actions and clear progress indicators together with the timeframe during which the progress has to be achieved. That timeframe may extend beyond one financial year.

The Member State concerned shall respond within a period of two months of the Commission’s request for an action plan.

Within a period of two months of receipt of the action plan from the Member State concerned, the Commission shall, where appropriate, inform that Member State in writing of its objections to the action plan submitted and request its modification. The Member State concerned shall comply with the action plan, as accepted by the Commission, and comply with the expected timeframe for its execution.

The Commission shall adopt implementing acts laying down further rules on the structure of the action plans and the procedure for setting up the action plans. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

2. If the Member State fails to submit or to implement the action plan referred to in paragraph 1 of this Article, or if that action plan is manifestly insufficient to remedy the situation, or if it has not been modified in accordance with the written request of the Commission referred to in that paragraph, the Commission may adopt implementing acts suspending the monthly payments referred to in Article 21(3) or the interim payments referred to in Article 32.

By way of derogation from the first subparagraph of this paragraph, the request for an action plan by the Commission for the financial year 2025 shall not lead to a suspension of payments before the performance review for the financial year 2026, as provided for in Article 135(3) of Regulation (EU) 2021/2115.

The suspension of payments referred to in the first subparagraph shall be applied in accordance with the principle of proportionality to the relevant expenditure related to the interventions which were to be covered by that action plan.

The Commission shall reimburse the suspended amounts when, on the basis of the performance review referred to in Article 135 of Regulation (EU) 2021/2115 or on the basis of the voluntary notification made during the financial year by the Member State concerned on the advancement of the action plan and of the corrective action taken to remedy the shortfall, satisfactory progress towards targets is achieved.

If the situation is not remedied by the end of the 12th month following the suspension of payments, the Commission may adopt an implementing act definitively reducing the amount suspended for the Member State concerned.

The implementing acts provided for in this paragraph shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

Before adopting such implementing acts, the Commission shall inform the Member State concerned of its intention and shall ask it to respond within a period which shall not be less than 30 days.

3. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with rules on the rate and duration of suspension of payments and the condition for reimbursing or reducing those amounts with regard to the multi-annual performance monitoring.

Article 42

Suspension of payments in relation to deficiencies in the governance systems

1. In the event of serious deficiencies in the proper functioning of the governance systems, the Commission shall, where necessary, ask the Member State concerned to submit an action plan including the necessary remedial actions and clear progress indicators. That action plan shall be established in consultation with the Commission. The Member State concerned shall respond within a period of two months of the Commission’s request in order to assess the need for an action plan.

The Commission shall adopt implementing acts laying down rules on the structure of the action plans and the procedure for setting up the action plans. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

2. If the Member State fails to submit or to implement the action plan referred to in paragraph 1 of this Article, or if that action plan is manifestly insufficient to remedy the situation, or if it has not been implemented in accordance with the written request of the Commission referred to in that paragraph, the Commission may adopt implementing acts suspending the monthly payments referred to in Article 21(3) or the interim payments referred to in Article 32.

The suspension shall be applied in accordance with the principle of proportionality to the relevant expenditure effected by the Member State where the deficiencies exist, for a period to be determined in the implementing acts referred to in the first subparagraph of this paragraph which shall not exceed 12 months. If the conditions for the suspension continue to be met, the Commission may adopt implementing acts prolonging that period for further periods not exceeding 12 months in total. The amounts suspended shall be taken into account when adopting the implementing acts referred to in Article 55.

3. The implementing acts provided for in paragraph 2 shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

Before adopting such implementing acts, the Commission shall inform the Member State concerned of its intention and shall ask it to respond within a period which shall not be less than 30 days.

4. The implementing acts determining the monthly payments referred to in Article 21(3) or the interim payments referred to in Article 32 shall take into account implementing acts adopted under paragraph 2 of this Article.

Article 43

Keeping separate accounts

1. Each paying agency shall keep a set of separate accounts for the appropriations entered in the Union budget for the EAGF and EAFRD.

2. The Commission may adopt implementing acts laying down further rules on the obligation laid down in this Article and the specific conditions applying to the information to be booked in the accounts kept by the paying agencies. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 44

Payment to beneficiaries

1. Except where otherwise explicitly provided for in Union law, Member States shall ensure that payments relating to the financing provided for in this Regulation are disbursed to the beneficiaries in full.

2. Member States shall ensure that the payments under the interventions and measures referred to in Article 65(2) are made at the earliest on 1 December and at the latest on 30 June of the following calendar year.

