Proposal for a Council Regulation on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) {SEC(2004)931}
Date: 2004-07-14
Institutions: European Commission
Subjects: common agricultural policy, economic and social cohesion, fund (EU), rural development, sustainable development

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 14.7.2004 
COM(2004)490 final 

2004/0161(CNS) 

Proposal for a 

COUNCIL REGULATION 

on support for rural development by the European Agricultural Fund  
for Rural Development (EAFRD) 

(presented by the Commission) 

{SEC(2004)931} 

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EXPLANATORY MEMORANDUM 

Following  the  fundamental  reform  of  the  first  pillar  of  the  Common  Agricultural 
Policy  in  2003  and  2004,  the  major  focus  for  policy  reform  in  the  new  financial 
period will be rural development. 

With over half of the population in EU-25 living in rural areas, which cover 90% of 
the territory, rural development is an important policy domain. Farming and forestry 
remain  of  overriding  importance  for  land  use  and  the  management  of  natural 
resources  in  the  EU's  rural  areas  and  important  as  a  platform  for  economic 
diversification in rural communities. 

The  'problems'  and  challenges  to  be  addressed  by  rural  development  policy  can  be 
summarised as follows:  

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– 

– 

Economic: Rural areas have a significantly lower income than the average, an 
ageing working population, and a greater dependency on the primary sector. 

Social:  There  is  clear  evidence  of  higher  unemployment  in  rural  areas.  Low 
population density and depopulation in some areas, may also increase the risk 
of problems like poor access to basic services, social exclusion, and a narrower 
range of employment options. 

Environmental: The need to ensure that agriculture and forestry make a positive 
contribution  to  the  countryside  and  the  wider  environment  requires  a  careful 
balance to be struck. 

Agenda 2000 established rural development policy as the 2nd pillar of the Common 
Agricultural  Policy,  to  accompany  the  further  reform  of  market  policy  across  the 
whole of European territory. Rural development policy therefore cannot be divorced 
from its role as 2nd pillar of the Common Agricultural Policy, with emphasis on the 
word 'common', i.e. the choice that has been made to organise the agricultural sector 
at  EU  level.  This  is  of  particular  significance  as  regards  ensuring  the  coherence  of 
instruments and policy objectives between the two pillars. 

The EU's rural development policy follows the overall orientations for a sustainable 
development in line with the conclusions of the Lisbon (March 2000) and Göteborg 
(June  2001)  European  Councils.  While  the  Lisbon  conclusions  set  the  target  of 
making the European Union the most competitive knowledge-based economic area by 
2010, the Göteborg conclusions added a new emphasis on protecting the environment 
and achieving a more sustainable pattern of development. The latter conclusions also 
highlighted the fact that in the context of Agenda 2000, European Agricultural policy 
had "become more oriented towards satisfying the general public's growing demands 
regarding  food  safety,  food  quality,  product  differentiation,  animal  welfare, 
environmental quality and the conservation of nature and the countryside".  

Further  implementation  of  CAP  reform  implies  a  need  for  a  continued  sectoral 
component in EU rural development policy. In addition, the duality of farm structures 
and sometimes still high share of agriculture in employment in many of the new MS 
implies  a  further  important  need  for  the  policy  to  accompany  restructuring  in 
agriculture and in rural areas. 

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7. 

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The  territorial  components  of  EU  rural  development  policy  to  respond  to  the 
in 
economic,  social  and  environmental  challenges  facing  rural  areas, 
accompanying agriculture and forestry in their important land management function 
and  in  embedding  agriculture  and  forestry  in  a  diversified  rural  economy  and 
contributing to the socio-economic development of rural areas. 

lie 

The complementarity of the two pillars of the CAP has been accentuated by the recent 
reform of the CAP, introducing decoupling, cross compliance and modulation (i.e. a 
transfer  of  funds  from  the  1st  to  the  2nd  pillar),  to  be  implemented  from  2005 
onwards. The 1st pillar concentrates on providing a basic income support to farmers, 
who  are  further  free  to  produce  in  function  of  market  demand,  while  the  2nd  pillar 
supports  agriculture  as  a  provider  of  public  goods  in  its  environmental  and  rural 
functions and rural areas in their development. 

Reflecting  the  Salzburg  conference  conclusions  (November  2003)  and  the  strategic 
orientations  of  the  Lisbon  and  Göteborg  European  Councils  emphasising  the 
economic,  environmental,  and  social  elements  of  sustainability,  the  following  three 
major objectives for RD policy have been set in the Communication on the Financial 
Perspectives for the period 2007–2013: 

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– 

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Increasing  the  competitiveness  of  the  agricultural  sector  through  support  for 
restructuring; 

Enhancing 
management (including RD actions related to Natura 2000 sites); 

the  environment  and  countryside 

through  support  for 

land 

Enhancing  the  quality  of  life  in  rural  areas  and  promoting  diversification  of 
economic activities through measures targeting the farm sector and other rural 
actors; 

In summary, the importance of the EU dimension of rural development policy lies in: 

– 

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Accompanying and complementing further CAP reform and ensuring coherence 
with the instruments and the policies of the first pillar; 

Contributing  to  other  EU  policy  priorities  such  as  sustainable  management  of 
natural resources, innovation and competitiveness in rural areas, and economic 
and social cohesion. 

10. 

11. 

12. 

The  large  number  of  programmes,  programming  systems  and  different  financial 
management  and  control  systems  in  the  current  programming  period  have 
considerably  increased  the  administrative  burden  for  the  Member  States  and  the 
Commission  and  decreased  the  coherence,  transparency  and  visibility  of  rural 
development policy. 

A  first  important  step  is  to  bring  rural  development  under  a  single  funding  and 
programming framework. 

An  important  instrument  to  ensure  the  focus  of  rural  development  programming  on 
EU  priorities  and  complementarity  with  other  EU  policies  will  be  the  EU  strategy 
document  for  rural  development  to  be  prepared  by  the  Commission  and  which  will 
serve as a basis for the national rural development strategies and programmes. 

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13. 

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Clearly set objectives in the light of EU priorities and more emphasis on reporting of 
programme  results  through  reinforced  monitoring  and  evaluation  will  ensure  more 
transparency  and  accountability  for  the  use  of  EU  money,  while  at  the  same  time 
leaving  member  states  more  freedom  in  how  they  wish  to  implement  their 
programmes  through  less  detailed  rules  and  eligibility  conditions  and  simplified 
financial management and control arrangements. 

Stakeholder  consultation  in  the  design,  implementation  and  evaluation  of  national 
strategies  and  programmes,  the  integration  of  the  LEADER  bottom  up  approach, 
exchange  of  best  practice  and  networking  will  all  help  to  ensure  the  structured 
dialogue underlying good governance. 

Together with an increased clarity as regards the responsibilities of member states and 
the Commission in financial management, the proposed changes should significantly 
improve the implementation and governance of rural development policy. 

To  achieve  a  more  strategic  approach  to  rural  development,  a  first  step  in  the 
programming  phase  will  be  the  preparation  by  the  Commission  of  a  strategy 
document  setting  out  the  EU  priorities  for  the  three  policy  axes.  It  will  identify 
strengths  and  weaknesses  at  EU  level  and  core  indicators  to  measure  progress  in 
achieving  the  EU  priorities.  The  EU  rural  development  strategy  would  then  be 
adopted  by  the  Council  and  form  the  basis  for  the  national  rural  development 
strategies of the MS. The national rural development strategy would translate the EU 
priorities  to  the  national  situation  after  stakeholder  consultation,  set  core  result 
indicators  and  demonstrate  the  complementarity  of  rural  development  programming 
with other EU policies, in particular cohesion policy.  

The  programmes  will  articulate  the  national  strategy  into  a  strategy  for  each  of  the 
three thematic axes corresponding to the main policy objectives under point 9 and for 
the LEADER axis, using quantified objectives and core result indicators (comprising 
a  minimum  set  of  EU-wide  common  indicators).  To  ensure  a  balanced  strategy  a 
minimum funding for axis 1 (competitiveness) and axis 3 (wider rural development) 
of at least 15% of total EU programme funding will be required and of at least 25% 
for  axis  2  (land  management).  For  the  LEADER  axis  a  minimum  of  7%  of  the  EU 
funding is reserved. 

As building blocks for each thematic axis a range of measures will be available. The 
conditions under which the measures can be implemented have been streamlined and 
simplified. 

For axis 1, competitiveness of farming and forestry, the restructuring strategy would 
be built on measures relating to human and physical capital and to quality aspects and 
would  allow  a  phasing  out  of  certain  measures  currently  applicable  in  the  new 
member states. 

For the strategy for axis 2, environment and land management, agri-environment is a 
compulsory component. The existing less-favoured areas measure is redefined as far 
as  the  delimitation  of  the  intermediate  zones  (partly  based  on  socio-economic  data 
which in many cases have become outdated) is concerned. The new delimitation is to 
be based on soil productivity and climatic conditions and the importance of extensive 
farming  activities  for  land  management,  low  soil  productivities  and  poor  climatic 
conditions giving an indication of the difficulty of maintaining agricultural activity. 

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21. 

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A  general  condition  for  the  measures  under  axis  2  at  the  level  of  the  beneficiary  is 
respect  of  the  EU  and  national  mandatory  requirements  relevant  for  respectively 
agriculture and forestry. 

For axis 3, wider rural development, the preferred implementation method is through 
local development strategies targeting sub-regional entities, either developed in close 
collaboration  between  national,  regional  and  local  authorities  or  designed  and 
implemented through a bottom up approach using the LEADER approach (selection 
of the best local development plans of local action groups representing public-private 
partnerships).  The  horizontal  application  of  certain  measures  under  axis  3  remains 
possible. 

Each programme should contain a LEADER axis to finance the implementation of the 
local development strategies of local action groups built on the three thematic axes, 
the  operating  costs  of  local  action  groups,  the  cooperation  projects  between  local 
action  groups,  experimental  and  pilot  approaches  and  the  capacity  building  and 
animation necessary for the preparation of local development strategies. 

For  technical  assistance  up  to  4%  of  programme  funding  can  be  reserved  for  the 
implementation  of  the  programme,  including  financing  of  national  networks  to 
support  the  implementation  of  rural  development  measures  and  in  particular  local 
action  groups  and  to  serve  as  contact  point  for  the  European  Network  for  rural 
development.  An  EU  rural  development  Network  will  assist  the  Commission  in  the 
implementation of the policy. 

The  EU  co-financing  rates  are  set  at  axis  level,  with  a  minimum  of  20%  and  a 
maximum of 50% of total public expenditure (75% in Convergence regions). For axis 
2  and  the  LEADER  axis  the  maximum  rate  will  be  55%  (80%  in  Convergence 
regions), expressing the EU priority attached to these axes. For the Outermost regions 
the maximum cofinancing rates are increased by 5 points. 

Of overall EU RD funding available for the period (excluding modulation), 3% will 
be  kept  in  reserve  to  be  allocated  in  2012  and  2013  to  the  Member  States  with  the 
most performing LEADER axes. 

For  the  implementation  of  the  programmes  a  reinforced  monitoring,  evaluation  and 
reporting  system  based  on  a  common  EU  framework  agreed  between  the  Member 
States and the Commission will be introduced. Based on the annual national synthesis 
reports on the execution of programmes and the progress in the implementation of the 
national  strategies  (in  terms  of  results),  the  Commission  reports  annually  on  the 
progress  in  implementing  the  EU  priorities  for  rural  development.  Where  necessary 
this could lead to a proposal for the adjustment of the EU rural development strategy. 

The  outlined  approach  would  allow  to  focus  the  EU  cofinancing  available  for  rural 
development  on  commonly  agreed  EU  priorities  for  the  three  policy  axes,  while 
leaving  sufficient  flexibility  at  Member  State  and  regional  level  to  find  a  balance 
between  the  sectoral  dimension  (agricultural  restructuring)  and  the  territorial 
dimension  (land  management  and  socio-economic  development  of  rural  areas), 
responding  to  the  individual  situations  and  needs.  Moreover,  the  LEADER  model 
could  be  applied  on  a  wider  scale,  while  for  the  EU  as  a  whole  continuation  and 
consolidation of the LEADER approach would be safeguarded. 

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2004/0161(CNS) 

Proposal for a 

COUNCIL REGULATION 

on support for rural development by the European Agricultural Fund  
for Rural Development (EAFRD) 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Article 37 thereof, 

Having regard to the proposal from the Commission, 

Having regard to the opinion of the European Parliament, 

Having regard to the opinion of the European Economic and Social Committee, 

Having regard to the opinion of the Committee of the Regions, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

A rural development policy should accompany and complement the market and income 
support policies of the Common Agricultural Policy (CAP) and thus contribute to the 
achievement  of  the  policy's  objectives  as  laid  down  in  Article  33(1)  of  the  Treaty. 
Rural  development  policy  should  also  take  into  account  the  general  objectives  for 
economic and social cohesion policy set out in Article 158 of the Treaty and contribute 
to  their  achievement,  while  integrating  other  major  policy  priorities  as  spelled  out  in 
the  conclusions  of  the  Lisbon  and  Göteborg,  European  Councils  for  sustainable 
development. 

According to Article 33(2)(a) of the Treaty, in working out the Common Agricultural 
Policy  and  the  special  methods  for  its  application,  account  is  to  be  taken  of  the 
particular  nature  of  agricultural  activity  which  results  from  the  social  structure  of 
agriculture and from structural and natural disparities between the various rural areas. 

The reform of the CAP in June 2003 and April 2004 introduced major changes likely to 
have  a  significant  impact  on  the  economy  across  the  whole  rural  territory  of  the 
Community  in  terms  of  agricultural  production  patterns,  land  management  methods, 
employment and the wider social and economic conditions in rural areas. 

Action by the Community should be complementary to that carried out by the Member 
States  or  seek  to  contribute  to  it.  The  partnership  should  be  strengthened  through 
arrangements  for  the  participation  of  various  types  of  partners  with  full  regard  to  the 
institutional  competences  of  the  Member  States.  The  partners  concerned  should  be 
involved in the preparation, monitoring and evaluation of programming. 

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(5) 

(6) 

(7) 

(8) 

(9) 

The Community may take measures in accordance with the principle of subsidiarity as 
provided for in Article 5 of the Treaty. Since the goal of rural development cannot be 
achieved  adequately  by  the  Member  States  given  the  links  between  it  and  the  other 
instruments of the Common Agricultural Policy, the extent of the disparities between 
rural  areas  and  the  limits  on  the  financial  resources  of  the  Member  States  in  an 
enlarged Union, it can be better achieved at Community level through the multiannual 
guarantee of Community finance and by concentrating it on its priorities. According to 
the  principle  of  proportionality  as  stated  in  Article  5  of  the  Treaty,  the  present 
Regulation does not exceed what is necessary to achieve this goal. 

The  activities  of  the  European  Agricultural  Fund  for  Rural  Development,  hereinafter 
called  the  "Fund",  and  the  operations  to  which  it  contributes  must  be  consistent  and 
compatible  with  the  other  Community  policies  and  comply  with  all  Community 
legislation. 

In its action in favour of rural development the Community takes care to encourage the 
elimination  of  disparities  and  the  promotion  of  equality  between  women  and  men  in 
accordance with Articles 2 and 3 of the Treaty. 

To  focus  the  strategic  content  of  rural  development  policy  in  line  with  the 
Community's  priorities  and  hereby  favour  its  transparency,  the  Council  should  adopt 
strategic guidelines on a proposal from the Commission.  

On  the  basis  of  the  strategic  guidelines  adopted  by  the  Council,  each  Member  State 
should  prepare  its  national  rural  development  strategies  constituting  the  reference 
framework  for  the  preparation  of  the  rural  development  programmes.  The  Member 
States  and  the  Commission  should  report  on  the  monitoring  of  the  national  and 
Community strategy. 

(10)  The programming of rural development should comply with Community and national 
priorities and complement the other Community policies, in particular the agricultural 
market policy, cohesion policy and Common Fisheries Policy. 

(11)  To  ensure  the  sustainable  development  of  rural  areas  it  is  necessary  to  focus  on  a 
limited number of core priority objectives at Community level relating to agricultural 
and  forestry  competitiveness,  land  management  and  environment,  and  quality  of  life 
and diversification of activities in those areas. 

(12)  There  is  a  need  to  establish  general  rules  for  programming  and  revising  rural 
development  programming,  while  ensuring  an  appropriate  balance  between  the  three 
priority  axis  of  the  rural  development  programmes.  The  duration  of  programming 
should be of seven years. 

(13)  To  achieve  the  objective  of  improving  the  competitiveness  of  the  agricultural  and 
forestry sectors it is important to build clear development strategies aimed at enhancing 
and  adapting  human  potential,  physical  capital  and  the  quality  of  agricultural 
production. 

(14)  With  regard  to  human  potential  a  set  of  measures  on  training,  setting  up  of  young 
farmers,  early  retirement  of  farmers  and  farm  workers,  use  by  farmers  and  forest 
holders  of  advisory  services  and  setting  up  of  farm  relief  and  management  services 
should be made available. 

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(15)  As regards training, the evolution and specialisation of agriculture and forestry require 
an  appropriate  level  of  technical  and  economic  training,  including  new  information 
technologies, as well as adequate awareness in the fields of product quality, results of 
research and sustainable management of natural resources, including cross-compliance 
requirements  and  the  application  of  production  practices  compatible  with  the 
maintenance and enhancement of the landscape and the protection of the environment. 
It  is  therefore  necessary  to  broaden  the  scope  of  training  to  all  adult  persons  dealing 
with  agricultural  and  forestry  matters  and  to  include  information  and  dissemination 
activities. Training  and  information activities  cover issues  under both  the agricultural 
and forestry competitiveness and the land management and environment objectives. 

