Proposal for a Council Regulation adapting Regulation (EC) No 1782/2003, establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers, Regulation (EC) No 1786/2003 on the common organisation of the market in dried fodder, and Regulation (EC) No 1257/1999 on support for rural development from the European Agricultural Guidance and Guarantee Fund (EAGGF) by reason of the accession of the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary, Malta, Poland, Slovenia and Slovakia to the European Union
Date: 2003-10-27
Institutions: European Commission
Subjects: accession to the European Union, aid system, aid to agriculture, enlargement of the Union, reform of the CAP

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 27.10.2003
COM(2003) 640 final

Proposal for a

COUNCIL REGULATION

adapting Regulation (EC) No 1782/2003, establishing common rules for direct support
schemes under the common agricultural policy and establishing certain support schemes
for farmers, Regulation (EC) No 1786/2003 on the common organisation of the market
in dried fodder, and Regulation (EC) No 1257/1999 on support for rural development
from the European Agricultural Guidance and Guarantee Fund (EAGGF) by reason
of the accession of the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary,
Malta, Poland, Slovenia and Slovakia to the European Union

.(presented by the Commission)

EXPLANATORY MEMORANDUM

CAP REFORM AND ENLARGEMENT ADAPTATION EXERCISE

Introduction

On 29 September 2003, the Council adopted a CAP reform package which makes significant
changes to the acquis on which the accession negotiations were based. In their current form
the  CAP  reform  texts  take  no  account  of  the  results  of  those  negotiations  or  indeed  of
enlargement itself. There is therefore a need to adapt both the Act of Accession and the CAP
reform  texts  before  accession  to  ensure  that  the  two  are  complete  and  compatible,  i.e.  to
ensure that they can function in an enlarged community. Specifically, there is a need to:

– 

– 

adapt the CAP-related annexes of the Act of Accession so that the negotiation results
fit  with  the  new  acquis  (this  will  be  necessary  where  references  in  the  Act  of
Accession are rendered obsolete or where the negotiation results are not immediately
compatible with the reformed CAP);

adapt the CAP reform texts so that they can be applied to the new Member States and
so that they incorporate  any negotiation results that would otherwise (in  the  future)
be lost.

To achieve these two objectives, the Commission has prepared two legislative proposals (for a
Decision  and  a  Regulation  respectively)  which  are  in  both  cases  based  on  the  following
guiding principles:

– 

– 

– 

– 

the  fundamental  character  and  principles  of  the  package  agreed  in  Copenhagen
should be maintained, and applied to any new elements. There should be no 'erosion'
of the terms of accession negotiated by the acceding countries;

where  the  CAP  reform  introduces  new  elements  that  were  not  covered  during  the
accession  negotiations  on  agriculture,  the  new  Member  States  should  be  treated
similarly  to  the  current  Member  States,  except  where  that  conflicts  with  the
overriding principle described above;

adaptations should be limited to what is absolutely necessary;

the  new  Member  States  should  be  integrated  smoothly  into  the  reformed  CAP  as
soon as possible.

The present proposal sets out the adaptations to the regulations adopted in the context of the
reform of  the  CAP  which  are  necessary  due  to  the  accession  of  ten  new  Member  States  on
1 May  2004.  Accordingly,  the  proposed  regulation  is  based  on  Article  57  of  the  Act  of
Accession.

Single Payment Scheme (SPS)

In  the  horizontal  Regulation  of  the  CAP  reform  package,  a  new  direct  payment  system  is
introduced  for  the  EU-15:  the  Single  Payment  Scheme  (SPS).  As  from  1  January  2005  this
replaces most of the classical direct payment schemes with a single de-coupled payment per
hectare. Under the standard version of the SPS, 'entitlements' to these payments are calculated
on  the  basis  of  direct  payments  granted  to  the  farmer  in  question  during  a  reference  period
(2000–2002),  so  the  value  of  the  entitlement  (per  hectare)  will  differ  between  farmers.  The
number of entitlements granted to a farmer will however be equal to the average number of
hectares  on  his  or  her  farm  that  gave  rights,  during  the  reference  period,  to  the  direct
payments  concerned.  Within  the  SPS  Member  States  are  given  various  options  as  to

2

implementation,  including  the  exclusion  of  some  direct  payments  on  a  temporary  basis,
keeping  some  payments  partially  coupled,  or  implementing  the  payment  per  hectare  on  a
regional basis.

The problem in relation to enlargement is how to apply the SPS to the new Member States,
given  that  the  latter  do  not  have  figures  for  farmers’  entitlements  during  the  historical
reference  period  to  be  used.  Using  future  reference  periods,  i.e.  basing  entitlements  for  the
new  Member  States  on  the  'classical'  direct  payment  schemes  applied  from  2004–2006  is
ruled out, given that it would:

– 

– 

– 

– 

be inconsistent with the treatment of the EU-15,

lead  to  artificial  shifts  of  production  to  sectors  promising  optimal  accumulation  of
entitlements,

force the new Member States to apply the 'classical' system until the end of 2006 and

necessarily  therefore  prevent  the  introduction  of  the  Single  Area  Payment  Scheme
(SAPS).

The  current  proposals  instead  provide  for  the  compulsory  application  by  the  new  Member
States of the regional implementation option set out in the horizontal  Regulation adapted  as
far as necessary. This means that:

– 

– 

– 

– 

– 

– 

– 

– 

there would be uniform per-hectare entitlements within any one region;

regional  financial  envelopes  would  be  calculated  by  dividing  the  national  envelope
between regions (defined by new Member States) according to objective criteria, for
example  statistics  on  regional  arable  crops  production,  the  size  of  the  beef  herd  in
different  regions,  payments  during  the  2004–2006  period  (see  above),  or  the
existence of pre-accession national direct support in particular regions;

individual  farm  entitlements  would  be  calculated  by  dividing  the  regional
envelope(s)  by  the  regional  utilised  agricultural  area  (minus  permanent  crops  area
and forests);

sector specific issues could be addressed by granting additional entitlements from the
national reserve;

the  national  reserve  should  be  set  at  3%  of  the  national  ceiling,  as  for  the  current
Member States;

data  on  pre-accession,  EU-like  direct  payments  could  be  accepted  as  "objective
criteria"  both  for  (i)  distributing  the  national  envelope  between  regions  and
(ii) distributing the reserve;

the 10% option referred to in Article 69 of the horizontal Regulation would also be
available to the new Member States, allowing additional resources to be channelled
to farmers in specific sectors such as organic farming;

in  the  event  that  a  new  Member  State  wished  to  apply  partial  decoupling,  the
determination of entitlements would follow the same rules as for the EU-15 under the
regional option.

3

Cross-compliance

Various acceding countries negotiated transition periods on certain directives (e.g. the habitats
directive),  which  under  the  CAP  reform  regulations  become  part  of  the  cross-compliance
requirements.  Care  is  taken  in  the  current  proposals  to  ensure  that  these  transition  periods
remain  valid  and  that  cross  compliance  with  these  particular  directives  will  not  apply  to
farmers in the new Member States concerned during the transition period in question.

The  CAP  reform  introduces  cross-compliance  as  a  compulsory  instrument.  However,  as
regards SAPS, it seems appropriate to maintain the concept of facultative application of cross-
compliance  as  it  results  from  the  relevant  arrangements  in  the  Act  of  Accession  (see
Article 1b  in  conjunction  with  Article  3  of  Council  Regulation  (EC)  No  1259/1999).
Moreover,  it  is  clear  that  imposing  compulsory  cross-compliance  would  complicate  SAPS
considerably, which should be avoided. The proposal therefore maintains the existing cross-
compliance  arrangement  as  a  baseline,  but  makes  the  implementation  of  the  new  rules
optional under SAPS from 2005 onwards.

