Commission Regulation (EC) No 239/2005 of 11 February 2005 amending and correcting Regulation (EC) No 796/2004 laying down detailed rules for the implementation of cross-compliance, modulation and the integrated administration and control system provided for in Council Regulation (EC) No 1782/2003 establishing common rules for direct support schemes under the common agricultural policy and establishing certain support schemes for farmers
Date: 2005-02-11
Institutions: European Commission
Subjects: aid per hectare, aid to agriculture, allocation of land, common agricultural policy, eligibility criteria, farming system, grassland, hops, land use, production aid

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Official Journal of the European Union

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COMMISSION REGULATION (EC) No 239/2005

of 11 February 2005

amending and correcting Regulation (EC) No 796/2004 laying down detailed rules for the
implementation of cross-compliance, modulation and the integrated administration and control
system provided for in Council Regulation (EC) No 1782/2003 establishing common rules for
direct support schemes under the common agricultural policy and establishing certain support
schemes for farmers

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

Having regard to the Treaty
Community,

establishing the European

Having regard to 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 2529/2001 (1), and in particular Article 7(1),
Article 34(2), and points (c),
(k) and (n) of Article 145
(d),
thereof,

Whereas:

(1)

(2)

(3)

2

Article
(EC) No
of Commission Regulation
796/2004 (2) contains several definitions that need to
be clarified. In particular, the definition of ‘permanent
pasture’ in point 2 of that Article needs to be clarified
and it is also necessary to introduce a definition for the
term ‘grasses or other herbaceous forage’. However,
in
that context it has to be considered that the Member
States need to have a certain flexibility to be able to
take account of local agronomic conditions.

Following the introduction of a payment for hops to
producer groups in the second paragraph of Article
68a of Regulation (EC) No 1782/2003 and Article 171
of Commission Regulation (EC) No 1973/2004 of 29
October 2004 laying down detailed rules for the appli-
cation of Council Regulation (EC) No 1782/2003 as
regards the support schemes provided for in Titles IV
and IVa of
land set
aside for the production of raw materials (3), Regulation
(EC) No 796/2004 needs to be amended in several
respects and it is also appropriate to introduce particular
provisions with regard to the application procedure and
controls for that aid scheme.

that Regulation and the use of

Regulation (EC) No 1782/2003 provides for certain
the Czech Republic, Estonia,
specific obligations
Cyprus,
Poland,
Slovenia and Slovakia (the new Member States) as

Lithuania, Hungary, Malta,

Latvia,

for

(1) OJ L 270, 21.10.2003, p. 1. Regulation last amended by Regulation

(EC) No 2217/2004 (OJ L 375, 23.12.2004, p. 1).

(2) OJ L 141, 30.4.2004, p. 18.
(3) OJ L 345, 20.11.2004, p. 1.

(4)

(5)

(6)

it

cross-compliance

conditions. Accordingly,

regards the maintenance of permanent pasture, as part of
the
is
necessary to lay down rules for the determination of
the proportion of permanent pasture in relation to
arable land that has to be maintained in the new
Member States. It is also necessary to provide for the
individual obligations at
farmers to be
respected where it is established that that proportion is
decreasing to the detriment of
land under permanent
pasture.

the level of

Article 4(1) of Regulation (EC) No 796/2004 provides,
with regard to certain situations, for the obligation of
farmers not to convert land under permanent pasture
without prior authorisation. That authorisation may
also include the permission to convert
land under
to the condition that an
permanent pasture subject
equivalent amount of area is being established as land
under permanent pasture
the
conversion. For those cases, it should be provided that
by way of derogation from the definition of ‘permanent
pasture’ contained in Article 2(2) of Regulation (EC) No
796/2004, land thus established should be considered as
land under permanent pasture from the moment of its
establishment.

to compensate

for

Under the second subparagraph of Article 4(2) of Regu-
lation (EC) No 796/2004 a farmer may be obliged to re-
convert into land under permanent pasture, land which
used to be permanent pasture in the past and which was
converted into land for other uses within a certain period
of time. That period should be extended in order to share
more equally amongst farmers the burden to maintain
permanent pasture.

