1995 report from the Commission to the Council on the implementation of the long-term national aid scheme for agriculture in the northern regions in Finland, pursuant to Commission Decision 95/196/EC
Date: 1997-04-30
Institutions: European Commission
Subjects: Finland, State aid, agricultural region, aid to agriculture, regional aid

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels,  30.04.1997 
COM(97) 162  final 

1995 REPORT FROM THE COMMISSION TO THE COUNCIL 

on the implementation of the long-term national aid scheme for agriculture in the 
northern regions in Finland, pursuant to Commission Decision 95/196/EC 

Report presented to the Council by the Commission pursuant to Article 143(2) of the Act of 
Accession to the European Union of the Republic of Austria, the Republic of Finland and the 

Kingdom of Sweden 

I. 

INTRODUCTION 

1.  Demarcation of the northern region 

2.  Reference period 

3.  Description of Finnish northern region aid programme 

4.  Method for calculating northern region aid 

5.  Assessment 

6. 

Support for agriculture 

H. 

IMPLEMENTATION OF AID FOR NORTHERN REGIONS IN 1995 

1.  Livestock production 

a)  BfiStoal 

b) 

Sucklercows 

c)  Male bovine animals > 6 months 

d)  Heifers for slaughter 

e)  Ewes and shegoats 

f) 

Saône 

g)  Eeuta 

h) 

i) 

HOJSÊS 

Reindeer 

j)  Milk 

k)  Aid for transport of milk and meat 

kl)  Aid for transport or milk 

k2)  Aid for transport of meat 

2.  Crop production 

1) 

Susari2££t 

m)  Potatoes for starch production 

n)  Cereals and other arable crops 

4 

1  c 

2 

3 

3 

4 

5 

6 

8 

8 

8 

9 

9 

10 

11 

12 

13 

14 

15 

15 

16 

16 

17 

17 

18 

18 

19 

ni)  Barley, oats and mixed cereals 

n2)  Other cereals and arable crops 

0)  Vegetables, flowers and plants grown under permanent shelter 

01)  Vegetables 

02)  Flowers and ornamental plants 

p) 

Fieldscale vegetables 

q)  Apples 

r)  Aid for storage for horticultural products 

s) 

Payment per hectare of UAA (land for grazing, left fallow, etc.) 

3.  Young farmers 

4. 

Land for grazing, left fallow and under ware potatoes 

5.  Other aid measures 

m.  AID FOR THE  NORTHERN REGIONS ALLOCATED IN 1995 

IV.  PRICES FOR  FRUIT AND VEGETABLES 

V.  COMMUNITY AID MEASURES APPLIED 

VI.  SOCIOECONOMIC DEVELOPMENT IN THE  NORTHERN REGIONS IN 1995. -

IMPACT OF NORTHERN REGION AID  MEASURES 

1. 

2. 

Economic development of the northern regions 

Socioeconomic situation and trends 

3.  Current state of agricultultural holdings and outlook 

4. 

Impact of aid on northern regions 

VH.  EFFECTS OF AID GRANTED ON ENVIRONMENTAL PROTECTION AND 

THE  PRESERVATION OF  THE  COUNTRYSIDE (AS PROVIDED FOR IN THE 

THIRD SUBPARAGRAPH OF ARTICLE 142(3) OF THE  ACT OF ACCESSION) 

Vffl.  INTEGRATED ADMINISTRATION AND CONTROL SYSTEM (IACS) 

20 

20 

21 

21 

21 

22 

23 

23 

24 

24 

25 

26 

26 

26 

26 

28 

28 

28 

29 

30 

30 

31 

4. ex. 

32 

32 

33 

33 

34 

34 

36 

37 

38 

39 

40 

41 

DC.  REQUESTS FROM FINNISH AUTHORITIES 

1.  Requests for amendments to Decision 95/196/EC 

2. 

Proposals 
Decision 95/196/EC 

for 

technical 

adjustments 

to  Annexes II 

to VI 

to 

as  a  result  in  particular  of  inaccurancies  and  shortcomings  in  regional 
statistics 

3.  Other requests 

X.  ADMINISTRATIVE 
IMPLEMENTATION 

INSTRUMENTS 

ADOPTED 

FOR 

THE 

OF COMMISSION DECISION 95/196/EC 

XL  CONCLUSIONS 

ANNEX 1 - 

Map of northern zones 

ANNEX 2 - 

Map of subrogions C1C4 

ANNEX 3 - 

Map of subzones P1P5 

ANNEX 4 - 

Northern regions 

ANNEX 5 - 

Northern aid...... 

, 

ANNEX 6 - 

Evolution of support in the northern zones 

^ 

I. 

INTRODUCTION 

Pursuant to Article  142 of the Act of Accession to the European Union of the Republic 
of Austria,  the Republic  of  Finland  and the  Kingdom  of  Sweden,  the  Commission  has 
authorized Finland to grant long-term national  aid to  ensure that agricultural  activity  is 
maintained  in specific  regions determined by the Commission  and covering  agricultural 
areas  situated  to  the  north  of  the  62nd  Parallel  and  some  adjacent  areas  affected  by 
comparable  climatic  conditions  rendering  agricultural  activity  particularly  difficult. 
When  determining  those  areas,  the  Commission  took  special  account  of  the  low 
population density,  the proportion of utilized  agricultural  area (UAA)  in relation to  the 
overall  area  and  the  proportion  of  the  UAA  given  over  to  arable  crops  for  human 
consumption. 

This aid, which may vary by region and be related to physical production factors taking 
account of the ceilings imposed by the COMs, must not be linked to future production or 
lead  to  an  increase  in  production  or  the  level  of  overall  support  recorded  during  a 
reference period prior to accession, to be determined by the Commission. 

The  aid  must  be  granted  in  particular  to  maintain  tradition  primary  production  and 
processing,  to  improve  structures  for  the  production,  marketing  and  processing  of 
agricultural  products,  to  facilitate  the  disposal  of  such  products  and to  ensure  that  the 
environment is protected and the countryside preserved. 

The  Community's  enlargement  to  Austria,  Finland  and  Sweden  provides  for  the 
immediate alignment of agricultural prices, but alongside the latter and in order to  soften 
the  effect  of  such  alignment,  Finland  is  authorized  to  grant  degressive  aid  for  a 
transitional  period  to  producers  of  agricultural  products  subject  to  the  common 
agricultural policy. 

In  addition,  Finland  has  the  right  to  maintain  a  long-term  national  aid  scheme  in  the 
northern  regions.  Since  there  is  provision  for  the  aid  scheme  in  question  under 
Article 142 of the Act  of  Accession,  it must be  considered  in terms of  that Article  and 
not on the basis of Articles 92 and 93 of the Treaty. 

In its final version submitted on 20 January 1995, the programme initially presented by 
the  Finnish  authorities  on  26 October 1994  and  later  supplemented  with  additional 
information  and amended  in certain respects  in response  to requests  from  Commission 
departments  sets out the  form and level  of  aid contemplated  and the production  factors 
(number of ha and LU) on which the aid may be paid. 

- 

In  Decision  95/196/EC  of  4  May  19951,  the  Commission  determined  the  northern 
regions  of  Finland,  set  the  reference  period  for  checking  that  aid  for  the  latter  regions 
does not lead to  an increase  in production or overall  support  and lays down the  ceiling 
on  agricultural  production  not  to  be  exceeded,  the penalty being  a reduction  in the  aid 
granted. 

1  OJ No L 126,9.6.1995, p. 35. 

1.  Demarcation of the northern regions 

On 21 February  1994 the Council  supplemented  its decision  in principle on long-
term national support for agriculture in specific northern areas by setting the precise 
values of the criteria to be used in demarcating those areas. 

These -values were recorded in conference  document No CONF.5/94 (GENERAL). 
The text was ratified unchanged in its entirety and all its details by the conference. 

For  the  Commission's  determination  of  the  northern  regions  of  Finland,  the 
abovementioned criteria are as follows: 

- 

- 

all municipalities north of the 62nd Parallel, 

for  other  municipalities  in  adjacent  areas  south  of  the  62nd  Parallel,  a 
population  density  of not  more than  10 inhabitants  per  square  kilometre,  less 
than  10% UAA as percentage of total area of the municipality,  and not  more 
than  20% of  that UAA  under  arable crops within  the meaning  of Regulation 
(EEC) No  1765/92 and intended for human consumption. 

The  method  applied  for  demarcating  the  northern  regions  is  analogous  with  the 
practice  adopted  in  defining  less-favoured  areas  in  accordance  with  Community 
legislation (Directive 75/268/EEC). 

The kunta-kommun or municipality was selected as the relevant administrative unit 
for  checking  compliance  with  the  abovementioned  criteria.  Where  appropriate, 
municipalities  which  do  not  simultaneously  meet  all  three  criteria  but  are 
completely surrounded by areas which do are included so as to form a homogeneous 
whole (this involves two municipalities accounting for 705 ha of agricultural land). 

Exceptionally, the rural district (maatalouspiiri/lantbrukdistrikt) of Mikkeli and the 
rural  district  of  South  Karelia  (representing  a  total  UAA  of  74 419  ha)  and  the 
agricultural  areas  defined  in  Area 3  of  the  Finnish  system  of  aid  to  agriculture 
according to  the size of holdings  in force  prior to  accession  and within  the limits 
existing at 31 December 1993 (with a UAA of 13 646 ha) were selected as territorial 
units for the purpose of checking compliance with the criteria. It was necessary to 
treat this area astride the 62nd Parallel as a special case owing to the presence  of 
specific  natural  handicaps. The area is a region of great  lakes, which  account  for 
over 20% of the total area of the districts of Mikkeli  and South Karelia, The area 
used for agriculture makes up only 5% of the total (including the lakes). Farmland is 
thus fragmented and  scattered  throughout  a  vast  area  covered  by  woodland  and 
lakes. 

Treating these  areas  as  a homogeneous  whole  made  it  possible  to  deal  with  this 
exceptional case within the European Union. These two areas as a whole meet the 
agreed thresholds, although no individual municipality taken separately could claim 
to do so. 

This  approach,  which 
followed  when  applying 
the  one  usually 
Directive 75/268/EEC  on  mountain  and  hill  fanning  and  farming  in  certain  less-
favoured  areas, will not only make it easier to administer the scheme but above all 
help in meeting the special needs of the great lakes region of Finland. 

is 

The northem region thus determined represents an area of  1 417 000 ha of UAA or 
55.5% of Finland's total UAA (see Map  1) and is subdivided  into five subrogions, 
i.e.  CI,  C2,  C2  North,  C3  and  C4  (see  Map 2).  Subregions  C3  and  C4  are 
subdivided  into  sub-areas  PI,  P2,  P3  and  P4  (subregion  C3)  and  P4  and  P5 
(subregion  C4) (see Map 3) in order to allow  for  a variation  in the aid  for  bovine 
animals, sheep and milk. 

This  subdivision  makes  it  possible  to  modulate  support  for  agriculture  by  taking 
account of the special features of the regions' agricultural economy and the severity 
of the natural handicaps. To that end, the Nikula index, a synthetic  agro-economic 
index which enables  each municipality  to be  classified  in a subregion  or subarea, 
was used in the main. 

The northern regions thus demarcated  (see maps and Table 4) are annexed  to this 
Report. 

2.  Reference period 

The  reference  period  for  agricultural  production  and  overall  support  before 
accession not to be exceeded should, on the basis of available national statistics with 
regard to quantities, be the period  1991-93. Exceptions  are cow's milk and bovine 
animals  on  the  one  hand,  for  which  1992,  used  to  fix  the  milk  quota  and  the 
reference  herd  for  Finland,  is  deemed  most  appropriate,  and  on  the  other  hand, 
horticultural production,  for which  1993 has been taken as the basis because of the 
availability of reliable statistics for that year. 