(16)  The  granting  of  specific  benefits  to  young  farmers  may  facilitate  both  their  initial 
establishment  and  the  structural  adjustment  of  their  holdings  after  their  initial  setting 
up.  The  setting-up  measure  should  be  streamlined  by  granting  a  single  premium  and 
made conditional on the establishment of a business plan ensuring the development of 
young farmers' activities. 

(17)  Early  retirement  from  farming  should  target  a  significant  structural  change  of  the 
transferred holdings through the measure for the setting-up of young farmers according 
to  the  requirements  of  that  measure,  or  by  transferring  the  holding  with  a  view  to 
increasing  its  size,  also  taking  into  account  the  experience  acquired  in  the 
implementation of previous Community schemes in this field. 

(18)  The  use  by  farmers  and  forest  holders  of  management  and  advisory  services  should 
allow  them  to  improve  the  sustainable  management  of  their  holdings.  More 
particularly, the use of farm advisory services, as provided for in Council Regulation 
(EC)  No 1782/2003  of  29  September  2003  establishing  common  rules  for  direct 
support  schemes  under  the  Common  Agricultural  Policy  and  establishing  certain 
support  schemes  for  farmers  and  amending  Regulations  (EEC)  No  2019/93,  (EC) 
No 1452/2001,  (EC)  No  1453/2001,  (EC)  No  1454/2001,  (EC)  No  1868/94,  (EC) 
No 1251/1999, (EC) No 1254/1999, (EC) No 1673/2000, (EEC) No 2358/71 and (EC) 
No 2529/20011,  should  help farmers  to assess  the performance of their  farm  business 
and  identify  necessary  improvements  with  regard  to  the  statutory  management 
requirements set out in that Regulation. 

(19)  The  setting  up  of  advisory,  management  and  relief  systems  for  farmers  and/or  forest 
holders should help them to adapt, improve and facilitate management and improve the 
overall  performance  of  their  holdings  by  further  enhancing  the  human  potential 
operating in the farming and forestry sectors. 

(20)  With  regard  to  physical  capital,  a  set  of  measures  on  the  modernisation  of  farms, 
improvement of the economic value of forests, adding value to primary agricultural and 
forestry  production,  improvement  and  development  of  agricultural  and  forestry 
infrastructure, restoring agricultural production potential damaged by natural disasters 
and introduction of appropriate prevention measures should be made available. 

(21)  The purpose of Community farm investment aid is to modernise agricultural holdings 
to  improve  their  economic  performance  through  better  use  of  the  production  factors 

1 

OJ  L  270,  21.10.2003,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No  583/2004  (OJ  L  91, 
30.3.2004, p. 1). 

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including  the  introduction  of  new  technologies,  targeting  quality  and  on/off-farm 
diversification, including non-food sectors and energy crops, as well as improving the 
environmental, occupational safety, hygiene and animal welfare status of farms, while 
simplifying  the  conditions  for  investment  aid  as  compared  with  those  laid  down  in 
Council  Regulation  (EC)  No 1257/1999  of  17  May  1999  on  support  for  rural 
development from the European Agricultural Guidance and Guarantee Fund (EAGGF) 
and amending and repealing certain Regulations2. 

(22)  Private forests play an important role in economic activity in rural areas and, therefore, 
Community  aid  is  important  for  improving  and  broadening  their  economic  value,  for 
increasing  diversification  of  production  and  enhancing  market  opportunities,  such  as 
renewable energy. 

(23) 

Improvements  in  the  processing  and  marketing  of  primary  agricultural  and  forestry 
production  should  be  encouraged  by  means  of  support  for  investments  aimed  at 
improving efficiency in the processing and marketing sector, promoting the processing 
of  agricultural  and  forestry  production  for  renewable  energy,  introducing  new 
technologies, opening new market opportunities for agricultural and forestry products, 
putting  emphasis  on  quality,  improving  performance  in  the  environmental  protection, 
occupational  safety,  hygiene  and  animal  welfare  fields,  as  appropriate,  by  targeting 
small  and  micro-enterprises  which  are  better  placed  to  add  value  to  local  products, 
while simplifying the conditions for investment aid as compared with those laid down 
in Council Regulation (EC) No 1257/1999. 

(24)  Agricultural  infrastructure  and  restorative  and  preventive  measures  against  natural 

disasters should contribute to the agricultural and forestry competitiveness priority. 

(25)  With regard to the quality of agricultural production and products, a set of measures on 
meeting  standards  by  farmers  based  on  Community 
legislation,  encouraging 
participation  of  farmers  in  food  quality  schemes  and  supporting  producer  groups  for 
information and promotion activities should be made available. 

(26)  The  aim  of  the  measure  on  meeting  standards  is  to  promote  a  more  rapid 
implementation  by  farmers  of  demanding  standards  based  on  Community  legislation 
concerning the environment, public health, animal and plant health, animal welfare and 
occupational safety and with the respect of those standards by farmers. These standards 
may impose new obligations on farmers and consequently support should be provided 
to  help  cover  partly  the  additional  costs  or  income  foregone  arising  from  these 
obligations. 

(27)  The aim of the measure providing support for farmers participating in Community or 
national food quality schemes is to provide assurances to consumers on the quality of 
the  product  or  the  production  process  used  as  a  result  of  their  participation  in  such 
schemes, to achieve added value for agricultural primary products and enhance market 
opportunities. Since participation in such schemes may give rise to additional costs and 
obligations  which  are  not  fully  rewarded  by  the  marketplace,  farmers  should  be 
encouraged to participate in such schemes. 

2 

OJ L 160, 26.6.1999, p. 80. Regulation as last amended by Regulation (EC) No 583/2004. 

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(28)  There is a need to improve consumers' awareness of the existence and specifications of 
products  produced  under  the  aforementioned  quality  schemes.  Support  should  be 
provided  to  producer  groups  to  inform  consumers  and  promote  products  provided 
under  quality  schemes  supported  by  Member  States  within  their  rural  development 
programmes. 

(29)  There  is  a  need  to  ensure  the  smooth  phasing-out  of  a  set  of  individual  measures 
introduced  through  the  Treaty  of  Accession  of  2003,  namely  the  measure  on  semi-
subsistence farming and the measure on producer groups, allowing the farming sector 
of the new Member States to benefit for the first two years of the programming period. 

(30)  Support  for  specific  methods  of  land  management  should  contribute  to  sustainable 
development  by  encouraging  farmers  and  forest  holders  in  particular  to  employ 
methods of land use compatible with the need to preserve the natural environment and 
landscape  and  protect  and  improve  natural  resources.  It  should  contribute  to  the 
implementation  of  the  6th  Community  Environment  Action  Programme  and  the 
Presidency conclusions regarding the Sustainable Development Strategy. Key issues to 
be addressed include biodiversity, NATURA 2000 site management, the protection of 
water  and  soil,  climate  change  mitigation  including  the  reduction  of  greenhouse  gas 
emissions, the reduction of ammonia emissions and the sustainable use of pesticides. 

(31)  Forestry is an integral part of rural development  and support for sustainable land use 
should encompass the sustainable management of forests and their multifunctional role. 
Forests  create  multiple  benefits:  they  provide  raw  material  for  renewable  and 
environmentally  friendly  products  and  play  an  important  role  in  economic  welfare, 
biological  diversity,  the  global  carbon  cycle,  water  balance,  erosion  control  and  the 
prevention  of  natural  hazards,  as  well  as  providing  social  and  recreational  services. 
Forestry  measures  should  be  adopted  in  the  light  of  undertakings  given  by  the 
Community  and  the  Member  States  at  international  level,  and  be  based  on  Member 
States'  national  or  sub-national  forest  programmes  or  equivalent  instruments,  which 
should take into account the commitments made in the Ministerial Conferences on the 
Protection  of  Forests  in  Europe.  Forestry  measures  should  contribute  to  the 
implementation  of  the  Community  Forestry  Strategy.  This  support  should  avoid 
distorting competition and should be market-neutral. 

(32)  Natural  handicap  payments  in  mountain  areas  and  payments  in  other  areas  with 
handicaps should contribute, through continued use of agricultural land, to maintaining 
the  countryside,  and  the  maintenance  and  promotion  of  sustainable  farming  systems. 
Objective parameters for fixing the level of payments should be laid down in order to 
ensure the efficiency of this support scheme and ensure that its objectives are achieved. 

(33)  Support should continue to be granted to farmers to help address specific disadvantages 
in  the  areas  concerned  resulting  from  the  implementation  of  Council  Directive 
79/409/EEC of 2 April 1979 on the conservation of wild birds3 and Council Directive 
92/43/EEC of 21 May 1992 on the conservation of natural habitats and of wild fauna 
and flora4 in order to contribute to the effective management of NATURA 2000 sites. 

3 

4 

OJ  L  103,  24.4.1979,  p.  7.  Directive  as  last  amended  by  Regulation  (EC)  No  807/2003  (OJ  L  122, 
16.5.2003, p. 36). 
OJ L 206, 22.7.1992, p. 7. Directive as last amended by Regulation (EC) No 1882/2003 of the European 
Parliament and of the Council (OJ L 284, 31.10.2003, p. 1). 

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(34)  Agri-environmental  payments  should  continue  to  play  a  prominent  role  in  supporting 
the  sustainable  development  of  rural  areas  and  in  responding  to  society's  increasing 
demand  for  environmental  services.  They  should  further  encourage  farmers  to  serve 
society  as  a  whole  by  introducing  or  continuing  to  apply  agricultural  production 
methods  compatible  with  the  protection  and  improvement  of  the  environment,  the 
landscape  and  its  features,  natural  resources,  the  soil  and  genetic  diversity.  In 
accordance  with  the  polluter-pays  principle  these  payments  should  cover  only  those 
commitments going beyond the relevant mandatory standards. 

(35)  Farmers should continue to be encouraged to adopt high standards of animal welfare by 
providing  for  support  for  farmers  who  undertake  to  adopt  standards  of  animal 
husbandry which go beyond the relevant mandatory standards. 

(36)  Support should be granted for non-remunerative investments where they are necessary 
to  achieve  the  commitments  undertaken  under  agri-environmental  schemes  or  where 
they enhance on-farm the public amenity value of the NATURA 2000 area concerned. 

(37) 

In  order  to  contribute  to  the  protection  of  the  environment,  the  prevention  of  natural 
hazards  and  fires,  as  well  as  to  mitigate  climate  change,  forest  resources  should  be 
extended  and  improved  by  first  afforestation  of  agricultural  land  and  other  than 
agricultural  land.  Any  first  afforestation  should  be  adapted  to  local  conditions  and 
compatible with the environment and enhance biodiversity. 

(38)  Agri-forestry systems have a high ecological and social value by combining extensive 
agriculture  and  forestry  systems,  aimed  at  the  production  of  high-quality  wood  and 
other forest products. Their establishment should be supported. 

(39)  Given  the  importance  of  forests  for  the  successful  implementation  of  Directives 
79/409/EEC  and  92/43/EEC,  specific  support  should  be  granted  to  forest  holders  to 
help address specific problems resulting from their implementation. 

(40)  Forest-environmen  payments  should  be  introduced  for  voluntary  commitments  to 
enhance  biodiversity,  preserve  high-value  forest  ecosystems  and  reinforce  the 
protective value of forests with respect to soil erosion, maintenance of water resources 
and water quality and to natural hazards. 

(41)  Support  should  be  granted  for  restoring  forestry  production  potential  in  forests 
damaged  by  natural  disasters  and  fire  and  introducing  preventive  actions.  Preventive 
actions against fires should cover areas classified by Member States as high or medium 
fire risk according to their forest protection plans. 

(42)  Support  should  be  granted  to  forest  holders  for  non-remunerative  investments  where 
they  are  necessary  to  achieve  the  forest-environment  commitments  or  in  forests  to 
enhance the public amenity value of the areas concerned. 

(43) 

In order to ensure the targeted and efficient use of land management support under this 
Regulation,  Member  States  should  designate  areas  for  intervention  under  certain 
measures  of  this  priority.  Mountain  areas  and  other  areas  with  handicaps  should  be 
designated  on  the  basis  of  objective  common  criteria.  Therefore,  Council  Directives 
and  Decisions  adopting  lists  of  less-favoured  areas  or  amending  such  lists  in 

EN 

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accordance  with  Article  21(2)  and  (3)  of  Council  Regulation  (EC)  No  950/97  of  20 
May  1997  on  improving  the  efficiency  of  agricultural  structures5  should  be  repealed. 
Natura  2000  areas  are  designated  in  accordance  with  Directives  79/409/EEC  and 
92/43/EEC.  Member  States  should  designate  areas  suitable  for  afforestation  for 
environmental  reasons,  such  as  protection  against  erosion,  prevention  of  natural 
hazards or extension of forest resources contributing to climate change mitigation, and 
forest areas with a medium to high forest fire risk. 

(44)  A  sanction  system  should  be  set  up  where  beneficiaries  receiving  payments  under 
certain land management measures do not meet the mandatory requirements provided 
for in Articles 4 and 5 and Annex III and IV of Council Regulation (EC) No 1782/2003 
on  all  of  their  holding,  taking  into  account  the  severity,  extent,  performance  and 
repetition of non-compliance. 

(45)  There  is  a  need  to  accompany  changes  in  rural  areas  by  helping  them  to  diversify 
farming  activities  towards  non-agricultural  activities  and  develop  non-agricultural 
sectors,  promote  employment,  improve  basic  services  and  carry  out  investments 
making  rural  areas  more  attractive  in  order  to  reverse  trends  towards  economic  and 
social  decline  and  depopulation  of  the  countryside.  An  effort  to  enhance  the  human 
potential in this respect is also necessary. 

(46)  Support  should  be  granted  for  other  measures  relating  to  the  broader  rural  economy. 
The  list  of  measures  should  be  defined  on  the  basis  of  experience  of  the  LEADER 
initiative  and  having  regard  to  the  multi-sectoral  needs  for  endogenous  rural 
development. 

(47)  The implementation of local development strategies can reinforce territorial coherence 
and  synergies  between  measures  intended  for  the  broader  rural  economy  and 
population. 

(48)  There  is  a  need  to  clearly  define  the  principles  of  coherence  and  complementarity  of 
the priority for the diversification of the rural economy and improvement of the quality 
of life in rural areas with other Community financial instruments, and particularly with 
those of Cohesion policy. 

(49)  The  LEADER  Initiative,  after  having  experienced  three  programming  periods,  has 
reached a level of maturity enabling rural areas to implement the LEADER approach 
more  widely  in  mainstream  rural  development  programming.  Provision  should 
therefore  be  made  to  transfer  the  basic  principles  of  the  LEADER  approach  to  the 
programmes building a specific priority in them, and provide a definition of the local 
action  groups  and  measures  to  be  supported,  including  implementation  of  local 
strategies, cooperation, networking and acquisition of skills. 

(50)  Given the importance of the LEADER approach, a substantial share of the contribution 

of the Fund should be earmarked for this priority. 

(51)  The  Fund 

to 
theimplementation of the programmes. As part of the technical assistance referred to in 

technical  assistance  actions 

to  support 

through 

relating 

is 

5 

OJ L 142, 2.6.1997, p. 1. 

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Article  5…  of  Council  Regulation  (EC)  No…/…6  on  the  financing  of  the  Common 
Agricultural Policy,  a  network  for  rural development should be set up at Community 
level. 

(52)  Provisions  on  the  allocation  of  the  available  resources  should  be  introduced.  The 
overall  amount  for  rural  development  should  be  allocated  annually.  Significant 
concentration  on  the  regions  eligible  under  the  Convergence  Objective  should  be 
allowed. 

(53)  The annual appropriations allocated to a Member State for the Convergence Objective 
under the Funds for the part coming from the EAGGF Guidance Section, the Structural 
Funds,  the  Cohesion  Fund  and  the  FIFG  should  be  limited  to  a  ceiling  fixed  with 
regard to its capacity for absorption. 

(54)  For the indicative breakdown of commitment appropriations available to the Member 

States criteria should be established according to an objective and transparent method. 

(55)  To promote an integrated and innovative approach, 3% of the appropriations allocated 
to  the  Member  States  should  be  placed  in  a  Community  reserve  for  the  LEADER 
approach. 

(56)  Over  and  above  these  amounts  the  Member  States  must  take  account  of  the  amounts 
generated by modulation as provided for in Article 12(2) of Regulation (EC) No …/… 
[οn the financing of the CAP]. 

(57)  The appropriations available under the Funds should be indexed on a flat-rate basis for 

programming. 

(58)  The rate of the Fund's contribution to rural development programming should be set in 
relation to public expenditure in the Member States, taking account of the importance 
of  the  priority  for  land  management  and  environment,  the  situation  in  the  regions 
covered  by  the  Convergence  Objective,  the  priority  given  to  the  LEADER  approach, 
the outermost regions referred to in Article 299 of the Treaty and the islands covered 
by  Council  Regulation  (EEC)  No 2019/93  of  19  July  1993  introducing  specific 
measures for the smaller Aegean islands concerning certain agricultural products7. 

(59) 

In accordance with the principle of subsidiarity and subject to exceptions, there should 
be relevant national rules on the eligibility of expenditure. 

(60)  To ensure the effectiveness, fairness and sustainable impact of the work of the Fund, 
there should be provisions guaranteeing that investments in businesses are durable and 
avoiding this fund being used to introduce unfair competition. 

