1972L0159 — EN — 07.07.1981 — 005.001 — 1
This document is meant purely as a documentation tool and the institutions do not assume any liability for its contents
►B COUNCILDIRECTIVE
of17April1972
onthemodernizationoffarms
(72/159/EEC)
(OJ L 96, 23.4.1972, p. 1)
Amended by:
Official Journal
No page date
►M1Council Directive 73/210/EEC of 24 July 1973 L 207 48 28.7.1973
►M2Council Directive 73/358/EEC of 19 November 1973 L 326 17 27.11.1973
►M3Council Directive 76/837/EEC of 25 October 1976 L 302 19 4.11.1976
►M4Council Directive 81/528/EEC of 30 June 1981 L 197 41 20.7.1981
Amended by:
►A1Act of Accession of Greece L 291 17 19.11.1979
Corrected by:
►C1Consolidated text of corrigenda to instruments published in Special
Editions 1952-72, p. 99 (72/159/EEC)
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COUNCILDIRECTIVE
of17April1972
onthemodernizationoffarms
(72/159/EEC)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic
Community, and in particular Articles 42 and 43 thereof;
Having regard to the proposal from the Commission;
Having regard to the Opinion of the European Parliament;
Whereas the objectives of the common agricultural policy set out in
Article 39 (1) (a) and (b) of the Treaty can only be achieved through
a reform of agricultural structures;
Whereas such structural reform is a basic factor in the development of
the common agricultural policy; whereas it should therefore be based
on a Community concept and on Community criteria;
Whereas, because of the diversity of their causes, nature and gravity,
structural problems in agriculture may require solutions which vary
according to region and are capable of adjustment over a period oftime; whereas such solutions must contribute to the overall economicand social development of each region concerned; whereas the bestresults can be achieved if, acting on the basis of Community concepts
and criteria, Member States implement the common measures individu-
ally through their own legislative and administrative procedures, and if,in addition, they themselves determine, on the basis of conditions laiddown by the Community, the extent to which such measures should beintensified in or concentrated on certain regions;
Whereas agricultural structure within the Community is typified by the
existence of a large number of farms which lack the structural condi-tions necessary to provide a fair income and living conditions
comparable with those of other occupations; whereas, moreover, the
gap between incomes on farms witha structure enabling th em to adjustto economic developments and incomes on other farms is constantlywidening;
Whereas, in the future, the only farms capable of adjusting to economic
developments will be those on which the farmer has adequate occupa-tional skill and competence, on which profitability is verified byaccounts and which are capable, through the adoption of rational
methods of production, of assuring a fair income and satisfactory
working conditions for persons working thereon; whereas, therefore,reform of the structure of agricultural production should be directedtowards the formation and development of such farms;
Whereas in most cases the development of such farms cannot be
achieved by short term measures; whereas, moreover, it can beachieved at a more reasonable and balanced pace under a developmentplan covering several years and setting out the measures to be taken
from the start of operations until completion of the plan;
Whereas, with a view to providing a guideline for the development of
such farms, the objective which a development plan must attain both as
regards the farm's profitability and as regards the working hours ofthose employed thereon should be specified;
Whereas, where the development of the farm includes a proposal for
extending the utilized agricultural area, it is not necessary that thefarm should be in occupation of the land earmarked for its extensionfrom the time the development plan is first put into operation; whereasit must, however, be certain that the land in question will become
available to the farm within the proposed development period;
Whereas, in order to ensure that public money allocated for the devel-
opment of farms is indeed used for the ►
C1benefit◄of farms1972L0159 — EN — 07.07.1981 — 005.001 — 2
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which satisfy the required conditions, development plans should be
subject to approval by the competent authorities;
Whereas the efforts of farmers towards achieving the objective of the
development plan may be encouraged by allocating to them by way ofpriority land released under the Council Directive of 17 April 1972 (
1)
and by granting aids for investment;
Whereas aids for investment should be granted mainly in the form of
interest rate subsidies, in order to leave economic and financial respon-sibility for the farm in the hands of the farmer; whereas for the samereasons he should pay part of the interest; whereas provision should be