Notwithstanding the first subparagraph, Member States may:

(a) prior to 1 December, but not before 16 October, pay advances of up to 50 % for interventions in the form of direct payments and for the measures referred to in Chapter IV of Regulation (EU) No 228/2013 and in Chapter IV of Regulation (EU) No 229/2013;

(b) prior to 1 December pay advances of up to 75 % for the support granted under interventions for rural development referred to in Article 65(2).

3. Member States may decide to pay advances of up to 50 % under the interventions referred to in Articles 73 and 77 of Regulation (EU) 2021/2115.

▼M1

3a. Member States may decide to pay advances to beneficiaries of the interventions referred to in Title III, Chapter III, of Regulation (EU) 2021/2115, subject to the specific conditions laid down pursuant to paragraph 5.

3b. Member States may decide to pay advances under the aid scheme laid down in Part II, Title I, Chapter II, Section 1, of Regulation (EU) No 1308/2013 in respect of aid for school year 2023/2024 and subsequent school years, subject to the specific conditions laid down pursuant to paragraph 5.

3c. Member States may decide to pay advances to beneficiaries of measures supporting agricultural markets adopted under Articles 219, 220 and 221 of Regulation (EU) No 1308/2013, subject to the specific conditions laid down pursuant to paragraph 5.

▼B

4. The Commission is empowered to adopt delegated acts in accordance with Article 102 amending this Article by adding rules allowing Member States to pay advances as regards the interventions referred to in Title III, Chapter III, of Regulation (EU) 2021/2115 and as regards measures regulating or supporting agricultural markets laid down in Regulation (EU) No 1308/2013 in order to ensure the coherent and non-discriminatory payment of advances.

5. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation by setting up specific conditions for the payment of advances to ensure the coherent and non-discriminatory payment of advances.

6. Upon the request of a Member State, in the event of an emergency, and within the limits of Article 11(2), point (b), of the Financial Regulation, the Commission shall adopt, where appropriate, implementing acts concerning the application of this Article. Those implementing acts may derogate from paragraph 2 of this Article, but only to the extent that, and for such a period, as is strictly necessary. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 45

Assignment of revenue

1. The following shall be considered as assigned revenue within the meaning of Article 21(5) of the Financial Regulation: (a) as regards expenditure under both the EAGF and the EAFRD, sums under Articles 38, 54 and 55 of this Regulation and Article 54 of Regulation (EU) No 1306/2013 applicable in accordance with Article 104 of this Regulation and, as regards expenditure under the EAGF, sums under Articles 53 and 56 of this Regulation which are to be paid into the Union budget, including interest thereon; (b) amounts corresponding to penalties applied in accordance with Articles 12 and 14 of Regulation (EU) 2021/2115 as regards expenditure under the EAGF; (c) any security, deposit or guarantee provided pursuant to Union law adopted within the framework of the CAP, excluding interventions for rural development, and subsequently forfeited; however, forfeited securities lodged when issuing export or import licences or under a tendering procedure for the sole purpose of ensuring that tenderers submit genuine tenders shall be retained by the Member States; (d) sums definitively reduced in accordance with Article 41(2).

2. The sums referred to in paragraph 1 shall be paid into the Union budget and, in the event of reuse, shall be used exclusively to finance EAGF or EAFRD expenditure.

3. This Regulation shall apply mutatis mutandis to assigned revenue referred to in paragraph 1.

4. As regards the EAGF, Article 113 of the Financial Regulation shall apply mutatis mutandis to the keeping of accounts on assigned revenue referred to in this Regulation.

Article 46

Information measures

1. The provision of information financed pursuant to Article 7, point (e), shall aim, in particular, to help explain, implement and develop the CAP and to raise public awareness of its content and objectives, including its interaction with the climate, the environment and animal welfare. This is done to inform citizens about the challenges faced in agriculture and food, to inform farmers and consumers, to restore consumer confidence following crises through information campaigns, to inform other parties active in rural areas and to promote a more sustainable Union model of agriculture, as well as to help citizens understand it.

It shall supply coherent, evidence-based, objective and comprehensive information, both inside and outside the Union, and outline the communication actions planned in the Commission’s multiannual strategic plan for agriculture and rural development.

2. The measures referred to in paragraph 1 may consist of: (a) annual work programmes or other specific measures presented by third parties; (b) activities implemented on the initiative of the Commission.