(61)  Decentralised implementation of the actions under the Fund should be accompanied by 
guarantees  relating  in  particular  to  the  quality  of  implementation,  the  results,  sound 
financial management and control. 

(62)  Member  States  should  take  appropriate  measures  to  guarantee  sound  functioning  of 
management and control systems. To this end, it is necessary to establish the general 

6 
7 

OJ L 
OJ L 184, 27.7.1993, p. 1. Regulation as last amended by Regulation (EC) No 1782/2003. 

EN 

13 

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principles  and  the  basic  functions  which  any  management  and  control  system  must 
ensure.  It  is  therefore  necessary  to  maintain  the  designation  of  a  single  Managing 
Authority and to specify its responsibilities. 

(63)  Each  rural  development  programme  must  be  subject  to  appropriate  monitoring, 
watched  over  by  a  Monitoring  Committee  and  on  the  basis  of  a  common  monitoring 
and  evaluation  framework  established  and  implemented  in  partnership  with  the 
Member States, to effectively meet the specific needs of rural development. 

(64)  The effectiveness and the impact of actions under the Fund also depend on improved 
evaluation  on  the  basis  of  the  common  monitoring  and  evaluation  framework.  In 
particular,  the  programmes  should  be  evaluated  for  their  preparation,  implementation 
and completion. 

(65)  To  enable  the  partnership  to  function  effectively  and  promote  Community  action, 
information on it should be publicised as widely as possible. The authorities managing 
the programmes have a responsibility in this respect. 

(66)  The  Community  reserve  for  the  LEADER  approach  should  be  allocated  taking  the 
performance  of  the  programmes  in  this  respect  into  account.  The  criteria  for  its 
allocation should be laid down accordingly. 

(67)  Rural  development  measures  as  defined  in  this  Regulation  should  be  eligible  for 
Member  State  support  without  Community  co-financing.  In  view  of  the  economic 
impact  of  such  aid  and  in  order  to  ensure  consistency  with  measures  eligible  for 
Community  support  and  simplify  procedures,  specific  State  aid  rules  should  be 
established,  also  taking  into  account  the  experience  from  the  implementation  of 
Regulation  (EC)  No 1257/1999.  Moreover,  Member  States  should  be  authorised  to 
grant  State  aid,  intended  to  provide  additional  financing  for  rural  development 
measures  for  which  Community  support  is  granted,  under  a  notification  procedure  in 
accordance with the provisions of this Regulation as part of programming. 

(68) 

In  accordance  with  Council  Decision  1999/468/EC  of  28  June  1999  laying  down  the 
procedures for the exercise of implementing powers conferred on the Commission8, the 
measures required for the implementation of this Regulation should be adopted. 

(69)  There is a need to adopt transitional rules to facilitate the transition from the existing 

support scheme to the new rural development support scheme. 

(70)  The new support scheme provided for in this Regulation replaces the existing support 

scheme. Therefore, Regulation (EC) No 1257/1999 should be repealed,  

8 

OJ L 184, 17.7.1999, p. 23. 

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HAS ADOPTED THIS REGULATION: 

TITLE I 
OBJECTIVES AND GENERAL RULES ON ASSISTANCE 

CHAPTER I 
SCOPE AND DEFINITIONS 

Article 1 
Scope 

1. 

2. 

3. 

4. 

5. 

This Regulation lays down the general rules governing Community support for rural 
development,  financed  by  the  European  Agricultural  Fund  for  Rural  Development 
(hereinafter  the  "Fund"),  established  by  Regulation  (EC)  No…/…[financing  of  the 
CAP]. 

This  Regulation  defines  the  Objectives  to  which  rural  development  policy  is  to 
contribute. 

This Regulation defines the strategic context for rural development policy, including 
the  method  for  fixing  the  Community  strategic  guidelines  for  rural  development 
policy and the national strategic plan. 

This Regulation defines the priorities and measures for rural development. 

This  Regulation  lays  down  rules  on  partnership,  programming,  evaluation,  financial 
management, monitoring and control on the basis of responsibilities shared between 
the Member States and the Commission.  

Article 2 
Definitions 

For the purposes of this Regulation, the following terms shall have the meanings assigned to 
them: 

(a) 

(b) 

(c) 

'programming': the process of organisation, decision-taking and financing in several 
stages  intended  to  implement,  on  a  multiannual  basis,  the  joint  action  by  the 
Community and the Member States to achieve the priority goals of the Fund;  

'region':  territorial  unit  corresponding  to  level  I  or  II  of  the  Nomenclature  of 
territorial units for statistics (NUTS level I and II) within the meaning of Regulation 
(EC) No 1059/2003 of the European Parliament and of the Council of 26 May 20039. 

'priority axis': one of the priorities of the strategy in a rural development programme 
corresponding  to  one  of  the  axes  defined  in  this  Regulation  comprising  a  coherent 
group  of  measures  with  specific  measurable  goals  resulting  directly  from  their 
implementation.  

9 

OJ L 154, 21.6.2003, p. 1. 

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15 

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(d) 

(e) 

(f) 

(g) 

(h) 

(i) 

(j) 

'measure': a set of operations contributing to the implementation of a priority; 

'operation': a project selected by the managing authority or under its responsibility or 
by  a  local  action  group  according  to  criteria  laid  down  for  the  rural  development 
programme  concerned  and  implemented  by  one  or  more  beneficiaries  allowing 
achievement of the goals of the measure to which it relates;  

'common monitoring and evaluation framework': a general approach developed by 
the  Commission  and  the  Member  States  defining  a  limited  number  of  common 
indicators 
financial  execution, 
implementation, results and impact of the programmes; 

the  baseline  situation  and 

relating 

the 

to 

'local  development  strategy':  a  coherent  set  of  operations  to  meet  local  objectives 
and needs implemented in partnership at the appropriate level; 

'beneficiary':  an  operator,  body  or  firm,  whether  public  or  private,  responsible  for 
implementing operations or receiving aid; 

'public  expenditure':  any  public  contribution  to  the  financing  of  operations  whose 
origin is the budget of the State, of regional or local authorities or the general budget 
of the European Communities;  

'Convergence  Objective':  The  objective  of  the  action  referred  to  in  Article  3(2)  of 
Council  Regulation  (EC)  No…/…  of…laying  down  general  provisions  of  the 
European Regional Development Fund, the European Social Fund and the Cohesion 
Fund10. 

CHAPTER II 
MISSIONS AND OBJECTIVES 

Article 3 
Missions 

The  Fund  contributes  to  the  promotion  of  sustainable  rural  development  throughout  the 
Community  in  a  complementary  manner  to  the  market  and  income  support  policies  of  the 
Common Agricultural Policy, to Cohesion policy and to the Common Fisheries Policy. 

Article 4 
Objectives 

1. 

Support for rural development shall contribute to achieving the following goals: 

(a) 

(b) 

improving the competitiveness of agriculture and forestry by means of support 
for restructuring; 

improving  the  environment  and  the  countryside  by  means  of  support  for  land 
management; 

10 

OJ L 

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(c) 

improving  the  quality  of  life  in  rural  areas  and  encouraging  diversification  of 
economic activity. 

2. 

The  objectives  set  out  in  paragraph  1  shall  be  implemented  by  means  of  the  four 
priority axes defined in Title IV. 

CHAPTER III 
PRINCIPLES OF ASSISTANCE 

Article 5 
Complementarity, consistency and conformity 

1. 

2. 

3. 

4. 

5. 

6. 

1. 

The  Fund  shall  complement  national,  regional  and  local  actions  contributing  to  the 
priorities of the Community.  

The  Commission  and  the  Member  States  shall  ensure  that  the  assistance  from  the 
Fund and the Member States is consistent with the activities, policies and priorities of 
the Community. The assistance of the Fund must be consistent with the objectives of 
Economic  and  Social  Cohesion  and  those  of  the  European  Fisheries  Fund  in 
particular. 

This consistency shall be provided by the Community strategic guidelines referred to 
in Article 9, the national strategic plan referred to in Article 11, the rural development 
programmes referred to in Article 15 and the annual Commission report referred to in 
Article 13. 

There  shall  also  be  consistency  with  the  measures  financed  by  the  European 
Agricultural Guarantee Fund. 

No  support  under  this  Regulation  shall  be  granted  to  schemes  eligible  for  support 
under  common  market  organisations,  subject  to  exceptions  yet  to  be  defined,  if 
appropriate, under Article 95(2). 

The  Member  States  shall  ensure  that  the  operations  financed  by  the  Fund  are  in 
conformity with the Treaty and any Acts adopted under it.  

Article 6 
Partnership 

Fund  assistance  shall  be  implemented  through  close  consultations,  hereinafter 
"partnership",  between  the  Commission  and  the  Member  State  and  with  the 
authorities  and  bodies  designated  by  the  Member  State  under  national  rules  and 
practices in force, namely: 

(a) 

the competent regional, local authorities and other public authorities; 

(b) 

the economic and social partners; 

(c) 

any  other  appropriate  body  representing  civil  society,  non-governmental 
(especially environmental) organisations and bodies responsible for promoting 
equality between men and women. 

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The  Member  State  shall  designate  the  most  representative  partners  at  national, 
regional and local level and in the economic, social, environmental  or  other  sphere, 
hereinafter  'partners'.  It  shall  create  the  conditions  for  a  broad  and  effective 
involvement of all appropriate bodies, in accordance with national rules and practices, 
taking  into  account  the  need  to  promote  equality  between  men  and  women  and 
sustainable  development  through  integration  of  environmental  protection  and 
improvement requirements. 

The  partnership  shall  be  conducted  with  due  regard  to  the  respective  institutional, 
legal and financial responsibilities of each category of partner. 

The  partnership  shall  be  involved  in  the  preparation  and  monitoring  of  the  national 
strategy  plan  and  in  the  preparation,  implementation,  monitoring  and  evaluation  of 
the rural development programmes. The Member States shall involve all appropriate 
partners at the various programming stages, due regard being had to the time limit set 
for each step.  

2. 

3. 

Article 7 
Subsidiarity 

The Member States shall be responsible for implementing the rural development programmes 
at  the  appropriate  territorial  level,  according  to  their  own  institutional  arrangements.  This 
responsibility shall be carried out in accordance with this Regulation. 

Article 8 
Equality between men and women 

The  Member  States  and  Commission  shall  promote  equality  between men  and  women  at  all 
the various stages of programme implementation. 

This includes the stages of conception, implementation, monitoring and evaluation. 

TITLE II 
THE STRATEGIC APPROACH TO RURAL DEVELOPMENT 

CHAPTER I 
THE COMMUNITY STRATEGIC GUIDELINES 

Article 9 
Content and adoption 

1. 

The Council adopts at Community level strategic guidelines for rural development for 
the programming period from 1 January 2007 to 31 December 2013 in the light of the 
policy priorities set at Community level. 

These  guidelines  shall  set  at  Community  level  the  strategic  priorities  for  rural 
development  for  the  programming  period  with  a  view  to  implementing  each  of  the 
priority headings laid down in this Regulation. 

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2. 

No  later  than  three  months  after  the  adoption  of  this  Regulation,  the  Community 
strategic  guidelines  shall  be  adopted  according  to  the  procedure  laid  down  in 
Article 37 of the Treaty. This decision shall be published in the Official Journal of the 
European Union. 

Article 10 
Review 

With  a  view  to  taking  account  of  changes  in  the  Community  priorities  in  particular,  the 
Community strategic guidelines may be subject to a mid-term review.  

CHAPTER II 
NATIONAL STRATEGY PLAN 

Article 11 
Content 

1 

2 

The Member State shall submit a national strategy plan indicating the priorities of the 
action  of  the  Fund  and  of  the  Member  State  concerned  taking  into  account  the 
Community  strategic  guidelines  on  rural  development,  their  specific  objectives,  the 
contribution from the Fund and the other financial resources. 

The national strategy plan shall ensure that Community aid for rural development is 
consistent with the Community strategic guidelines and that Community, national and 
regional priorities all coordinate. 

The national strategy plan shall be a reference tool for preparing Fund programming. 
It shall be implemented through the rural development programmes. 

3. 

Each national strategy plan shall include: 

(a) 

(b) 

(c) 

(d) 

(e) 

(f) 

an  evaluation  of  the  economic,  social  and  environmental  situation  and  the 
potential for development; 

the  strategy  chosen  for  joint  action  by  the  Community  and  Member  State 
concerned, showing the consistency of the choices made  with  the  Community 
strategic guidelines; 

the thematic and territorial priorities for rural development under each priority 
axis,  including  the  main  quantified  objectives  and  the  appropriate  monitoring 
and evaluation indicators; 

a list of the rural development programmes implementing the national strategy 
plan  and  an  indicative  Fund  allocation  for  each  programme,  including  the 
amounts  resulting  from  modulation  in  accordance  with  Article  10(2)  of 
Regulation (EC) No 1782/2003; 

the  means  to  ensure  coordination  with  the  other  CAP  instruments  and  with 
Cohesion policy; 

if appropriate, the budget for achieving the Convergence Objective laid down in 
Article 3 of Regulation (EC) No…/… [cohesion];  

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(g) 

a  description of the arrangements and the indication  of the amount  earmarked 
for  establishing  the  national  rural  network  referred  to  in  Articles  67(2)  third 
subparagraph  and  69,  including  those  Member  States  that  have  opted  for 
regionalised programming. 

Article 11a 
Preparation 

1. 

Each  Member  State  shall  prepare  its  national  strategy  plan  immediately  after  the 
Community strategic guidelines are adopted.  

This  plan  shall  be  prepared  in  accordance  with  the  Member  States'  institutional 
arrangements, following close collaboration with the partners referred to in Article 6. 
It shall be drawn up in close collaboration with the Commission and shall cover the 
period from 1 January 2007 to 31 December 2013.  

2. 

Each  Member  State  shall  send  the  Commission  its  national  strategic  plan  before 
submitting its rural development programmes. 

CHAPTER III 
STRATEGIC MONITORING 

Article 12 
Annual summary report by Member State 

1. 

2. 

3. 

1. 

For the first time in 2008 and no later than 1 October each year, each Member State 
shall  submit  to  the  Commission  a  summary  report  setting  out  the  progress  made  in 
implementing its strategy and objectives and their contribution to the achievement of 
the Community strategic guidelines for rural development. 

The report shall summarise the annual programme implementation reports referred to 
in Article 86 and shall describe in particular:  

(a) 

the  achievements  and  results  of  the  rural  development  programmes  relative  to 
the indicators set out in the national strategy plan; 

(b) 

the results of the annual ongoing evaluations made of each programme. 

Notwithstanding  paragraph  1,  for  single  programmes  as  referred  to  in  Article  14(2) 
Member  States  may  include  in  the  annual  implementation  reports  referred  to  in 
Article  86  the  elements  provided  for  in  paragraph  2  within  the  time  limit  set  in 
Article 86. 

Article 13 
Annual Commission report 

For the first time in 2009 and at the start of each year, the Commission shall present 
an annual report summarising the main developments, trends and challenges relating 
to  the  implementation  of  the  national  strategy  plans  and  the  Community  strategic 
guidelines.  

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This report shall be based on the Commission's analysis and appraisal of the Member 
States'  annual  summary  reports  referred  to  in  Article  12  and  any  other  available 
information. It shall indicate the measures taken or to be taken by the Member States 
and  Commission  in  order  to  provide  an  appropriate  follow-up  to  the  report's 
conclusions. 

2. 

The annual Commission report shall be sent to the Council, Parliament, the European 
Economic and Social Committee and the Committee of the Regions. 

TITLE III 
PROGRAMMING 

CHAPTER I 
PROGRAMMING CONTENT 

Article 14 
Rural development programmes 

1. 

The  Fund  shall  act  in  the  Member  States  through  rural  development  programmes. 
These programmes implement a rural development strategy through a set of measures 
grouped  together  in  accordance  with  the  priority  axes  defined  in  Title  IV,  for  the 
achievement of which aid from the Fund will be sought 

Each rural development programme shall cover a period between 1 January 2007 and 
31 December 2013. 

2. 

A  Member  State  may  submit  either  a  single  programme  for  its  entire  territory  or  a 
programme for each region. 