3.  Description of Finnish northern region aid programme 

The  programme  submitted  by  the  Finnish  authorities  pursuant  to  Article 142 
provides for long-term aid for production within the ceilings set out in the Annexes 
to Commission Decision 95/196/EC. 

It  covers  a wide  range  of  products  and  is justified  on  the  grounds  that  Finland's 
accession  entails  a  major  reduction  in  the  level  of  support  for  the  agricultural 
economy of the northern regions. 

There  is provision  for  the  support  to  vary  be  region  in  several  cases  in  order  to 
reflect the conditions existing in Finland. 

The Finnish authorities have specified the form in which they intend to allocate the 
aid. The aid proposed for all plant products (cereals and other arable crops, fruit and 
vegetables, potatoes  for  starch production  and sugarbeet)  is expressed per hectare. 
For  livestock  production, the  aid  is  expressed  per  livestock  unit  (LU)  for  bovine 
animals (excepting heifers),  equines, ewes, goats, swine  and poultry, while in the 
case of milk it is expressed per kilogram, and for reindeers and heifers per head of 
livestock. 

The coefficients  used for converting livestock into LU are identical to those applied 
for fixing aid under Articles  138,  139 and  140 in Finland in the Decision  approved 
by the Commission. 

There is  also provision  for aid for the transport of milk  and meat from the  farm to 
the first collection or processing  centre in certain areas of the northem regions (C4, 
C3  and  C2  North,  with  the  exception  of  the  municipalities  that  do  not  belong  to 
regions  eligible  under  Objective  6  of  the  Structural  Funds),  which  is  expressed  in 
Finnish markka per tonne (the average cost is estimated to be FIM 54/t for milk and 
FIM 0.5/kg  for meat).  The  level  of  aid was  calculated  by  reference  to  the  average 
quantity  delivered  to  the  dairy  per  holding,  the  average  density  of  farms  in  the 
dairy's collection area and the average distance between the farms and the dairy. 

Aid is also planned for the storage of fruit and vegetables produced in the northern 
regions, expressed in Finnish markka per cubic metre per year. 

For  young  farmers  (under  40  years  old)  there  is  provision  for  flat-rate  aid  per 
hectare  under  pasturage  and  cereals.  The  number  of  recipients  is  estimated  at 
19000. 

Aid  is  also  planned  for  all  UAA  used  for  grazing,  left  fallow  and  sown  to  ware 
potatoes. The same aid is allocated for other crops but the accounting is separate for 
each type of crop. 

It is also planned to grant aid for the Skolt population2,  "the reindeer industry" and 
"the natural economy",  allocated  in the  form  of  a subsidy  on  the interest  rates  for 
loans or as direct grants covering a percentage of 45% to 75% (up to 80-85% for the 
Skolt population) of the cost of certain small-scale productive investments and rural 
infrastructure (roads and water supply). 

4.  Method for calculating northern  region  aid 

To  assess  the  level  of  aid  contemplated  by  the  programme,  overall  support  per 
product during the reference period was compared with support after accession. 

To calculate overall support during the reference period, account was taken firstly of 
the  différence  between  1993  prices  in  Finland  and  in  the  Community  (indirect 
support) and secondly of the direct support financed by the national  budget  in that 
year. 

Support  after  accession was  taken to  include  not only  aid for the northern  regions 
and degressive national aid under Articles  138,139 and 140 of the Act of  Accession 
applied during the transitional period (1995-96), but also compensatory  allowances, 
agri-environmental aid provided for by the Member State for farmers in the northern 
regions and aid currently granted under the COMs. 

2  Ethnic group of around 800 people transferred from Petsamo after the Second World War. 

4 

Any change  in those amounts resulting in the level  of  support before  accession's 
being  exceeded  will  entail  adjusting  the permissible  aid  for the northern regions 
from  the following calendar year. 

The amounts are expressed in national currency as at  1 January  1995  and may be 
adjusted each year. The Commission Decision will have to be amended to  reflect 
sucrradjustments. 

Aid for the northern regions, with the exception of that for cow's milk (for which 
there is a quota system), is not granted on the basis of the quantities produced but on 
that of production factors within the regional limits shown in Annex 4 to Decision 
95/196/EC  (see  Annex  5).  Support  before  and  after  accession  in  the  northern 
regions is given in the diagram in Annex 6. 

5.  Assessment 

The Finnish authorities have shown that a dference exists depending on the product 
between support during the reference period and support after accession. The  figures 
were checked by the Commission departments in close cooperation with the Finnish 
authorities. 

The difference in price levels and the fall in production costs (of pigmeat, eggs and 
poultry) were checked and no overcompensation was observed. 

For fruit and vegetables, where it was estimated that prices in 1995 could turn out to 
be different from those used as the basis for assessing support, there is provision for 
a system for adjusting the level of  aid to take account of  storage aid, in order to 
avoid  any  overcompensation  from  1996  on.  There  is  also  provision  for  such  a 
review of aid levels in respect of transitional aid under Articles 138,139 and 140 of 
the Act of Accession. 

Aid for the transport of milk and meat in these remote areas of the Community is to 
be considered aid to facilitate the disposal of those products in accordance with the 
third subparagraph of Article 142(3) and is therefore permissible. 

The aid per kilogram of meat was "converted" into aid per LU, and the aid for dairy 
cows  and  for  heifers  intended  for  dairy  production  was  converted  into  aid per 
kilogram  of milk,  and is  therefore  permissible.  The  aid  for  heifers  for  slaughter 
(expressed in head of livestock slaughtered and paid after slaughter) and for keeping 
mares for breeding, foals (1-3 years) and Finnish horses is also acceptable. 

In  order  to  avoid  an  increase  in  production,  a  clause  inserted  in  the  Decision 
provides that if production  of  a product is  found  to  exceed  that of  the  reference 
period, a proportional  reduction in the aid for the product groups concerned will 
apply  the  following  year.  In  the  case  of  field-scale  production,  that  clause  is 
applicable if production is 10% higher on average for two consecutive years. 

In order to avoid penalizing product groups or subrogions (aid varies by subregion) 
through  the application  across the board  of  a reduction  in aid  in the event  of any 
excess production,  the  levels of production  and  support  are  presented  by  product 
and by subregion. 

Under  these  circumstances,  the  aid  arrangements  for  Finland's  northern  regions 
proposed by the Finnish  authorities pursuant  to Article  142 may be considered  to 
meet  the  conditions  laid  down  in  that  Article,  and  the  Decision  determining  the 
northern  regions  of Finland,  authorized  aid,  the  reference  period  and  the  level  of 
production  and  overall  support  was  adopted  by  the  Commission  on  4  May  1995 
(Decision 95/196/EC). 

6.  Support for agriculture 

Main changes in the environment in which Finland's agriculture operates 

Finland's accession to the European Union has brought about far-reaching  changes 
in the environment within which Finnish agriculture operates. National agricultural 
policy underwent a sea change as market prices and the system of support provided 
for under the EUs  common  agricultural policy were applied  immediately.  With  a 
view  to  the  integration  of  Finnish  agriculture  within  the  CAP,  the  special 
arrangements laid down in the Act of Accession were implemented. 

The impact of accession must be viewed from various standpoints. At the holding 
level, accession has affected  producer prices and those of certain inputs, as well as 
the level of support overall. These factors have influenced holdings' profitability and 
income. 

The abolition of protection  at the frontier and of regulation prices  for  agricultural 
products led to a significant reduction in market prices from day one after accession. 

The loss of income due to the reduction  in market prices  for  agricultural  products 
was partially offset  by the fall  in production costs. The remaining income loss was 
offset  by  other  forms  of  support.  The  previous  national  system  of  support  was 
replaced by support under the CAP (market support, compensatory allowances and 
agri-environmental measures) and by national aids provided for in Articles 138,139 
and 140 of the Act of Accession. 

For  the purposes  of  regional  apportionment  of  aid,  Finland  was  subdivided  into 
various support zones. 

The major forms of support in the various zones in 1995 were as follows: 

-  Zone  A: 

CAP premiums and compensatory payments; 

-  Zone Bi 

In addition to the aids provided for in respect of Zone A: 

Compensatory  allowance  provided  for  in  Directive  75/268/EEC  and 
Regulation (EEC) No 2328/91; 

-  Zone C1-C4: 

In addition to the aids provided for in respect of Zone B: 

Long-term  national  aids pursuant  to  Article  142 of the  Act  of  Accession 
authorized  by  Commission  Decision  95/196/EC  to  maintain  agricultural 
activity in the northern regions; 

-  Finland as a whole: 

In addition to the abovementioned aids: 

•  National  aids  pursuant  to  Articles  138,  139  and  140  authorized  by 
Commission  Decision  95/3 3/EC3 to  facilitate  the  adaptation  of  Finland's 
agricultural  and  horticultural  industries  to  prices  set  by  the  market 
organizations and the integration of Finnish agriculture within the CAP; 

•  Measures  accompanying  the reform  of  the  CAP  and  support  pursuant  to 

Regulations (EEC) No 2078/924, No 2079/92* and No 2081/92*. 

The total amount paid in 1995 as support for agriculture and horticulture in Finland 
was FIM 12.320 billion, including FIM 2.3 billion  as compensation  for  stocks. Of 
that amount, FIM  1.677 billion allocated for production support in 1995 was carried 
over for payment in 1996. 

3 

4 

5 

6 

OJNoL  6,  9. 1.1996, p. 21. 

OJ No L 215, 30. 7.1992, p. 85. 

OJNoL215,30.7.1992,p.91. 

OJ No L 208, 24. 7.1992, p. 1. 

IL 

IMPLEMENTATION OF AID FOR NORTHERN  REGIONS IN  1995 

AJd for the northern regions is not paid to farmers over 65 years old. 

1.  Livestock  production 

(a) Bççf/vçal 

The  northem  regions,  73%  of Finland's  cattle  are reared  on 44 814  holdings 
with a stocking density of 1.25  LU/ha. 

Table 1 

Total number of cattle reared 
(LU) 

Beef and veal 
production (t) 

In the reference 
period 
in  1995 
In the reference 
period(1 ) 
en 1995(2) 

(1)  except for cow's meat (26,300t) 
(2)  production of coWs meat in 1995:23|281t 

C1 

Subregion 
C2 

C2-North 

C3 

C4 

Total 

188 550 
15(586 

316,700 
255,377 

35,900 
28/673 

56,550 
40,063 

7,650 
5,550 

605,350 
481,249 

18,400 
14,142 

31,700 
25,814 

3,600 
2,715 

5,600 
4028 

600 
446 

59,000 
47,144 

Remarks: 

In 1995, both livestock numbers and beef/veal  production were below the levels 
recorded  during  the  reference  period.  As  a  consequence,  the  condition 
concerning the prohibition on an overrun in production laid down in Article 142 
was met. 

(b)  Suckler cows 

53% of Finland's suckler cows are reared on 2 189 holdings {51.1% of national 
total) in the northern regions. 

Table 2 

Production units 
reared  (LU) 

In the reference 

period 
in  1995 

Unit aid in 
1995 (FIM/LU) 

Authorized and 

applied (1) 

Total aid 
in 1995 (FIM million) 

Authorized 
Paid (2) 

Ci 

6,550 

C2 

7,100 

7,030 

7,229 

1995 

Subregion 

C2-North 

650 

654 

C3 

900 

538 

C4 

150 

Total 

15,350 

37 

15,488 

100 

150 

600 

1,050 

2,150 

0  .7' 
0  .6 

1  . 1' 
1  .0 

0  .4' 
0 .3 

0  .9' 
0  .5 

0  .3 
0  .1 

3  .4 
2  .5 

(1)  The aid is paid up to the individual quota limit allocated to each producer. The aid is paid in full 

on a maximum of 30 LU. Between 31 and 50 LU the aid is reduced by 25%. For more than 50 LU the aid is reduced by 50%. 
The aid is limited to 300 LU in subregions C1 and C2, in subregions C3 and C4 it is limited to 200 and 100 LU/holding respectively. 