Article 11(2) of Regulation (EC) No 796/2004 provides
that single applications are to be submitted by a date to
be fixed by the Member States which must not be later
than 15 May in a given year. However, due to the
particular climatic conditions in Finland and Sweden,
those two Member States may fix a later date which
Following the
must not be
accession of
same
exception should now be provided for with regard to
Estonia, Latvia and Lithuania. The date of 15 June
should also apply with regard to notifications from
farmers
subsequent
amendments to the single application, as provided for
in Article 15(2) of Regulation (EC) No 796/2004.

the new Member

than 15 June.

authority of

competent

to the

States,

later

the

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(7)

(8)

(9)

(10)

(11)

In order to enable Member States to carry out controls
effectively, in particular controls on the respect of cross-
compliance obligations, Article 14(1) of Regulation (EC)
No 796/2004 obliges farmers to declare all the areas at
their disposal whether or not they claim aid for such
areas.
It is necessary to provide for a mechanism to
ensure that farmers comply with that obligation.

Article 20 of Regulation (EC) No 796/2004 contains
special rules to provide for the situation where the
latest date for the submission of an aid application is a
public holiday, a Saturday or a Sunday. The same rule
should apply to the submission of applications to the
Single Payment Scheme in accordance with Article
34(2) of Regulation (EC) No 1782/2003.

In the first year of the application of the Single Payment
Scheme farmers have to lodge an application if they want
to participate in that scheme in accordance with Article
34(2) of Regulation (EC) No 1782/2003. Those appli-
cations will then serve as the basis for the allocation of
payment entitlements. The punctual submission of the
information included in those applications is essential
for the Member States to establish the payment enti-
tlements within the time-limits provided for in that Regu-
lation and in order to guarantee a good start to the new
scheme. Farmers have been made aware of the time-
limits which they have to respect. Moreover, Member
States have to provide the farmers with the appropriate
the
pre-printed application forms long in advance of
submission of
the application. Late submissions of
those applications should therefore only be permitted
within the same additional time-limit, as provided for
in Article 21 of Regulation (EC) No 796/2004, for the
late submission of any aid applications. A dissuasive
reduction-rate should also be applied unless the delay is
due to cases of force majeure or exceptional circumstances.

It is necessary to provide for a time period during which
hemp grown for
fibre may not be harvested after
flowering in order to enable the control obligations
provided for in respect of these crops to be carried out
effectively.

It is necessary to clarify that areas declared under the
Single Area Payment scheme in accordance with Article
143b of Regulation (EC) No 1782/2003, are to be
regarded as one crop group within the meaning of
Article 49(1) of Regulation (EC) No 796/2004. The
same clarification should also be made with regard to
areas declared by producer groups to support their aid
applications for hops payments in accordance with the
second paragraph of Article 68a of Regulation (EC) No
1782/2003.

(12)

In Article 50(6) of Regulation (EC) No 796/2004, the
reduction level for payments to arable crop producers
should be clarified.

(13) Moreover, certain clarifications need to be introduced in
respect of the sanctioning system applicable in the case
of the non-compliance with such obligations.

(14)

(15)

(16)

(17)

Commission Regulation (EC) No 1655/2004 of 22
September 2004 laying down rules for the transition
from the optional modulation system established by
Article 4 of Council Regulation (EC) No 1259/1999 to
the mandatory modulation system established by Council
Regulation (EC) No 1782/2003 (1) has an impact on the
kinds of reductions to be applied in respect of direct
payments to be granted in accordance with Regulation
(EC) No 796/2004. Those reductions, as well as the
introduction of further kinds of reductions by this Regu-
lation, need to be taken into account in the framework
of Article 71 of Regulation (EC) No 796/2004.

Rules need to be established to cover the eventuality
where a farmer has
received unduly a number of
payment entitlements or that the value of each of the
level
payment entitlements was fixed at an incorrect
the Single
according to the different models under
Payment Scheme. Moreover, provision has to be made
for the case where such payment entitlements have been
transferred and for the case where transfers of payment
entitlements have occurred without respecting Article
46(2) of Regulation (EC) No 1782/2003.

the submission of

In several
language versions of Regulation (EC) No
796/2004, the latest date which Members States may
the copies of supporting
fix for
documents
seed aid
for
referred to in point (d) of Article 13(8) of that Regulation
is set at 31 May, instead of 15 June of the year following
the harvest.

in relation to applications

In several
language versions of Regulation (EC) No
796/2004 an error needs to be rectified in the second
subparagraph of Article 21(2), where reference is made
to Article 14(2) of that Regulation,
instead of Article
15(2).