Article 15 
Content of programmes 

Each rural development programme shall include: 

(a) 

(b) 

(c) 

an analysis of the situation in terms of strengths and weaknesses, the strategy chosen 
to meet them and the ex-ante evaluation referred to in Article 89;  

a  justification  of  the  priorities  chosen  having  regard  to  the  Community  strategic 
guidelines  and  the  national  strategic  plan,  as  well  as  the  expected  impact  in  the  ex-
ante evaluation;  

an information on the priority axes and measures proposed for each priority axis and 
their description, including the specific verifiable objectives and indicators referred to 
in Article 85 that allow the programme's progress, efficiency and effectiveness to be 
measured;  

(d) 

a financing plan, comprising two tables:  

(i) 

a  table  setting  out,  in  accordance  with  Article  70(5)  and  (6),  the  total  Fund 
contribution  planned  for  each  year.  When  applicable,  this  financing  plan  shall 
indicate  separately  within  the  total  Fund  contribution  the  appropriations 

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provided for the regions eligible under the Convergence Objective. The planned 
annual Fund contribution shall be compatible with the Financial Perspectives;  

(ii) 

a  table  specifying  for  the  entire  programming  period  the  total  Community 
contribution planned and the matching national public funding for each priority 
axis, the Fund contribution rate for each priority axis and the amount earmarked 
for  technical  assistance.  When  applicable,  this  table  shall  also  indicate 
separately  the  planned  Fund  contribution  for  the  regions  eligible  under  the 
Convergence Objective and the matching national public funding.  

for information, an indicative breakdown of the initial amounts by measure in terms 
of public and private expenditure; 

the elements needed for the appraisal of competition rules and, when applicable, the 
list of aid schemes allowed under Article 87 of the Treaty; 

information  on  the  complementarity  with  the  measures  financed  by  the  other  CAP 
instruments, through Cohesion policy as well as by the European Fisheries Fund;  

(e) 

(f) 

(g) 

(h) 

programme implementing arrangements, including:  

(i) 

(ii) 

the  designation  by  the  Member  State  of  all  the  authorities  provided  for  in 
Article 76;  

a  description  of  the  monitoring  and  evaluation  systems,  as  well  as  the 
composition of the Monitoring Committee;  

(iii)  details on the implementation of the LEADER approach; 

(iv) 

the  description  of  the  control  systems,  covering  in  particular  the  organisation 
and procedures of the authorities and bodies in charge of the implementation of 
the  programme  and  the  internal  control  system  operating  in  those  authorities 
and bodies; 

(v) 

the provisions to ensure that the programme is publicised;  

(vi)  a description of the arrangements agreed between the Commission and Member 
State  concerned  for  exchanging  the  computerised  data  needed  to  meet  the 
this  Regulation  as  regards  payments,  monitoring  and 
requirements  of 
evaluation. 

(i) 

The  designation  of  the  partners  referred  to  in  Article  6  and  the  results  of  the 
consultations of the partners. 

Article 16 
Balance between priorities 

The Community financial contribution to each of the three objectives referred to in Article 4 
shall cover at least 15% of the Fund's total contribution to the programme for priority axis I 
and III referred to in Sections I and III respectively under Chapter I of Title IV and 25% of the 
Fund's total contribution to the programme for the priority axis II referred to in Section II of 
Chapter I.  

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CHAPTER II 
PREPARATION, APPROVAL AND REVIEW 

Article 17 
Preparation and approval 

1. 

2. 

3. 

4. 

1. 

2. 

Rural  development  programmes  shall  be  established  by  a  Member  State  following 
close cooperation with the partners referred to in Article 6. 

Member States shall submit to the Commission a proposal for each rural development 
programme, containing the information mentioned in Article 15, as soon as possible 
after  the  submission  of  its  strategic  plan  to  the  Commission  in  accordance  with 
Article 11a(2). 

The  Commission  shall  assess  the  proposed  programmes  on  the  basis  of  their 
consistency  with  the  Community  strategic  guidelines  for  rural  development,  the 
national strategic plan and this Regulation. 

Where  the  Commission  considers  that  a  rural  development  programme  is  not 
consistent with the Community strategic guidelines, the national strategy plan or this 
Regulation,  it  shall  request  the  Member  State  to  revise  the  proposed  programme 
accordingly. 

Each  rural  development  programme  shall  be  adopted  as  soon  as  possible  after  its 
submission  by  the  Member  State,  in  accordance  with  the  procedure  laid  down  in 
Article 95(2). 

Article 18 
Review 

The rural development programmes shall be re-examined and, if appropriate, adapted 
for  the  remainder  of  the  period  at  the  Member  State's  or  Commission's  initiative, 
following Monitoring Committee approval. The purpose of these revisions shall be to 
take  account  of  the  outcome  of  evaluations  and  the  Commission's  annual  reports, 
particularly  with  a  view  to  strengthening  or  adapting  the  way  in  which  the 
Community  priorities  are  taken  into  account.  The  rural  development  programmes 
shall  be  revised,  when  applicable,  following  allocation  of  the  LEADER  reserve 
referred to in Article 92. 

The  Commission  shall  adopt  a  decision  on  requests  to  revise  rural  development 
programmes  shortly  after  the  submission  of  a  request  by  a  Member  State  in 
accordance with the procedure laid down in Article 95(2).  

Changes requiring approval by Commission decision shall be defined in accordance 
with the procedure laid down in Article 95(2). 

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TITLE IV 
RURAL DEVELOPMENT PRIORITIES 

CHAPTER I 
PRIORITIES 

SECTION 1 

PRIORITY AXIS 1: 
IMPROVING THE COMPETITIVENESS OF  
THE AGRICULTURAL AND FORESTRY SECTOR 

Article 19 
Measures 

Support targeting the competitiveness of the agricultural and forestry sector shall concern: 

(a) 

measures aimed at improving human potential through: 

(i) 

vocational  training  and  information  actions  for  persons  engaged  in  the 
agricultural and forestry sectors, 

(ii) 

setting up of young farmers, 

(iii)  early retirement of farmers and farm workers, 

(iv)  use by farmers and forest holders of advisory services. 

(v) 

setting up of farm management, farm relief and farm advisory services, as well 
as of forestry advisory services; 

(b) 

measures aimed at restructuring physical potential through: 

(i) 

farm modernisation, 

(ii) 

improving the economic value of forests, 

(iii)  adding value to primary agricultural and forestry production, 

(iv) 

(v) 

improving  and  developing  infrastructure  related  to  the  development  and 
adaptation of agriculture and forestry, 

restoring  agricultural  production  potential  damaged  by  natural  disasters  and 
introducing appropriate prevention actions; 

(c) 

measures aimed at improving the quality of agricultural production and products by: 

(i) 

helping  farmers  to  adapt  to  demanding  standards  based  on  Community 
legislation, 

(ii) 

supporting farmers who participate in food quality schemes,  

(iii)  supporting  producer  groups  for  information  and  promotion  activities  for 

products under food quality schemes; 

(d) 

transitional measures for the new Member States concerning: 

(i) 

supporting semi-subsistence farms undergoing restructuring, 

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(ii) 

supporting setting up of producer groups. 

SUB-SECTION 1 
CONDITIONS FOR MEASURES AIMED AT IMPROVING HUMAN POTENTIAL 

Article 20 
Vocational training and information actions 

Support  provided  for  in  Article  19  (a)(i)  shall  not  include  courses  of  instruction  or  training 
which  form  part  of  normal  programmes  or  systems  of  agricultural  and  forestry  education  at 
secondary or higher levels. 

Article 21 
Setting up of young farmers 

1. 

Support provided for in Article 19 (a)(ii), shall be granted to persons who: 

(a) 

are  less  than  40  years  of  age  and  are  setting  up  for  the  first  time  on  an 
agricultural holding as head of the holding; 

(b)  possess adequate occupational skills and competence; 

(c) 

submit a business plan for the development of their farming activities. 

2. 

The  support  shall  be  granted  in  the  form  of  a  single  premium  up  to  the  maximum 
amount laid down in Annex I.  

Article 22 
Early retirement 

1. 

Support provided for in Article 19, point (a)(iii), shall be granted: 

(a) 

to  farmers  who  decide  to  stop  their  agricultural  activity  for  the  purpose  of 
transferring the holdings to other farmers; 

(b) 

to farm workers who decide to stop all farm work definitively. 

2. 

The transferor shall: 

(a) 

be not less than 55 years old but not yet of normal retirement age at the time of 
transfer or not less than 10 years younger than the normal retirement age in the 
Member State concerned at the time of the transfer; 

(b) 

stop all commercial farming activity definitively; 

(c) 

have practised farming for the 10 years preceding transfer. 

The transferee shall: 

(a) 

succeed the transferor by setting up as provided for in Article 21, or 

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(b)  be  a  farmer  of  less  than  50  years  old  and  take  over  the  farm  released  by  the 

transferor to increase the size of his holding. 

The farm worker shall: 

(a) 

be  not  less  than  55  years  old  but  not  yet  of  normal  retirement  age  or  not  less 
than  10  years  younger  than  the  normal  retirement  age  in  the  Member  State 
concerned; 

(b)  have devoted at least half of his working time during the preceding five years as 

a family helper or farm worker to farm work; 

(c) 

have worked on the transferor's agricultural holding for at least the equivalent 
of two years full-time during the four-year period preceding the early retirement 
of the transferor; 

(d)  belong to a social security scheme. 

3. 

The total duration of early retirement support shall not exceed a period of 10 years for 
the transferor and for the farm worker. It shall not go beyond the 70th birthday of the 
transferor and the normal retirement age of the farm worker. 

Where in the case of a transferor a normal retirement pension is paid by the Member 
State,  early  retirement  support  shall  be  granted  as  a  supplement  taking  into  account 
the amount of the national retirement pension. 

4. 

This support shall be granted in the form of an annual payment up to the maxima set 
out in Annex I. 

Article 23 
Use of advisory services 

1. 

Support provided for in Article 19 (a)(iv), shall be granted in order: 

(a) 

(b) 

to help farmers and forest holders to meet costs arising from the use of advisory 
services for the improvement of the overall performance of their holding; 

to  help  farmers  to  meet  costs  arising  from  the  use  of  advisory  services  as 
regards  compliance  with  Community  statutory  standards  in  the  fields  of 
environmental protection, public health, animal and plant health, animal welfare 
and occupational safety standards.  

2. 

Support for the use of advisory services shall be limited to the maxima laid down in 
Annex I.  

Article 24 
Setting up of management, relief and advisory services 

Support provided for in Article 19 (a)(v) shall be granted in order to cover costs arising from 
the  setting  up  of  management,  relief  and  advisory  services  and  shall  be  degressive  over  a 
maximum period of 5 years from setting up. 

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SUB-SECTION 2 
CONDITIONS FOR MEASURES AIMED AT RESTRUCTURING PHYSICAL POTENTIAL 

Article 25 
Modernisation of farms 

1. 

Support provided for in Article 19 (b)(i), shall be granted to farmers for investments 
which: 

(a) 

improve the overall performance of the farm, and  

(b) 

respect the Community standards applicable to the investment concerned. 

Where investments are made in order to comply with Community standards, support 
may  be  granted  only  to  those  which  are  made  in  order  to  comply  with  newly 
introduced  Community  standards.  In  that  case  a  period  of  grace,  not  exceeding  36 
months from the date on which the standard becomes mandatory for the farmer, may 
be provided to farmers to meet that standard. 

2. 

Support shall be limited to the maxima laid down in Annex I.  

Article 26 
Improvement of the economic value of forests 

1 

2. 

3. 

Investment  support  provided  for  in  Article  19  (b)(ii)  shall  be  granted  for  forests 
owned  by  private  owners  or  their  associations  or  by  municipalities  or  their 
associations.  This  limitation  does  not  apply  to  the  subtropical  forests  and  to  the 
wooded areas of the territories of Açores, Madeira and French Oversea Departments. 

Investments shall be based on forest management plans. 

Support shall be limited to the maxima laid down in Annex I. 

Article 27 
Adding value to primary agricultural and forestry production 

1. 

Support provided for in Article 19 (b)(iii), shall be granted for investments which:  

(a) 

improve the overall performance of the enterprise; 

(b) 

concern  the  processing  and  marketing  of  products  covered  by  Annex  I  to  the 
Treaty except fishery products, as well as forestry products, and 

(c) 

respect the Community standards applicable to the investment concerned. 

Where investments are made in order to comply with Community standards, support 
may  be  granted  only  to  those  which  are  made  by  microentreprises,  as  referred  in 
paragraph 2, in order to comply with a newly introduced Community standard. In that 
case a period of grace, not exceeding 36 months from the date on which the standard 
becomes mandatory for the enterprise, may be provided to meet the standard. 

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2. 

Support under paragraph 1 shall be limited to micro and small enterprises within the 
meaning  of  Commission  recommendation  2003/361/EC11.  In  the  case  of  forestry 
production, support shall be limited to micro-enterprises.  

Support  shall  not  be  granted  to  enterprises  in  difficulty  within  the  meaning  of  the 
Community Guidelines in State aid for rescuing and restructuring firms in difficulty12.  

3. 

Support shall be limited to the maxima laid down in Annex I. 

Article 28 
Infrastructure related to the development and adaptation of agriculture and forestry 

Support provided for in Article 19 (b)(iv), may cover notably operations related to access to 
farm and forest land, energy supply and water management.  

SUB-SECTION 3 
CONDITIONS FOR MEASURES AIMING TO IMPROVE THE QUALITY OF 
AGRICULTURAL PRODUCTION AND PRODUCTS 

Article 29 
Meeting standards based on Community legislation 

1. 

2. 

Support provided for in Article 19 (c)(i) shall contribute partly to costs incurred and 
income foregone caused to farmers who have to apply standards in the fields of the 
environmental protection, public health, animal and plant health, animal welfare and 
occupational safety. 

These  standards  must  be  newly  introduced  in  national  legislation  and  impose  new 
obligations  or  restrictions  to  farming  practice  which  have  a  significant  impact  on 
typical farm operating costs and concern a significant number of farmers. 

The support shall be granted as a flat-rate, temporary and degressive aid on an annual 
basis,  for  a  maximum  duration  of  5  years  from  the  date  the  standard  becomes 
mandatory in accordance with Community legislation.  

Support shall be limited to the maximum amount laid down in Annex I. 

Article 30 
Participation of farmers in food quality schemes 

1. 

Support provided for in Article 19 (c)(ii) shall:  

(a) 

cover agricultural products only intended for human consumption; 

(b)  be  for  Community  food  quality  schemes,  or  for  those  recognised  by  the 
Member States which comply with precise criteria to be defined in accordance 

11 
12 

OJ L 124, 20.5.2003, p. 36. 
OJ C 288, 9.10.1999, p. 2. 

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with the procedure referred to in Article 95(2); schemes whose sole purpose is 
to  provide  a  higher  level  of  control  of  respect  of  obligatory  standards  under 
Community or national law shall not be eligible for support, 

(c) 

be  granted  as  an  annual  incentive  payment  whose  level  shall  be  determined 
according to the level of the fixed costs arising from participation in supported 
schemes, for a maximum duration of 5 years. 

2. 

Support shall be limited to the maximum laid down in Annex I. 

Article 31 
Information and promotion activities 

Support provided for in Article 19 (c)(iii) shall concern products covered by the support of the 
quality schemes referred to in Article 30. 

Support shall be limited to the maximum laid down in Annex I. 

SUB-SECTION 4 
CONDITIONS FOR TRANSITIONAL MEASURES 

Article 32 
Semi-subsistence farming 

1. 

2. 

3. 

4. 

1. 

Support provided for in Article 19 (d)(i) to farms which produce primarily for their 
own  consumption  and  also  market  a  proportion  of  their  output  ("semi-subsistence 
farms") shall be granted to farmers who present a business plan. 

Progress in respect of the business plan referred to in paragraph 1 shall be assessed 
after three years. 

Support  shall  be  paid  in  the  form  of  a  flat  rate  aid  up  to  the  maximum  amount 
specified in Annex I and for a period not exceeding 5 years. 

The  support  referred  to  in  paragraph  3  shall  be  granted  in  respect  of  applications 
approved by 31 December 2008 at the latest. 

Article 33 
Producer groups 

Support  provided  for  in  Article  19  (d)(ii)  shall  be  granted  in  order  to  facilitate  the 
setting up and administrative operation of producer groups for the purposes of: 

(a) 

(b) 

(c) 

adapting  the  production  and  output  of  producers  who  are  members  of  such 
groups to market requirements; 

jointly  placing  goods  on 
centralisation of sales and supply to bulk buyers; 

the  market, 

including  preparation  for  sale, 

establishing common rules on production information, with particular regard to 
harvesting and availability. 

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2. 

3. 

The  support  shall  be  granted  as  a  flat-rate  aid  in  annual  instalments  for  the  first 
5 years  following  the  date  on  which  the  producer  group  was  recognised.  It  shall  be 
calculated on the basis of the group's annual marketed production, up to the ceilings 
set in Annex I. 

The support shall be granted to producer groups which are formally recognised by the 
Member State's competent authority by 31 December 2008 at the latest. 

SECTION 2 

PRIORITY AXIS 2: 
LAND MANAGEMENT 

Article 34 
Measures 

Support under this section concerns the following measures: 

(a) 

measures targeting the sustainable use of agricultural land through:  

(i) 

natural handicap payments to farmers in mountain areas,  

(ii)  payments to farmers in areas with handicaps, other than mountain areas, 

(iii)  NATURA 2000 payments,  

(iv)  agri-environment and animal welfare payments, 

(v) 

support for non-productive investments; 

(b) 

measures targeting the sustainable use of forestry land through: 

(i) 

first afforestation of agricultural land, 

(ii) 

first establishment of agroforestry systems on agricultural land, 

(iii)  first afforestation of non agricultural land, 

(iv)  NATURA 2000 payments, 

(v) 

forest-environment payments,  

(vi) 

restoring forestry production potential and introducing prevention actions, 

(vii)  support for non-productive investments. 

SUB-SECTION 1 
CONDITIONS FOR MEASURES TARGETING THE SUSTAINABLE USE  
OF AGRICULTURAL LAND 

Article 35 
Natural handicap payments in mountain areas and payments in other areas with handicaps 

1. 

Payments  provided  for  in  Article  34  (a)(i)  and  (ii)  shall  be  granted  annually  per 
hectare of Utilised Agricultural Area.  

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They should compensate for farmers' additional costs and income forgone related to 
the handicap for agricultural production in the area concerned.  

2. 

Payments shall be granted to farmers who undertake to pursue their farming activity 
in areas designated pursuant to Article 47 paragraphs 2 and 3 for at least five years 
from the first payment.  

3. 

Payments shall be fixed between the minima and maxima laid down in the Annex I. 

Payments  higher  than  the  maximum  amount  may  be  granted  in  duly  justified  cases 
provided that the average amount of all these payments granted at the Member State 
level concerned does not exceed this maximum amount. 