made for aids to be granted also in the form of capital grants or
deferred repayments;
Whereas, in view of the size of the investment required to ensure the
profitability of farm businesses concentrating on cattle and sheep enter-
prises, the granting of aids for the purchase of such stock should be
made subject to certain conditions;
Whereas, bearing in mind Community production objectives, incentives
in respect of pig farming should be granted only under certain special
conditions, and incentives in respect of poultry and eggs should be
subject to a further decision, while farms should be encouraged toconcentrate on the production of beef, veal, mutton and lamb;
Whereas the keeping of accounts is essential to a correct assessment of
the financial and economic situation of farms, and in particular of thoseundergoing modernization; whereas a financial incentive may encou-rage the keeping of accounts;
Whereas, in the interests of rational production and of improvement in
living conditions, encouragement should be given to the formation ofgroups having as their purpose mutual aid between farms a morerational common use of agricultural investments, or group farmingoperations:
Whereas the possibilities of developing farms by means of land repar-
celling or irrigation schemes must be used as fully as possible in orderto help achieve the objectives of this Directive; whereas it is thereforedesirable that special systems of additional aids be introduced inconnection with such schemes or that existing systems be adapted;
Whereas the modernization of farms will only be realized successfully
if the financial assistance given by Member States is concentrated onachieving the aforesaid objectives; whereas farms whose long-term
profitability is doubtful should not be encouraged to embark upon a
growth process which is often long and costly; whereas, however,Member States should be allowed to alleviate, by means of temporaryinvestment aids, the situation of heads of farm businesses which, forvarious reasons, are not eligible to benefit from the measures for agri-cultural reform.
Whereas Member States must be able to adopt special measures of aid
for certain regions where the maintenance of a minimum level of popu-lation is not assured and where a certain amount of farming is essentialin view of the need to conserve the countryside;
Whereas the proposed measures are in the Community's interest and
are intended to achieve the objectives set out in Article 39 (1) (a) ofthe Treaty, including the structural changes necessary for the proper
functioning of the common market; whereas they therefore constitute
common measures within the meaning of Article 6 of Council Regula-tion (EEC) No 729/70 of 21 April 1970 on the financing of thecommon agricultural policy (
2);
Whereas, inasmuch as the Community contributes to the financing of
the common measures, it must be in a position to ascertain that theprovisions adopted by Member States for the implementation of those1972L0159 — EN — 07.07.1981 — 005.001 — 3
(1) OJ No L 96, 17.4.1972, p. 9.
(2) OJ No L 94, 28.4.1970, p. 13.
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measures will contribute towards achievement of the objectives thereof;
whereas, to this end, provision should be made for a procedure estab-lishing close cooperation between Member States and the Commission
within the Standing Committee on Agricultural Structure set up by
Article 1 of the Council Decision of 4 December 1962 on the coordina-tion of policies on agricultural structure, (
1) and involving, as regards
financial aspects, consultation withth e EAGGF Committee referred to►
C1in Articles 11 to 15 of Regulation (EEC) No 729/70 ◄;
Whereas it is desirable that the European Parliament and the Council
be able, on the basis of a report submitted by the Commission, toexamine annually the effects of the national and Community measurestaken, so that they may assess the need to supplement or adapt thesystem introduced hereunder;
HAS ADOPTED THIS DIRECTIVE:
TITLE I
Incentivestofarmssuitablefordevelopment
Article 1
1. Witha view to bringing about structural conditions conducive to
a significant improvement in agricultural incomes and working andproduction conditions, Member States shall introduce a system ofselective incentives to farms suitable for development, designed toencourage their operation and development under rational conditions.
2. Member States may, acting in accordance withth e general provi-
sions to be adopted hereafter by the Council under the procedure laiddown in Article 43 of the Treaty:
— vary according to region the amount of the financial incentives
provided for in the first subparagraph of Article 8 (2), and, withinthe limits set out therein, those provided for in Articles 10, 11 and12 and also those provided for in Article 13;
— refrain from applying in certain regions all or some of the measures
provided for in Articles 8, 10, 11, 12 and 13.