(2) Government Decision No 413/95 paragraph 12. 
(3) Aid paid on a minimum of 3 LU 

Remarks: 

On account of restrictions in the aid allocated, the total aid granted  was below 
the  level  authorized,  despite  a  very  slight  increase  (0.9%)  in total  livestock 
numbers. 

(c)  Male bovine animals > 6 months 

73% of Finland's male bovine animals are reared in the northern regions. 

Table 3 

Production units 
reared (LU) 

Unit aid 
(FIM/LU) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 
Authorized and 
applied (1 ) 
Authorized 
Paid (4) 

C1 

C2 

C2-North 

C3 

C4 

Total 

Subregion 

1995 

36,000 
35,214 

62.300 
58,764 

650 

23  .4' 
16 .7 

700 

43.6' 
33.4 

7,250 
6,370 

1,150 

8.3* 
6  .0 

11.100 
8,612 

1,050 
1,153 

117,700 
110,113 

2900-3400  (2) 
35  .0' 
20  .9 

4500-6000  (3)1 
4  .8 
3  .1 

115.1 
80  .2 

(1)  Government Decision No 413/95. paragraphs 12 and 13. 
(2)  Sub-areas P1-P2:2,900 FIM/LU (of which 1  600 annual aid and 1  300 once during the animal's lifetime). P3-P4: 

3.400 FIM/LU (of which 1,600 annual aid and 1  800 once during the animal's lifetime) 

(3)  Sub-area P4:4 500 FIM/LU (of which FIM 2,700 annual aid and 1,800 once during the animal's lifetime). 

P5: 6000 FIM/LU (of which 2/700 annual aid and 3 300 once during the animal's lifetime) 

(4) Aid paid on a minimum of 3 LU. 

Remarks: 

The  number  of  livestock  raised  and  the  aid  granted  in  1995  are  within  the 
ceiling authorized. 

(d)  Heifers for slaughter 

72% of Finland's heifers are raised in the northem regions. 

Table 4 

Production units 
(head) 
Unit aid 
(FIM/head)(1) 
Total aid 
in 1995 (FIM million) 

Authorized 
Reared 
Authorized and 
applied (2) 
Authorized 
Paid 

C1 
17,390 
9,828 

C2 
30,020 
18,907 

Subregion 

C2-North 
3,380 
2,105 

C3 
5,440 
3,304 

C4 
810 
391 

1995 

Total 
57,040 
34,535 

460 

8.0 
4.52 

470 

14 .1 
8.89 

780 

1,060 

1,640 

2 .6 
1  .64 

5.8 
3,50 

1  .3 
0.64 

31  .8 
19,19 

(1 )  Aid paid once in an animars lifetime, at slaughter. 
(2)  Government Decision No 413/95. paragraph 13. 
(3) AJd paid on a minimum of 3 LU. 

Remarks: 

Figures for the number of animals slaughtered and total  aid allocated in 1995 
are below those for the reference period. 

10 

(e)  Ewes and she-goats 

57% of ewes and 41% of she-goats in Finland are reared on 2 828 holdings and 
62% of Finland's sheepmeat and goatmeat is produced in the northern regions. 

Table 5 

Production units 
reared (LU) 

Sheepmeat and 
goatmeat 
production (t) 
Unit aid 
(FIM/LU) 

Total aid 
in  1995 (FIM million) 

In the reference 
period 
in 1995 
in receipt of 
aid in 1995 
In the reference 
period 
in 1995 
Authorized and 
applied 
Applied on average 
in 1995(3) 
Authorized 
Paid (5) 

C1 

C2 

C2-North 

C3 

Subregion 

1,650 
2,318 

1,810 
2,337 

1,860 

1,899 

223 
303 
650 

276 
407 
700 

460 
436 

331 

60 
57 
1,150 

1995 

Total 

5,010 
5,913 

4.805 

711 
892 

C4 

300 
193 

164 

790 
629 

551 

111 
101 
3,100 (1)' 
3,700 (1)' 

41 
23 
4,800  (2)' 
6,400 (2)' 

621 

691 

1,130 

1  .1' 
1  .2 

1  .3' 
1  .3 

0.5' 
0  .4 

3,372 (1) 
2  .6' 
1  .8 

5,052 (2) 
1  .5' 
0  .80 

7 
5  .6' 

(1)  Sub-areas P1-P2: 3,100 FIM/LU. P3-P4: 3,700 FIM/LU 
(2)  Sub-areas P4: 4,800 FIM/LU. P5: 6 400 FIM/LU 
(3)  The aid is paid up to the individual quota limit allocated to each holding. The aid is paid in full 

on a maximum of 30 LU.  Between 31 and 50 LU the aid is reduced by 25%.  For more than 50 LU the aid is reduced by 50%. 
In subregions C1 and C2 the aid is limited to 300 LU. in subregions C3 and C4 it is limited 
to 200 and 100 LU/holding respectively. 

(4)  Government Decision No 413/95. paragraph 12. 
(5)  Aid paid on a minimum of 1.5 LU. 

Remarks: 

In  1995, there was a rise of  around  18% in  livestock  numbers  and  of  around 
25.5%  in  meat  production  compared  with  the  reference  period.  Despite  the 
increase in numbers of animals reared in 1995, there was no overrun in the level 
of support authorized since the aid was limited to a small number of LU. 

As a result of the rise in production  and pursuant to Article 4(1 )(c) of Decision 
95/196/EC,  the  aid  for  1996  should  be  reduced  proportionately.  Unless  the 
resulting FIM 1.785 million reduction is offset  by an increase in aid as a result 
of  the reduction  in  Community  aid  or  revaluation  of  the  national  currency,  it 
must be spread among the regions where the overrun was recorded. 

11 

(f)  Swine 

42% of Finland's pigs are reared in the northern regions. 

Table 6 

Production units 
reared (LU) 

Pigmeat 
production (t) 

Unit aid 
(FIM/LU) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 
In the reference 
period 
in 1995 
Authorized and 
applied 
Authorized 
Paid (2)(3) 

C1 

C2 

C2-North 

C3 

Subregion 

63,700 
74,570 

37,600 
43,138 

2.100 
2,172 

42,900 
40,673 

24,700 
23,897 

1,300 
1,273 

3,150 
2,569 

2,000 
1..420 

1995 

Total 

106,590 
122,452 

70,906 (1) 
67,264 

C4 

40 
3 

6 
3 

0 
0 
0 

0 
0 
0 

590 

590 

900 

1 .2' 
1  .3 

1  .9' 
1 .3 

0  .04' 
0  .0 

3  .1" 
2  .5 

(1)  Sow's meat (3  1001) is included 
(2)  In the case of sows, the full aid payment is limited to 30 LU. Between 31 and 50 LU the aid is reduced by 25%. 

For more than 50 LU. the aid is reduced by 50%.  In subregions C1 and C2 the aid is limited to 300 LU; in subregions C3 and C4 the 
aid is limited to 200 and  100 LU/holding  respectively. 

(3) Aid paid on a minimum of 3 LU. 

Remarks: 

Despite the  14,9% increase in the number of swine reared, there was no rise in 
pigmeat  production  or  in  the  aid  granted  in  the  northern  regions.  The  reason 
behind  the increase in the number of swine lies in the  fact  that  from  1995 on, 
the method for classifying pigs (based on age) has changed to a system based on 
the weight of the animal. In accordance with the new system, pigs of less than 
20  kg  are  classified  as piglets,  whereas  prior  to  1995, piglets  were  less  than 
three months old. Since the number of LU was calculated  for  swine other than 
piglets, the increase in LU is due to this change in statistics. The change has no 
impact on the reference quantity. 

12 

(g)  Poultry 

30.3%o of Finland's poultry is raised in the northern regions, where 30.1% of the 
country's poultrymeat is produced. 

Table 7 

Production  units 
reared (LU) 

Production  (tonnes) 
-eggs 

-meat 

Unit aid in 
1995 (FIM/LU) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 

In the reference 
period 
Achieved in 1995 
In the reference 
period 
Achieved in 1995 
Authorized 
Applied (4) 
Authorized 
Paid (5)(6) 

C1 

C2 

C2-North 

C3 

C4 

Sub-region 

1995 

Total 

23,700 
20,559 

7,700 
5,838 

850 
468(1) 

355 
356(1) 

5 
2(1) 

32,610 
27,223 

26,000 
14,513 

8,000 
2,784 

1,000 
147 

1,000 
110 

4,820 
10,148  (2) 
0 
0 
0.0' 
0 

1,140 
1,457  (3) 
0 
0 
0  .0" 
0 

10 
0 
590 
590 

20 
99 
900 
900 

36,002 
17,554 

5,991 
11,705 

2 
0 

1 
0 
1,900 
1,900 

0  .5" 
0  .3 

0  .3' 
0  .20' 

0  .01 
0  .00 
L 

0  .8' 
0  .5 

(1 )  Of which 9,5901 broiler meat and 5581 other poultry. 
(2)  Of which 1,401 t broilers and 561 other poultry. 
(3)  The aid is paid in full on a maximum of 30 LU. Between 31 and 50 LU the aid is reduced by 25%. For more than 50 LU 

the aid is reduced by 50%. In the subregions C1 and C2, the aid is limited to 300 LU; in subregions C3 and C4 it is limited to 200 
and 100 LU/holding respectively. 

(4)  Government Decision No 413/95. paragraph 12. 
(5)  Aid paid on a minimum of 3 LU. 

Remarks: 

A major increase in poultrymeat production was recorded in  1995. As a result, a 
proportionate reduction must be made in the aid in 1996. 

The  Finnish  authorities  propose  that  the  figures  for  authorized  production  of 
poultrymeat  and  eggs be  changed  and  the  aid be  divided  into two  categories, 
one for  layers and broilers and another  for  table fowl  and other poultry.  These 
changes result in no increase in the aid planned  (see Table below). If the new 
figures are  used,  a reduction  of  23%  in  the  aid  as  a  result  of  the  overrun  in 
production must be applied in 1996. 

13 

Table 8 

Production units 
reared (LU) 

Production (tonnes) 
-eggs 

-meat 

Total aid (FIM million) 
laid down in Decision 
95/196/EC 

Total aid (FIM million) 
laid down in the new 
Finnish 
proposal(3) 

Subregion 

Laid down in 
Dec. 95/196/EC 
New proposal 

C1 
23/00 

C2 
7/700 

C2-North 
850 

23,700(1) 

7,700 (2) 

850 

Decision 95/196/EC 
New proposal 
Decision 95/196/EC 
New proposal 

26,000 
16,950 
4,820 
8y335 

8,000 
8,000 
1,140 
1,075 

1995 
1996 
1997 
1998 
1999 
from 2000 
1995 

1996 

1997 

1998 

1999 

from 2000 

a 
b 
a 
b 
a 
b 
a 
b 
a 
b 
a 
lb 

0 .0 
0  .0 
14 .5 
29.1 
43 .6 
58.1 
0 
0 
0 
0 
9 .8 
4 .7 
19.6 
9 .4 
29.4 
14 .2 
39.2 
18.9 

0  .0 
0 .0 
4 .8 
9.6 
14 .4 
19.3 
0 
0 
0 
0 
3 .9 
0  .9 
7  .9 
1  .8 
11 .8 
2 ,6 
15.8 
3.5 

1,000 
1,000 
/  10 
10 
0  .5 
0.5 
1 .0 
1 .5 
2 .0 
2 .5 
0 .4 
0  .1 
0  .4 
0  .1 
0  .8 
0  .2 
1 .2 
0 .3 
1  .6 
0  .4 
2 .0 
0.5 

C3 
355 

355 

1,000 
1,000 
J  20 
20 

0  .3 
0  .3 
0  .5 
0  .8 
1 .0 
1  .2 
0 .2 
0  .1 
0  .2 
0  .1 
0 .5 
0  .04 
0 .7 
0  .06 
0  .9 
0  .07 
1  .1 
0.1 

1995 

Total 
32,610 

32,610 

36,002 
261952 
5,991 
9,441 

0  .8 
0 .8 
20 .9 
41 .0 
61 .0 
81 .1 
0  .6 
0  .2 
0  .6 
0 .2 
15.1 
5.8 
29.4 
11 .5 
43 .7 
17 .3 
58.1 
23.0 

C4 
5 

5 

2 
2 
1 
1 
0  .01 
0  .01 
0  .01 
0  .02 
0  .02 
0  .02 
0 .0 
0  .0 
0  .0 
0  .0 
0  .0 
0  .003 
0  .014 
0  .003 
0  .014 
0  .004 
0  .018 
0,002 

(1) Of which:  16 000  LU laying hens, 6 400  LU broilers and  1 300  LU other poultry 
(2) Of which:  6 300 LU laying hens, 900 broilers and 500 other poultry 
(3) Total aid for eggs before accession in the northern regions is FIM  109 million 

a  = laying hens and chicks 
b = broilers and other  poultry 

(h) Horses 

Table 9 

Production units 
raised (LU) 

In the reference 
period 
in 1995 

C1 

C2 

C2-North 

C3 

C4 

Total 

Subregion 

1995 

2,400 
3,5 11 

2,800 
4,119 

340 
566 

390 
446 

70 
79 

6,000 
8,721 

(1)  Breeding mares, foals (1-3 years) and Finnish horses. 