4. 

Payments shall be degressive above a threshold level of area per holding to be defined 
in the programme. 

Article 36 
NATURA 2000 payments 

Support provided for in Article 34 (a)(iii), shall be granted annually and per hectare of Utilised 
Agricultural Area  to  farmers  in order to compensate for costs incurred and income foregone 
resulting  from  disadvantages  in  the  areas  concerned  related  to  the  implementation  of 
Directives 79/409/EEC and 92/43/EEC.  

Support shall be limited to the maxima laid down in Annex I. 

Article 37 
Agri-environment and animal welfare payments 

1. 

2. 

3. 

Member  States  shall  make  available  support  provided  for  in  Article  34  (a)(iv) 
throughout their territories, in accordance with their specific needs. 

Agri-environment  and  animal  welfare  payments  shall  be  granted  to  farmers  who 
make  on  a  voluntary  basis  agri-environmental  or  animal  welfare  commitments. 
Where duly justified to achieve environmental objectives, agri-environment payments 
may be granted to other land managers. 

Agri-environment  and  welfare  payments  cover  only  those  commitments  going 
beyond the relevant mandatory standards established pursuant to Articles.4 and 5 and 
Annexes  III  and  IV  of  Council  Regulation  (EC)  No  1782/2003  and  other  relevant 
mandatory  requirements  established  by  national  legislation  and  identified  in  the 
programme.  Additionally,  farmers  and  other  land  managers  undertaking  agri-
environment  commitments  shall  respect  minimum  requirements  for  fertiliser  and 
plant protection product use to be identified in the programme. 

These commitments shall be undertaken for five years. Where necessary and justified, 
a  longer  period  shall  be  determined  according  to  the  procedure  referred  to  in 
Article 95(2) for particular types of commitments.  

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4. 

The payments shall be granted annually and shall cover additional costs and income 
foregone resulting from the commitment given; where necessary, they may cover also 
transaction cost. 

Where  appropriate,  the  beneficiaries  are  selected  on  the  basis  of  calls  for  tender, 
applying criteria of economic, environmental and animal welfare efficiency. 

Support shall be limited to the maxima laid down in Annex I. 

Article 38 
Non-productive investments 

Support provided in Article 34 (a)(v) shall be granted for: 

(a) 

(b) 

1. 

2. 

investments  linked  to  the  achievement  of  commitments  undertaken  pursuant  to  the 
measure provided for in Articl 34 (a)(iv);e 

on-farm investments which enhance the public amenity value of the NATURA 2000 
area concerned. 

SUB-SECTION 2 
CONDITIONS FOR MEASURES TARGETING  
THE SUSTAINABLE USE OF FORESTRY LAND 

Article 39 
General conditions 

Support  under  this  sub-section  shall  be  granted  only  for  forests  and  wooded  areas 
owned  by  private  owners  or  by  their  associations  or  by  municipalities  or  their 
associations.  

This restriction shall not apply to the support provided for in Article 34 (b)(i), (vi) and 
(vii). 

Measures proposed under this sub-section in areas classified as high or medium forest 
fire  risk  within  the  framework  of  the  Community  action  on  protection  of  forests 
against fires must conform to the forest protection plans established by the Member 
States for those areas. 

Article 40 
First afforestation of agricultural land 

1. 

Support provided for in Article 34 (b)(i), may include: 

(a) 

establishment costs; 

(b) 

an annual premium per hectare afforested to contribute to covering maintenance 
costs for a period of up to five years, 

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(c) 

an  annual  premium  per  hectare  to  contribute  to  covering  loss  of  income 
resulting  from  afforestation  for  a  maximum  period  of  10  years  for  farmers  or 
associations  thereof  who  worked  the  land  before  its  afforestation  or  for  any 
other natural person or private-law corporation. 

2. 

Support  for  the  afforestation  of  agricultural  land  owned  by  public  authorities  shall 
cover only the cost of establishment. If the agricultural land to be afforested is rented 
by  a  natural  person  or  private-law  corporation,  the  annual  premia  referred  to  in 
paragraph 1 may be granted. 

3. 

Support for the afforestation of agricultural land shall not be granted: 

(a) 

for farmers benefiting from early retirement support; 

(b) 

in respect of the planting of Christmas trees. 

In the case of fast-growing species for short term cultivation, support for afforestation 
shall be granted for establishment costs only. 

4. 

Support  to  farmers  or  other  natural  persons  and  private-law  corporations  shall  be 
limited to the maxima laid down in Annex I. 

Article 41 
First establishment of agroforestry systems on agricultural land 

Support  provided  for  in  Article  34(b)  (ii),  shall  be  granted  to  farmers  to  create 
agroforestry systems combining extensive agriculture and forestry systems. 

It shall cover the establishment costs. 

Agroforestry  systems  refer  to  land  use  systems  in  which  trees  are  grown  in 
combination with agriculture on the same land.  

Christmas trees and fast-growing species for short term cultivation shall be excluded 
from support. 

Support shall be limited to the maxima laid down in Annex I. 

Article 42 
First afforestation of non-agricultural land 

Support  provided  for  in  Article  34  (b)(iii)  shall  cover  the  establishment  cost  of 
afforestation of land not eligible under Article 34, point (b)(i). 

Support shall not be granted in respect of Christmas trees. 

Support to natural persons or private-law corporations shall be limited to the maxima 
laid down in Annex I. 

1. 

2. 

3. 

4. 

1. 

2. 

3. 

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Article 43 
NATURA 2000 payments 

Support provided for in Article 31 (b)(iv), shall be granted annually and per hectare of forest 
to  private  forest  owners  or  associations  thereof  in  order  to  compensate  for  costs  incurred 
resulting  from  the  restrictions  on  the  use  of  forests  and  other  wooded  land  related  to  the 
implementation of Directives 79/409/EEC and 92/43/EEC in the area concerned.  

Support shall be fixed between the minimum and maximum amounts laid down in Annex I. 

Article 44 
Forest-environment payments  

1. 

Forest-environment payments provided for in Article 34 (b)(v), shall be granted per 
hectare of forest to beneficiaries who make forest-environmental commitments on a 
voluntary  basis.  These  payments  shall  cover  only  those  commitments  going  beyond 
the relevant mandatory requirements.  

These commitments shall be undertaken for five years. Where necessary and justified, 
another period shall be determined for particular types of commitments.  

2. 

The payments shall cover additional costs resulting from the commitment given. They 
shall be calculated on the basis of real costs. 

Support  shall  be  fixed  between  the  minimum  and  maximum  amounts  laid  down  in 
Annex I. 

Article 45 
Restoring forestry production potential and introducing prevention actions  

1. 

2. 

Support  provided  for  in  Article  34  (b)(vi),  shall  be  granted  for  restoring  forestry 
production potential in forests damaged by natural disasters and fire and introducing 
appropriate prevention actions. 

Preventive actions against fires shall concern forests classified by the Member States 
as high or medium forest fire risk according to their forest protection plans. 

Article 46 
Non productive investments 

Support provided in Article 34 (b)(vii), shall be granted for investments in forests: 

(a) 

linked  to  the  achievement  of  commitments  undertaken  pursuant  to  the  measure 
provided for in Article 34 (b)(v), or 

(b) 

which enhance the public amenity value of the area concerned. 

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SUB-SECTION 3 
DESIGNATION OF AREAS 

Article 47 
Eligible areas for payments 

1. 

2. 

Member States shall designate the areas eligible for payments provided for in Article 
34 (a)(i), (ii) and (iii) as well as (b)(i), (iii), (iv) and (vi) of that Article, taking into 
account the provisions of paragraphs 2, 3, 4 and 5 of this Article.  

In order to be eligible for payments provided for in Article 34 (a)(i) mountain areas 
must  be  characterised  by  a  considerable  limitation  of  the  possibilities  for  using  the 
land and an appreciable increase in the cost of working it due::  

(a) 

(b) 

to  the  existence,  because  of  altitude,  of  very  difficult  climatic  conditions,  the 
effect of which is substantially to shorten the growing season;  

at a lower altitude, to the presence over the greater part of the area in question 
of  slopes  too  steep  for  the  use  of  machinery  or  requiring  the  use  of  very 
expensive  special  equipment,  or  to  a  combination  of  these  two  factors,  where 
the  handicap  resulting  from  each  taken  separately  is  less  acute  but  the 
combination of the two gives rise to an equivalent handicap. 

Areas  north  of  the  62nd  parallel  and  certain  adjacent  areas  shall  be  regarded  as 
mountain areas. 

In the programmes, the Member States shall either confirm the existing delimitation 
of their mountain areas or amend it according to specific provisions to be defined in 
accordance with the procedure referred to in Article 95(2). 

3. 

In order to be eligible for payments provided for in Article 34 (a)(ii), areas other than 
mountain areas referred to in paragraph 2 of this Article must be: 

(a) 

(b) 

affected  by  significant  natural  handicaps,  notably  a  low  soil  productivity  or 
poor  climate  conditions  and  where  maintaining  extensive  farming  activity  is 
important for the management of the land, or  

affected  by  specific  handicaps,  and  where  land  management  should  be 
continued  in  order  to  conserve  or  improve  the  environment,  maintain  the 
countryside and preserve the tourist potential of the area or in order to protect 
the coastline. 

Those areas shall comprise farming areas which are homogeneous from the point of 
view of natural production conditions. 

As concerns areas affected by specific handicaps referred to in point (b) of the first 
subparagraph, their total extent shall not exceed 10% of the area of the Member State 
concerned. 

The  Member  States  shall  delimitate  those  areas  in  the  programmes  according  to 
specific  provisions  to  be  defined  in  accordance  with  the  procedure  referred  to  in 
Article 95(2). 

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4. 

5. 

NATURA 2000 agricultural areas designated pursuant to Directives 79/409/EEC and 
92/43/EEC shall be eligible for payments provided for in Article 34 (a)(iii). 

Areas  apt  for  afforestation  for  environmental  reasons  such  as  protection  against 
erosion  or  extension  of  forest  resources  contributing  to  climate  change  mitigation, 
shall be eligible for payments provided for in Article 34 (b) (i) and (iii). 

NATURA  2000  forest  areas  designated  pursuant  to  Directives  79/409/EEC  and 
92/43/EEC, shall be eligible for payments provided for in Article 34 (b) (iv). 

Forest  areas  with  a  medium  to  high  forest  fire  risk  shall  be  eligible  for  payments 
provided for in Article 34 (b) (vi) relating to prevention actions against fires. 

SUB-SECTION 4 
RESPECT OF STANDARDS 

Article 48 
Reduction or exclusion from payments 

Where beneficiaries receiving payments under Article 34 (a)(i) to (iv) and (b)(i), (iv) and (v) 
do not respect on the whole holding, as a result of an action or omission directly attributable to 
them, the mandatory requirements provided for in Articles 4 and 5 and Annexes III and IV of 
Council Regulation (EC) No 1782/2003, the total amount of their payments to be granted in 
the calendar year in which the non-compliance occurs shall be reduced or cancelled.  

Detailed  rules  for  the  reductions  and  exclusions  shall  be  laid  down  in  accordance  with  the 
procedure  referred  to  in  Article  95(2).  In  this  context  account  shall  be  taken  of  the  severity, 
extent, performance and repetition of non-compliance. 

SECTION 3 

PRIORITY AXIS 3: 
DIVERSIFICATION OF THE RURAL ECONOMY  
AND THE QUALITY OF LIFE IN RURAL AREAS 

Article 49 
Measures 

Support under this section involves: 

(a) 

Measures to diversify the rural economy, comprising: 

(i) 

diversification into non-agricultural activities, 

(ii) 

support  for  the  creation  and  development  of  micro-enterprises  with  a  view  to 
promoting entrepreneurship and developing the economic fabric, 

(iii)  encouragement of tourism activities, 

(iv) 

the  protection,  upgrading  and  management  of  the  natural  heritage,  so 
contributing to sustainable economic development. 

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(b) 

Measures to improve the quality of rural life in the rural areas, comprising: 

(i) 

essential services for the economy and rural population, 

(ii)  village  renovation  and  development;  conservation  and  upgrading  of  the  rural 

heritage. 

(c) 

(d) 

A vocational training measure for economic actors operating in the fields covered by 
priority axis 3. 

A  skills-acquisition  and  animation  measure  with  a  view  to  preparing  and 
implementing a local development strategy. 

SUB-SECTION 1 
CONDITIONS GOVERNING THE MEASURES TO DIVERSITY THE RURAL ECONOMY 

Article 50 
Diversification into non-agricultural activities 

The aid beneficiary referred to in Article 49(a) (i) may be either the farmer, his or her spouse, 
or one of their children. 

Article 51 
Support for business creation and development 

The support provided for in Article 49(a) (ii) relates only to micro-entreprises as defined in the 
Commission Recommendation 2003/361/EC of 6 May 2003. 

Article 52 
Encouragement of tourism activities 

The support referred to in Article 49(a)(iii) covers the following: 

(a) 

(b) 

(c) 

small-scale  infrastructure  such  as  information  centres  and  the  signposting  of  tourist 
sites;  

recreational  infrastructure  offering  access  to  natural  areas,  and  small-capacity 
accommodation; 

the  development  and  placing  on  the  market  of  tourism  products  relating  to  rural 
tourism. 

Article 53 
Protection, upgrading and management of the natural heritage 

The support referred to in Article 49(a)(iv) covers environmental awareness actions, tourism 
improvements and the drawing-up of protection and management plans relating to NATURA 
2000 sites and other places of high natural value.  

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SUB-SECTION 2 
CONDITIONS GOVERNING THE MEASURES TO IMPROVE  
THE QUALITY OF LIFE IN RURAL AREAS 

Article 54 
Basic services for the economy and rural population 

The support referred to in Article 49(b)(i) covers the setting up of basic services concerning a 
village or group of villages, and related small scaleinfrastructure. 

Article 55 
Village renewal and development, conservation and upgrading of the rural heritage 

The support referred to in Article 49(b)(ii) concerns studies and investment associated with:  

(a) 

(b) 

a village improvement or development programme;  

the maintenance, restoration and upgrading of the rural heritage at village level or as 
regards part of a village such as its centre and historical sites or monuments. 

SUB-SECTION 3 
VOCATIONAL TRAINING, SKILLS ACQUISITION AND ANIMATION 

Article 56 
Vocational training 

Support  under  Article  49(c),  shall  not  include  courses  of  instruction  or  training  which  form 
part of normal education programmes or systems at secondary or higher levels. 

Article 57 
Skills acquisition and animation  

The support referred to in Article 49(d) covers: 

(a) 

(b) 

(c) 

studies of the area concerned;  

measures to provide information about the area and the local development strategy; 

the  training  of  staff  involved  in  the  preparation  and  implementation  of  a  rural 
development strategy, 

(d) 

promotional events and the training of leaders. 

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SUB-SECTION 4 
IMPLEMENTATION OF THE PRIORITY AXIS 

Article 58 
Local development strategies 

The measures listed in Article 49 shall be implemented preferably through local development 
strategies. 

Article 59 
Demarcation 

Where  a  measure  falling  within  this  section  targets  operations  eligible  also  under  another 
Community  support  instrument,  including  the  Structural  Funds  and  the  European  Fisheries 
Fund,  the  Member  State  shall  set  in  each  programme  the  demarcation  criteria  for  the 
operations  supported  by  the  Fund  and  those  supported  by  the  other  Community  support 
instrument. 

CHAPTER II 
LEADER 

SECTION I 
THE LEADER APPROACH 

Article 60 
Definition 

The LEADER approach is a local development strategy which comprises at least the following 
elements: 

(a) 

(b) 

(c) 

(d) 

(e) 

(f) 

(g) 

area-based programmes intended for well-identified sub-regional rural territories; 

bottom-up approach with a decision-making power for local action groups concerning 
the elaboration and implementation of a local development strategy; 

local public-private partnerships (hereinafter called "Local Action Groups");  

multi-sectoral global approach based on the interaction between actors and projects of 
different sectors of the local economy; 

implementation of innovative approaches; 

implementation of cooperation projects; 

networking of local partnerships. 

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Article 61 
Local action groups 

1. 

A  partnered  local  development  approach  shall  be  implemented  by  the  Local  action 
groups satisfying the following conditions:: 

(a) 

(b) 

(c) 

(d) 

they must propose an integrated local development strategy and be responsible 
for its implementation;  

they  must  consist  of  either  a  group  already  qualified  for  the  LEADER II13  or 
LEADER+14  Initiatives,  or  according  to  the  LEADER  approach,  or  be  a  new 
group  representing  partners  from  the  various  locally  based  socio-economic 
sectors  in  the  territory  concerned.  At  the  decision-making  level  the  economic 
and  social  partners,  to  include  agricultural  associations,  rural  woman,  young 
people and associations, must make up at least 50% of the local partnership; 

they must show an ability to define and implement a development strategy for 
the area; 

they  must  either  select  an  administrative  and  financial  lead  actor  able  to 
administer public funds and ensure the satisfactory operation of the partnership, 
or come together in a legally constituted common structure the constitution of 
which guarantees the satisfactory operation of the partnership and the ability to 
administer public funds. 

2. 

3. 

The area covered by the strategy shall be coherent and offer sufficient critical mass in 
terms  of  human,  financial  and  economic  resources  to  support  a  viable  development 
strategy. 

The Local action groups shall choose the projects to be financed under the strategy. 
They may also select cooperation projects. 