Article 2
For the purposes of this Directive a farm shall be considered suitable
for development where:
1. the farmer:
(a) practises farming as his main occupation;
(b) possesses adequate occupational skill and competence;
(c) undertakes that from the start of the development plan he will
keep accounts as defined in Article 11;
(d) draws up a plan for the development of the farm business which
satisfies the conditions laid down in Article 4;
2. its level of earned income is less than the modernization objective
established by Member States in accordance with Article 4 (2) orwhose earned income does not exceed 120 % of this modernizationobjective, and where its present structure is such as to jeopardizemaintenance of that income at a comparable level; in the latter
case, the interest rate subsidy provided for in Article 8 (1) (b) shall
apply only to two-thirds of the loan referred to in Article 8 (2).
Article 3
1. Member States shall for the purposes of this Directive define
what is meant by the expression ‘a farmer practising farming as hismain occupation’. Definitions shall, in the case of a natural person, at1972L0159 — EN — 07.07.1981 — 005.001 — 4
(1) OJ No 136, 17.12.1962, p. 2892/62.▼M4
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least include the condition that the proportion of income from farming
be not less than 50% of the farmer's total income and that the workingtime devoted to non-farming activities be less than half of the farmer's
total working time.
Having regard, in particular, to the criteria indicated in the preceding
subparagraph, Member States shall define the aforesaid expression:
— in relation to a person other than a natural person;
— in respect of a farm owned by a person other than the farmer;
— in respect of a farm worked under a share-cropping agreement.
2. In addition, Member States shall lay down the criteria for asses-
sing the occupational skill and competence of the farmer. Such criteriashall refer to the standard of agricultural training received or to aminimum period of farming experience or to both.
Article 4
1. The development plan provided for in Article 2 (1) (d) must show
that, upon its completion, the farm undergoing modernization will be
capable of attaining as a minimum, in principle for either one or two
man-work units, a level of earned income comparable to that receivedfor non-agricultural work in the region in question.
2. A comparable earned income as referred to in paragraph1 means
the average gross wage for a non-agricultural worker to which Member
States may apply a 5 % general corrective abatement.
Member States may, where necessary, take account of disparities
between the social security arrangements for farmers and those fornon-agricultural workers.
Furthermore, Member States are authorized to accept, at the request of
the farmer, development plans whose income objective represents only90 % of the comparable earned income fixed in accordance with this
paragraph.
3. For the purpose of showing that the farm undergoing moderniza-
tion will be capable of attaining the objective referred to in paragraph1, the earned income to be attained upon completion of the develop-ment plan shall be compared either:
— withth e comparable earned income as defined in paragraph2, or
— with that of reference farms which at the time when application is
made have an earned income equivalent to the comparable incomeas defined in paragraph2.
4. Member States
(a) shall:
— specify the minimum number of man-work units, having regard
to the various types of production and to the working conditions
associated therewith;
— determine what constitutes an adequate return on the capital
invested in the farm business. Member States may add to theearned income accruing from the farm the amount of any returnon capital over and above 3 · 5 %;
— fix, having regard to the duration of the development plan, the
modernization objective referred to in paragraph1;
— lay down the conditions of application of paragraph 2, subpara-
graph3;
(b) may provide that up to a specified percentage of the earned income
to be attained upon completion of the development plan mayconsist of income arising from non-agricultural activities, so long1972L0159 — EN — 07.07.1981 — 005.001 — 5
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as the earned income derived from the farm business is at least
equal to the comparable earned income for one man-work unit.The percentage specified may not exceed 20%.
5. Upon completion of the plan, the level of income referred to in
paragraphs 2 and 3 must be attainable by means of an annual workingperiod not exceeding 2300 hours. ►
M4Moreover, income from
forestry work on the farm may be included in the agricultural
income.◄
6. The achievement of the objectives of the development plan may
be spread over a maximum of six years. ►M4However, Member
States may be authorized, under the procedure laid down in Article18, to specify a longer period not exceeding nine years for certain
regions or for young farmers who have not reached the age of 40 years
and who carry out a development plan within five years after their firstinstallation on a farm. ◄
Article 5
1. Persons coming within Articles 2 and 3 who wish to benefit from
the incentives herein provided for shall submit applications to the
authorities appointed under Article 7.
2. An application may be made by a single farmer or by several
farmers who are in association or who have agreed to form an associa-
tion. Member States shall not discriminate between single and
associated farmers.