Farm advisory system

Under the CAP reform package there is provision for a farm audit system. As this system only
has  to  be  in  place  by  2007,  and  as  the  farmers’  participation  will  remain  voluntary,  no
adaptation  is  necessary  and  the  relevant  sections  of  the  horizontal  Regulation  can  apply  in
full.

Modulation and financial discipline

In  the  final  compromise  on  CAP  reform  a  Commission  declaration  is  included  stating  that:
“The Commission commits itself to propose that the mechanism of financial discipline as well
as  modulation  shall  not  apply  in  the  new  Member  States  until  the  phasing-in  of  direct
payments reaches the EU level.” The proposed text reflects this declaration. Since it cannot be
precisely predicted when modulation will become applicable in the new Member States it is
not possible at this stage to determine the ceilings referred to in Article 12(2). This should be
done by the Commission according to the management procedure.

Rye compensation

Under  the  CAP  reform,  rye  intervention  has  been  abolished.  To  soften  the  effects  of  this
decision, the following mechanism has been granted:

"In  view  of  the  structural  adjustment  pressures  resulting  from  the  abolition  of  rye
intervention, the following transitional measure shall apply: If in a Member State the
proportion  of  rye  as  a  part  of  its  total  cereal  production  exceeded  5%  on  average
during the 3 years 2000–2002 and its proportion of the total Community production
of  rye  exceeded  50%  during  the  same  period,  the  amounts  of  modulation  money
generated in this Member State will be re-allocated at a level of at least 90% to the
Member  State  concerned,  until  the  end  of  the  next  financial  perspective.  In  such
cases,  at  least  10%  of  the  modulation  money  has  to  be  spent  in  rye  producing
regions.1"

1

Article 10(4) of the Regulation (EC) No 1782/2003.

4

                                                
The above arrangement is in fact a non-issue for the new Member States as they will not be
subject  to  modulation.  It  is  also  possible  for  significant  rye  producers  amongst  the  new
Member States to use their (significant) rural development allocation to target rye-producing
regions or rye producers, with a view to encouraging diversification.

Quotas and ceilings

The CAP Reform proposals mention a series of national or Community ceilings, quota’s and
maximum guaranteed  quantities.  The proposal  therefore includes adjustments in  some  cases
to take into account the candidate countries. The various points concerned are as follows:

Article 74 of the horizontal Regulation and Annex X: durum wheat (national base areas)

Cyprus  and  Hungary  are  added  to  the  list  of  beneficiary  countries  and  in  Annex  X  the
traditional  production  zones  in  Cyprus  and  Hungary  are  included.  The  figures  in  question
have  already  been  fixed  in  the  accession  negotiations  and  so  the  adaptation  in  this  case  is
straightforward.

Article 78 of the horizontal Regulation: protein crops (maximum guaranteed area)

The  MGA  for  the  EU-15  is  1 400 000  ha.  This  is  increased  proportionally  for  the  10  new
Member States, on the basis of the statistics used in the accession negotiations for the arable
crop scheme. This implies an increase of 200 000 ha.

Articles 80 and 81 of the horizontal Regulation: rice (aid and national base area)

In  Article  80,  slight  variations  in  the  national  base  areas  of  the  current  MS  have  been
introduced.  For  the  new  MS,  only  Hungary  is  concerned  and  there  appears  no  reason  to
modify the negotiated base area (i.e. 3 222 ha). The proposals therefore make no changes in
this area.

In  Article 80, the  aid  for  Hungary  is  fixed  on  the  basis  of  the  reference  yield  agreed  in  the
accession  negotiations,  meaning  at  548,7  €/ha  for  the  marketing  year  2004/05  and  at
232,5 €/ha from the marketing year 2005/06.

Article 84 of the horizontal Regulation: nuts (MGA and NGA)

The  MGA  of  800 000  ha  is  divided  into  national  guaranteed  areas  (NGA).  The  proposals
therefore set NGAs for the new MS and increase the MGA accordingly to take into account
their  production.  The  same  20%  reduction  has  been  applied  as  was  used  for  the  current
Member States.

Article 89 of the horizontal Regulation: Energy crops (maximum guaranteed area)

A MGA of 1 500 000 ha was established by the CAP reform proposals, based on approximate
data, largely covering the areas currently sown in energy crops. Originally the purpose of this
aid was to compensate for the abolition of non-food set-aside. However, as the non-food set-
aside has been re-introduced in the final CAP reform texts, the attractiveness of this scheme
decreases and an overshooting of the MGA becomes unlikely. The current proposals therefore
maintain the MGA as agreed in the CAP reform.

5

Article 56(3) of the horizontal Regulation: Non-food set-aside (forecast quantities covered by
contracts)

A limit of 1 million metric tonnes expressed in soya bean meal equivalents has been set for
quantities of by-products for feed or food uses as a result of the cultivation of oilseeds on land
set-aside. This limit is subject to the Blair House agreement, meaning that any change would
need  to  be  negotiated  with  the  US.  For  this  reason  the  agreed  limit  is  maintained  in  the
proposals rather than adjusted.

Other adaptations

From  Article  95  of  the  horizontal  Regulation  onwards  (existing  direct  payments),  all  the
tables  with  ceilings,  global  amounts  or  NGA  are  adapted  in  these  proposals  to  include  the
negotiating results achieved by the new Member States.

Additional direct payment in dairy sector

Slovenia  and  Poland  have  obtained  a  transitional  period  of  1  year  for  the  allocation  of
individual milk quotas. This raises the question of what to use in those countries as the basis
for  granting  the  new-coupled  dairy  payments  in  2004.  The  answer  for  Poland  is
straightforward: as Poland has announced its intention to apply SAPS, the dairy payments will
already be included in the national SAPS envelope. For Slovenia, which is likely to opt for the
'classical' direct payments system, the Commission proposes that payments be granted on the
basis of the provisionally allocated quotas or on the basis of the milk delivered.

Rural development

In view of the  short  programming period the Act of Accession introduced the possibility  to
integrate  a  "LEADER+  type  measure"  in  the  mainstream  programmes,  instead  of  having  a
separate  LEADER+  programming.  Therefore  the  measure  "management  of  integrated  rural
development strategies by local partnerships" introduced by the CAP reform is not needed for
the new Member States as it is covered by the LEADER+ type measure.

6

Proposal for a

COUNCIL REGULATION

adapting Regulation (EC) No 1782/2003, establishing common rules for direct support
schemes under the common agricultural policy and establishing certain support schemes
for farmers, Regulation (EC) No 1786/2003 on the common organisation of the market
in dried fodder, and Regulation (EC) No 1257/1999 on support for rural development
from the European Agricultural Guidance and Guarantee Fund (EAGGF) by reason
of the accession of the Czech Republic, Estonia, Cyprus, Latvia, Lithuania, Hungary,
Malta, Poland, Slovenia and Slovakia to the European Union

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty establishing the European Community,

Having  regard  to  the  Treaty  of  Accession  of  the  Czech  Republic,  Estonia,  Cyprus,  Latvia,
Lithuania,  Hungary,  Malta,  Poland,  Slovenia  and  Slovakia,  and  in  particular  Article  2(3)
thereof,

Having  regard  to  the  Act  of  Accession  of  the  Czech  Republic,  Estonia,  Cyprus,  Latvia,
Lithuania,  Hungary,  Malta,  Poland,  Slovenia  and  Slovakia  and  in  particular  Article  57(2)
thereof,

Having regard to the proposal from the Commission2,

Whereas:

(1) 

(2) 

Council Regulation (EC) No 1782/20033 introduced common rules for direct support
schemes  under  the  common  agricultural  policy  and  established  certain  support
schemes for farmers.