Remarks: 

No aid is planned for tilts product group for 1995-97. As from 1998, support for 
horses will  be paid  in respect  of  only  20  units per recipient.  If there  is  still  an 
overrun in 1998, a reduction will apply to the aid in 1999. 

14 

(i)  Reindeer 

Reindeer are reared in the northem regions only. 

Table 10 

C1 

C2 

C2-North 

Subregion 
C3 

C4 

Production units 
reared (head) 

Production (tonnes) 

Unit aid in 
1995 (FIM/LU) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 
Authorized 
Achieved in 1995 
Authorized 
Applied (1) 
Authorized 
Paid 

(1) Government Decision No 413/95 paragraph 13a 

0 
0 
0 
0 
0 
0 
0 
0 

0 
0 
0 
0 
0 
0 
0 
0 

0 
0 
0 
0 
0 
0 
0 
0 

71,500 
64,581 
1,073 
879 
160 
140 

11  .4' 
9  .04 

157,500 
143,559 
2,370 
1,941 
160 
140 
25  .2' 
20  .10 

1995 

Total 

229,000 
208,140 
3,443 
2,820 

36  .6' 
29  .14 

Remarks: 

In  1995, the number of animals and the level of production were below those 
recorded  during  the reference  period  and total  aid allocated  in the northem 
regions was within the ceiling authorized. 

(j)  Mi& 

There  are 26 870 holdings  (1992)  producing  milk  in the  northern  regions of 
Finland.  They  are distributed  by subregion  as  follows:  CI  =  8 617;  C2 = 
13 500; C2 North = 1 696; C3 = 2 624; C4 = 433. They  account  for 80% of 
Finland's milk production. 

Table 11 

Production  units 
reared  (LU) 

Production 

(tonnes) 

In the reference 
period 
in  1995 

In the reference 

period 
in  1995 

C1 

C2 

C2-North 

C3 

C4 

Subregion 

1995 

Total 

96,600 

90,034 

166,800 

156,542 

18,800 

18,054 

30,200 
25,955 

4,500 

3,704 

316J900 

294^89 

524,000 

517,153  (2) 

906,000 
903,369  (2) 

102,000 
105,745 

164,000 

168^15  (3) 

24,000 
23,750  (4) 

1,720,000  (1 ) 
1,718,932  (5) 

Unit aid in  1995 
(FIM/Kg) 

Authorized and 
applied 

Total aid 
in  1995  (FIM  million) 

Authorized 
Paid (7) 

0.17' 

86 .9' 

86.054 

0.18' 

159  . 1' 
162  .155 

0  .29' 

29.6" 
30  .596 

0.47-0.72 

(6) 
101  .7' 
109  .288 

0.99-1.51 

(6) 
25 .8' 
25  .553 

403  .1" 
415  .646 

(1 )  These quantities can be supplemented by the quantities allocated under 

the Act of Accession using the reserve decided upon for the Finnish SLOM quota. 

(2) Of which 105.51 and 35.21 goat's milk in sub-regions C1 and C2. 
(3)  Of which, by sub-area: C3P1 = 13,5801. C3P2 = 58,058. C3P3 = 65,826, C3P4 = 26 8961. 
(4)  Of which by sub-area: C4P4 = 20,6431 and C4P5 = 3 6151. 
(5)  Only 1 715 889 tonnes of milk benefited from northem aid. In the case of 3 043.204 tonnes produced by fanners over 65. 

the aid was not paid. 

(6)  Unit aid in FIM/kg for subregion C3: P1 = 0.47. P2 = 0.57, P3 = 0.72 and for C4: P4 = 0.99, P5 = 1.51. 
(7)  The unit aid applied in 1995 in FIM/kg was: for subregion C3: P1 = 0.459. P2 = 0.558. P3 = 0.704. 

P4 = 0.705 and for C4: P4 = 0.968. P5 = 1.48. 
(8)  Government Decision No 413/95, paragraph 6. 
(9) For quantities exceeding 20Q 000 kg per producer, the aid is reduced by 50% 

15 

Remarks: 

The  aid  allocated  exceeded  the  total  aid  authorized.  The  overrun  (FIM 12.5 
million,  or  3.1%)  should  be  recovered.  On 19 September 1996  the  Finnish 
Government  amended  Government  Decision  413/95  (amended  by  Decisions 
Nos 1006/95,  1435/95  and  225/96)  in  order  that  aid  for  the  northern  regions 
paid  in  October-December  1996  be  reduced  by  the  amount  exceeding  that 
authorized  for  milk  in  1995.  Following  that  decision,  a  general  reduction  of 
FIM 0.0317/kg was applied in all the northern regions. 

The  Commission  departments  are  considering  a  request  from  the  Finnish 
authorities relating to: 

(a) 

a change in the total aid (increase of FIM 4.2 million for  1995 and 1996) 
as a result of a more accurate estimate of the quantity produced in areas 
P1-P4  of  subregion  C3,  resulting  in  a  change  in  the  distribution  of 
quantities  produced  among  the  areas  but  no  increase  in  the  ceiling  on 
production; 

(b) 

an increase in the quantity of milk  on which the aid  is payable  and the 
total  aid  in  subregions  CI,  C2  and  C3  to  include  the  SLOM  quantity 
allocated in 1995 and 1996, and 

(c)  the abolition of the restriction with regard to cow's milk whereby the aid 
for  the  northern  regions  is  limited  to  the  reference  quantity  allocated  to 
each producer. 

(k)  Aid for  transport of milk and meat 

(kl) Aid for transport of milk 

Table 12 

C1 

C2 

C2-North 

C3 

C4 

Subregion 

Production units 
(tonnes) 

In the reference 
period 
in 1995 
Authorized 
Average unit 
Achieved in 1995 
aid (FIM/t) 
Authorized 
Total aid 
in 1995 (FIM million) 
Paid(1) 
(1) Government Decision No 1373/95 
(*) regions of Kainuu and Lappi and Koillismaa district 

. 
-
-
-
-

. 
-
-
-
-
-

n 
3Q,831 
o 

64 .56' 

n 

0 

o 
148,566 
n 
38 .22' 
O 

7.7 

<*) 
23,786 
n 
51,62 
n 

1 .20 

1995 

Total 

203,183 

43 ,79' 
13,5' 
8.90' 

16 

(k2) Aid for transport of meat 

Aid for the transport of all types of meat (FIM 0.704 million - see table below) 
for  1995 in the province of Lappi  will  be paid  in  1996 in accordance with  the 
arrangements applying prior to accession. The aid is payable on 1  832.6 t. 

Table 13 

Products 

Quantity  (kg) 
Area 

Aid in FIM (1) 
Area 

C3 P4 and 
C4P4 
1,483,271 
22,662 
229..573 
1,433 

C4P5 

C3P4 and C4P4 
(0.35  FIM/kg) 

92,866 
2,776 

519,145 
7,932 
80,350 
501 

C4P5 
(0.8 FIM/kg) 
74,292 
2,220 

7,736;939 

95,642 

607,928 

19,600 
96,112 

1,832,581 

Total 

Quantity 
(kg) 

1995 

Aid 
FIM 

1..576,137 
25,437 

593,437 
10,152 
80,350 
501 

19,600 
704,040 

Beef and veal 
Sheepmeat 
Pigmeat 
Other  meat 
Sick animals 
(number: 28) 
Total 

(1) Government Decision No 1374/95. 

Remarks: 

There is no overrun in the total amount authorized for transport aid. 

2.  Crop production 

In  the  northern  regions,  irrespective  of  the  type  of  crop,  aid  amounting  to 
FIM200/ha  is  paid  in  subregions  C2  and  C2  North  and  FIM400/ha  and 
FIM 800/ha in subregions C3 and C4 respectively. 

The aid is not granted to farmers qualifying under pension arrangements. 

By product the situation is as follows. 

17 

(l)  Sugarbeet 

Production in the northern regions accounts for only 8.3% of Finland's total. 

Leaving  aside  the  general  support  mentioned  above,  aid  amounting  to 
FIM 500/ha is paid for this crop in subregions CI, C2 and C2 North. 

Table 14 

Production units 
cultivated (ha) 

Sugar 
production (tonnes) 
Unit aid in 
1995(FIM/ha)(1) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 
Authorized 
Achieved in 1995 
Authorized and 
applied 
Authorized 
Paid 

C1 

C2 

C2-Nord 

C3 

C4 

Total 

Subregion 

1995 

3,230 
3,358 
17,570 
11,689 

520 
153 
2,270 
458 

0 
14 
0 
0 

500 

1  .6' 
1 .60 

500+200' 
0  .4' 
0  .10 

500+200' 
0 .0' 
0  .00 

0 
0 
0 
0 

0 
-
-

0 
0 
0 
0 

0 
-
-

3,750 
3,525 
19,840 
12,147 

2  .0 
1  .7 

(1) Government Decision No 413/95. paragraphs 8 and 9. 
(2) Aid allocated on a minimum of 3 ha. 

Remarks: 

In 1995, both production and support were below levels in the reference period. 

(m) Potatoes for starch production 

The northern regions account for 61.4% of Finland's production. 

Leaving  aside  the  general  support  paid  per  hectare  in  subregions  C2  and  C2 
North, aid amounting to FIM 400/ha was paid in all subregions in 1995. 

Table 15 

Production units 
(ha) 
Starch (1) 
production  (tonnes) 
Unit aid in 
1995(FIM/ha) 
Total aid 
in 1995 (FIM million) 

Authorized 
Cultivated in 1995 
Authorized 
Achieved in 1995 
Authorized and 
applied 
Authorized 
Applied (2) 

C1 
1,700 
4,229 
15,590 
23,182 

C2 
2,190 
1,830 
8,060 
8.836 

Subregion 

C2-Nord 

0 
0 
0 
0 

400 

1  . 1' 
1 .7 

400+200' 
0  .8' 
1  .00 

400+200 
0.0' 
0 

C3 
0 
0 
0 
116 

. 
-
-

C4 
0 
2 
0 
0 

. 
-
-

1995 

Total 
3,890 
6,059 
23,650 
32,134 

1  .9' 
2  .6 

(1 ) There is a quota system in operation on potato starch production. 
(2) Government Decision No 413/95 paragraphs 8 and 9. 
(3) Aid allocated on a minimum of 3 ha. 

18 

Remarks: 

Following  the  Council's  decision  to  grant  a quota of  54 7501 potato  starch  to 
Finland (Regulation (EC) No 1863/95 of  17 July  19957), 61.4% of which is for 
the northern  regions, the Commission  is preparing  an amendment  to  Decision 
95/196/EC setting the starch production  ceiling  at 33 560 t,  including  24 1601 
for  subregion  CI  and 9 400 t for  subregion  C2, and overall  support  at FIM 3.1 
million. As a result  of that amendment,  there has been  no overshooting  of the 
reference quantity for production or support. 