Article 6
1. The application shall be accompanied by the development plan
provided for in Article 2 (1) (d). This shall contain all the necessary
particulars for assessing whether the farm satisfies the conditions laid
down in Articles 2 and 4, and in particular:
— a description of the situation at the start of the plan;
— a description, in the form of a forward estimate, of the situation on
completion of the plan;
— an indication of the measures to be taken, and in particular of the
investments to be made, in order to achieve the desired results.
2. If the development plan contains a proposal for extending the
area of the farm, the enlarged area shall consist of:
— the land already in the possession of the farmer;
— land in respect of which he has been given a legally enforceable
promise entitling him to possession.
Article 7
Member States shall:
— appoint the authorities responsible for examining applications and
approving development plans;
— lay down an examination and approval procedure.
Article 8
1. Incentives to farmers whose applications have been accepted and
whose development plans have been approved shall include thefollowing measures:
(a) the allocation, by way of priority, of land released under the
Council Directive of 17 April 1972;
(b) the granting of aids in the form of interest rate subsidies in respect
of the investments necessary for carrying out the development plan,
but excluding expenditure incurred in buying:
— land;
— pigs, poultry, or calves intended for slaughter.1972L0159 — EN — 07.07.1981 — 005.001 — 6
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With regard to the purchase of livestock, only the initial purchase
provided for by the development plan may be taken into account;
(c) the provision of guarantees for loans contracted and the interest
thereon, where the security or personal guarantee provided is insuf-ficient.
►
M42. The interest rate subsidy provided for in paragraph 1 (b)
shall apply to the whole of the loan except for any part of the loanexceeding 72538 ECU (A) per man-work unit and 217612 ECU (A)per farm. However, the Member States may fix lower maximum
amounts. ◄It shall not exceed 5% and, in principle, shall cover a
period of fifteen years, which Member States may, however, extend totwenty years for investments in immovable property and reduce to tenyears for other investments. The rate of interest remaining payable bythe beneficiary may not be lower than 3%. Member States may grant
this aid, in whole or in part, in the form of a capital subsidy or of
deferred repayments; or they may combine the two forms.
However, the Council, acting on a proposal from the Commission and
voting as provided in Article 43 (2) of the Treaty, may authorize aMember State, for a specified period:
— to grant interest rate subsidies exceeding 5%, if suchaction is
warranted by the situation of the capital market in that Member
State;
— to lower the minimum rate payable by the beneficiary to 2% in
certain regions.
3. Member States may grant special aid to young farmers who have
not reached the age of 40 years and who within five years after theirfirst installation on a farm fulfil the conditions referred to in Article 2.
The special aid shall at most be equal to 10 % of the amount of the
investment provided for in the development plan and eligible withinthe meaning of paragraph 1, without, however, exceeding 7 254 ECU(A).
Where two or more young farmers who fulfil the conditions of the first
subparagraphcarry out a development plan in association, th e specialaid may not exceed 10 881 ECU (A).
The special aid shall be paid as a capital grant. Member States may,
however, grant the aid in some other form.
The special aid may be paid in several instalments.
Article 9
1. Where the development plan provides for the purchase of cattle
or sheep, the granting for the purchase of such livestock of the aids
provided for in Article 8 (1) (b) and (c) shall be subject to the condi-tion that the proportion of sales from the cattle and sheep enterpriseson completion of the development plan will be greater than 60% ofthe total sales of the business.
2. Where the development plan provides for an investment in pig
farming, the granting under Article 8 (1) (b) or (c) of the incentives tothat investment shall be subject to the condition that the investment isof at least 10000 units of account but does not exceed►
M353 333◄units of account and that the farm will be capable
on completion of the plan of producing at least 35% of the feeding-
stuffs consumed by the pigs.
In the case of joint production by more than one farm, this condition
shall be satisfied if any one or more of the farms involved is capable
of producing 35% of the feedingstuffs.
3. In respect of poultry and eggs the granting of the incentives
provided for in Article 8 (1) (b) and (c) shall be subject to a subsequentdecision by the Council, acting on a proposal from the Commissionand voting as provided in Article 43 (2) of the Treaty.1972L0159 — EN — 07.07.1981 — 005.001 — 7
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Article 10
Where it is provided in the development plan that the farm will
concentrate on the production of beef, veal, mutton or lamb, the incen-tives provided for in Article 8 shall be supplemented by the granting of
a guidance premium. The amount of this premium shall be fixed before
15 September 1972 by the Council, acting upon a proposal from theCommission and voting as provided in Article 43 (2) of the Treaty.