SECTION 2 
AREAS OF ASSISTANCE 

Article 62 
Measures 

The support granted under the LEADER priority axis is for: 

(a) 

(b) 

implementing local rural development strategies, through a LEADER approach, with 
a view to achieving the objectives of one or more of the three priority axes defined in 
Chapter I of this Title;  

implementing  cooperation  projects  involving  the  objectives  selected  under  point  (a) 
above; 

(c) 

running the local action group, acquiring skills and animating the territory. 

13 
14 

Communication from the Commission of 19.3.1991 (OJ C 73, 19.3.1991, p. 33). 
Communication from the Commission of 14.4.2000 (OJ C 139, 18.5.2000, p. 5). 

EN 

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SUB-SECTION 1 
CONDITIONS 

Article 63 
Implementing local strategies 

1. 

2. 

In  the  case  of  the  support  referred  to  in  Article  62(a),  operations  under  the  strategy 
must meet the goals laid down in this Regulation for each of the priority axes. 

If  the  planned  measures  correspond  to  the  measures  defined  in  this  Regulation  for 
each priority axis, the relevant conditions shall apply in accordance with Chapter I of 
this Title. 

Article 64 
Cooperation 

1. 

The  support  referred  to  in  Article  62(b)  shall  be  granted  to  inter-territorial  or 
transnational cooperation projects.  

"Inter-territorial  cooperation"  means  cooperation  within  a  Member  State. 
"Transnational  cooperation"  means  cooperation  between  territories  in  several 
Member States and with territories in non-member countries. 

Only  expenditure  relating  to  the  territories  within  the  European  Union  shall  be 
eligible for support. 

Article 63 shall also apply to cooperation projects. 

2. 

3. 

Article 65 
Skills acquisition 

The support for skills acquisition referred to in Article 62(c) shall be granted as a priority to 
the new regions where the LEADER approach has not been applied. 

SUB-SECTION 2 
IMPLEMENTING THE PRIORITY AXIS 

Article 66 
Funding the priority axis 

An amount of 7% at least of the total Fund contribution to the programme must be reserved for 
implementing the LEADER priority axis. 

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CHAPTER III 
TECHNICAL ASSISTANCE 

Article 67 
Funding technical assistance  

1. 

2. 

In accordance with Article 5 of Regulation …/… [CAP financing], the Fund may use 
up  to  0.30%  of  its  annual  allocation  to  finance  the  preparatory,  monitoring, 
administrative  support,  evaluation  and  control  measures,  at  the  Commission's 
initiative and/or on its behalf. These actions are executed in accordance with Article 
53(2)  of  Regulation  (EC,  Euratom)  No  1605/2002  and  any  other  provisions  of  that 
Regulation and of its implementing modalities applicable to this form of execution of 
the budget. 

At  the  initiative  of  the  Member  States,  for  each  rural  development  programme,  the 
Fund may finance preparation, management, monitoring, evaluation, information and 
control activities of programme assistance. 

Up to 4% of the total amount for each programme may be devoted to these measures.  

Within  the  limit  set  in  the  above  subparagraph,  each  programme  shall  reserve  an 
amount  for  establishing  and  operating  the  national  rural  network  referred  to  in 
Article 69. 

Article 68 
European Network for Rural Development 

A  European  Network  for  Rural  Development  for  the  networking  of  national  networks, 
organisations and administrations active in the field of rural development at Community level 
shall be put in place in accordance with Article 67(1). 

The aims of the European Network shall be to: 

(a) 

(b) 

(c) 

(d) 

(e) 

collect,  analyse  and  disseminate  information  on  Community  rural  development 
measures, 

collect,  disseminate  and  consolidate  at  Community  level  good  rural  development 
practice, 

provide  information  on  developments  in  the  Community's  rural  areas  and  in 
non-member countries, 

organise  meetings  and  seminars  at  Community  level  for  those  actively  involved  in 
rural development, 

set  up  and  run  expert  networks  with  a  view  to  facilitating  an  exchange  of  expertise 
and supporting implementation and evaluation of the rural development policy, 

(f) 

support the national networks and trans-national cooperation initiatives. 

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1. 

2. 

1. 

2. 

3. 

4. 

5. 

Article 69 
National rural network 

Each Member State shall establish a national rural network, which gathers together all 
the organisations and administrations involved in rural development. 

The support referred to in Article 67(2) third subparagraph shall be granted:  

(a) 

for the structures needed to run the network; 

(b) 

for  an  action  plan  containing  at  least  the  identification  and  analysis  of  good 
transferable  practices  and  the  provision  of  information  about  them,  network 
management,  the  organisation  of  exchanges  of  experience  and  know-how,  the 
preparation  of  training  programmes  for  local  action  groups  in  the  process  of 
formation  and  technical  assistance  for  inter-territorial  and  trans-national 
cooperation. 

TITLE V 
FUND CONTRIBUTION 

Article 70 
Resources and their distribution 

The resources available for commitment from the Fund for the period 2007 to 2013 
shall  be  EUR  88.75  billion  at  2004  prices.  The  annual  breakdown  is  shown  in 
Annex II.  Of  these  resources,  at  least  EUR  31.3  billion  at  2004  prices  shall  be 
concentrated in regions eligible for the Convergence Objective.  

3% of the resources referred to in paragraph 1, for an amount of EUR 2.66 billion at 
2004 prices, shall be allocated to the reserve provided for in Article 92. 

0.30% of the resources referred to in paragraph 1, for an amount of EUR 0.27 billion 
at 2004 prices, shall be devoted to technical assistance for the Commission as referred 
to in Article 67(1). 

For the purpose of their programming and subsequent inclusion in the general budget 
of the European Communities, the sums referred to in paragraph 1 shall be indexed at 
2% per year. 

The Commission shall make an initial annual indicative breakdown by Member State 
of the amounts indicated in paragraph 1, after deduction of the amounts referred to in 
paragraphs 2 and 3, based on objective criteria and taking into account: 

(a) 

the amounts reserved for regions eligible to the Convergence Objective; 

(b)  past performance, and 

(c) 

particular situations and needs. 

The Commission shall review in 2011 the annual allocations for the years 2012 and 
2013 in order to distribute the amount referred to in paragraph 2.  

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6. 

7 

1. 

2. 

3. 

4. 

5. 

In addition to the amounts indicated in paragraph 5, the Member States shall take into 
account  for  the  purpose  of  programming  the  amounts  resulting  from  modulation  as 
provided for in Article 12(2) of Regulation (EC) No…/…[financing of the CAP]. 

The Commission ensures that total annual allocations from the Fund originating from 
the EAGGF Guidance section for any Member State pursuant to this Regulation, and 
from  the  ERDF  and  the  ESF  pursuant  to  Regulation  (EC)  No  .../…[including  the 
contribution of the ERDF to the financing of the cross-border strand of the European 
Neighbourhood  Instrument  pursuant  to  Regulation  (EC)  No…/…and  of  the 
Instrument  for  Pre-Accession  pursuant  to  Regulation  (EC)  No…/…],  and  from  the 
part of the FIFG contributing to the Convergence objective, shall not exceed 4% of 
that  Member  State's  GDP  as  estimated  at  the  time  of  the  adoption  of  the 
interinstitutional agreement 

Article 71 
Fund contribution 

The  Decision  adopting  a  rural  development  programme  shall  fix  the  maximum 
contribution  from  the  Fund  for  each  priority  heading.  The  decision  shall  clearly 
identify, where necessary, the appropriations allocated to the regions eligible for the 
Convergence Objective.  

The Fund contribution shall be calculated on the basis of the entire amount of eligible 
public expenditure.  

The Fund contribution rate shall be established for each priority axis. In the case of 
priority  axis  1  (competitiveness)  and  axis  3  (diversification  and  quality  of  life)  the 
following ceilings shall apply respectively:  

(a) 

75% of the eligible public expenditure in the regions referred to in Article 5(1) 
and (2) of Regulation (EC) No…/…[cohesion];  

(b)  50% of the eligible public expenditure in the other regions.  

In  the  case  of  priority  axis  2  (land  management)  and  Leader  the  following  ceilings 
shall apply respectively: 

(a) 

80% of the eligible public expenditure in the regions referred to in Article 5(1) 
and (2) of Regulation (EC) No…/… [cohesion];  

(b)  55% of the eligible public expenditure in the other regions.  

The minimum Fund contribution rate at priority axis level shall be 20%. 

Notwithstanding  the  ceilings  set  out  in  paragraph  3,  the  Fund  contribution  may  be 
increased by five percentage points for the programmes of the outermost regions and 
the smaller islands of Aegean Sea. 

Technical  assistance  measures  taken  at  the  initiative  of  the  Commission  or  on  its 
behalf may be funded at 100%. 

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6. 

An operation financed by the Fund shall not simultaneously benefit during its term of 
eligibility from  a contribution from  the Structural Funds, the Cohesion Fund or any 
other Community financial instrument. An expenditure co-financed by the Fund shall 
not be co-financed by way of another Community financial instrument. 

An operation may qualify for a Fund contribution only under one rural development 
programme  at  a  time.  It  may  be  financed  under  only  one  priority  axis  of  the  rural 
development programme. 

7. 

Public expenditure on aid to enterprises shall comply with the aid limits laid down in 
respect of State aid, unless this Regulation provides otherwise. 

1. 

2. 

3. 

4. 

5. 

Article 72 
Eligibility of expenditure 

Without  prejudice  to  Article  39(1)  of  Regulation  (EC)  No…/…  [CAP  financing], 
expenditure shall be eligible for a Fund contribution if the relevant aid is actually paid 
by the paying agency at some time between 1 January 2007 and 31 December 2015. 
Co-financed operations may not be completed before the eligibility starting date.  

A new expenditure added at the moment of the modification of a programme referred 
to in Article 18, shall be eligible from the date of the reception by the Commission of 
the request for modification of the programme. 

Expenditure  shall  be  eligible  for  a  Fund  contribution  only  where  incurred  for 
operations  decided  on  by  the  Managing  Authority  of  the  programme  in  question  or 
under  its  responsibility,  in  accordance  with  the  criteria  fixed  by  the  Monitoring 
Committee. 

The  rules  on  eligibility  of  expenditure  shall  be  set  at  national  level,  subject  to  the 
special  conditions  laid  down  by  this  Regulation  for  certain  rural  development 
measures. 

The following costs are not eligible for a Fund contribution, however: 

(a)  VAT, 

(b) 

interest on debt, 

(c) 

the purchase of land costing more than 10% of all the eligible expenditure on 
the operation concerned. 

Provisions  under  paragraphs  1  to  3  shall  not  apply  to  the  provisions  laid  down  in 
Article 67(1). 

The contribution from the Fund may be under a form other than grants. If appropriate, 
detailed  rules  may  be  defined  in  accordance  with  the  procedure  laid  down  in 
Article 95(2). 

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Article 73 
Durability of investment-related operations 

1. 

Without prejudice to the rules realating to free provision of services and the freedom 
of establishment within the meaning of Articles 43 and 49 of the Treaty, the Member 
State  or  Managing  Authority  shall  ensure  that  an  investment  operationretains  the 
Fund  contribution  if  that  operation  does  not,  within  seven  years  of  the  Managing 
Authority's funding decision, undergo a substantial modification that:  

(a) 

(b) 

affects  its  nature  or  implementation  conditions  or  gives  undue  advantage  to  a 
firm or public body; 

results  either  from  a  change  in  the  nature  of  ownership  of  an  item  of 
infrastructure, or the cessation or relocation of a productive activity. 

2. 

Amounts  unduly  paid  out  shall  be  recovered  in  accordance  with  Article  33  of 
Regulation (EC) No …/…[CAP financing]. 

TITLE VI 
MANAGEMENT, CONTROL AND INFORMATION 

CHAPTER I 
MANAGEMENT AND CONTROL 

Article 74 
Responsibilities of the Commission 

To ensure, in the context of shared management, sound financial management in accordance 
with Article 274 of the EC Treaty, the Commission shall carry out the measures and controls 
laid down in Article 9 of Regulation (EC) No…/…[CAP financing].  

Article 75 
Responsibilities of the Member States 

1. 

2. 

In order to ensure that the Community's financial interests are effectively protected, 
the  Member  States  shall  adopt  all  the  legislative,  statutory  and  administrative 
provisions laid down in Article 9 of Regulation No…/...[CAP financing]. 

Prior  to  the  adoption  of  the  programme,  the  Member  State  shall  ensure  that  the 
relevant  management  and  control  systems  have  been  set  up  in  accordance  with  the 
following requirements: 

(a) 

(b) 

(c) 

a  clear  definition of  the  functions of the bodies concerned in the management 
and control and a clear allocation of functions within each body; 

an  adequate  separation  of  functions  between  the  bodies  concerned  in  the 
management and control, and within each such body; 

adequate  resources  for  each  body  to  carry  out  the  functions  which  have  been 
allocated to it; 

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(d) 

(e) 

(f) 

effective  internal  control  arrangements  including  those  on  compliance  with 
Community rules concerning combinations of State aids; 

an  effective  system  of  reporting  and  monitoring,  where  the  performance  of 
tasks is delegated; 

the  existence  of  manuals  of  procedures  in  relation  to  the  functions  to  be 
performed; 

(g) 

arrangements for the audit of the effective functioning of the system; 

(h) 

reliable accounting, monitoring and financial reporting systems in computerised 
form; 

(i) 

systems and procedures to ensure a sufficient audit trail. 

Member States shall be responsible for ensuring that the systems function effectively 
throughout the programme period. 

3. 

Member  States  shall  undertake  controls  in  accordance  with  detailed  implementing 
rules  to  be  adopted  in  accordance  with  the  procedure  referred  to  in  Article  95(2), 
notably  regarding  the  type  and  intensity  of  controls,  adapted  to  the  nature  of  the 
different rural development measures. 

Article 76 
Designation of authorities 

For each rural development programme the Member State shall designate: 

(a) 

(b) 

(c) 

the  managing  authority,  being  a  public  or  private  national,  regional  or  local  body 
designated by the Member State, or the Member State itself when it carries out that 
task, to manage a programme; 

the  paying  agency  provided  for  in  Article  6  of  Regulation  (EC)  No../….[CAP 
financing];  

the  certifying  body  provided  for  in  Article  7  of  Regulation  (EC)  No…/…  [CAP 
financing];  

Article 77 
Managing Authority 

1. 

The  Managing  Authority  shall  be  responsible  for  managing  and  implementing  the 
programme in an efficient, effective and correct way and in particular for: 

(a) 

ensuring that operations are selected for funding in accordance with the criteria 
applicable  to  the  rural  development  programme  and  that  they  comply,  for  the 
whole period of their execution, with applicable Community and national rules 
and Community policies; 

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(b) 

ensuring that there is a system to record and maintain statistical information on 
implementation in computerised form adequate for the purposes of monitoring 
and evaluation; 

(c) 

ensuring that beneficiaries and other bodies involved in the implementation of 
operations: 

(i) 

are  informed  of  their  obligations  resulting  from  the  aid  granted,  and 
maintain  either  a  separate  accounting  system  or  an  adequate  accounting 
code for all transactions relating to the operation, and 

(ii) 

are  aware  of  the  requirements  concerning  the  provision  of  data  to  the 
managing authority and the recording of outputs and results; 

(d) 

(e) 

(f) 

ensuring that programme evaluations are conducted within the time limits laid 
down in this Regulation and conform to the common monitoring and evaluation 
framework  and  for  submitting  evaluations  undertaken  to  the  relevant  national 
authorities and the Commission; 

coordinating the Monitoring Committee and sending it the documents needed to 
monitor implementation of the programme in the light of its specific objectives; 

ensuring  compliance  with  the  obligations  concerning  publicity  referred  to  in 
Article 80; 

(g)  drawing  up  the  annual  progress  report  and,  after  approval  by  the  Monitoring 

Committee, submitting it to the Commission; 

(h) 

ensuring  that  the  paying  agency  receives  all  necessary  information  on  the 
procedures  operated  and  the  controls  carried  out  in  relation  to  operations 
selected for funding, before payments are authorised. 

When  a  part  of  its  tasks  is  delegated  to  another  body,  the  managing  authority  shall 
retain  full  responsibility  for  the  efficiency  and  correctness  of  management  and 
implementation of those tasks. 

Article 78 
Paying Agency 

The  paying  agency  shall  be  responsible  for  authorisation,  execution  and  accounting  for 
payment of aids to beneficiaries, and reception of the Community contribution, in accordance 
with Regulation (EC) No…/…[CAP financing]. 

Article 79 
Certifying Body 

The  certifying  body  shall  verify  the  effective  functioning  of  the  management  and  control 
system  for  rural  development  programmes,  in  accordance  with  Regulation  (EC)  No  [CAP 
financing]. 

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CHAPTER II 
INFORMATION AND PUBLICITY 

Article 80 
Information and publicity 

1. 

The  Member  States  shall  provide  information  on  and  publicise  part-financed 
operations. 

This information shall be aimed at European citizens. It shall spotlight the role of the 
Community and ensure the transparency of Fund assistance. 

2. 

The Managing Authority for the programme shall be responsible for its publicity: 

(a) 

it shall inform potential beneficiaries, professional organisations, the economic 
and  social  partners,  bodies  involved  in  promoting  gender  equality  and  the 
non-governmental  organisations  concerned  of  the  possibilities  offered  by  the 
programme and the rules for gaining access to programme funding;  

(b) 

it shall inform the beneficiaries of the amount of the Community contribution;  

(c) 

it shall inform European citizens about the role played by the Community in the 
programmes and the results thereof.  