(n)  Cereals and other arable crops 

In the  northern  regions,  51%  of  Finland's  arable  land  is cultivated  on  58 120 
holdings (58%). 

Table 16 

Cultivated  area 
(ha) 

Production 

(tonnes) 

C1 

C2 

Subregion 
C3 

C2-North 

C4 

Total 

1995 

In the  reference 
period 
in  1995 
In the  reference 
period 
in  1995 

286,780 
224,425 

238,100 
176,344 

20,720 
12,562 

12,600 
7,752 

100 
117 

557,700 
421,200 

900,400 
706,811 

717.800 
521,480 

52.500 
31.633 

32,500 
19,696 

0 
266 

1,703,200 
1,279,886 

The situation is as follows by category of crop. 

OJ No L 179,29. 7.1995, p. I. 

19 

(ni)Barley, oats and mixed cereals 

46.6%o of  the  area  under  these  crops  is  located  in  the  northern  regions  and 
accounts  for  44.2%  of  the  country's  production.  In  1995,  only  the  general 
support  for  all areas sown,  amounting  to  FIM 200, FIM 400  and  FIM 800 per 
hectare, was paid in subregions C2 and C2 North, subregion  C3 and  subregion 
C4 respectively. 

C1 

C2 

C2-North 

C3 

Subregion 

248,000 
204,218 

227,050 
171,521 

809,400 
663/445 

680,000 
510,946 

19,900 
12,297 

52,000 
31,289 

12,600 
7,719 

32,000 
19,652 

1995 

Total 

507,650 
395,870 

1,573,000 
1..225..598 

C4 

100 
115 

0 
266 

0 
0.0' 
0.0 

0+200' 
45.4' 
34 .30* 

0+200' 
4.0' 
2  .46 

0+400* 
5.0 
3  .09 

0+800' 

0  . 1' 
0  .09 

54  .5' 
39  .94" 

Table 17 

Area cultivated 
(ha) 

Production 
achieved (tonnes) 

Unit aid in 
1995(FIM/ha) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 
In the reference 
period 
in 1995 
Authorized and 
applied 
Authorized 
Paid (1) 

(1) Government Decision No 413/95. paragraph 9. 
(2) Aid allocated on a minimum of 3 ha. 

Remarks: 

In  1995, both production  and  support  were below the levels  for  the  reference 
period. 

(n2) Qther cereals and arable crops 

In  1995, only  the  general  support  amounting  to  FIM 200/ha  was  granted  in 
subregions  C2 and  C2 North.  Production  in the northem  regions  accounts  for 
7.5%  of the national total. 

C1 
38,780 

20,207 
91,400 
43,366 

C2 
10,450 

4,823 
37,800 
10,534 

Subregion 

C2-North 
820 

265 
500 
344 

C3 
0 

33 
500 
44 

0 
0  .0' 
0 

0+200' 

2 . 1' 
0  .97' 

0+200' 
0 .1 
0  .05 

-
-

1995 

C4 
0 

Total 
50,050 

2 
0 
0 

-
-

25,330 
129,200 
54,288 

2 . 2' 
1  .02' 

Table 18 

Cultivated  area 
(ha) 

Production 

(tonnes) 

Unit aid in 
1995  (FIM/hectare) 
Total aid 
in  1995 (FIM  million) 

In the  reference 
period 
in  1995 
Authorized 
in  1995 
Authorized  and 
applied 
Authorized 
Applied (1)(2) 

(1) Government Decision No 413/95 paragraph 9. 
(2) Aid allocated on a minimum of 3 ha. 

Remarks: 

In  1995, both production  and  support were below the  levels  for  the  reference 
period. 

20 

(o)  Vegetables, flowers and niants grown under permanent shelter 

Of  crops  grown  under  permanent  shelter,  output  in  the  northern  regions 
accounts for 53.3% of national production. 

The  aid  is  paid  mainly  in  respect  of  tomatoes,  cucumbers,  lettuce,  dill, 
parsley,  gherkins, cabbages,  sweet peppers, cut  flowers,  green  vegetables 
and ornamental plants. In  1995, only transitional  degressive  aid was paid 
on these crops. 

The situation by category of product is as follows. 

(on Vegetables 

Table 19 

Area cultivated 
(ha) 

Production 
achieved  (tonnes) 

Unit aid in 
1995(FIM/ha) 
Total aid 
FIM million 

In the reference 
period 
in 1995 
In the  reference 
period 
in 1995 
Authorized and 
applied 
Authorized 
Applied (1) 

C1 

C2 

C2-Nord 

C3 

C4 

|  Total 

Subregion 

1995 

116 
121  .4 

29 
25  .9 

1  .1" 
1  .3 

.1' 
1 
0  .7 

0  .6' 
0.5 

148 
149 

41,000 

10,000 

25,190 

4 / 39 

0 
0 
0 

0 
0 
0 

400 
236 

0 
0 
0 

400 
98 

0 
0 
0 

200 
92 

52,000 

3Ç 355 

0 
0 
0 

0 
0 
0 

(1) Government Decision No 413/95 paragraph  11. 

(o2^ Flowers and ornamental plants 

C1 

C2 

C2-North 

C3 

C4 

Total 

Subregion 

Year: 1995 

26 .7' 
26.1 

n 
10.07 

20 
18.9 

C) 

4 .48 

2 .6' 
2.2 

(*) 

0.61 

5  .2" 
4 .2 

n 

0 .90 

.6' 

0 
0 .6 

55 
52 

n 

0.02 

60 
16 .08 

0 

0 
0 

0 

0 
0 

0 

0 
0 

0 

0 
0 

0 

0 
0 

0 

0 
0 

Table 20 

Area cultivated 
(ha) 

Production 
achieved (1 ) 

Unit aid in 
1995(FIM/m2) 

Total aid 
FIM million 

In the reference 
period 
in 1995 
In the reference 
period 
in 1995 
In the reference 
period and 
in  1995 
In the reference 
period 
in 1995 (2) 

(1) Millions of items. 
(2) Government Decision No 413/95 paragraph 11. 

Remarks: 

There is no provision for aid in 1995. There was no overrun in production. 

21 

(p)  Field-scale vegetables 

Production  in the northern regions, which  involves  733 holdings,  accounts  for 
24.5% of total national output. 

Table 21 

Area cultivated 
(ha) 

Production 
(tonnes) 

Unit aid in 
1995(FIM/ha) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 
In the reference 
period 
in 1995 
Authorized and 
applied 
Authorized 
Applied (1 ) 

C1 

1,285 
1,402  .6 

C2 

678 
558 

Subregion 
C3 

C2-North 

52 
55.8 

68 
67 

39,000 
39,908 

20,000 
16,318 

1,600 
1,943 

2,000 
2y154 

1995 

Total 

2,085 
2,084 .4 

62,660 
60,375 

C4 

2 
1 

60 
52 

0 
0  .0' 

0+200" 

0+200' 

0+400 

0  .1' 

0  .0' 

0  .0' 

0+800 

0  .0' 

0  .2' 

(1) Government Decision No 413/95 paragraphs 8 and 9. 
(2) Aid allocated on a minimum of 1.5 ha. 

Remarks: 

No increase was recorded in production or authorized support. 

In accordance with Article 4(l)(d)  of Decision  95/196/EC, Finland  forwarded 
information  to the Commission  in respect  of  1995 concerning producer  prices 
recorded on the national market for fruit and vegetables with a view to assessing 
any  need  to  review  the  Decision  should  an  increase  be  recorded  in  overall 
support  as  compared  with  that  in  the  reference  period  in  accordance  with 
Article 4(2) thereof (see Chapter V). 

22 

(q)  Apples 

The area under apple-trees in the northern regions is very small (around  10 ha), 
accounting  for  2.7% of  the  total,  and  is  cultivated  by  19 farmers.  The  reason 
why this area is not  included  in that  under other fruit and vegetables  is due to 
the fact that a different  rate of aid applies to this crop. 

Table 22 

Area  cultivated 
(ha) 

Production 

(tonnes) 

In the reference 
period 
in  1995 
In the  reference 
period 
in  1995 
Authorized and 
applied 
Authorized 
Paid(1) 

Unit aid in 
1995(FIM/ha) 
Total aid 
in 1995 (FIM million) 
(1) Government Decision No 413/95 paragraphs 8 and 9. 

C1 

C2 

C2-Nord 

C3 

C4 

Subregion 

5 
3.7 

50 
18 

0 
0 
0 

5 
6  .3 

50 
40 

0 
0 

0 
0 

0+200" 

0+200' 

0  .001" 
0 .001' 

0 .0... 
0  .0002' 

0 
0 

0 
0 

. 

0 
0 

0 
0 

0 
0 

Remarks: 

No increase was recorded in production or support in 1995. 

(r)  Aid for storage for horticultural produce 

Table 23 

Quantities stored 
(m3) in 1995 
Unit aid 
in 1995 
FIM/m3/year 

Total aid in 1995 
('FIM  million) 

With heat control 
Without heat control 
With heat control 

Without heat control 

Authorized and 
applied 
Authorized and 
applied 
Authorized 
Paid 

(1) On average 86 FIM(m3) 

Remarks: 

C1 

C2 

Subregion 
C3 

C2North 

C4 

120 

120 

120 

120 

120 

120 

80 

80 

80 

80 

80 

80 
15 .0' 
5  .65 

1995 

Total 

10 
10 

100 
58 

0 .001' 
0  .001' 

1995 

Total 
51,398 
13,971 

The authorized ceiling on aid was not exceeded. 

23 

(s)  Payment per hectare of UAA (land for grazing, left fallow, etc.) 

Table 26 

Total UAA (ha) 

Authorized 
Cultivated 

C1 
535,225 
459,998 

C2 

646,388 
534,846 

Sub-region 

C2-North 
81,644 
55,091 

C3 
134,138 
69,047 

1995 

C4 
19^715 
8.905 

Total 
1,417,140 
1,127,887 

Remarks: 

The authorized ceilings on area and aid were not exceeded. 

3.  Young farmers 

In order to encourage young people to continue  farming  in Finland's northern 
regions, the Finnish  authorities have made provision  for  aid  of FIM 200/ha in 
subregions  C1-C4, the area concerned  being  estimated  at 400 000 ha. The aid 
is paid on condition  that the area of arable  land cultivated  amounts  to at  least 
three hectares. Arable land covered by the set-aside arrangements is deemed to 
have been sown. 

Table 25 

Reference 
period 

Achieved in 
1995 

C1 
200 
n 
183.205 
8.292 
200 

C2 
200 
n 
231,779 
9S945 
200 

Subregion 

C2-Nord 
200 
n 
22,567 
1,157 
200 

C3 
200 
n 
30,124 
1,598 
200 

C4 
200 
n 
3.461 
265 
200 

1995 

Total (m) 

80 
471,136 
21,257 

36 .64' 

46  .36' 

4  .51' 

6.02 

0.69| 

94 .22' 

Unit aid FIM/ha 
Total aid FIM million 
Area cultivated, (ha) 
Number of holdings 
UnitaidFIM/ha(1) 
Total aid (FIM million) 

(1) Government Decision No 413/95 Article 10 

In 1995, the area cultivated by young farmers was 17,8 per cent higher than the 
maximum allowed.  The proportional increase of granted aid was linked to this, 
which  led  Finnish  authorities  to  ask  to  set  the  above  mentioned  aid 
retroactively from 1995 at FIM 94 million a year. 

The  Commission  is  considering  this  request,  which  does  not  lead  to  any 
overrun in the ceiling on support prior to accession in respect of any crop, with 
a view to incorporating it in a decision amending Decision 95/196/EC. 