The  said  common  rules  and  support  schemes  should  be  amended  to  allow  their
implementation in the Czech  Republic, Estonia,  Cyprus,  Latvia,  Lithuania,  Hungary,
Malta, Poland, Slovenia and Slovakia (hereinafter "the new Member States").

(3)  With  a  view  to  the  introduction  of  modulation  in  the  new  Member  States  the
Commission should establish national ceilings for the additional amount of aid for the
new Member States.

(4) 

The  farmers  in  the  new  Member  States  will  receive  direct  payments,  following  a
phasing-in  mechanism.  In  order  to  achieve  the  proper  balance  between  policy  tools
designed  to  promote  sustainable  agriculture  and  those  designed  to  promote  rural
development,  the  system  of  modulation  should  not  be  applied  in  the  new  Member

2

3

OJ C …, …, p. …
OJ L 270, 21.10.2003, p. 1.

7

                                                
(5) 

(6) 

(7) 

(8) 

(9) 

States  until  the  level  of  direct  payments  applicable  in  the  new  Member  States  is  at
least equal to the level applicable in the Community as constituted on 30 April 2004.

Taking  into  account  the  levels  of  direct  payments  for  farmers  in  the  new  Member
States as a result of phasing-in, the instrument of financial discipline should not apply
in  the  new  Member  States  until  the  level  of  direct  payments  applicable  in  the  new
Member States is at least equal to the level applicable in the Community as constituted
on 30 April 2004.

Direct payments under the single payment scheme are based on reference amounts of
direct payments that were received in the past or on regionalised per hectare payments.
Farmers  in  the  new  Member  States  did  not  receive  Community  direct  payments  and
have no historical references for the calendar  years 2000, 2001  and  2002. Therefore,
the single payment scheme in the new Member States should be based on regionalised
per hectare payments, subdivided between regions according to objective criteria and
divided  by  the  farmers  whose  holdings  are  located  in  the  region  concerned  and  that
meet the eligibility criteria.

The  amount  of  direct  payments,  described  in  national  ceilings,  under  the  single
payment  scheme  for  the  new  Member  States  should  be  based  on  the  quota,  ceilings
and quantities that were agreed in the accession negotiations multiplied by the relevant
aid amounts per hectare, head or tonne.

As of 1 April 2005 the market measure benefiting the production of dried fodder,  as
provided for in Council Regulation (EC) No 1786/20034, is amended. From that date
the market support is partially turned into a direct payment which will benefit farmers.
In order to avoid a decrease in overall support in 2005 for the new Member States, it is
appropriate  to  derogate  from  the  general  principle  of  phasing-in  of  direct  payments.
Therefore, the dried fodder related component in the single payment scheme national
ceiling should be calculated at the 100% aid level instead of at the phasing-in aid level.

Under the regionalised option for the single payment scheme the new Member States
should have the possibility to adjust the premium per hectare on the basis of objective
criteria  in  order  to  ensure  equal  treatment  between  farmers  and  to  avoid  market
distortions.

(10)  The new  Member States should have the possibility  to partially implement  and/or to

exclude certain sectors from the single payment scheme.

(11)  The sectoral ceilings for partial implementation and/or the exclusion of certain sectors
of  the  single  payment  scheme  should  be  based  on  the  quota,  ceilings  and  quantities
that were agreed in the accession negotiations.

(12)  The transition from the single area payment scheme to the single payment scheme and
other aid schemes may give rise to difficulties of adaptation which are not dealt with
in this Regulation. In order to deal with that eventuality, a general provision should be
included  in  Regulation  (EC)  No  1782/2003  enabling  the  Commission  to  adopt  the
transitional measures necessary for a certain period.

(13) 

In  view  of  the  short  programming  period  the  Act  of  Accession  introduced  the
possibility  to  integrate  a  "LEADER+  type  measure"  in  the  mainstream  programmes,
instead  of  having  a  separate  LEADER+  programming.  Therefore  the  measure

4

OJ L 270, 21.10.2003, p. 114.

8

                                                
"management  of  integrated  rural  development  strategies  by  local  partnerships"
introduced  in  Council  Regulation  (EC)  No  1257/19995  is  not  needed  for  the  new
Member States as it is covered by the LEADER+ type measure.

(14)  Regulations (EC) No 1782/2003, (EC) No 1786/2003 and (EC) No 1257/1999 should

therefore be amended accordingly,

HAS ADOPTED THIS REGULATION:

Council Regulation (EC) No 1782/2003 is adapted as follows:

Article 1

1.

In Article 5(2) the following sentence is added at the end of the first subparagraph:

“The new Member States shall ensure that land which was under permanent pasture
on 30 June 2003 is maintained under permanent pasture.”

2.

In Article 12 the following paragraph (5) is added:

"5.

For  the  new  Member  States  the  ceilings  referred  to  in  paragraph  2  shall  be
fixed  by  the  Commission  in  accordance  with  the  procedure  referred  to  in
Article 144(2)."

3.

After Article 12 the following Article 12a is inserted:

"Article 12a
Application to new Member States

The  provisions  of  this  Chapter  shall  apply  to  the  new  Member  States  as  from  the
calendar year in respect of which the level of direct payments applicable in the new
Member  States  in  accordance  with  Article  143a  is  at  least  equal  to  the  then
applicable  level  of  such  payments  in  the  Community  as  constituted  on  30  April
2004."

4.

In Article 54(2) the following sentence is added at the end of the first subparagraph:

“For  the  new  Member  States,  the  reference  to  the  date  provided  for  the  area  aid
applications for 2003 shall be construed as a reference to 30 June 2003.”

5.

In Title III the following Chapter 6 is added:

"Chapter 6

Implementation in the new Member States

Article 71a

1.

Save as otherwise provided for in this Chapter the provisions of this Title shall
apply to the new Member States.

5

OJ L 160, 26.6.1999, p. 80. Regulation as last amended by Regulation (EC) No 1783/2003 (OJ L 270,
21.10.2003, p. 70).

9

                                                
Articles 33, 34, 37, 38, 39, 40(1), (2), (3) and (5), 41, 42, 43, 47 to 50, 53 and
58 to 63 shall not apply.

Any new Member State applying the single area payment scheme shall take the
decisions  referred  to  in  Article  64(1),  71(1)  and  (2)  by  1  August  of  the  year
preceding that in respect of which it will apply the single area payment scheme
for the first time.

Article 71b
Application for support

Farmers shall apply for support under the single payment scheme by a date, to
be fixed by the new Member States, but not later than 15 May.

Except  in  case  of  force  majeure  and  exceptional  circumstances  within  the
meaning of Article 40(4), no entitlements shall be allocated to farmers, if they
do  not  apply  for  the  single  payment  scheme  by  15  May  of  the  first  year  of
application of the single payment scheme.

The  amounts  corresponding  to  entitlements  not  allocated  shall  revert  to  the
national  reserve  referred  to  in  Article  71d  and  shall  be  available  for
reallocation.

2.

1.

2.

3.

Article 71c
Ceiling

The national ceilings of the new Member States shall be those listed in Annex VIIIa.

Article 71d
National reserve

1.

2.

3.

Each  new  Member  State  shall  proceed  to  a  linear  percentage  reduction  of  its
national  ceiling  in  order  to  constitute  a  national  reserve.  This  reduction  shall
not be higher than 3%, without prejudice to the application of Article 71b(3).