TITLE II
Othermeasurestoassistfarms
Article 11
1. Member States shall introduce a system of incentives to encou-
rage the keeping of accounts on farms.
Where in a Member State more than 70% of farms operated by way of
main occupation already keep accounts satisfying the provisions ofparagraph 2, that Member State shall not be obliged to introduce sucha system.
The system shall involve granting to farmers whose main occupation is
farming and who apply therefor and aid of ►
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account, spread over at least the first four years during which manage-
ment accounts are kept on their farms.
A Member State, in which the amount of aid expressed in national
currency has considerably increased since the introduction of the saidsystem, may be authorized in accordance with the procedure laiddown in Article 18 to fix the amount of aid temporarily at a level
between 473 units of account and 600 units of account.
2. The keeping of accounts shall:
(a) comprise:
— the preparation of annual opening and closing valuations;
— the systematic and regular recording over the accounting year
of the various transactions in cash or in kind concerning thefarm business;
(b) conclude withth e presentation eachyear of:
— a description of the general characteristics of the farm business,
and in particular of the factors of production employed;
— a detailed balance sheet (assets and liabilities) and trading
account (expenditure and income);
— the necessary data, including in particular the earned income
per man-work unit and the farmer's income, for assessing the
efficiency of the management of the farm business as a wholeand the profitability of the main enterprises of the business.
3. Where a farm is chosen by the authorities appointed by Member
States for the collection of accountancy data for purposes of informa-tion and scientific study, in particular within the framework of the EECaccountancy data network, and the farmer is in receipt of aid as
provided for in paragraph1, h e must undertake to make available to
those authorities, under conditions of anonymity, the accountancy datarelating to his farm.
Article 12
Member States shall on request grant to any recognized group having
as its object mutual aid between farms, a more rational common use ofagricultural investments, or group farming operations, a launching aidas a contribution to management costs.
The amount of such aid shall be not less than 2500 units of account
and not more than 7500 units of account and shall be fixed accordingto the number of participants and to the work carried out jointly.1972L0159 — EN — 07.07.1981 — 005.001 — 8
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The legal form which such groups shall take and the provisions
governing cooperation between members shall be determined byMember States.
Article 13
1. Witha view to promoting th e modernization of farms coming
within Article 2, through schemes for irrigation or for land reparcelling
and works related thereto, Member States shall:
— introduce special systems of national aids, comprising additional
incentives to promote modernization of farms coming within Arti-cles 2 and 4 and to encourage the cessation of farming; or
— adapt their existing systems of aids for general structural improve-
ment in sucha way as to encourage land reparcelling and irrigation
schemes fulfilling the condition laid down in paragraph 2.
2. The Community shall contribute to the expenditure incurred by
Member States for land reparcelling and works related thereto, and for
irrigation, including any additional incentives introduced under the first
indent of paragraph 1, provided that after completion of the land real-location or irrigation scheme at least 40% of the utilized agriculturalarea is to be worked by farms whose development plans have beenapproved, or that 70% thereof is to be worked by farms which havereached the level of development laid down in Article 4 (1).
Article 14
1. Aids for investments on farms satisfying the conditions laid down
in Articles 2 and 4 which exceed the amount laid down in Article 8 (2)
shall be prohibited, with the exception of aids:
— for the construction of farm buildings;
— for the transfer of farm buildings to new sites, where this is done in
the public interest;
— for land improvement operations;
these exceptions being subject to paragraph 3 of this Article and to
Articles 92 to 94 of the Treaty.
2. As regards investments on other farms and without prejudice to
Article 92 (2) of the Treaty, Member States may grant aids only in sofar as the interest remaining payable by the beneficiary, or the equiva-lent of that interest if the aid is given in another form, amounts to notless than 5% per year.