24 

4.  Land for grazing, left fallow and under ware potatoes 

Land  for  grazing,  under  ware  potatoes  and  left  fallow  qualifies  for  the  general 
support applicable in the northern regions, amounting to FIM 200/ha in  subregions 
C2  and  C2  North  and  FIM 400/ha  and  FIM 800/ha  in  subregions  C3  and  C4 
respectively. 

C1 

C2 

C2-Nord 

C3 

C4 

Total 

Subregion 

1995 

242-112 
226,069 
0 
0 
0 
0 

404,846 
355,549 
200 
200 

60,868 
42,387 
200 
200 

121.464 
61.126 
400 
400 

19,612 
8,784 
800 
800 

849,502 
693,915 

81  .1" 
66  .7 

12  .2" 
7  .5 

48  .5 
23  .2 

15 .7 
6  .6 

157  .4' 
104 

Table 24 

Area cultivated 
(ha) 

Unit aid in 
1995(FIM/ha) 
Total aid 
in 1995 (FIM million) 

In the reference 
period 
in 1995 
Authorized 
Applied (1 ) 
Authorized 
Applied (2) 

(1) Government Decision No 413/95 Article 8 
(2) Aid allocated on a minimum of 3 hectares 

Remarks: 

The authorized ceilings on aid and production were not exceeded. 

25 

5.  Other aid measures 

This  covers  aid  for  the  Skolt  population,  the  "natural  economy"  and  the 
"reindeer industry",  amounting to FIM 22.7 million a year. This  aid was not 
allocated in 1995. 

III. 

AID FOR THE NORTHERN REGIONS ALLOCATED IN 1995 

The aid for the northern regions allocated in  1995 is set out in the summary table 
below. 

Table 27  Summary 

Product 

Subregion 

C1 

C2 

C2North 

C3 

C4 

Total 

Nordic aid applied In 1995 

FIM million 

Total eligible 
aid 

Animal production 
Suckler cows 
Male bovine animals 
HeHérs for slaughter 
Ewes - she-goats 
Swine 
Poultry 
Horses 
Reindeer 
Milk(1) 
Transport of milk and meat (2) 
Total 1 
Plant  production 
Sugar beet 
Potatoes for starch (3) 
Barley, oats, mixed cereals 
Other cereals and arable crops 
Vegetables, flowers and plants 
under permanent shelter 
Field-scale vegetables 
Apples 
Storage aid 
Payment per ha UUA (pasture, 
set-aside, etc.) 
Young farmers (4) 
Other aids (5) 
Total 2 
GRAND TOTAL 

0  .60 
16.7 
4.52 
1  .20 
0 
0 
0 
0 

88 .054 
0 

111 .074 

1  .60 
1 .60 
0 
0 

0 
0 
0 

1 .00 

33.4 

8 .89 
1 .3 
0 
0 
0 
0 

162 .155 

0 

206 .745 

0  .1 
1 .00 

34.3 
0  .97 

0 
0 
0.001 

0.30 
6  .00 
1 .64 
0.40 
1 .3 
0.3 
0 
0 
30 .596 
0 

40 .536 

0  .01 
0 
2.46 
0.05 

0 
0 
0  .000 

0.50 
20 .90 
3,50 
1 .80 
1 .3 
0  .20 
0 
9.04 
109 .288 
8  .3 
154 ,828 

0  .10 
3  .10 
0  ,64 
0  .80 
0.00 
0  .00 
0 
20 .1 
25 .553 
1 .30 
51 ,593 

3.09 

0  .09 

0 
0 

0 

0 
0 

0 

0 
36 .64 

66 .7 
46 .36 

7 .5 
4 .51 

23.2 

6 .02 

6 .6 
0  .69 

2.50 
80 .10 
19,19 
5.6 
2.50 
0  .50 
0 

29 .14 
415 .646 
9  .6(3) 
564 ,776 

1 .7 
2.6 
39 .94 
1 .02 
0 
0 

0.001 
5.65 

104 
94 .22 
-
249 .131 

813 .907 

3 .4 
115 .1 
31 .8 
7.0 
3  .1 
0  .8 
0 
36 .6 
403 .1 
13 .5 
614 .4 

2 
1 .9 
54 .5 
2  .2 
0 
0 
0 
0  .001 
15 

157 .4 
80 
22 .7 
335.9 

950 .3 

(1) FIM 12.5 million will be recovered 
(2) Of which 0.7 million for the transport of meat 
(3) Overrun due to Reg. 1863/95 
(4) Overrun to be accounted for 
(5) Not applied in 1995 

IV.  PRICES FOR FRUIT AND VEGETABLES 

According to figures provided by the Finnish authorities pursuant to Article 4(1 )(d) 
of Decision 95/196/EC  on producer price levels recorded on the national market, 
prices in 1995 were (around 18%) below those recorded during the reference period 
and there was no increase in overall support over the latter. 

V. 

COMMUNITY AID MEASURES APPLIED 

Community  aid  measures  (market  support,  compensatory  allowances  and  agri-
environmental measures) applied in the northern regions in  1995 (see table below) 
resulted  in  no  overrun  for  any  product  in  the  amounts  set  out  in  Annex  VI  to 
Decision 95/196/EC. 

26 

Table 28 

Market support (1) 

Compensatory  payment (2) 

Community  aids 

Zone 

C1 

C2 

1. ANIMAL PRODUCTS 

Suckler cows 
Male bovine animals 

Suckler cows 
Male bovine animals 

C2North 

Suckler cows 
Male bovine animals 

C3 

C4 

Suckler cows 
Male bovine animals 

Suckler cows 
Male bovine animals 

Total 

Suckler cows 
Male bovine animals 

C1-C4 

Dairy cows, other bovine animals 

Total bovine  animals 

C1-C4 
C1-C4 

Ewes, she-goals (4) 
Horses (5) 

Total  1 

Total 

Total 

Total 

Total 

Total 

Total 

R.805/68 and 3886/92 
Total 
FIM million 
4  .93 
45  .070 
50  .927 
5.24 
87  .040 
93  .432 
0  .41 
9  .130 
9  .524 
0  .34 
13.20 
13  .602 
0.03 
1  .29 
1  .325 
10 .95 
155 .61 
168  .810 

6.95 

175  .76 

(1) For  1995: sudder cows: 1.096 FIM/head (175 ECU/head) 

Male bovine animals 

:  680 FIM/head (120 ECU/head) 

(2) 

(3) 

(4) 

(5) 

1.007  FIM/LU 

650 FIM/ha 

Ewes, she-goats 

: 

24.2 ECU/head 

Finnish horses 

under Reg. 2328/91 
Total 
million 

J 63  .46 

282  .83 

31  .55 

44  .31 

5  .84 

527  .99 

5.53 

533  .51 

Agii-envlronmental measures 
under Reg. 2078/92(3) 
Total 
million 

Grand  total 

FIM million 

127  .59 

341  .977 

220  .779 

597 .041 

24  .628 

34  .589 

65  .702 

92  .501 

4  .559 

11  .724 

412  .145 

1.108  .945 

4  .294 

476  .44 

16  .774 

1,125  .71 

Community  aid 

Market support 
R.1765/92 
Total 
mio 

Compensatory  allowance 
under Reg. 2328/91 
Total 
mio 

Agri-environmental  measures 

under Reg. 2078/9? 
Total 
mio 

Total 

229  .542 

95  .056 

526  .218 

172  .302 

54  .289 

352  .141 

11 .94 

3  .762 

24  .402 

7  .136 

2  .249 

14  .585 

420  .92 

155  .356 

919  .346 

4  .259 
1  .843 
3.348 
2  .099 

60.300 
492  .768 
1,026  .275(6) 

3.324 
1  .439 
2.771 
1  .638 

164 .528 
580  .967(7) 

18  .983 
7  .982 
6.119 
3.737 

60.300 
1.016 .466 
2*142  .176 

Ion» 

2.  Plant products 

C1 

C2 

Cereals and other arable crops 
-  Barley, oats and mixed cereals 
- Wheat, rye. malt barley and other 

arable crops 

- Barley, oats and mixed cereals 
- Wheat, rye. malt barley and other 

arable crops 

C2North 

- Barley, oats and mixed cereals 
- Wheat, rye. malt barley and other 

arable crops 

C3 

-  Barley, oats and mixed cereals 
- Wheat, rye. malt barley and other 

arable crops 

Total 

-  Barley, oats and mixed cereals 
- Wheat, rye. malt barley and other 

arable crops 

Total 

ToUl 

Total 

Total 

Total 

Autres cultures 

C1 
C2 
C1-C4 
C1-C4 
C1-C4 
C1-C4 
C1-C4 

- Potatoes for starch production 
- Potatoes for starch production 
Sugar beet 
• Field-scale vegetables 
-Apples 
- Soft fruits 
- Other crops 

177.5 

26.12 
203  .62 
120  .30 

5.25 
125  .55 
8.5 

0.20 
8  .70 
5.20 

5  .2 
311  .50 

31 .57 
343  .07 

11  .4 
4  .7 

Total 2 
TOTAL 1+2 

359  .17 
534.93 

(6) Of which FIM 686.355 mWon bome by the Member State and FIM 339.92 m«on by the EAGGF. 

(7) Of which FIM 290.63 mBon bome by the Member State and FIM 290.62 mWon by the EAGGF. 

27 

VI.  S  OCIO-ECONOMIC DEVELOPMENT IN THE NORTHERN REGIONS IN  1995  -  IMPACT OF 

NORTHERN REGION AID MEASURES 

1.  Economic development of the northern regions 

No assessment of economic development in the northern regions can be made in the 
first  year of application.  This Report  concentrates  on production  figures  and  total 
support paid in  1995 compared with levels in the reference period as set out in the 
Decision on aid in the northern regions. 

The  final  picture  that  emerges  of  economic  development  in  agriculture  will  be 
clearer once statistics for  1995 have been finalized, after  adjustments  are made and 
by  monitoring  agriculture  and  horticulture  following  accession.  Accordingly,  in 
1994 the  Ministry  of  Agriculture  and  Forestry  introduced  a  research  programme 
called "MATEUS", one of the principal tasks of which is to provide information  on 
the economic impact of accession to the EU. Some of the studies undertaken in the 
framework of MATEUS cover the following: 

- 

adjustments due to the EU in Finnish agriculture in 1995-97, 

-  monitoring the development  of prices and the effects  of the system  of  aid  for 

horticulture and adjustments in 1995-96, 

the adaptation of agriculture to the CAP, 

the effects of accession on agricultural areas where selected vertically integrated 
sectors are dominant, 

the importance of the animal feed  industry having regard to the remoteness  of 
the region and development measures, 

conditions of life in the country without the adjustments due to the EU, 

farmers'  participation  in  the  Finnish  agri-environmental  programme,  reasons 
why farmers take part or not and the type of farmers concerned, 

- 

- 

- 

- 

- 

-  monitoring of impact of Finnish agri-environmental programme. 

2.  Socio-economic situation and trends 

The table below  sets  out certain  socio-economic  indicators  outlining the  situation 
and trends in the northern regions of Finland. 