TITLE VII 
MONITORING, EVALUATION AND RESERVE 

CHAPTER I 
MONITORING 

Article 81 
Monitoring Committee 

1. 

A Monitoring Committee shall be set up for  each rural  development programme by 
the Member State, in agreement with the Managing Authority and after consulting the 
partners.  

Each  Monitoring  Committee  shall  be  set  up  within  a  maximum  of  three  months 
following the decision approving the programme. 

Each Committee shall draw up its rules of procedure within the institutional, legal and 
financial  framework  of  the  Member  State  concerned  and  adopt  them  in  agreement 
with  the  Managing  Authority  in  order  to  perform  its  duties  in  accordance  with  this 
Regulation 

2. 

Each Monitoring Committee shall be chaired by a representative of the Member State 
or of the Managing Authority.  

Its composition shall be decided by the Member State and shall include the partners 
referred to in Article 6 (1). 

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At its own initiative, a Commission representative may participate in the work of the 
Monitoring Committee in an advisory capacity. 

Article 82 
Responsibilities of the Monitoring Committee 

The Monitoring Committee shall satisfy itself as to the effectiveness of the implementation of 
the rural development programme. To that end, the Monitoring Committee: 

(a) 

(b) 

(c) 

(d) 

(e) 

(f) 

1. 

2. 

shall consider and approve, in the four months following approval of the programme, 
the  selection  criteria  for  financed  operations.  The  selection  criteria  shall  be  revised 
according to programming needs; 

shall periodically review progress made towards achieving the specific targets of the 
programme, on the basis of the documents submitted by the Managing Authority; 

shall  examine  the  results  of  implementation,  particularly  achievement  of  the  targets 
set for each priority axis and ongoing evaluations; 

shall  consider  and  approve  the  annual  progress  report  and  the  last  progress  report 
before they are sent to the Commission; 

may propose to the Managing Authority any adjustment or review of the programme 
aimed at achieving the Objectives of the Fund defined in Article 4 or improving its 
management, including its financial management; 

shall  consider  and  approve  any  proposal  to  amend  the  content  of  the  Commission 
decision on the contribution from the Fund. 

Article 83 
Monitoring procedures 

The Managing Authority and the Monitoring Committee shall monitor the quality of 
programme implementation. 

The Managing Authority and the Monitoring Committee shall carry out monitoring of 
each rural development programme by means of financial, implementation and result 
indicators. 

Article 84 
Common monitoring and evaluation framework 

The common monitoring and evaluation framework shall be drawn up in cooperation between 
the  Commission  and  the  Member  States  and  adopted  in  accordance  with  the  procedure  laid 
down in Article 95(2). The framework shall specify a limited number  of  common  indicators 
applicable to each programme. 

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Article 85 
Indicators 

1. 

2. 

3. 

1. 

The  progress,  efficiency  and  effectiveness  of  rural  development  programmes  in 
relation  to  their  objectives  shall  be  measured  by  means  of  indicators  relating  to  the 
baseline  situation  as  well  as  to  the  financial  execution,  implementation,  results  and 
impact of the programmes. 

Each  rural  development  programme  shall  specify  a  limited  number  of  additional 
indicators specific to that programme. 

Where the nature of the assistance so permits, the data relating to the indicators shall 
be broken down by sex and age of the beneficiaries. 

Article 86 
Annual progress report 

For  the  first  time  in  2008  and  by  30  June  each  year,  the  Managing  Authority  shall 
send  the  Commission  an  annual  progress  report  on  the  implementation  of  the 
programme.  The  Managing  Authority  shall  send  a  last  progress  report  on  the 
implementation of the programme to the Commission at the latest by 30 June 2016. 

2. 

Each annual progress report shall contain the following elements: 

(a) 

(b) 

(c) 

(d) 

any change to the general conditions having a direct impact on the conditions 
for  implementing  the  programme  as  well  as  any  change  to  Community  and 
national  policies  affecting  consistency  between  the  Fund  and  other  financial 
instruments; 

the progress of the programme in relation to the objectives set, on the basis of 
output and result indicators; 

the  financial  implementation  of  the  programme  giving,  for  each  measure,  a 
statement  of  the  expenditure  paid  to  beneficiaries;if  the  programme  covers 
regions  eligible  under  the  Convergence  Objective,  expenditure  shall  be 
identified separately. 

the  steps  taken  by  the  Managing  Authority  and  the  Monitoring  Committee  to 
ensure  the  quality  and  effectiveness  of  programme  implementation,  in 
particular: 

(i)  monitoring and evaluation measures; 

(ii) 

a  summary  of  the  major  problems  encountered  in  managing  the 
programme  and  any  measures  taken,  including  in  response  to  comments 
made under Article 87; 

(iii)  use of technical assistance; 

(iv)  steps taken to ensure that the programme is publicised in accordance with 

Article 80; 

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(e) 

a  declaration  on  compliance  with  Community  policies  in  the  context  of  the 
support, including identification of the problems encountered and the measures 
adopted to deal with them; 

(f) 

a  separate  chapter  on  the  progress  and  financing  of  measures  under  the 
LEADER approach; 

(g)  where applicable, re-utilisation of aid recovered under Article 33 of Regulation 

(EC) No …/….[financing the CAP]. 

3. 

The  report  shall  be  judged  admissible  with  a  view  to  applying  Article  26  of 
Regulation (EC) No …/…[financing the CAP] if it contains all the elements listed in 
paragraph 2 and enables programme implementation to be appraised. 

The  Commission  shall  have  two  months  to  comment  on  the  annual  progress  report 
after it has been sent by the Managing Authority. That time limit shall be increased to 
five months for the last report of the programme. If the Commission does not respond 
within the time limit set, the report shall be deemed accepted. 

1. 

2. 

1. 

2. 

Article 87 
Annual examination of programmes 

Each  year,  on  presentation  of  the  annual  progress  report,  the  Commission  and  the 
Managing  Authority  shall  examine  the  main  results  of  the  previous  year,  in 
accordance  with  procedures  to  be  determined  in  agreement  with  the  Member  State 
and Managing Authority concerned. 

Following  that  examination  the  Commission  may  make  comments  to  the  Member 
State  and  to  the  Managing  Authority,  which  will  inform  the  Monitoring  Committee 
thereof. The Member State shall inform the Commission of action taken in response 
to those comments. 

CHAPTER II 
EVALUATION 

Article 88 
General provisions 

Rural development policy and programmes shall be subject to ex-ante, ongoing and 
ex-post evaluations in accordance with Articles 89 to 91. 

The evaluations shall aim to improve the quality, efficiency and effectiveness of the 
implementation  of  rural  development  programmes.  They  shall  assess  the  impact  of 
the programmes as regards the strategic guidelines of the Community provided for in 
Article  9  and  the  rural  development  problems  specific  to  the  Member  States  and 
regions  concerned,  taking  into  account  sustainable  development  requirements  and 
environmental impact, meeting the requirements of relevant Community legislation. 

3. 

The  evaluation  work  shall  be  organised,  as  appropriate,  under  the  responsibility  of 
either Member States or the Commission. 

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4. 

5. 

6. 

1. 

The  evaluations  shall  be  carried  out  by  independent  evaluators.  The  results  shall  be 
published in accordance with the provisions of Regulation (EC) No 1049/2001 of the 
European Parliament and of the Council of 30 May 2001 regarding public access to 
European Parliament, Council and Commission documents15. 

Member  States  shall  provide  the  human  and  financial  resources  necessary  for 
carrying  out  the  evaluations,  shall  organise  the  production  and  gathering  of  the 
requisite  data,  and  shall  use  the  various  pieces  of  information  provided  by  the 
monitoring system. 

The  Member  States  and  the  Commission  shall  agree  evaluation  methods  and 
standards to be applied at the initiative of the Commission within the framework of 
Article 84. 

Article 89 
Ex-ante evaluation 

Ex-ante evaluation shall form part of drawing up each rural development programme 
and aim to optimise the allocation of budgetary resources and improve programming 
quality.  It  shall  identify  and  appraise  medium  and  long-term  needs,  the  goals  to  be 
achieved, the results expected, the quantified targets particularly in terms of impact in 
relation to the baseline situation, the Community value-added, the extent to which the 
Community's  priorities  have  been  taken  into  account,  the  lessons  drawn  from 
previous  programming  and  the  quality  of  the  procedures  for  implementation, 
monitoring, evaluation and financial management 

2. 

Ex-ante evaluation shall be carried out under the responsibility of the Member State. 

Article 90 
Ongoing evaluation 

1. 

2. 

The  Member  States  shall  establish  a  system  of  ongoing  annual  evaluation  for  each 
rural development programme. 

The Managing Authority for the programme and the Monitoring Committee shall use 
ongoing annual evaluation to: 

(a) 

examine  the  progress  of  the  programme  in  relation  to  its  goals  by  means  of 
result and, where appropriate, impact indicators; 

(b) 

improve the quality of programmes and their implementation; 

(c) 

examine proposals for substantive changes to programmes; 

(d)  prepare for mid-term and ex-post evaluation. 

3. 

From 2008, the Managing Authority shall each year submit a report to the Monitoring 
Committee containing the results of ongoing evaluation. After discussion, the report 

15 

OJ L 145, 31.5.2001, p. 43. 

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shall be sent to the Commission together with the annual progress report provided for 
in Article 86. 

In 2010, ongoing annual evaluation shall take the form of a mid-term evaluation. That 
mid-term  evaluation  shall  propose  measures  to  improve  the  quality  of  programmes 
and their implementation. 

A summary of the mid-term evaluation reports shall be undertaken on the initiative of 
the Commission. 

In 2015, ongoing annual evaluation shall take the form of an ex-post evaluation. 

The  mid-term  and  ex-post  evaluations  shall  examine  the  degree  of  utilisation  of 
resources, the effectiveness and efficiency of the programming of the Fund, its socio-
economic  impact  and  its  impact  on  the  Community  priorities.  They  shall  cover  the 
goals  of  the  programme  and  aim  to  draw  lessons  concerning  rural  development 
policy. They shall identify the factors which contributed to the success or failure of 
the programmes' implementation, including as regards sustainability, and identify best 
practice. 

Ongoing  annual  evaluation  shall  be  organised  on  the  initiative  of  the  Managing 
Authorities  in  cooperation  with  the  Commission.  It  shall  be  organised  on  a  multi-
annual basis and cover the period 2007–2015. 

The  Commission  shall  organise  measures  on  its  initiative  to  provide  training, 
exchanges  of  best  practice  and  information  for  ongoing  evaluators,  experts  in  the 
Member  States  and  Monitoring  Committee  members,  as  well  as  thematic  and 
summary evaluations. 

Article 91 
Summary of ex-post evaluations 

A  summary  of  ex-post  evaluations  shall  be  made,  under  the  responsibility  of  the 
Commission,  in  cooperation  with  the  Member  State  and  the  Managing  Authority, 
which shall gather the data required for its completion. The summary shall cover all 
the rural development programmes. 

The summary of ex-post evaluations shall be finalised at the latest by 31 December 
2016. 

CHAPTER III 
RESERVE 

Article 92 
Community reserve for the LEADER priority axis 

The  amount  allocated  to  the  reserve  referred  to  in  Article  70(2)  shall  be  used  to 
support implementation of the LEADER approach in programmes. 

Implementation of the LEADER approach shall be evaluated on the basis of objective 
criteria including: 

4. 

5. 

6. 

7. 

8. 

1. 

2. 

1. 

2. 

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(a) 

the priority given to the LEADER approach, 

(b) 

the territorial coverage of the LEADER approach, 

(c) 

the stage reached in implementing the LEADER priority axis, 

(d) 

the leverage effect on private capital, 

(e) 

the results of mid-term evaluations. 

TITLE VIII 
STATE AID 

Article 93 
Application of the rules to State aid 

1. 

2. 

3. 

4. 

5. 

Save as otherwise provided in this Title, Articles 87 to 89 of the Treaty shall apply to 
aid granted by Member States for measures to support rural development. 

However,  Articles  87,  88  and89  of  the  Treaty  shall  not  apply  to  financial 
contributions provided by Member States for measures subject to Community support 
in accordance with the provisions of this Regulation. 

Aid  for  modernisation  of  farms  which  exceeds  the  percentages  set  in  Annex  I,  as 
regards Article 25(2), shall be prohibited. 

This prohibition shall not apply to aid for investments relating to: 

(a) 

investments undertaken predominantly in  the public interest and related to the 
conversation  of  traditional  landscapes  shaped  by  agricultural  and  forestry 
activities or to the relocation of farm buildings; 

(b) 

the protection and improvement of the environment; 

(c) 

improvement  of  the  hygiene  conditions  of  livestock  undertakings  and  animal 
welfare. 

State  aid  granted  to  farmers  to  compensate  for  natural  handicaps  in  mountain  areas 
and  in  other  areas  with  handicaps  shall  be  prohibited  if  it  does  not  satisfy  the 
conditions laid down in Article 35. However, additional aid exceeding amounts fixed 
according to Article 35(3) may be granted in duly justified cases. 

State  aid  to  support  farmers  who  enter  into  agri-environmental  or  animal  welfare 
commitments  which  fail  to  satisfy  the  conditions  laid  down  in  Article  37  shall  be 
prohibited. However, additional aid exceeding maximum amounts set in Annex I, as 
regards  Article  37(4),  may  be  granted  if  duly  justified.  In  exceptional  cases,  duly 
justified  derogation  may  be  permitted  in  respect  of  the  minimum  duration  of  those 
commitments as laid down in Article 37(3). 

State aid to support farmers who adapt to demanding standards based on Community 
legislation  in  the  fields  of  the  environmental  protection,  public  health,  animal  and 
plant health, animal welfare and occupational safety shall be prohibited if it does not 
satisfy the conditions laid down in Article 29. However, additional aid exceeding the 

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maximum  amounts  fixed  in  accordance  with  that  Article  may  be  granted  to  help 
farmers to comply with national legislation which exceeds Community standards. 

In the absence  of Community  legislation, State aid to support farmers who adapt to 
demanding  standards  based  on  national  legislation  in  the  fields  of  the  environment, 
public  health,  animal  and  plant  health,  animal  welfare  and  occupational  safety  shall 
be prohibited if it does not satisfy the conditions laid down in Article 29. Additional 
aid exceeding the maximum amounts set in Annex I, as regards Article 29(2), may be 
granted if justified under Article 29. 

Article 94 
Additional national financing 

State aid intended to provide additional financing for rural development measures for which 
Community  support  is  granted,  shall  be  notified  by  Member  States  and  approved  by  the 
Commission in accordance with the provisions of this Regulation as part of the programming 
referred to in Article 15. The first sentence of Article 88(3) of the Treaty shall not apply to aid 
thus notified.  

TITLE IX 
TRANSITIONAL AND FINAL PROVISIONS 

Article 95 
Committee 

1. 

2. 

The Commission shall be assisted by a Rural Development Committee (hereinafter: 
the 'Committee'). 

Where reference is made to this paragraph, Articles 4 and 7 of Decision 1999/468/EC 
shall apply. 

The period provided for in Article 4(3) of Decision 1999/468/EC shall be one month. 

3. 

The Committee shall adopt its rules of procedure. 

Article 96 
Implementing rules 

Over  and  above  the  measures  foreseen  in  particular  provisions  of  this  Regulation,,  detailed 
rules  shall  be  adopted  for  the  implementation  of  this  Regulation  in  accordance  with  the 
procedure referred to in Article 95(2). They shall cover in particular: 

(a) 

(b) 

the presentation of proposed rural development programmes; 

the conditions governing rural development measures.  

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Article 97 
Transitional provisions 

Should specific measures be necessary to facilitate the transition from the system in force to 
that  established  by  this  Regulation,  such  measures  shall  be  adopted  in  accordance  with  the 
procedure referred to in Article 95(2). 

Such  measures  shall  in  particular  be  adopted  to  integrate  existing  Community  support 
approved  by  the  Commission  for  a  period  ending  after  1 January  2007  into  the  rural 
development support provided for by this Regulation. 

Article 98 
Repeal 

1. 

Regulation (EC) No 1257/1999 is repealed with effect from 1 January 2007. 

References to the repealed Regulation shall be understood as being to this Regulation. 

The  repealed  Regulation  shall  continue  to  apply  to  actions  approved  by  the 
Commission under that Regulation before 1 January 2007. 

2. 

Council  Directives  and  Decisions  laying  down  and  amending  the  lists  of  less-
favoured  areas  referred  to  in  Article 21(2)  of  Regulation  (EC)  No 950/97  are 
repealed. 

Article 99 
Entry into force 

This  Regulation  shall  enter  into  force  on  the  day  following  that  of  its  publication  in  the 
Official Journal of the European Union. 

It shall apply in relation to Community support as from 1 January 2007. 

However, Article 10 shall apply from the entry into force of this Regulation. 