Those measures which are required by law or those measures already receiving financing under another Union action shall be excluded.

When implementing the activities referred to in the first subparagraph, point (b), the Commission may be assisted by external experts.

The measures referred to in the first subparagraph shall also contribute to the corporate communication of the Union’s political priorities in so far as those priorities are related to the general objectives of this Regulation.

3. The Commission shall publish once a year a call for proposals respecting the conditions set out in the Financial Regulation.

4. The committee referred to in Article 103(1) shall be notified of measures envisaged and taken pursuant to this Article.

5. The Commission shall submit a report on the implementation of this Article to the European Parliament and to the Council every two years.

Article 47

Other Commission powers relating to this Chapter

1. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with the conditions under which certain types of expenditure and revenue under the EAGF and EAFRD are to be compensated.

If the Union budget has not been adopted by the beginning of the budgetary year or if the total amount of the commitments scheduled exceeds the threshold laid down in Article 11(2) of the Financial Regulation, the Commission is empowered to adopt delegated acts in accordance with Article 102 of this Regulation supplementing this Regulation with rules on the method applicable to the commitments and the payment of the amounts.

2. The Commission may adopt implementing acts laying down rules on: (a) the financing and accounting of intervention measures in the form of public storage, and other expenditure financed by the EAGF and EAFRD; (b) the terms and conditions governing the implementation of the automatic decommitment procedure.

Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).







CHAPTER IV

Clearance of accounts







Section 1

General provisions

Article 48

Single audit approach

In accordance with Article 127 of the Financial Regulation, the Commission shall take assurance from the work of the certification bodies referred to in Article 12 of this Regulation, unless it has informed the Member State concerned that it cannot rely on the work of the certification body for a given financial year, and it shall take it into account in its risk assessment of the need for Commission audits in that Member State. The Commission shall inform that Member State of the reasons why it cannot rely on the work of the certification body concerned.

Article 49

Checks by the Commission

1. Without prejudice to the checks carried out by Member States under national laws, regulations and administrative provisions or Article 287 TFEU, to any check organised under Article 322 TFEU or based on Regulation (Euratom, EC) No 2185/96, or to Article 127 of the Financial Regulation, the Commission may organise checks in Member States with a view to verifying in particular whether: (a) administrative practices comply with Union rules; (b) the expenditure falling within the scope of Article 5(2) and Article 6 of this Regulation and corresponding to the interventions referred to in Regulation (EU) 2021/2115 has a corresponding output as reported in the annual performance report; (c) the expenditure corresponding to the measures laid down in Regulations (EU) No 228/2013, (EU) No 229/2013, (EU) No 1308/2013 and (EU) No 1144/2014 has been effected and checked in accordance with applicable Union rules; (d) the work of the certification body is carried out in accordance with Article 12 and for the purposes of Section 2 of this Chapter; (e) a paying agency complies with the minimum conditions for the accreditation laid down in Article 9(2) and whether the Member State correctly applies Article 9(4); (f) the Member State concerned implements the CAP Strategic Plan in accordance with Article 9 of Regulation (EU) 2021/2115; (g) the action plans referred to in Article 42 are correctly implemented.

Persons authorised by the Commission to carry out checks on its behalf, or Commission agents acting within the scope of the powers conferred on them, shall have access to the books and all other documents, including documents and metadata drawn up or received and recorded on an electronic medium, relating to expenditure financed by the EAGF or the EAFRD.

The powers to carry out checks shall not affect the application of national provisions which reserve certain acts for agents specifically designated by national law. Without prejudice to the specific provisions of Regulation (Euratom, EC) No 2185/96 and Regulation (EU, Euratom) No 883/2013, persons authorised by the Commission to act on its behalf shall not take part, inter alia, in home visits or the formal questioning of persons on the basis of law of the Member State concerned. However, they shall have access to information thus obtained.

2. The Commission shall give sufficient prior notice of a check to the Member State concerned or to the Member State within whose territory the check is to take place, taking into account the administrative impact on paying agencies when organising checks. Agents from the Member State concerned may take part in such checks.

At the request of the Commission and with the agreement of the Member State, additional checks or inquiries into the operations covered by this Regulation shall be undertaken by the competent bodies of that Member State. Commission agents or persons authorised by the Commission to act on its behalf may take part in such checks.

In order to improve checks, the Commission may, with the agreement of the Member States concerned, request the assistance of the authorities of those Member States for certain checks or inquiries.