28 

Table 29 

Indicator 

Northern  Region 

Finland 

Entire  region 

Rural  area 

Population  31/12/95  ( x  1000  inhabitants) 
change  1970-95  ( x  1000  inhabitants) 
forecast  1995-2030  ( x  1000  inhabitants) 
population  density  31/12/95  inhab/km2 
Net  migration  1993  ( x  1000  inhabitants) 
Net  migration  1994  ( x  1000  inhabitants) 
Net  migration  1995  ( x  1000  inhabitants) 
Rate of  population  benefiting  from 
infrastructure  built  by the  municipalities 
31.12.85% 
31.12.95% 
Population  over  64  as a  percentage 
of the  population  in  1995 
Unemployment  rate  in  1995  (%) 
Number  of jobs  in agriculture  and 
forestry:  1980 
1993 

%  change 
Number  of jobs  in the  other  sectors 

1980 
1993 

%  change 

2,031 
+  65 
- 87 
7 
-1 
-6 
-7 

66  % 
71  % 

1 5% 
22  % 

1,141 
-115 
-108 
5 
-2 
-7 
-9 

50  % 
56  % 

17  % 
21  % 

5,117 
+  518 
- 22 
15 
+ 8 
+ 3 
+  3 

76  % 
80  % 

14  % 
20  % 

178,507 
102  086 

159,815 
91,567 

279,175 
162,181 

- 42  .8% 

- 42  .7% 

- 41  .9% 

687,322 
576,759 

339,260 
284,404 

1,942,964 
1,715,540 

- 14  .6 

- 16  .2 

- 11  .7 

Migration from the northern regions to southern Finland has continued over recent 
years  (-14 000 inhabitants  in  1993-95), this negative trend being  more marked  in 
rural  areas (-18 000 inhabitants  in  1993-95). This trend  is expected to continue in 
forthcoming  decades (- 87 000 inhabitants over the period  1995-2030 according to 
national statistics for  1995). In  1995 the unemployment rate in the northern regions 
(22%) was higher than the national average (20%). 

3.  Current state of agricultural holdings and outlook 

In  1995 there were 61 743 agricultural holdings in the northern regions (9% down 
on  the  previous  year)  (see  Table  30).  The  greatest  fall  affected  stockfarms  and 
poultry holdings. 

29 

Table 30 

Types of holding in 
the northern regions 
• dairy cows 
• bovine animals 
• swine 
• eggs and poultry 
• cereals 
• other 

Total 
Farm holdings in 
Finland 

Number of  holdings 

in 1994 

in  1995 

Difference  94-95 
% 

holdings 

26,155 
7,505 
3,085 
1,055 
12,007 
17,995 
67,802 

24,232 
6,569 
2,921 
923 
10,753 
16,345 
61,743 

-  1,923 
-936 
-164 
-132 
- 1,254 
-1,650 
- 6,059 

- 7 ,4 
- 1 2 .5 
-5  ,3 
- 1 2 ,5 
- 1 0 ,4 
- 9 .2 
-8  ,9 

114,472 

104,555 

-9,917 

- 8 ,7 

It  is  estimated  that  by  the  year  2000,  there  will  be  a  25% fall  in  the  number  of 
holdings of at least five hectares' area. 

4.  Impact of aid on northern regions 

The  primary  sector  still  provides  a  major  share  of  employment  in  the  northern 
regions and the success in offsetting job  losses in agriculture by openings  in other 
sectors of the economy plays an important role. Between  1980 and  1994, only 6% 
of job  losses  in  agriculture  were  offset  by  other  sectors  in  municipalities  in  the 
northern regions. This is clear evidence of the importance of northern region support 
(as  of  other  types  of  support)  in  maintaining  the  population  in  the  area,  since  it 
would be very difficult  to create alternative employment in the region if agricultural 
activity were not maintained. 

VII.  EFFECTS  OF  AID  GRANTED ON  ENVDJONMENTAL  PROTECTION  AND THE  PRESERVATION  OF THE 

COUNTRYSIDE  (AS  PROVIDED  FOR  IN THE  THIRD  SUBPARAGRAPH  OF  ARTICLE  142(3)  OF THE  ACT  OF 
ACCESSION) 

In the northern  regions  of Finland,  as moreover  throughout  the rest of the country,  an 
agri-environmental  programme  has  been  applied  pursuant  to  Regulation  (EEC) 
No 2078/92 on agricultural production methods compatible with the requirements of the 
protection of the environment and the maintenance of the countryside. 

30 

Pursuant  to  Article  142,  one  of  the  objectives  of  the  aid  measures  for  the  northern 
regions is to protect the environment  and preserve the countryside, which was also one 
of  the main  objectives  of  Finland's  pre-EU  agricultural  policy.  In the  decades  prior  to 
accession,  the  aim  of  the  latter  was  to  maintain  both  agricultural  production  and  the 
population in rural areas, in particular in the northern regions. Rates of aid to agriculture 
varied  with  the  severity  of  the  natural  handicaps  besetting  it.  This  policy  has  been 
continued  with the adoption  of Article  142 of the Act of Accession. Aid  applied  in the 
northern regions is intended  to offset  the high production costs occasioned  by the short 
growth  period  and  low  yields  and  varies  with  the  conditions  specific  to  each  region. 
Ceilings on production qualifying  for aid have been set per subregion in order to prevent 
the transfer of production to areas where aid payable is higher. The regional ceilings and 
quotas prevent production rising in subregions, firstly  because production not  benefiting 
from support  is totally  unprofitable,  and  secondly because  the  aid  is  not  linked  to  the 
actual quantity produced. 

The table set out below gives a general overview of the area cultivated per subregion in 
Finland. 

Table  31 

Subregion 

Number  of 
holdings 

C4 
C3 
C2North 
C2 
C1 
Sub-total  1 
B 
A 
Sub-total  2 
TOTAL 

720 
4,095 
3,116 
26,303 
23,886 
58/120 
29,715 
12,475 
42,190 
100,310 

Area 
cultivated 
ha 
8,905 
69,047 
55,091 
534,846 
459,998 
1y 127,887 
690,478 
380,138 
1,070,616 
2  198,504 

ha/ 
holding 

Area  of  the 
subregion 
km2 

Area 
cultivated 

(%) 

12  .37 
16  .86 
17  .68 
20  .23 
19  .26 
19  .41 
23  .24 
30  .47 
25  .38 
21  .92 

71,393 
64,779 
24,290 
67,788 
48,866 
227,115 
47,071 
13,518 
60,589 
337,704 

0  .1 
1  .1 
2  .3 
7  .9 
9  .4 
4  .1 
14  .7 
28  .1 
17  .7 
6  .5 

The conditions  and restrictions  governing  support  for  the northern regions  prevent  any 
change in livestock production  and any intensification  of crop production, which  could 
have  undesirable  consequences  for  the  environment  and  the  countryside.  To  sum  up, 
support  for the northem regions plays an important part in maintaining the  countryside 
and the natural environment and provides an obstacle to excessive  over-afforestation. 

VIII.  INTEGRATED ADMINISTRATION AND CONTROL SYSTEM (IACS) 

Like other types of assistance to farmers, aid for the northern regions is administered and 
monitored  by  the  information  network  which  operates  in  Finland,  comprising  a 
centralized system at national and regional level and a decentralized system at municipal 
level. 

31 

The decentralized  system  provides  data on most widespread  forms  of  aid granted to 
farmers,  i.e.  national  support  applying  to cultivated  areas and livestock  and CAP aid 
measures, subsidies for stockfarming (premiums for bovine animals, suckler cows, sheep 
and  goats),  the  general  scheme  for  agri-environmental  support  and  compensatory 
allowances,  while  certain,  less  widespread  aid  measures  are  administered  by  the 
centralized  system  (e.g.  additional  aid  for  agri-environmental  measures,  afforestation, 
dried  fodder, flax and hemp, and structural  assistance).  The Ministry  of Agriculture's 
centralized system deals with accounting, statistics and markets. 

IACS  subsystems  undertake  the  management  of  aid,  non-food  production  and  the 
administration and monitoring of quotas. 

Aid applications are fed by farmers into the decentralized information system set up in 
all 455 municipalities. The system handles data on holdings, processes aid applications, 
calculates the aid and forwards the information to the centralized system, which carries 
out the requisite checks,  selects the recipients  for inspection and makes reports to the 
EU. 

Checks conducted in  1995 on all types of production numbered  11 527  (13.2% of aid 
applications),  of which  65% took place in the northern regions.  45.2% of the checks 
conducted  throughout  the  country  relate  to  crop  production.  In the  northern regions, 
there were 438 cases of irregularities observed in respect of all types of aid and penalties 
applied (4.9% of cases checked). 

DC  REQUESTS FROM FINNISH AUTHORITIES 

On 5 December  1995  and 5 March 1996 the Finnish authorities forwarded  a series of 
requests, supplemented later on 7,15 and 25 October and 19 November 1996. 

The proposals relate to the following. 

1.  Requests for amendments to Decision 95/196/EC 

(a)  Limiting of northern region aid for cow's milk provided for Article 3(2)(c)  of 
Decision  95/196/EC  to  reference  quantity  allocated  pursuant  to  Article 4  of 
Regulation (EEC) No 3950/928 after reallocation of unused reference quantities 
pursuant to the second subparagraph of Article 2(1) of that Regulation; 

(b)  Increase in total aid for milk owing to more accurate estimate of  distribution 

between areas P1-P4 of subregion C3; 

(c)  Increase in quantity of milk qualifying for aid and in total aid in subregions Cl-

C3 to include SLOM quantity allocated in 1995 and 1996; 

OJ No L 405,31.12.1992, p. 1. 

32 

(d)  Change  in  quantities  of  poultrymeat  and  eggs  produced  during  the 
reference  period,  together  with  adjustment  of  total  aid  recorded  over  the 
same  period  and  amendment  to  Annexes  to  Decision 95/196/EC  to 
distinguish  between  layers,  pullets  and  chicks  on  the  one  hand,  and 
broilers and other poultry on the other hand; 

(e)  Allocation from 1997 of aid for storage for wild soft fruit (gathered berries) 

and wild mushrooms. Maximum aid: FIM 2 million/year; 

(f)  Increase  in  total  aid  for  young  farmers  (FIM 94 million/year  instead  of 

FIM 80 million/year laid down); 

(g)  Increase in quantity covered and northern region aid allocated in respect of 
potatoes  for  starch production  following  the increase  in the potato  starch 
quota allocated to Finland. 

2.  Proposals  for  technical  adjustments  to  Annexes  II  to  VI  to  Decision 
95/196/EC  as  a  result  in  particular  of  inaccuracies  and  shortcomings  in 
regional statistics 

These concern: 

- 

- 

- 

- 

- 

- 

- 

- 

- 

poultrymeat 

the SLOM quota for cow's milk 

production of potatoes for starch production 

ceiling on milk production and support 

support for young farmers 

agri-environmental aid, aid for potatoes for starch production and sugarbeet 

area under grazing, ware potatoes and land left  fallow 

unit  aid  for  other  cereals  and  arable  crops  from  the  year  2000  on: 
FIM 800/ha  instead  of  FIM 600/ha  laid  down  (correction  of  typing 
mistake) 

adjustment  of  amounts  in  Annex  VI  to  Decision  95/196/EC  for 
Community aid for potatoes for starch production and sugarbeet  following 
the approval of Finnish agri-environmental programme in autumn 1995. 

3.  Other requests 

No  application of reduction in aid for ewes and she-goats in  1996 owing to  1995 
overrun  in  authorized  production  ceiling,  which,  given  the  very  low  prices  for 
sheepmeat in Finland, would have adverse effects on production in the sector. The 
grounds for the request are that, on the one hand, the number of animals qualifying 
for the aid is below the limit laid down in Decision 95/196/EC and, on the other 
hand, the reduction in Community support expressed in national currency in 1996 is 
greater than the reduction due to the overrun in the authorized ceiling. 

33 

X. 

A D M I N I S T R A T I VE 

I N S T R U M E N TS 

A D O P T ED 

F OR 

T HE 

I M P L E M E N T A T I ON 

OF 

COMMISSION DECISION 95/196/EC 

1.  Council  of  State  Decision  No  413/95  of  23  March  1995  on  support  in  northern 
regions for agricultural and horticultural production (as amended by Decisions Nos 
1006/96,1435/95 and 225/96) 

2.  Ministry of Agriculture and Forestry Decision No 31/96 of  18 January  1996  fixing 
the  maximum  size  of  agricultural  holdings  for  the  purposes  of  payment  of 
supplementary aid in 1995 

3.  Ministry of Agriculture and Forestry Decision No 32/96 of 24 January  1996 on the 

implementation in 1995 of aid for egg production 

4.  Council of State Decision No 223/96 of 28 March 1996 on additional premiums for 

suckler cows for 1995 

5.  Council  of  State Decision  No  376/96 of  30 May  1996 on  aid  for  horticulture  for 
1995 

XL 

CONCLUSIONS 

Pursuant to Article  142 of the Act of Accession, the Commission authorized Finland by 
Decision  95/196/EC of 4  May  1995 to  grant  long-term  national  aid  for  agriculture  in 
agricultural areas situated to the north of the 62nd Parallel and adjoining regions  affected 
by comparable conditions rendering agricultural activity particularly arduous. 