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

Done at Brussels, 

For the Council 
The President 

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ANNEX I 

AMOUNTS AND RATES OF SUPPORT 

Article 

Subject 

21(2) 

22(3) 

Setting up premium 

Early retirement 

23(2) 

Advisory services 

25(2) 

Intensity  of  aid 
modernisation of farms 

for 

the 

26(3) 

Intensity  of  aid 
the 
improvement of the economic 
value of forests 

for 

Amount in euros  
or rate 

40 000 

18 000 

180 000 

4 000 

40 000 

80% 

1 500 

60% 

50% 

50% 

40% 

75% 

50% 

40% 

75% 

Per transferor per year 

Total 
transferor 

amount 

per 

Per worker per year 

Total amount per worker 

Of  the  eligible  cost  per 
advisory service 

Maximum eligible amount 

Of  the  amount  of  eligible 
young 
investment 
by 
the 
farmers 
areas 
referred 
in  Article 
34(a)(i), (ii) and (iii) 

in 
to 

Of  the  amount  of  eligible 
other 
investment 
by 
areas 
farmers 
the 
referred 
in  Article 
34(a)(i), (ii) and (iii) 

in 
to 

Of  the  amount  of  eligible 
young 
investment 
farmers in other areas 

by 

Of  the  amount  of  eligible 
other 
investment 
farmers in other areas 

by 

Of  the  amount  of  eligible 
the 
investment 
outermost  regions  and  the 
Aegean Islands 

in 

Of  the  amount  of  eligible 
the  areas 
in 
investment 
referred 
in  Article 
34(a)(i), (ii) and (iii) 

to 

Of  the  amount  of  eligible 
investment in other areas 

Of  the  amount  of  eligible 
investment 
the 
in 
outermost regions  

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27(3) 

Intensity  of  aid  for  adding 
to  agricultural  and 
value 
forestry production 

29(2) 

30(2) 

31 

32(3) 

33(2) 

Maximum  amount  of  support 
for meeting standards 

Maximum  amount  of  support 
for  participation 
food 
quality schemes 

in 

Intensity 
for 
of 
information  and  promotion 
activities 

aid 

Maximum  amount  for  semi-
subsistence farms 

Producer groups: ceiling, as a 
percentage 
of  marketed 
production  during  the  first 
five 
following 
recognition 

years 

But  not  exceeding  in  respect 
of  each  of  the  first  five years 
the amount of 

35(3) 

Minimum handicap payment 

36 

Maximum  natural  handicap 
payment 

Maximum  payment  for  areas 
with other handicaps 

Initial maximum Natura 2000 
payment  for  a  period  not 
exceeding five years 

Normal  maximum  Natura 
2000 payment 

50% 

40% 

65% 

Of  the  amount  of  eligible 
regions 
investment 
covered 
the 
Convergence Objective 

in 
by 

Of  the  amount  of  eligible 
investment in other regions 

Of  the  amount  of  eligible 
the 
investment 
outermost  regions  and  the 
Aegean Islands 

in 

10 000 

Per holding 

3 000 

Per holding 

70% 

Of  the  eligible  cost  of  the 
action 

1 500 

Per farm per year 

5%, 5%, 4%, 3%, and 
2% (*) 

2.5%, 2.5%, 2.0%, 
1.5% and 1.5% 

For  the  1st,  2nd,  3rd,  4th 
and  5th  year  respectively 
for marketed production up 
to €1 000 000 

For  the  1st,  2nd,  3rd,  4th 
and  5th  year  respectively 
for  marketed  production 
exceeding €1 000 000 

100 000 

100 000 

80 000 

60 000 

50 000 

25 

250 

150 

For the 1st year 

For the 2nd year 

For the 3rd year 

For the 4th year 

For the 5th year 

Per hectare of UAA 

Per hectare of UAA 

Per hectare of UAA 

500 (**) 

Per hectare of UAA 

200 (**) 

Per hectare of UAA 

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37(4) 

Annual crops 

Specialised perennial crops 

Other land uses 

Local  breeds  in  danger  of 
being lost to farming 

600 (**) 

900 (**) 

450 (**) 

200 (**) 

Per hectare 

Per hectare 

Per hectare 

Per livestock unit 

Animal welfare 

500 

Per livestock unit 

40(1), 
2nd indent 

Maximum annual premium to 
cover  loss  of  income  from 
afforestation 

–  for  farmers  or  associations 

thereof 

–  for  any  other  private-law 

person 

500 

150 

Per hectare 

Per hectare 

40(4), 41(4) 
and 42(3) 

–  Intensity 

of 

aid 

for 

50% 

establishment costs 

– 

– 

40% 

75% 

43 and 44(2) 

–  Natura  2000  and  forest-
annual 

environment 
payment 

Of  eligible  costs  in  the 
areas 
in 
referred 
Article 34(a)(i), 
(ii)  and 
(iii) 

to 

Of  eligible  costs  in  other 
areas 

Of  eligible  costs  in  the 
outermost regions 

–  minimum payment 

–  maximum payment 

40 

200 

Per hectare 

Per hectare 

(*) 

(**) 

In the case of Malta, the Commission may set a minimum amount of aid for sectors of production 
in which total output is extremely small. 
These amounts may be increased in exceptional cases taking account of specific circumstances to 
be justified in the rural development programmes. 

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ANNEX II 

Annual breakdown of commitment appropriations for 2007–2013 

(referred to in Article 70(1)) 

Year 

2007 

2008 

2009 

2010 

2011 

2012 

2013 

11 759 

12 235 

12 700 

12 825 

12 952 

13 077 

13 205 

EUR million – 2004 prices) 

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FICHE FINANCIÈRE LÉGISLATIVE 

Domaines politiques: Agriculture et développement rural 

Activité: Développement rural 

DENOMINATION  DE  L’ACTION:  REGLEMENT  DU  CONSEIL  CONCERNANT  LE  SOUTIEN  AU 
DEVELOPPEMENT  RURAL  PAR  LE  FONDS  EUROPEEN  AGRICOLE  POUR  LE 
DEVELOPPEMENT RURAL (FEADER) 

1. 

2. 

2.1 

2.2 

2.3 

a) 

LIGNE(S) BUDGÉTAIRE(S) + INTITULÉ(S) 

DONNÉES CHIFFRÉES GLOBALES 

Enveloppe  totale  de  l’action  (partie  B):  88 753,-  millions  d'euros  en  CE  (prix 
constant 2004) 

Période d’application: du 1 janvier 2007 au 31 décembre 2013 

Estimation globale pluriannuelle des dépenses: 

Échéancier  crédits  d'engagement/crédits  de  paiement  (intervention  financière) 
(cf. point 6.1.1) 

millions d'euros (à la 3e décimale) 

Année 
2007 

Année 
2008 

Année 
2009 

Année 
2010 

Année 
2011 

Année 
2012 

Année 
2013 et 
exercices 
suivants 

Crédits 
d'engagement 

Crédits de 
paiement 

11 724 

12 198 

12 662 

12 787 

12 913 

13 038 

13 165 

3 426 

7 317 

7 696 

9 091 

10 738 

12 133 

38 086 

b) 

Assistance 
(cf. point 6.1.2) 

technique  et  administrative  (ATA)  et  dépenses  d’appui  (DDA) 

CE 

CP 

35 

35 

37 

37 

38 

38 

38 

38 

39 

39 

39 

39 

40 

40 

Sous-total a+b 

CE 

CP 

11 759 

12 235 

12 700 

12 825 

12 952 

13 077 

13 205 

3 461 

7 354 

7 734 

9 129 

10 777 

12 172 

38 086 

c) 

Incidence  financière  globale  des  ressources  humaines  et  autres  dépenses  de 
fonctionnement (cf. points 7.2 et 7.3) 

CE/CP 

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TOTAL a+b+c 

CE 

CP 

2.4 

Compatibilité avec la programmation financière et les perspectives financières 

[X]  Proposition compatible avec la programmation financière 2007–2013. 

Cette proposition nécessite une reprogrammation de la rubrique concernée des 
perspectives financières, 

y  compris, 
interinstitutionnel. 

le  cas  échéant,  un  recours  aux  dispositions  de 

l’accord 

2.5 

Incidence financière sur les recettes 

[X]  Aucune implication financière. 

Ligne 
budgétaire 

Recettes 

millions d'euros (à la première décimale) 

Avant 
l'action 
(anné
e n–
1) 

Anné
e n3 

Situation après l'action 

n+1  n+2  n+3  n+4  n+5 

a) Recettes en termes 
absolus1 

b)Modification des recettes2 

 ∆ 

3. 

CARACTÉRISTIQUES BUDGÉTAIRES 

Nature de la dépense 

Nouvelle 

Participation 
AELE 

Participation 
pays candidats 

Rubrique PF 

DNO 

CD 

NON 

NON 

N° 2 

4. 

BASE JURIDIQUE 

Article 36 et 37 du traité. 

5. 

DESCRIPTION ET JUSTIFICATION 

5.1 

Nécessité d'une intervention communautaire 

5.1.1  Objectifs poursuivis 

La politique de développement rural accompagne la politique commune relative aux marchés 
agricoles et elle contribue aux objectifs énoncés à l’article 33 du traité. La présente proposition 
établit le cadre de soutien du développement rural par l’Union européenne. 

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Le  soutien  de  la  Communauté  en  faveur  d’un  développement  rural,  financé  par  le  Fonds 
agricole  pour  le  développement  rural  (FEADER),  contribuera  à  la  réalisation  des  objectifs 
suivants : 

•  l’amélioration de la compétitivité de l’agriculture et de la sylviculture par un soutien à la 

restructuration ; 

•  l’amélioration de l’environnement et l’espace rural par le soutien à la gestion du territoire ; 

•  l’amélioration  de  la  qualité  de  la  vie  dans  les  zones  rurales  et  l’encouragement  de  la 

diversification des activités économiques. 

5.1.2 Dispositions prises relevant de l’évaluation ex ante  

(Il s’agit ici: 

a) 

d'expliquer comment et quand l'évaluation ex ante a été effectuée (auteur, calendrier 
et si le(s) rapport(s) est/sont disponible(s) ou comment l'information correspondante 
a été collectée. 

Une étude d’impact a été élaborée et accompagne la proposition. 

b) 

de décrire brièvement les constatations et enseignements tirés de l'évaluation ex ante) 

Les conclusions figurent à la partie 5 de l’étude d’impact. 

5.1.3 Dispositions prises à la suite de l’évaluation ex post 

(Dans  le  cas  du  renouvellement  d’un  programme,  il  s’agit  aussi  de  décrire  brièvement  les 
enseignements à tirer d’une évaluation intérimaire ou ex post.) 

Voir partie 5 de l’étude d’impact. 

5.2 

Actions envisagées et modalités de l'intervention budgétaire 

La  politique  de  développement  rural  sera  implémentée  par  des  programmes  pluriannuels 
couvrant la période 2007 – 2013. Ils seront articulés autour de 3 axes prioritaires et de l’axe 
LEADER conformément aux dispositions des titres III et IV de la proposition. 

5.3 

Modalités de mise en œuvre 

Les  programmes  de  développement  rural  sont  établis  et  présentés  à  la  Commission  par  les 
Etats  membres  à  l’issue  d’une  concertation  avec  les  partenaires  régionaux,  locaux, 
économiques et sociaux. L’Etat membre peut présenter soit un seul programme couvrant tout 
son territoire soit un programme par région. 

La Commission approuve les programmes en fonction de leur cohérence avec les orientations 
stratégiques  de  l’Union  sur  le  développement  rural,  le  plan  stratégique  national  présenté  par 
l’Etat membre, ainsi qu’avec le présent règlement. La mise en œuvre des programmes et leur 
contrôle relève de la gestion partagée (art. 53 du Règlement 1605/2002). 

L’assistance technique à l’initiative de la Commission est implémentée en gestion directe. 

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6. 

6.1 

INCIDENCE FINANCIÈRE 

Incidence  financière  totale  sur  la  partie  B  (pour  toute  la  période  de 
programmation) 

(Le mode de calcul des montants totaux présentés dans le tableau ci-après doit être expliqué 
par la ventilation dans le tableau 6.2.) 

6.1.1 

Intervention financière 

Crédits d'engagement en millions d'euros (à la 3e décimale) 

Ventilation 

Année 
2007 

2008 

2009 

2010 

2011 

2012 

2013 

Action 1 
Action 2 
etc. 

TOTAL 

11 724 

12 198 

12 662 

12 787 

12 913 

13 038 

13 165 

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6.1.2 

Assistance technique et administrative (ATA), dépenses d'appui (DDA) et dépenses TI 
(crédits d’engagement) 

Année 
2007 

2008 

2009 

2010 

2011 

2012 

2013 

1)  Assistance  technique  et 
administrative (ATA): 
a) Bureaux d’assistance 
technique (BAT) 

b) Autre assistance 
technique et administrative: 
– intra-muros: 
– extra-muros: 
dont  pour  la  construction  et 
la  maintenance  de  systèmes 
de gestion informatisés: 

Sous-total 1 

2) Dépenses d’appui (DDA): 

a) Études 

b) Réunion d’experts 

c) Information et  
publications 

Sous-total 2 

TOTAL 

35 

37 

38 

38 

39 

39 

40 

6.2. 

Calcul  des  coûts  par  mesure  envisagée  en  partie  B  (pour  toute  la  période  de 
programmation) 

(Dans  le  cas  où  il  y  a  plusieurs  actions,  il  y  a  lieu  de  donner,  sur  les  mesures  concrètes  à 
prendre pour chaque action, les précisions nécessaires à l'estimation du volume et du coût des 
réalisations.) 

Ventilation 

Crédits d'engagement en millions d'euros (à la 3e décimale) 

Type  
de réalisations 
/outputs 
(projets, 
dossiers …) 
1 

Nombre de 
réalisations/ 
outputs 
(total pour 
années 1…n)  
2 

Coût unitaire 
moyen 

Coût total 
(total pour années 
1…n)  

3 

4=(2X3) 

Action 1 
– Mesure 1 
– Mesure 2  
Action 2 
– Mesure 1 
– Mesure 2 
– Mesure 3 
etc. 

COÛT TOTAL 

(Si nécessaire, expliquer le mode de calcul.) 

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7. 

INCIDENCE SUR LES EFFECTIFS ET LES DÉPENSES ADMINISTRATIVES  

7.1. 

Incidence sur les ressources humaines 

Effectifs à affecter à la gestion de l’action 
par utilisation des ressources existantes 
et/ou supplémentaires 

Nombre d’emplois 
permanents 

Nombre d’emplois 
temporaires 

Total 

Description des tâches découlant de 
l’action 

(Si nécessaire, une description plus 
complète des tâches peut être annexée.) 

Types d’emplois 

A 
B 
C 
ressources 

Fonctionnaires ou 
agents 
temporaires 
Autres 
humaines 
Total 

7.2 

Incidence financière globale des ressources humaines 

Type de ressources humaines 

Montants en euros 

Mode de calcul *  

Fonctionnaires 
Agents temporaires 

Autres ressources humaines 

(indiquer la ligne budgétaire) 

Total 

Les montants correspondent aux dépenses totales pour 12 mois. 

7.3 

Autres dépenses de fonctionnement découlant de l’action 

Montants en euros 

Mode de calcul 

Ligne budgétaire   
(n° et intitulé) 

Enveloppe globale (Titre A7) 
A0701 – Missions 
A07030 – Réunions 
A07031 – Comités obligatoires (1) 
A07032 – Comités non obligatoires (1) 
A07040 – Conférences 
A0705 – Études et consultations 
  Autres dépenses (indiquer lesquelles) 

Systèmes d’information (A-5001/A-4300) 

Autres dépenses – partie A (indiquer lesquelles) 

Total 

Les montants correspondent aux dépenses totales de l’action pour 12 mois. 

(1) Préciser le type de comité ainsi que le groupe auquel il appartient. 

I. 
II. 
III. 

Total annuel (7.2 + 7.3) 
Durée de l’action 
Coût total de l’action (I x II) 

euros 
années 
euros 

(Dans  l’estimation  des  ressources humaines et  administratives nécessaires pour  l’action,  les 
DG/services  devront  tenir  compte  des  décisions  arrêtées  par  la  Commission  lors  du  débat 

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d’orientation et de l’approbation de l’avant-projet de budget (APB). Ceci signifie que les DG 
devront  indiquer  que  les  ressources  humaines  peuvent  être  couvertes  à  l’intérieur  de  la 
préallocation indicative prévue lors de l’adoption de l’APB.  

Dans  des  cas  exceptionnels  où  les  actions  visées  n’étaient  pas  prévisibles  lors  de  la 
préparation de l’APB, la Commission devra être saisie afin de décider si la mise en œuvre de 
l’action proposée peut être acceptée et selon quelles modalités (à travers une modification de 
la  préallocation  indicative,  une  opération  ad  hoc  de  redéploiement,  un  budget  rectificatif  et 
supplémentaire ou une lettre rectificative au projet de budget.) 

Les  besoins  en  ressources  humaines  et  administratives  seront  couverts  à  l’intérieur  de  la 
dotation allouée à la DG gestionnaire dans le cadre de la procédure d’allocation annuelle. 

8. 

SUIVI ET ÉVALUATION 

8.1 

Système de suivi 

Il est défini aux articles 81 à 87. 

8.2 

Modalités et périodicité de l’évaluation prévue 

Les  programmes  de  développement  rural  font  l’objet  d’évaluations  conformément  aux 
dispositions des articles 88 à 91. 

9. 

MESURES ANTIFRAUDE 

Les  Etats  membres  assument  en  premier  ressort  la  responsabilité  du  contrôle  financier  des 
interventions.  A  cette  fin,  les  Etats  membres  prennent  toutes  les  dispositions  et  mesures 
nécessaires pour s’assurer de la réalité et régularité des opérations financées par le FEADER, 
prévenir  et  détecter  les  irrégularités,  poursuivre  et  récupérer  les  fonds  perdus  en  cas 
d’irrégularité. La Commission, pour sa part, s’assure de l’existence et du bon fonctionnement 
des systèmes de gestion et de contrôle dans les Etats membres et elle applique les corrections 
financières  en  cas  de  défaillance  de  ces  systèmes.  Il  convient  de  noter  que  la  procédure 
d’apurement des comptes s’applique. 

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