The  new  Member  States  shall  use  the  national  reserve  for  the  purpose  of
allocating, according to objective criteria and in such a way as to ensure equal
treatment  between  farmers  and  to  avoid  market  and  competition  distortions,
payment entitlements to farmers finding themselves in a special situation, to be
defined  by  the  Commission  in  accordance  with  the  procedure  referred  to  in
Article 144(2).

During  the  first  year  of  application  of  the  Single  payment  scheme,  the  new
Member  States  may  use  the  national  reserve  for  the  purpose  of  allocating
payment entitlements,  according  to  objective  criteria  and  in  such  a  way  as  to
ensure equal treatment  between  farmers  and to avoid  market  and  competition
distortions,  to  farmers  in  specific  sectors,  finding  themselves  in  a  special
situation  as  a  result  of  the  transition  to  the  single  payment  scheme.  Such
payment  entitlements  shall  be  distributed  according  to  rules  to  be  defined  by
the Commission in accordance with the procedure referred to in Article 144(2).

10

4.

5.

The new Member States shall proceed to linear reductions of the entitlements
in case their national reserve is not sufficient to cover the cases referred to in
paragraphs 2 and 3.

Except  in  case  of  transfer  by  actual  or  anticipated  inheritance  and  by  way  of
derogation  from  Article  46,  the  entitlements  established  using  the  national
reserve  shall  not  be  transferred  for  a  period  of  five  years  starting  from  their
allocation.

By way of derogation from Article 45(1), any entitlement which has not been
used  during  each  year  of  the  five-year  period  shall  revert  immediately  to  the
national reserve.

Article 71e
Regional allocation of the ceiling referred to in Article 71c

1.

The  new  Member  States  shall  apply  the  single  payment  scheme  at  regional
level.

2.

The new Member States shall define the regions according to objective criteria.

New  Member  States  with  less  than  three  million  eligible  hectares  may  be
considered as one single region.

3.

1.

2.

1.

Each  new  Member  State  shall  subdivide  its  national  ceiling  referred  to  in
Article  71c  after  any  reduction  under  Article  71d  between  the  regions
according to objective criteria.

Article 71f
Regionalisation of the single payment scheme

All  farmers  whose  holdings  are  located  in  a  given  region  shall  receive
entitlements,  whose  unit  value  is  calculated  by  dividing  the  regional  ceiling
established  under  Article  71e  by  the  number  of  eligible  hectares  within  the
meaning of Article 44(2), established at regional level.

The number of entitlements per farmer shall be equal to the number of hectares
he declares in accordance with Article 44(2) the first year of application of the
single  payment  scheme,  except  in  case  of  force  majeure  or  exceptional
circumstances within the meaning of Article 40(4).

Article 71 g
Use of the land

Farmers may, by way of derogation from Article 51 and in accordance with the
provisions  of  this  Article,  also  use  the  parcels  declared  according  to
Article 44(3)  for  the  production  of  products  referred  to  in  Article 1(2)  of
Council  Regulation  (EC)  No  2200/966,  in  Article  1(2)  of  Council  Regulation
(EC) No 2201/967 and potatoes other than those intended for the manufacture

6

7

OJ L 297, 21.11.1996, p. 1.
OJ L 297, 21.11.1996, p. 29.

11

                                                
of  potato  starch  for  which  aid  is  granted  under  Article  93  of  this  Regulation,
except permanent crops.

2.

The  new  Member  States  shall  establish  the  number  of  hectares  that  may  be
used according to paragraph 1 by subdividing, according to objective criteria,
the average of the number of hectares that were used for the production of the
products  referred  to  in  paragraph  1  at  national  level  during  the  three-year
period 2000–2002 amongst the regions defined pursuant to Article 71e(2). The
average  number  of  hectares  at  national  level  and  the  number  of  hectares  at
regional  level  shall  be  fixed  by  the  Commission  in  accordance  with  the
procedure referred to in Article 144(2) on the basis of the data communicated
by the new Member State.

3. Within the limit established according to paragraph 2 for the region concerned,
a farmer shall be allowed to make use of the option referred to in paragraph 1 :

(a) within the limit of the number of hectares that he used for the production

of the products referred to in paragraph 1 in 2003;

(b)

by way of derogation from Article 71a(2), in case of application, mutatis
mutandis,  of  Articles  40  and  42(4),  within  the  limit  of  a  number  of
hectares  to  be  established  according  to  objective  criteria  and  in  such  a
way  as  to  ensure  equal  treatment  between  farmers  and  to  avoid  market
and competition distortions.

4. Within  the  limit  of  the  number  of  hectares  that  remain  available  after
application  of  paragraph  3,  farmers  shall  be  allowed  to  produce  the  products
referred  to  in  paragraph  1  on  a  number  of  hectares  other  than  the  number  of
hectares falling under paragraph 3 within the limit of a number of hectares used
for  the  production  of  the  products  referred  to  in  paragraph  1  in  2004  and/or
2005,  whereby  priority  shall  be  given  to  the  farmers  who  produced  the
products  already  in  2004  within  the  limit  of  the  number  of  hectares  used  in
2004.

In  case  of  application  of  Article  71  or  Article  143b,  2004  and  2005  shall  be
replaced  by,  respectively,  the  year  previous  to  the  year  of  application  of  the
single payment scheme and the year of application itself.

In order to establish the individual limits referred to in paragraphs 3 and 4, new
Members States shall use the farmer’s individual data, where available, or any
other evidence at their satisfaction provided by the farmer.

The  number  of  hectares  for  which  the  authorisation  has  been  established
according to paragraphs 3 and 4 shall in no case exceed the number of eligible
hectares as defined in Article 44(2) declared in the first year of application of
the single payment scheme.

The  authorisation  shall  be  used,  within  the  region  concerned,  with  the
corresponding payment entitlement.

5.

6.

7.

8.

The report referred to in Article 60 shall also relate to the new Member States.

12

Article 71h
Grassland

The  new  Member  States  may  also,  according  to  objective  criteria,  fix,  within  the
regional ceiling or part of it, different per unit values of entitlements to be allocated
to farmers referred to in Article 71f(1), for hectares under grassland as identified on
30  June  2003  and  for  any  other  eligible  hectare  or  alternatively  for  hectares  under
permanent pasture as identified on 30 June 2003 and for any other eligible hectare.

Article 71i
Dairy premium and additional payments

Starting from 2007 and by way of derogation from Articles 44 and 71f, the amounts
resulting  from  dairy  premium  and  additional  payments,  provided  for  in  Articles  95
and 96 and to be granted in 2007 shall be included in the single payment scheme.

However,  new  Member  States  may  decide  that  the  amounts  resulting  from  dairy
premiums  and  additional  payments,  provided  for  in  Articles  95  and  96,  shall  be
included,  in  part  or  in  full,  in  the  single  payment  scheme  starting  from  2005.
Entitlements established under this paragraph shall be modified accordingly.

The amount used for the establishment of entitlements in respect of those payments
shall be equal to the amounts to be granted according to Articles 95 and 96 calculated
on the basis of the individual reference quantity for milk available on the holding on
31 March of the year of inclusion, in part or in full, of those payments in the single
payment scheme.

By way of derogation from Article 71a(1), Articles 48, 49 and 50 shall apply mutatis
mutandis.

Article 71j
Set-aside entitlements

1.

2.

3.

4.

Farmers shall receive part of their payment entitlements in the form of set-aside
entitlements.

The  number  of  set-aside  entitlements  shall  be  established  by  multiplying  the
farmer’s eligible land within the meaning of Article 54(2) declared in the first
year of application of the single payment scheme with the applicable set-aside
rate.