However:
(a) Witheffect from 1 January 1981, Member States may grant transi-
tional aid to farmers practising farming as their main occupationwho:
— are unable to attain the earned income fixed pursuant to Article
4;
— are not yet eligible for the annuities provided for in Article 2
(1) of Council Directive 72/160/EEC of 17 April 1972concerning measures to encourage the cessation of farming andthe reallocation of utilized agricultural areas for the purpose of
structural improvement (
1).
The transitional aid may be granted only in respect of investment
not exceeding 18135 ECU (A) and it may not be granted on terms
more favourable than those laid down in Article 8, taking accountof Article 9 (1) of Council Directive 75/268/EEC of 28 April 1975on mountain and hill farming and farming in certain less-favouredareas (
2), as last amended by Council Directive 80/666/EEC (3).1972L0159 — EN — 07.07.1981 — 005.001 — 9
(1) OJ No L 96, 23. 4. 1972, p. 9.
(2) OJ No L 128, 19. 5. 1975, p. 1.
(3) OJ No L 180, 14. 7. 1980, p. 34.▼M4
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The grant of this transitional aid shall not exclude the farmer from
subsequent eligibility for aid pursuant to Article 1 (1) or to the firstsubparagraph of this paragraph.
(b) Member States may introduce systems of special aids in certain
regions where the maintenance of a minimum level of populationis not assured and where a minimum amount of farming is essentialin view of the need to conserve the countryside;
The Council, acting in accordance with the procedure laid down in
Article 43 of the Treaty, shall lay down the criteria to be used in
defining suchregions and in applying suchsystems.
3. The following shall also be prohibited:
(a) aids for the purchase of pigs, poultry, or calves for slaughter;
(b) aids which do not satisfy the conditions laid down in Article 9.
4. Aid for the purchase of land shall not be covered by this Direc-
tive.
TITLE III
Financialandgeneral provisions
Article 15
The measures provided for by this Directive constitute common
measures within the meaning of Article 6 (1) of Regulation (EEC)
No 729/70.
Article 16
1. The estimated time required for carrying out the common
measures is ten years.
2. Five years after this Directive takes effect, the common measures
shall be re-examined by the Council upon a proposal from theCommission.
3. The total contribution by the EAGGF to the cost of the common
measures is estimated at 432 million units of account for the first fiveyears.
4. The provisions of Article 6 (5) of Regulation (EEC) No 729/70
shall apply to this Directive.
Article 17
1. Member States shall forward to the Commission:
— drafts of all laws, regulations or administrative provisions which
they propose to adopt in pursuance of this Directive, includingthose relating to Article 14;
— the texts of any provisions effectively implementing this Directive
existing prior to the date on which it takes effect.
2. When submitting pursuant to paragraph 1 drafts of laws, regula-
tions or administrative provisions or the texts of existing provisions,Member States shall also submit an explanatory memorandum showingthe relationship at regional level between the measure in question and
economic and structural conditions.
3. The Commission shall examine drafts forwarded in accordance
with the first indent of paragraph 1 for the purpose of determining
whether, having regard to the objectives of this Directive and to theneed for a proper connection between the various measures, such draftscomply with the Directive, and thus satisfy the conditions for financialcontribution by the Community to common measures within themeaning of Article 15. Within two months following receipt of any1972L0159 — EN — 07.07.1981 — 005.001 — 10
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draft the Commission shall, after consulting the Standing Committee on
Agricultural Structure, issue an opinion thereon.
4. Member States shall, on the adoption of any law, regulation or
administrative provision as referred to in paragraph3, forward th e text
thereof to the Commission.
Article 18
1. With regard to provisions the texts of which are forwarded
pursuant to the second indent of Article 17 (1) or to Article 17 (4),
the Commission shall examine whether, having regard to the objectivesof this Directive and to the need for a proper connection between thevarious measures, suchprovisions satisfy th e conditions for financialcontribution by the Community to common measures within themeaning of Article 15. Within two months following receipt of any
text, the Commission representative shall, after consulting the EAGGF
Committee on the financial aspects of the provision, submit a draftdecision thereon to the Standing Committee on Agricultural Structure.
2. The Committee shall issue its opinion within a time limit to be
fixed by the Chairman according to the urgency of the matters forexamination. It shall decide by a majority of ►
A1forty-five ◄votes,
the votes of Member States being weighted as laid down in Article 148
(2) of the Treaty. The Chairman shall not vote.