Article 50

Access to information

1. Member States shall make available to the Commission all information necessary for the smooth operation of the EAGF and EAFRD and shall take all appropriate measures to facilitate the checks which the Commission deems appropriate in connection with the management of Union financing.

2. Member States shall communicate to the Commission at its request the laws, regulations and administrative provisions which they have adopted in order to implement the Union legal acts relating to the CAP and which have a financial impact on the EAGF or the EAFRD.

3. Member States shall make available to the Commission information about irregularities within the meaning of Regulation (EC, Euratom) No 2988/95 and other cases of non-compliance with the conditions established by Member States in their CAP Strategic Plans, about suspected fraud cases detected, and about the steps taken pursuant to Section 3 of this Chapter to recover undue payments in connection with those irregularities and frauds. The Commission shall summarise and publish that information annually and shall communicate it to the European Parliament.

Article 51

Access to documents

1. The accredited paying agencies shall keep supporting documents relating to payments made and documents relating to the performance of the checks required by Union law, and shall make those documents and related information available to the Commission.

Those documents and that information may be kept in electronic form under the conditions laid down by the Commission pursuant to paragraph 3.

Where those documents and that information are kept by an authority acting under delegation from a paying agency and responsible for authorising expenditure, that authority shall send reports to the accredited paying agency on the number of checks made, their content and the measures taken in the light of their results.

2. This Article shall apply mutatis mutandis to the certification bodies.

3. The Commission may adopt implementing acts laying down rules on the conditions under which the documents and information referred to in this Article are to be kept, including their form and the time period of their storage. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 52

Commission powers relating to checks and documents and information and cooperation obligation

1. The Commission is empowered to adopt delegated acts in accordance with Article 102 which are necessary to ensure the correct and efficient application of the provisions relating to checks and access to documents and information set out in this Chapter, supplementing this Regulation with specific obligations to be complied with by the Member States under this Chapter and with rules on the criteria for determining the cases of irregularity within the meaning of Regulation (EC, Euratom) No 2988/95 and other cases of non-compliance with the conditions established by Member States in the CAP Strategic Plans to be reported and on the data to be provided in this context.

2. The Commission may adopt implementing acts laying down rules on the procedures relating to the cooperation obligations to be complied with by the Member States for the implementation of Articles 49 and 50. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).







Section 2

Clearance

Article 53

Annual financial clearance

1. Prior to 31 May of the year following the relevant budgetary year and on the basis of the information referred to in Article 9(3), first subparagraph, points (a) and (d), the Commission shall adopt implementing acts containing its decision on the clearance of the accounts of the accredited paying agencies for the expenditure referred to in Article 5(2) and Article 6. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

Those implementing acts shall cover the completeness, accuracy and veracity of the annual accounts submitted and shall be without prejudice to the content of the implementing acts subsequently adopted pursuant to Articles 54 and 55.

2. The Commission shall adopt implementing acts laying down rules on the actions necessary for the purposes of adoption and implementation of the implementing acts referred to in paragraph 1, including the rules on information exchange between the Commission and the Member States and the deadlines to be respected. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 54

Annual performance clearance

1. Where the expenditure referred to in Article 5(2) and Article 6 of this Regulation and corresponding to the interventions referred to in Title III of Regulation (EU) 2021/2115 does not have a corresponding output as reported in the annual performance report referred to in Article 9(3) and Article 10 of this Regulation and in Article 134 of Regulation (EU) 2021/2115, the Commission shall adopt implementing acts prior to 15 October of the year following the relevant budgetary year determining the amounts to be reduced from Union financing. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

Those implementing acts shall be without prejudice to the content of the implementing acts subsequently adopted pursuant to Article 55 of this Regulation.

2. The Commission shall assess the amounts to be reduced on the basis of the difference between the annual expenditure declared for an intervention and the amount corresponding to the relevant reported output in accordance with the CAP Strategic Plan and taking account of justifications provided by the Member State in the annual performance reports in accordance with Article 134(8) of Regulation (EU) 2021/2115.

3. Before the adoption of the implementing act referred to in paragraph 1 of this Article, the Commission shall give the Member State concerned an opportunity to submit its comments and justify any differences within a period which, where the documents referred to in Article 9(3), Article 10 and Article 12(2) have been submitted by the deadline, shall not be less than 30 days.

4. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with rules on the criteria for justifications from the concerned Member State and the methodology and criteria for applying reductions.