The  set-aside  rate  shall  be  calculated  by  multiplying  the  basic  rate  of
compulsory  set-aside  of  10%  by  the  proportion,  in  the  region  concerned,
between  the  regional  base  area  or  areas  referred  to  in  Article  101,  third
paragraph, and the eligible land within the meaning of Article 54(2).

The value of the set-aside entitlements shall be the regional value for payment
entitlements as established according to Article 71f(1).

Paragraphs 1 to 3 shall not apply to farmers who declare less than a number of
hectares  within  the  meaning  of  Article  54(2)  which  would  be  needed  to
produce a number of tons equal to 92 tons of cereals as defined in Annex IX on
the basis of the reference yield referred to in Annex XIb applicable to the new

13

Member State where the holding is located, divided by the proportion referred
to in the second subparagraph of paragraph 2.

Article 71k
Conditions for the entitlements

By  way  of  derogation  from  Article  46(1),  entitlements  established  under  this
Chapter  may  only  be  transferred  within  the  same  region  or  between  regions
where the entitlements per hectare are the same.

New  Member  States  may  also  decide,  by  1  August  of  the  year  preceding  the
first year of application of the single payment scheme at the latest, and acting
in compliance with the general principle of Community law, that entitlements
established  under  this  Chapter  shall  be  subject  to  progressive  modifications
according to pre-established steps and objective criteria.

Article 71l
Optional implementation

Sections 2, 3 and 4 of Chapter 5 shall apply to the new Member States under
the conditions laid down in this Article. However, Section 4 shall not apply to
new  Member  States  applying  the  single  area  payment  scheme  referred  to  in
Article 143b.

Any reference in Sections 2 and 3 of Chapter 5 to Article 41, in particular with
regard  to  the  national  ceiling(s),  shall  be  construed  as  a  reference  to
Article 71c.

The  report  referred  to  in  Article  64(3)  shall  include  the  options  laid  down  in
this Chapter."

1.

2.

1.

2.

3.

6.

Article 74(1) is replaced by the following:

"1. The  aid  shall  be  granted  for  national  base  areas  in  the  traditional  production

zones listed in Annex X.

The base area shall be as follows:

Greece
Spain
France
Italy
Cyprus
Hungary
Austria
Portugal

617 000 ha
594 000 ha
208 000 ha
1 646 000 ha
6 183 ha
2 500 ha
7 000 ha
118 000 ha."

7.

Article 78(1) is replaced by the following:

"1. A maximum guaranteed area of 1 600 000 ha for which the aid may be granted

is hereby established."

14

8.

Article 80(2) is replaced by the following:

"2. The  aid  shall  be  as  follows,  according  to  the  yields  in  the  Member  States

concerned:

Marketing year 2004/05
and in case of
application of Article 70
(EUR/ha)
1 323,96
1 123,95

Marketing year
2005/06 and
onwards
(EUR/ha)
561,00
476,25

971,73
1 329,27
1 069,08
548,70
1 070,85

411,75
563,25
453,00
232,50
453,75"

Greece
Spain
France:
— metropolitan territory
— French Guyana
Italy
Hungary
Portugal

9.

Article 81 is replaced by the following:

"Article 81
Areas

A national base area for each producing Member State is hereby established.
However, for France two base areas are established. The base areas shall be as
follows:

Greece

Spain
France:
— metropolitan territory
— French Guyana
Italy
Hungary
Portugal

20 333 ha

104 973 ha

19 050 ha
4 190 ha
219 588 ha
3 222 ha
24 667 ha.

A Member State may subdivide its base area or areas into sub-base areas in
accordance with objective criteria."

10.

Article 84 is replaced by the following:

"Article 84
Areas

1.

2.

3.

A  Member  State  shall  grant  the  Community  aid  within  the  limit  of  a  ceiling
calculated  by  multiplying  the  number  of  hectares  of  its  NGA  as  fixed  in
paragraph 3 by the average amount of EUR 120,75.

A maximum guaranteed area of 810 400 ha is hereby established.

The maximum guaranteed area referred to in paragraph 2 shall be divided into
the following NGA:

15

National Guaranteed Areas (NGA)

Belgium
Germany
Greece
Spain
France
Italy
Cyprus
Luxembourg
Hungary
Netherlands
Austria
Poland
Portugal
Slovenia
Slovakia
United Kingdom

100 ha
1 500 ha
41 100 ha
568 200 ha
17 300 ha
130 100 ha
3 100 ha
100 ha
2 900 ha
100 ha
100 ha
1 000 ha
41 300 ha
300 ha
3 100 ha
100 ha

4.

A  Member  State  may  subdivide  its  NGA  into  sub-areas  in  accordance  with
objective  criteria,  in  particular  at  regional  level  or  in  relation  to  the
production."

11.

Article 90 is replaced by the following:

"Article 90
Conditions for eligibility

The aid shall be  granted only in respect of  areas  whose production  is  covered by  a
contract between the farmer and the processing industry, except in case of processing
undertaken by the farmer himself on the holding.

Areas which have been subject to an application for energy crops scheme may not be
counted as being set aside for the purposes of the set-aside requirement indicated in
Article 6(1) of Regulation (EC) No 1251/1999 and in Articles 54(2), 63(2), 71j and
107(1) of this Regulation."

12.

Article 94 is replaced by the following:

"Article 94
Conditions

The  aid  shall  be  paid  only  in  respect  of  the  quantity  of  potatoes  covered  by  a
cultivation contract between the potato producer and the starch manufacturer within
the limit of the quota allocated to such undertaking, as referred to in Article 2(2) or
2(4) of Regulation (EC) No 1868/94."

13.

Article 99(3) is replaced by the following:

"3. The amount of aid claimed shall not exceed a ceiling, fixed by the Commission
in accordance with Article 64(2), corresponding to the component of seed aids
for  the  species  concerned  in  the  national  ceiling  referred  to  in  Article  41.
However,  for  the  new  Member  States  this  ceiling  shall  correspond  with  the
amounts mentioned in Annex XIa.

16

When  the  total  amount  of  aid  claimed  exceeds  the  fixed  ceiling,  the  aid  per
farmer shall be reduced proportionately in that year."

14.

In Article 101, the following paragraph is added after the second paragraph:

"However, the regional base area or areas in the new Member States shall be fixed by
the Commission in accordance with the procedure referred to in Article  144(2)  and
within the limits of the national base areas listed in Annex XIb."

15.

In Article 103, the following paragraph is added after the first paragraph:

"Alternatively, for any new Member State applying the single area payment scheme
referred to in Article 143b in 2004 and opting for the application of Article 66, the
regionalisation plan shall be established, according to objective criteria, not later than
1 August  of  the  last  year  of  application  of  the  single  area  payment  scheme.  Where
this  is  done,  the  combined  regional  base  areas  and  the  weighted  average  reference
yield  in  the  regions  shall  respect  the  limits  of  the  national  base  area  and  reference
yield as listed in Annex XIb."

16.

Article 105 is replaced by the following:

"Article 105
Durum wheat supplement

1.

A supplement to the area payment of

– 

– 

EUR 291/ha for the marketing year 2005/06

EUR 285/ha for the marketing year 2006/07 and onwards

shall  be  paid  for  the  area  down  to  durum  wheat  in  the  traditional  production
zones listed in Annex X, subject to the following limits:

Greece
Spain
France
Italy
Cyprus
Hungary
Austria
Portugal

(hectares)

617 000
594 000
208 000
1 646 000
6 183
2 500
7 000
118 000

2.

Should  the  total  of  the  areas  for  which  a  supplement  to  the  area  payment  is
claimed  be  greater  than  the  limit  referred  to  above  during  the  course  of  a
marketing year, the area per farmer for which the supplement may be paid shall
be reduced proportionately.