3. The Commission shall adopt the decision. However, if the deci-
sion is not in accordance with the opinion issued by the Committee, itshall immediately be communicated to the Council. In that event, theCommission may defer application of the decision for a period notexceeding one monthfrom th e date of its communication.
The Council, voting as provided in Article 43 (2) of the Treaty, may
within that month adopt a different decision.
Article 19
1. The expenditure incurred by Member States for the purposes of
any measures taken under Article 8 (1) (b), under the first subpara-
graphof paragraph2, under paragraph3, and under Articles 10, 11and 12, shall be eligible for assistance under the Guidance Section ofthe European Agricultural Guidance and Guarantee Fund.
The Council, acting on a proposal from the Commission and voting as
provided in Article 43 (2) of the Treaty, may declare eligible the
expenditure incurred by Member States for the purposes of measures
taken under the second subparagraph of Article 8 (2).
2. A proportion of Member States' expenditure referred to in Article
13 (2), calculated by reference to the agricultural area farmed, aftercompletion of the land ►
C1reparcelling ◄or irrigation scheme, by
farms whose development plans have been approved, shall be eligiblefor assistance from the EAGGF, with the exception, however, of
expenditure incurred in respect of:
— any land clearance not offset by the reafforestation of an equivalent
area;
— installation of mains electricity;— the laying on of a drinking water supply.
3. The Guidance Section of the EAGGF shall refund 25% of the
eligible expenditure to Member States.
However, the Community's contribution to the eligible expenditure
referred to in paragraph2 may not exceed 150 units of account perhectare for land reallocation and works related thereto, or 250 units ofaccount per hectare for irrigation works.
4. Detailed rules for applying paragraph3 sh all be adopted
according to the procedure laid down in Article 13 of Regulation(EEC) No 729/70.1972L0159 — EN — 07.07.1981 — 005.001 — 11
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Article 20
1. Measures taken by Member States shall not be eligible to benefit
from financial contribution by the Community unless a favourable
decision under Article 18 has been given in respect of the provisions
relating thereto.
2. Financial contribution by the Community shall be only in respect
of eligible expenditure arising in connection withaids granted in pursu-ance of decisions taken after the date on which this Directive takeseffect.
Article 21
1. Applications for reimbursement shall relate to expenditure
incurred by Member States in the course of a calendar year and shall
be submitted to the Commission before 1 July of the following year.
2. The granting of aid from the Fund shall be decided upon in accor-
dance withArticle 7 (1) of Regulation (EEC) No 729/70.
3. Payments on account may be authorized by the Commission.4. Detailed rules for applying this Article shall be adopted according
to the procedure laid down in Article 13 of Regulation (EEC) No 729/70.
Article 22
1. Before 1 August in eachyear th e national and Community
measures in force relating to this Directive shall be examined in the
context of an annual report which the Commission shall submit to theEuropean Parliament and to the Council, and for which Member Statesshall send all necessary documentation to the Commission.
The Council shall evaluate the effects of such measures, taking into
consideration the rate of structural development required to achieve
the objectives of the common agricultural policy, their effect on the
production objectives of the Community and on the harmonious devel-opment of the regions of the Community and the financial implicationsof the measures in question.
If necessary, it shall, acting under the procedure laid down in Article
43 of the Treaty, adopt appropriate provisions.
2. In order to achieve the Community's objectives in respect of
production, the Council, acting on a proposal from the Commission
and voting as provided in Article 43 (2) of the Treaty, may, in respectof certain sectors, amend or supplement the provisions of this Directiveor suspend their application.
Article 23
This Directive shall not affect the power of the Grand Duchy of
Luxembourg, subject to Articles 92 to 94 of the Treaty, to maintainuntil 31 December 1975 at the latest in respect of the matters covered
by this Directive, the national measures now in force.
Article 24
Member States may lay down additional conditions as regards the
implementation of the measures of aid provided for in this Directive.
Article 25
The Member States shall bring into force the measures necessary to
comply herewith not later than 31 December 1973.
Article 26
This Directive is addressed to the Member States.1972L0159 — EN — 07.07.1981 — 005.001 — 12
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