By that Decision, the Commission: 

(a)  demarcated  the  areas taking  account  of  low population  density, the proportion  of 
agricultural  land  in  relation  to  the  overall  area  and  the proportion  of  agricultural 
land given over to arable crops for human consumption, and 

(b)  fixed  on the one hand, the unit aid and total aid ceiling not to be exceeded  taking 
account  of  the  difference  in  prices  obtaining  in  the  EU  and  in  Finland  prior  to 
accession, degressive national aid authorized pursuant to Article  138 of the Act of 
Accession  and  Community  aid  (market  aid,  compensatory  allowances,  agri-
environmental  measures)  and,  on  the  other  hand,  the  ceiling  on  production,  any 
overrun  in  which  will  lead  to  a proportionate  reduction  in  authorized  aid  in  the 
following year. 

As noted in this Report on authorizations granted and results achieved, which has been 
drawn up with a view to presentation to the Council on the basis of information provided 
by  the  Finnish  authorities  pursuant  to  Article 143(2)  of  the  Act  of  Accession,  the 
following points are clear: 

1. 

In most product groups where aid was authorized in the northern regions, there was 
no overrun in 1995 in the level of production or support authorized. 

-  Production was exceeded in respect of: 

• 

horses, for which there was no provision for aid in 1995; 

34 

• 

poultry, where an overrun in production was recorded and a reduction in 
proportion  to  the  overrun  recorded  in  1995  must  be  applied  in  the  aid 
authorized in 1996; 

• 

ewes  and  she-goats,  where  a  reduction  in  proportion  to  the  overrun 
recorded  in  1995  should  not  be  applied  in the  aid authorized  for  1996, 
- -  since the reduction in the aid due to the overrun in production was offset 

by the reduction in Community aid expressed in national currency. 

-  An  overrun  was  recorded  in  the  total  aid  authorized  for  milk  without  any 
overrun  in  the  total  quantity  authorized.  This  overrun  is  due  to  higher 
production as compared with that laid down for certain sub-areas in subregion 
C3 and in subregions C2 and C2 North. This has led the Finnish authorities to 
apply  a  general  reduction  in  the  aid  allocated  in  1996  in  order  to  recover 
amounts unduly paid in 1995. 

-  A justified  overrun in both production  and total  aid authorized  in respect  of 
potatoes for starch production, as a result of the Council's increasing the quota 
of potato starch production for Finland (Regulation (EC) No 1863/95). 

2.  All the aid measures were applied in 1995 except for aid for the Skolt population, 

the "natural economy" and the "reindeer industry". 

3.  Producer  prices  for  vegetables  in  Finland  in  1995  were  lower  than  in  the 
Community. As a consequence, there is no reason to reduce northern region support 
for such products. 

4.  Community  aid  measures  (market  aid,  compensatory  allowances  and  agri-
environmental measures) applied per product were below the level used to fix the 
northern region  aid  authorized;  as  a consequence,  their  application  results  in no 
overrun in support applying before accession. 

5.  Checks conducted by the Member State show that the aid has been applied properly. 

6.  Aid granted plays an important role in protecting the environment and preserving 
the countryside  and as a consequence  it complies with the third subparagraph of 
Article 142(3) of the Act of Accession. 

It  emerges from the  foregoing  that,  generally  speaking,  the  Finnish  authorities  have 
correctly applied Decision 95/196/EC on aid in the northern regions. In the few cases 
where an overrun has been recorded in production or aid authorized, the aid must be 
reduced in accordance with the Commission Decision. 

The  Finnish  authorities  have proposed  a  set  of  amendments  to  Decision 95/196/EC, 
which the Commission is considering. 

35 

MAP  N° 

i 

MAP  N°  2 

31 

MAP  N°  3 

<g 

ANNEXE 4 
FINLAND - Nordic Region - Article 142 

Lâàni-County 
name 

Total Area 
km* 

Land Area 
km1 

Population 
1990 

Density 
H/km2 

Total U.A.A. 
"1990" ha 

U.A.A. eligible of which 

ha 
Total 

% Total  North 62  Fullfllling 
3 criteria 

Isolated  Homogeneous 

area 

UUSIMAA 
«TURKU AND PORI 
1ÂLAND ISLANDS 
HÀME 
KYMI 
MIKKELI 
NORTH-KARELIA 
KUOPIO 
KESKI-SUOMI 
VAASA 
OULU 
LAPPI 
FINLAND 

10,254 
22,355 
1,553 
20,699 
12,708 
19,887 
22,355 
20,028 
19,212 
26,985 
61,880 
99,854 
337,770 

9,905 
19,958 
1,527 
19,230 
10,784 
16,346 
17,783 
16,509 
16,232 
26,018 
56,476 
93,058 
303,826 

1,248,041 
694,407 
24,604 
715,340 
342,629 
208,225 
176,836 
256,781 
252,815 
457,557 
439,249 
200,694 
5,017,178 

126 
35 
16 
37 
32 
13 
10 
16 
16 
18 
8 
2 
17 

221,909 
479,533 
13,393 
308,304 
163,440 
122,286 
119,174 
169,550 
121,485 
452,403 
302,137 
75,330 
2.548,944 

0 
21,690 
0 
35,722 
32,173 
98,138 
119,170 
169,550 
110,823 
452,403 
302,137 
75,330 
1.417,140 

0.0% 
4.5% 
0.0 
11.6% 
19.7% 
80.3% 
100.0% 
100.0% 
91.2% 
100.0% 
100.0% 
100.0% 
55.6% 

13,981 

33,259 

2,268 

195 

55,382 
119,174 
169,550 
98,540 
452,403 
302,137 
75,330 
1,319,756 

510 

6,346 

8,614 

705 

7,709 

32,173! 
42,246 

5,937 

ANNEXE 5 
Northern Aid (Article 142) 
FINLAND 

- bovines: 

. suckler cows 
. male bovines > 6 months 
. heifers for slaughter 

- milk 
- sheep/goats 
- swines 
- poultry 
- horses 
- reindeer 
- milk and meat transport 

Total a 

0 

- cereals and other arable crops 

. barley, oats and mixed cereals 
. other cereals and arable crops 

- potatoes for starch production 
- sugar beet 
- horticulture under perman. shelter 
- field scale vegetables 
- storage of vegetables 
- payment per ha of UAA 
- young farmers 

Total b 

- aid for Skolt Lapps, "natural 

economy" and "reindeer  industry" 
GRAND TOTAL 

1995 

1996 

1997 

Year (in mio FIM) 
1999 

1998 

>2000 

1995 

1996 

1997 

Year (In mio ECU) 
1999 

1998 

>2000 

3  .4 
115  .1 
31  .8 
403  .0 
7  .0 
3  .1 
0  .8 
0 
36  .6 
13 .5 
614  .4 

54  .5 
2  .2 
1 .9 
2  .0 
0 
0  .2 
15 .0 
157 .4 
80  .0 
313  .2 

3  .4 
115  .1 
31  .8 
403  .0 
7  .0 
3  .1 
0  .8 
0 
36  .6 
13 .5 
614  .4 

54  .5 
2  .2 
1 .9 
2  .0 
0 
0  .2 
15 .0 
157  .4 
80  .0 
313  .2 

10 .3 
166  .9 
49  .3 
597  .9 
9  .2 
68  .8 
20  .9 
0 
36  .6 
13 .5 
973  .4 

54  .3 
9  .3 
2  .5 
3  .4 
9  .2 
2  .1 
15 .0 
157 .4 
80  .0 
333  .4 

17 .2 
220  .5 
67  .2 
793  .0 
11 .5 
134  .5 
41  .0 
4  .8 
36  .6 
13 .5 
1,339 .8 

24  .1 
274  .1 
84  .6 
987  .9 
13 .7 
200  .1 
61  .0 
9  .0 
36  .6 
13  .5 
1.704.6 

31  .0 
326  .4 
102 .0 
1183  .2 
'  16 .0 
265  .7 
81  .1 
15 .0 
36  .6 
13 .5 
2.070.5 

54  .5 
16 .4 
3  .1 
4  .8 
51  .4 
3  .1 
15 .0 
157  .4 
80  .0 
385  .7 

54  .5 
23  .5 
3  .7 
6  .2 
99  .0 
3  .9 
15 .0 
157 .4 
80  .0 
445  .3 

54  .5 
30  .9 
4  .3 
7  .6 
146 .8 
5  .1 
15 .0 
157 .4 
80  .0 
501  .3 

0  .54 
18 .27 
5  .05 
63  .97 
1  .11 
0  .49 
0  .13 
0 
5  .81 
2  .14 

97  .5 

8  .65 
0  .35 
0  .30 
0  .32 
0 
0  .03 
2  .38 
24  .98 
12  .70 
49  .71 

0  .54 
18  .27 
5  .05 
63  .97 
1  .11 
0  .49 
0  .13 
0 
5  .81 
2  .14 

97  .5 

8  .65 
0  .35 
0  .30 
0  .32 
0 
0  .03 
2  .38 
24  .98 
12  .70 
49  .71 

1  .63 
26  .49 
7  .83 
94  .90 
1  .46 
10 .92 
3  .32 
0 
5  .81 
2  .14 
154  .50 

8  .65 
1  .48 
0  .40 
0  .54 
1  .46 
0  .33 
2  .38 
24  .98 
12 .70 
52  .92 

2  .73 

35  .0 
10 .67 
125  .87 
1  .83 
21  .35 
6  .51 
0  .76 
5  .81 
2  .14 
212  .67 

8  .65 
2  .60 
0  .49 
0  .76 
8  .16 
0  .49 
2  .38 
24  .98 
12 .70 
61  .22 

3  .83 
43  .51 
13 .43 
156  .81 
2  .17 
31  .76 
9  .68 
1  .43 
5  .81 
2  .14 
270  .57 

8  .65 
3  .73 
0  .59 
0  .98 
15 .71 
0  .62 
2  .38 
24  .98 
12 .70 
70  .68 

4  .92 
51 .81 
16 .19 
187 .81 
2  .54 
42  .17 
12 .87 
2  .38 
5  .81 
2  .14 
328  .65 

8  .65 
4  .90 
0  .68 
1  .21 
23  .30 
0  .81 
2  .38 
24  .98 
12 .70 
79  .57 

22  .7 
950  .3 

22  .7 
950  .3 

22  .7 
1,329  .5 

22  .7 
1,748 .2 

22  .2 
2 172  .6 

22  .2 
2.594  .7 

3  .60 
150  .84 

3  .60 
150  .84 

3  .60 
211  .03 

3  .60 
277  .49 

3  .60 
344  .86 

3  .60 
411  .86 

ANNEX 6 
DIAGRAMME 

Evolution  of support  in the  northern areas of Finland 

7000 

3 

B Price support 

E3 Budget support 

B Support according to Articles 138-140 

•  Support according to Article 142 

•  Market support foreseen 

B Compensatory allowances foreseen 

B Agri-environmental measures foreseen 

—I 
Support 
during the 
reference 
period 

1995 

1996 

1997 

1998 

1999 

2000 

2001 

>2002 

(*)  1 green ECU = 7,0207 FIM 
1 budget ECU = 5,8163 FIM 

ISSN 0254-1475 

COM(97) 162 final 

DOCUMENTS 

EN 

03  13 

Catalogue  number  :  CB-CO-97-150-EN-C 

ISBN  92-78-18352-0 

Office  for Official  Publications of the European Communities 

L-2985 Luxembourg