However,  subject  to  the  limits  per  Member  State  laid  down  in  paragraph  1,
Member States may distribute the areas indicated in that paragraph among the
production  zones  as  defined  in  Annex  X,  or,  for  the  Member  States  of  the
Community  as  constituted  on  30  April  2004,  if  necessary,  the  production
regions of the regionalisation plan, according to the extent of the production of
durum  wheat during  the period 1993 to 1997.  Where  this  is  done,  should  the
total of the areas within a region for which a supplement to the area payment is
requested be greater than the corresponding regional limit during the course of

17

a marketing  year, the area per  farmer in that  production  region  for  which  the
supplement may be paid shall be reduced proportionately. The reduction shall
be  made  when,  within  a  Member  State  the  areas  in  regions,  which  have  not
reached  their  regional  limits,  have  been  distributed  to  regions  in  which  those
limits have been exceeded.

3.

In regions where the production of durum wheat is well established, other than
those  referred  to  in  Annex  X,  special  aid  amounting  to  EUR  46/ha  for  the
marketing year 2005/06 shall be granted up to a limit of the following number
of hectares:

Germany
Spain
France
Italy
Hungary
Slovakia
United Kingdom

(hectares)
10 000
4 000
50 000
4 000
4 305
4 717
5 000"

17.

Article 108 is replaced by the following:

"Article 108
Eligible land

Applications  for  payments  may  not  be  made  in  respect  of  land  which,  at  the  date
provided  for  the  area  aid  applications  for  2003,  was  under  permanent  pasture,
permanent crops or trees or was used for non-agricultural purposes.

For the new Member States, applications for payments may not be made in respect of
land which, on 30 June 2003, was under permanent pasture, permanent crops or trees
or was used for non-agricultural purposes.

Member  States  may,  on  terms  to  be  determined  in  accordance  with  the  procedure
referred to in Article 144(2), derogate from the first or second subparagraph of this
Article provided that they take action to prevent any significant increase in the total
eligible agricultural area."

18.

Article 116(2) is replaced by the following:

"2. Member  States  shall  take  the  necessary  measures  to  ensure  that  the  sum  of
premium rights on their territory does not exceed the national ceilings set out in
paragraph  4  of  this  Article  and  that  the  national  reserves  referred  to  in
Article 118  may  be  maintained.  The  new  Member  States  shall  allocate
individual ceilings to producers and shall set up the national reserves from the
overall  number  of  rights  to  the  premium  reserved  for  each  of  these  new
Member States as set out in paragraph 4, no later than one year after the date of
accession."

18

19.

Article 116(4) is replaced by the following:

"4. The following ceilings shall apply:

Member State

Belgium
Czech Republic
Denmark
Germany
Estonia
Greece
Spain
France
Ireland
Italy
Cyprus
Latvia
Lithuania
Luxembourg
Hungary
Malta
Netherlands
Austria
Poland
Portugal*
Slovenia
Slovakia
Finland
Sweden
United Kingdom

Total

Rights
(x 1 000)

70
66,733
104
2 432
48
11 023
19 580
7 842
4 956
9 575

472,401
18,437
17,304
4
1 146

8,485

930
206
335,88

2 690

84,909
305,756
80
180
19 492

81 667,905

*

To be adjusted at the expiry of Regulation (EEC) No 1017/94."

19

20.

Article 119(3) is replaced by the following:

"3. The following global amounts shall apply:

(thousands EUR)

Belgium
Czech Republic
Denmark
Germany
Estonia
Greece
Spain
France
Ireland
Italy
Cyprus
Latvia
Lithuania
Luxembourg
Hungary
Malta
Netherlands
Austria
Poland
Portugal
Slovenia
Slovakia
Finland
Sweden
United Kingdom

64
71
79
1 793
51
8 767
18 827
7 083
4 875
6 920
441
19
18
4
1 212
9
743
185
355
2 275
86
323
61
162
20 162"

21.

In Article 119, the following paragraph (4) is added:

"4.

In the new Member States, the global amounts shall be applied in accordance
with the schedule of increments as set out in Article 143a."

20

22.

Article 123(8) is replaced by the following:

"8. The following regional ceilings shall apply:

Belgium
Czech Republic
Denmark
Germany
Estonia
Greece
Spain
France
Ireland
Italy
Cyprus
Latvia
Lithuania
Luxembourg
Hungary
Malta
Netherlands
Austria
Poland
Portugal
Slovenia
Slovakia
Finland
Sweden
United Kingdom

235 149
244 349
277 110
1 782 700
18 800
143 134
713 999*
1 754 732**
1 077 458
598 746
12 000
70 200
150 000
18 962
94 620
3 201
157 932
373 400
926 000
175 075*** ****
92 276
78 348
250 000
250 000
1 419 811*****

*

**

Without prejudice to the specific rules laid down in Regulation (EC)
No 1454/2001.
Without prejudice to the specific rules laid down in Regulation (EC)
No 1452/2001.

*** Without prejudice to the specific rules laid down in Regulation (EC)

No 1453/2001.
****
To be adjusted at the expiry of Regulation (EEC) No 1017/94.
***** This  ceiling  shall  be  temporarily  increased  by  100 000  to  1 519 811
until  such  time  as  live  animals  under  six  months  of  age  may  be
exported."

23.

Article 126(1) is replaced by the following:

"1. An aid shall be  granted to each farmer  of  suckler cow within  the limit  of the
individual  ceilings  established  in  application  of  Article  7  of  Regulation  (EC)
No 1254/1999 or of the second sub-paragraph of paragraph 2."

24.

Article 126(2) is replaced by the following:

"2. Member  States  shall  take  the  necessary  steps  to  ensure  that  the  sum  of
premium rights on their territory does not exceed the national ceilings set out in
paragraph  5  and  that  the  national  reserves  referred  to  in  Article  128  may  be
maintained.

The  new  Member  States  shall  allocate  individual  ceilings  to  producers  and
shall  set  up  the  national  reserves  from  the  overall  number  of  rights  to  the
premium reserved for each of these Member States  as  set  out in paragraph 5,
no later than one year after the date of accession."

21

25.

Article 126(5) is replaced by the following:

"5. The following national ceilings shall apply:

Belgium
Czech Republic *
Denmark
Germany
Estonia *
Greece
Spain**
France***
Ireland
Italy
Cyprus *
Latvia *
Lithuania *
Luxembourg
Hungary*
Malta*
Netherlands
Austria
Poland *
Portugal**** *****
Slovenia *
Slovakia *
Finland
Sweden
United Kingdom

394 253
90 300
112 932
639 535
13 416
138 005
1 441 539
3 779 866
1 102 620
621 611
500
19 368
47 232
18 537
117 000
454
63 236
375 000
325 581
416 539
86 384
28 080
55 000
155 000
1 699 511

*

**

Applicable from the date of accession
Without  prejudice  to  the  specific  rules  laid  down  in
Regulation (EC) No 1454/2001.

*** Without  prejudice  to  the  specific  rules  laid  down  in

Regulation (EC) No 1452/2001.

**** Without  prejudice  to  the  specific  rules  laid  down  in

Regulation (EC) No 1453/2001.
increased  at 

***** To  be 

the  expiry  of  Regulation  (EEC)
No 1017/94 by the premiums resulting from the application of
that Regulation in 2003 and 2004.”

26.

In Article 130(3) the following subparagraph is added:

"For  the  new  Member  States  the  national  ceilings  shall  be  those  contained  in  the
following table.