5. The Commission shall adopt implementing acts laying down rules on the actions necessary for the purposes of adoption and implementation of the implementing acts referred to in paragraph 1 of this Article, including the rules on information exchange between the Commission and the Member States and the deadlines to be respected. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).

Article 55

Conformity procedure

1. Where the Commission finds that the expenditure referred to in Article 5(2) and Article 6 has not been effected in conformity with Union law, it shall adopt implementing acts determining the amounts to be excluded from Union financing. Those implementing acts shall be adopted in accordance with the advisory procedure referred to in Article 103(2).

However, as regards the types of intervention referred to in Regulation (EU) 2021/2115, the exclusions from Union financing referred to in the first subparagraph of this paragraph shall only apply in the case of serious deficiencies in the proper functioning of the governance systems of the Member States.

The first subparagraph shall not apply to cases of non-compliance with the eligibility conditions for individual beneficiaries laid down in the CAP Strategic Plans and national rules.

2. The Commission shall assess the amounts to be excluded on the basis of the gravity of the deficiencies found. In that context, it shall take due account of the nature of those deficiencies and of the financial damage incurred by the Union.

3. Before the adoption of the implementing act referred to in paragraph 1, the Commission findings and the comments of the Member State concerned to those findings shall be notified between the two parties in writing, following which they shall attempt to reach an agreement on the action to be taken. The Member State concerned shall be given the opportunity to demonstrate that the actual extent of the non-compliance is lower than the Commission’s assessment.

If no agreement is reached, the Member State concerned may request the opening of a procedure aimed at reconciling, within a period of four months, each party’s position. The procedure shall be carried out by a conciliation body. A report on the outcome of that procedure shall be submitted to the Commission. The Commission shall take into account the recommendations of the report before deciding on refusal of the financing and shall provide justification if it decides not to follow those recommendations.

4. Financing shall not be refused for: (a) the expenditure indicated in Article 5(2) which is effected more than 24 months before the Commission notifies the Member State in writing of its findings; (b) expenditure on multiannual interventions falling within the scope of Article 5(2) or within the scope of the interventions for rural development referred to in Article 6, where the final obligation of the beneficiary occurs more than 24 months before the Commission notifies the Member State in writing of its findings; (c) expenditure on the interventions for rural development referred to in Article 6, other than those referred to in point (b) of this paragraph, for which the payment or, as the case may be, the final payment by the paying agency is made more than 24 months before the Commission notifies the Member State in writing of its findings.

5. Paragraph 4 shall not apply in the case of: (a) aids granted by a Member State for which the Commission has initiated the procedure laid down in Article 108(2) TFEU; (b) infringements which the Commission has notified to the Member State concerned by a reasoned opinion in accordance with Article 258 TFEU; (c) infringements by Member States of their obligations under Title IV, Chapter III, of this Regulation, provided that the Commission notifies the Member State in writing of its findings within 12 months following receipt of the Member State’s report on the results of its checks on the expenditure concerned.

6. The Commission is empowered to adopt delegated acts in accordance with Article 102 supplementing this Regulation with rules on the criteria and methodology for applying financial corrections.

7. The Commission shall adopt implementing acts laying down rules on the actions necessary for the purposes of adoption and implementation of the implementing acts referred to in paragraph 1 of this Article, including the rules on information exchange between the Commission and the Member States, on the deadlines to be respected and the conciliation procedure provided for in paragraph 3 of this Article, and on the establishment, tasks, composition and working arrangements of the conciliation body. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).







Section 3

Recoveries for non-compliance

Article 56

Provisions specific to the EAGF

1. Sums recovered by the Member States following the occurrence of irregularities and other cases of non-compliance by beneficiaries with the conditions of the interventions referred to in the CAP Strategic Plans and the interest thereon shall be made over to the paying agency and booked by it as revenue assigned to the EAGF in the month in which the sums are actually received.

2. Member States may, without prejudice to paragraph 1, instruct the paying agency, as the body responsible for the recovery of debt, to deduct any outstanding debts owed by a beneficiary from future payments to that beneficiary.

3. When the Union budget is credited as referred to in paragraph 1, the Member State concerned may retain 20 % of the corresponding amounts as flat-rate recovery costs, except in cases of non-compliance attributable to its administrative authorities or other official bodies.