Bulls, steers, cows
and heifers

Calves more than 1 and less than
7 months old and of carcass
weight up to 185 kg

Czech Republic
Estonia
Cyprus
Latvia
Lithuania
Hungary
Malta
Poland
Slovenia
Slovakia

483 382
107 813
21 000
124 320
367 484
141 559
6 002
1 815 430
161 137
204 062

22

27 380
30 000
–
53 280
244 200
94 439
17
839 518
35 852
62 841"

27.

Article 133(3) is replaced by the following:

"3. The following global amounts shall apply:

(million EUR)

Belgium
Czech Republic
Denmark
Germany
Estonia
Greece
Spain
France
Ireland
Italy
Cyprus
Latvia
Lithuania
Luxembourg
Hungary
Malta
Netherlands
Austria
Poland
Portugal
Slovenia
Slovakia
Finland
Sweden
United Kingdom

39,4

8,776017

11,8
88,4
1,13451
3,8
33,1
93,4
31,4
65,6

0,308945
1,33068
4,942267
3,4
2,936076
0,0637

25,3
12,0
27,3
6,2
2,964780
4,500535
6,2
9,2
63,8 "

28.

In Article 135(1) the following indent is added to the first subparagraph:

"

for  the  new  Member  States:  equal  to  the  ceilings  set  out  in  Article  123(8)  or
equal  to  the  average  number  of  slaughterings  of  male  bovine  animals  during
the years 2001, 2002 and 2003 deriving from Eurostat statistics for these years
or any other published official statistical information  for  these  years accepted
by the Commission."

29.

In Article 135(4), the following sentence is added:

"For the new Member States the reference years shall be 2001, 2002 and 2003."

30.

In Article 136(2), the following sentence is added to the second sub-paragraph:

"For the new Member States the reference years shall be 1999, 2000 and 2001."

31.

After Article 136, the following new Article 136a is inserted:

"Article 136a
Conditions of application in the new Member States

In the new Member States, the global amounts referred to in Article 133(3) and the
maximum area payment per hectare at EUR 350 referred to in Article 136(3) shall be
applied in accordance with the schedule of increments as set out in Article 143a."

23

32.

In Article 139, the following sentence is added at the first subparagraph:

"However,  for  the  new  Member  States,  the  ceiling  fixed  by  the  Commission  in
accordance with Article 64(2) shall correspond to the component of each of the direct
payments concerned in the ceiling referred to in Article 71c."

33.

Article 143 is replaced by the following:

"Article 143
Ceiling

The  sum  of  the  aid  claimed  shall  not  be  higher  than  a  ceiling,  fixed  by  the
Commission  in  accordance  with  Article  64(2),  corresponding  to  the  component  of
grain legumes area payments referred to in Annex VI in the national ceiling referred
to  in  Article  41.  However,  for  the  new  Member  States  the  ceiling  fixed  by  the
Commission in accordance with Article 64(2) shall correspond to the component of
grain legumes area payments referred to in Annex VI in the national ceiling referred
to in Article 71c.

When the total amount of aid claimed exceeds the fixed ceiling,  the  aid  per  farmer
shall be reduced proportionately in that year."

34.

In Article 145, point (d) is replaced by the following:

"(d) with regard to the single payment scheme, detailed rules relating in particular
to  the  establishment  of  national  reserve,  the  transfer  of  entitlements,  the
definition  of  permanent  crops,  permanent  pastures  and  grassland,  the  options
provided for in Chapters 5 and 6 of Title III and the list of crops allowed on the
set-aside  land  as  well  as  detailed  rules  relating  to  compliance  with  the
Memorandum  of  Understanding  on  certain  oil  seeds  between  the  European
Economic Community and the United States of America within the framework
of the GATT approved by Decision 93/355/EEC.*

*

OJ L 147, 18.6.1993, p. 25."

35.

In Article 145, point (i) is replaced by the following:

"(i)

such  amendments  to  Annexes  II,  VI,  VII,  IX,  X  and  XI  as  may  become
necessary taking into account, in particular new Community legislation and, as
far  as  it  concerns  Annex  VIII  and  Annex  VIIIa,  in  case  of  application  of
respectively Article 62 and Article 71i and, as the case may be, in function of
the information communicated by the Member States in relation to the part of
the reference amounts corresponding to the payments for arable crops, as well
as  the  amounts  of  the  ceilings  themselves,  to  be  increased  in  function  of  the
difference  between  the  area  actually  determined  and  the  area  for  which
premiums  were  paid  for  arable  crops  in  2000  and  2001,  in  application  of
Article 9(2)  and  (3)  of  Commission  Regulation  (EEC)  No  3887/92**,  within
the limit of the base areas (or maximum guaranteed area for durum wheat) and
taking  into  account  the  average  national  yield  used  for  the  calculation  of
Annex VIII.

**

OJ L 327, 12.12.2001, p. 11."

24

36.

In Article 145, point (q) is replaced by the following:

"(q) measures  which  are  both  necessary  and  duly  justified  to  resolve,  in  an
emergency,  practical  and  specific  problems,  in  particular  those  related  to  the
implementation of Chapter 4 of Title II and Chapters 5 and 6 of Title III. Such
measures  may  derogate  from  certain  parts  of  this  Regulation,  but  only  to  the
extent that, and for such a period, as is strictly necessary."

37.

Article 146 is replaced by the following:

"Article 146
Transmission of information to the Commission

Member  States  shall  inform  the  Commission  in  detail  of  the  measures  taken  to
implement this Regulation and, in particular, those relating to Articles 5, 13, 42, 58,
71d and 71e."

38.

The following Article 154a is added after Article 154:

"Article 154a
Transitional arrangements for new Member States

1. Where  transitional  measures  are  necessary  in  order  to  facilitate,  for  the  new
Member  States,  the  transition  from  the  single  area  payment  scheme  to  the
single payment scheme and other aid schemes referred to in Titles III and IV,
such measures shall be adopted in accordance with the procedure laid down in
Article 144(2).

2.

The  measures  referred  to  in  paragraph  1  may  be  adopted  during  a  period
starting  on  1  May  2004  and  expiring  on  30  June  2009  and  shall  not  apply
beyond  that  date.  The  Council,  acting  by  a  qualified  majority  on  a  proposal
from the Commission, may extend that period."

25

39.

The following Annex VIIIa is added after Annex VIII:

"Annex VIIIa
National ceilings referred to in Article 71c

The  ceilings  have  been  calculated  taking  account  of  the  schedule  of  increments
provided for in  Article  143a.  Therefore,  those  ceilings  shall  not  be  reduced  to  take
Article 143a into account.

million EUR

Calendar
year

Czech
Republic

Estonia Cyprus

Latvia Lithuania Hungary Malta

Poland

Slovenia Slovakia

2005

2006

2007

2008

2009

2010

2011

2012

2013

227,9

265,7

342,4

427,8

513,2

598,5

683,9

769,3

854,6

23,4

27,3

40,4

50,5

60,5

70,6

80,7

90,8

100,9

8,9

10,4

13,9

17,4

20,9

24,4

27,8

31,3

34,8

33,9

39,6

55,6

69,5

83,4

97,3

111,2

125,1

139,0

92,0

107,3

146,9

183,6

220,3

257,0

293,7

330,4

367,1

350,8

408,7

495,1

618,5

741,9

865,2

988,6

1111,9

1235,3

0,67

0,78

1,59

1,99

2,38

2,78

3,18

3,57

3,97

724,3

845,0

1098,8

1373,4

1648,0

1922,5

2197,1

2471,7

2746,3

35,5

41,4

55,5

69,4

83,3

97,2

111,0

124,9

138,8

97,6

113,6

144,5

180,5

216,6

252,6

288,6

324,6

360,6"

40.

Annex X shall be completed by the following entries:

"CYPRUS

HUNGARY

Regions

Dél Dunamenti síkság
Dél-Dunántúl
Közép-Alföld
Mezőföld
Berettyo-Kőrös-Maros vidéke".