Article 57

Provisions specific to the EAFRD

1. Where irregularities and other cases of non-compliance by beneficiaries, and as regards financial instruments, also by specific funds under holding funds or final recipients, with the conditions of the interventions for rural development specified in the CAP Strategic Plans are detected, Member States shall make financial adjustments by cancelling partially or, when justified, entirely the Union financing concerned. Member States shall take into consideration the nature and gravity of the non-compliance detected and the level of the financial loss to the EAFRD.

Amounts of the Union financing under the EAFRD which are cancelled and amounts recovered, and the interest thereon, shall be reallocated to other rural development operations in the CAP Strategic Plans. However, Member States may reuse the cancelled or recovered Union funds in their entirety only for a rural development operation under their CAP Strategic Plans and may not reallocate them to rural development operations which have been the subject of a financial adjustment.

Member States shall deduct any sums unduly paid as a result of an outstanding irregularity by a beneficiary, in accordance with this Article, from any future payments to the beneficiary by the paying agency.

2. By way of derogation from paragraph 1, second subparagraph, for interventions for rural development receiving aid from the financial instruments referred to in Article 58 of Regulation (EU) 2021/1060, a contribution cancelled as a result of an individual non-compliance may be reused within the same financial instrument as follows: (a) where the non-compliance that gives rise to the cancellation of the contribution is detected at the level of the final recipient as defined in Article 2, point (18), of Regulation (EU) 2021/1060, only for other final recipients within the same financial instrument; (b) where the non-compliance that gives rise to the cancellation of the contribution is detected at the level of the specific fund as defined in Article 2, point (21), of Regulation (EU) 2021/1060 within a holding fund as defined in Article 2, point (20), of that Regulation, only for other specific funds.

Article 58

Implementing powers relating to the possible offsetting of the amounts and notification forms

The Commission shall adopt implementing acts laying down rules on the possible offsetting of the amounts resulting from recovery of undue payments and the forms of notification and communication to be made by the Member States to the Commission in relation to the obligations set out in this Section. Those implementing acts shall be adopted in accordance with the examination procedure referred to in Article 103(3).







TITLE IV

CONTROL SYSTEMS AND PENALTIES







CHAPTER I

General rules

Article 59

Protection of the financial interests of the Union

1. Member States shall, within the framework of the CAP, while respecting the applicable governance systems, adopt all laws, regulations and administrative provisions and take any other measures necessary to ensure effective protection of the financial interests of the Union, including effective application of the eligibility of expenditure criteria laid down in Article 37. Those acts and measures shall relate in particular to: (a) checking the legality and regularity of operations financed by the EAGF and EAFRD, including at the level of beneficiaries and as set out in the CAP Strategic Plans; (b) ensuring effective prevention against fraud, especially in areas with a higher level of risk, which will act as a deterrent, having regard to the costs and benefits and the proportionality of the measures; (c) preventing, detecting and correcting irregularities and fraud; (d) imposing penalties which are effective, proportionate and dissuasive in accordance with Union law, or failing this, national law, and bring legal proceedings to that effect, as necessary; (e) recovering undue payments plus interest and bring legal proceedings to that effect, as necessary, including for irregularities within the meaning of Article 1(2) of Regulation (EC, Euratom) No 2988/95.

2. Member States shall set up efficient management and control systems in order to ensure compliance with the Union legislation governing Union interventions.

Member States shall take the actions necessary to ensure the proper functioning of their management and control systems and the legality and regularity of expenditure declared to the Commission.

To assist the Member States in this respect, the Commission shall make available to the Member States a data-mining tool to assess risks presented by projects, beneficiaries, contractors and contracts while ensuring minimal administrative burden and effective protection of the Union financial interests. That data-mining tool may also be used in order to avoid circumvention of rules as referred to in Article 62. By 2025, the Commission shall present a report which assesses the use of the single data-mining tool and its interoperability with a view to its generalised use by Member States.

3. Member States shall ensure the quality and reliability of the reporting system and of data on indicators.

4. Member States shall ensure that beneficiaries of the EAGF and EAFRD provide them with the information necessary for their identification, including, where applicable, the identification of the group in which they participate, as defined in Article 2, point (11), of Directive 2013/34/EU of the European Parliament and of the Council ( 6 ).

5. Member States shall take appropriate precautions ensuring that the penalties applied as referred to in paragraph 1, point (d), are proportionate and graduated according to the severity, extent, permanence or reoccurrence of the non-compliance detected.

The arrangements set out by Member States shall ensure, in particular, that no penalties are imposed where:

(a) the non-compliance is due to force majeure or exceptional circumstances in ac