41.

The following Annexes XIa and XIb shall be inserted after Annex XI:

"Annex XIa
Seed aid ceilings in the new Member States referred to in Article 99(3)

Calendar
year

Czech
Republic

Estonia Cyprus

Latvia Lithuania Hungary Malta

Poland Slovenia Slovakia

 million EUR

2005

2006

2007

2008

2009

2010

2011

2012

2013

0,87

1,02

1,17

1,46

1,75

2,04

2,33

2,62

2,91

0,04

0,04

0,05

0,06

0,07

0,08

0,10

0,11

0,12

0,03

0,03

0,04

0,05

0,06

0,07

0,08

0,09

0,10

0,10

0,12

0,14

0,17

0,21

0,24

0,28

0,31

0,35

0,10

0,12

0,14

0,17

0,21

0,24

0,28

0,31

0,35

26

0,78

0,90

1,03

1,29

1,55

1,81

2,07

2,33

2,59

0,03

0,03

0,04

0,05

0,06

0,07

0,08

0,09

0,10

0,56

0,65

0,74

0,93

1,11

1,30

1,48

1,67

1,85

0,08

0,10

0,11

0,14

0,17

0,19

0,22

0,25

0,28

0,04

0,04

0,05

0,06

0,07

0,08

0,09

0,11

0,12

Annex XIb
National arable crops base areas and reference yields in the new Member States
referred to in Article 101 and 103

Czech Republic
Estonia
Cyprus
Latvia
Lithuania
Hungary
Malta
Poland
Slovenia
Slovakia

Base area
(hectares)
2 253 598
362 827
79 004
443 580
1 146 633
3 487 792
4 565
9 454 671
125 171
1 003 453

Reference
yields (t/ha)
4,20
2,40
2,30
2,50
2,70
4,73
2,02
3,00
5,27
4,06"

Article 2

Article 5(2) of Regulation (EC) No 1786/2003 on the common organisation of the market in
dried fodder is replaced by the following:

"2.

The  maximum  guaranteed  quantity  provided  for  in  paragraph  1  shall  be  divided
among the Member States as follows:

Guaranteed national quantity

Belgo-Luxembourg Economic
Union (BLEU)
Czech Republic
Denmark
Germany
Greece
Spain
France
Ireland
Italy
Lithuania
Hungary
Netherlands
Austria
Poland
Portugal*
Slovakia
Finland
Sweden
United Kingdom

(tonnes)

8 000

27 942
334 000
421 000
37 500
1 325 000
1 605 000
5 000
685 000
650
49 593
285 000
4 400
13 538
30 000
13 100
3 000
11 000
102 000

*

To  be  adjusted  at  the  expiry  of  Regulation  (EEC)
No 1017/94 "

27

Article 3

In Article 33 of Regulation (EC) No 1257/1999 the following paragraph is added:

"The  measure  foreseen  in  the  last  indent  of  the  second  paragraph  is  not  applicable  for  the
Czech  Republic,  Estonia,  Cyprus,  Latvia,  Lithuania,  Hungary,  Malta,  Poland,  Slovenia  and
Slovakia."

Article 4

This  Regulation  shall  enter  into  force  on  1  May  2004  subject  to  the  entry  into  force  of  the
Treaty  of  Accession  of  the  Czech  Republic,  Estonia,  Cyprus,  Latvia,  Lithuania,  Hungary,
Malta, Poland, Slovenia and Slovakia.

This Regulation shall be binding in its entirety and directly applicable in all Member States.

Done at Brussels, […]

For the Council
The President

28

FINANCIAL STATEMENT

BUDGET HEADING:
Sub-section B1

APPROPRIATIONS:
44 762,45 Mio €

TITLE:
Proposal for a Council regulation adapting Regulation (EC) No 1782/2003, establishing common rules
for  direct  support  schemes  under  the  common  agricultural  policy  and  establishing  certain  support
schemes for farmers, Regulation (EC) No 1786/2003 on the common organisation of the market in dried
fodder,  and  Regulation  (EC)  No  1257/1999  on  support  for  rural  development  from  the  European
Agricultural Guidance and Guarantee Fund (EAGGF) by reason of the accession of the Czech Republic,
Estonia,  Cyprus,  Latvia,  Lithuania,  Hungary,  Malta,  Poland,  Slovenia  and  Slovakia  to  the  European
Union

LEGAL BASIS:
Act of Accession – Article 57

AIMS:
To adopt the Accession Treaty following the decision on CAP Reform.

12 MONTH
PERIOD

(EUR million)

CURRENT
FINANCIAL
YEAR 2004
(EUR million)
0

FOLLOWING
FINANCIAL
YEAR 2005
(EUR million)
– 15,6

FINANCIAL IMPLICATIONS

CHARGED TO THE EC BUDGET

NATIONAL AUTHORITIES
OTHER

EXPENDITURE
–
(REFUNDS/INTERVENTIONS)
–
–
REVENUE
–
(LEVIES/CUSTOMS DUTIES)
–

NATIONAL

OWN RESOURCES OF THE EC

1.

2.

3.

4.

5.

5.0

5.1

5.0.1 ESTIMATED EXPENDITURE
5.1.1 ESTIMATED REVENUE

5.2 METHOD OF CALCULATION:

See Annex (Heading 1A)

2006
– 32,0

2007

2008

2009

6.0

6.1

CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE
RELEVANT CHAPTER OF THE CURRENT BUDGET?

CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF
THE CURRENT BUDGET?

6.2 WILL A SUPPLEMENTARY BUDGET BE NECESSARY?

6.3 WILL APPROPRIATIONS NEED TO BE ENTERED IN FUTURE BUDGETS?

YES

YES

NO

NO

OBSERVATIONS:

The  figures  in  the  annex  have  been  established  in  comparison  to  the  financial  estimates  made  at  the  end  of
enlargement negotiations in Copenhagen in December 2002.
In the Financial implications presented by the Commission  following the Council agreement of June 2003 in
Luxembourg on the CAP Reform, the most important changes had already been taken into account.

29

Copenhagen

0

Proposal

Copenhagen

Proposal

Annex: Heading 1A

Copenhagen 1999 prices

Copenhagen current prices

DAIRY

Premium

Difference

Market expenditure

Difference

Increase Protein MGA

Copenhagen (9.5€/t * yield)

Increase MGA (200 000 ha * 55€/t)

Copenhagen

Proposal (10 400 ha * 120.75)

Copenhagen

Proposal

Copenhagen

Processing aid (new and old)

Proposal decoupled farm aid

Copenhagen

Proposal coupled payment

Proposal decoupled payment

Difference

NUTS

Difference

DURUM WHEAT

Difference

DRIED FODDER

Difference

RICE

Difference

Total changes compared to COPENHAGEN

Of  which  already 
calculation in Luxembourg

included 

in  CAP-reform

30

mio €

2004

2005

2006

327

361

2032

2288

2322

2667

Current prices

0

54

54,0

392

316

–76,0

1,5

2,8

1,3

0

1,3

1,3

1,1

1,1

0,0

7,2

7,2

3,6

3,6

0,1

0,3

0,2

0,3

–15,6

–22,0

46

130

84,0

452

332

–120,0

1,8

3,3

1,5

0

1,3

1,3

0,0

1,0

1,0

7,2

3,5

3,6

–0,1

0,2

0,3

0,2

0,4

–32,0

–36,0

0,0

154

154

0,0

0

0

0,0

0

0,0

0,0

0

0

0,0

2,8

2,8

0

0,0

0

0

0

0,0

0,0

0,0