(18) With regard to the liability in the case of the non-respect
of cross compliance obligations provided for in Article
65(2) of Regulation (EC) No 796/2004, various language
versions create ambiguity as regards the possibility to
hold the farmer concerned liable under the applicable
national rules, notably in case where the farmer did
not act himself in the strict sense. It is therefore appro-
priate to harmonise that Article in all language versions.

(19)

It is therefore necessary to amend and correct Regulation
(EC) No 796/2004 accordingly.

(20)

The measures provided for in this Regulation are in
accordance with the opinion of
the Management
Committee for Direct Payments,

(1) OJ L 298, 23.9.2004, p. 3.

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HAS ADOPTED THIS REGULATION:

Article 1

Title IV of Regulation (EC) No 1782/2003, except
those established under Chapters 7, 11 and 12 of
that Title;’

Regulation (EC) No 796/2004 is amended as follows:

(d) point 36 is replaced by the following:

1. Article 2 is amended as follows:

(a) points 1 and 2 are replaced by the following:

‘1.

2.

“Arable land”: shall mean land cultivated for crop
production and land under set-aside, or maintained
in good agricultural and environmental condition
in accordance with Article 5 of Regulation (EC)
No 1782/2003,
irrespective of whether or not
that land is under greenhouses or under fixed or
mobile cover;

“Permanent pasture”: shall mean land used to grow
grasses or other herbaceous forage naturally (self-
seeded) or through cultivation (sown) and that has
the
not been included in the crop rotation of
holding for five years or longer, excluding land
under set-aside schemes pursuant to Article 6 of
Council Regulation (EC) No 1251/1999 (*),
land
under set aside schemes pursuant to Article 54(2)
and Article 107 of Regulation (EC) No 1782/2003,
areas set aside in accordance with Council Regu-
lation (EEC) No 2078/92 (**) and areas set aside in
accordance with Articles 22, 23 and 24 of Council
Regulation (EC) No 1257/1999 (***);

___________

(*) OJ L 160, 26.6.1999, p. 1.
(**) OJ L 215, 30.7.1992, p. 85.
(***) OJ L 160, 26.6.1999, p. 80.’

(b) the following point is inserted after the point (2):

‘(2a)

‘grasses or other herbaceous forage’: shall mean all
herbaceous plants traditionally found in natural
pastures or normally included in mixtures of
seeds for pastures or meadows in the Member
State (whether or not used for grazing animals).
Member States may include crops listed in Annex
IX to Regulation (EC) No 1782/2003;’

(c) points 11 and 12 are replaced by the following:

‘11.

“Single application”: shall mean the application for
direct payments in respect of the single payment
scheme and other area-related aid schemes with
the exception of an application for hops payment
by a recognised producer group pursuant to the
second paragraph of Article 68a of Regulation
(EC) No 1782/2003;

12.

“Area-related aid schemes”: shall mean the single
payment scheme, the hops payment to recognised
producer groups
second
paragraph of Article 68a of Regulation (EC) No
1782/2003 and all aid schemes established under

referred to in the

‘36.

“Specialised control bodies”:
shall mean the
authorities,
as
national
control
competent
this Regulation,
referred to in Article 42 of
responsible,
in accordance with the first sub-
paragraph of Article 25(2) of Regulation (EC) No
for ensuring compliance with the
1782/2003,
statutory management
requirements and good
agricultural and environmental condition;’

(e)

the following paragraph is added:

this Regulation, “new Member
‘For the purposes of
States”
shall mean the Czech Republic, Estonia,
Cyprus, Latvia, Lithuania, Hungary, Malta, Poland,
Slovenia and Slovakia.’;

2. Article 3 is amended as follows:

(a) paragraph 2 is replaced by the following:

‘2.
For the purpose of applying the second sub-
paragraph of Article 5(2) of Regulation (EC) No
1782/2003, the Member States shall ensure that the
ratio referred to in paragraph 1 of this Article shall
not
under
permanent pasture by more than 10 % relatively to
the ratio for the relevant reference year referred to in
the first subparagraph of Article 5(2) of that Regulation
(hereinafter referred to as the reference ratio).’;

detriment of

decrease

to the

land

(b) the introductory sentence of paragraph 4 is replaced by

the following:

‘For the Member States, other than the new Member
States,
the reference ratio shall be established as
follows:’;

(c)

the following paragraphs are added:

‘5.
For the new Member States that have not applied
in respect of the year 2004 the single area payment
scheme referred to in Article 143b of Regulation (EC)
No 1782/2003, the reference ratio shall be established
as follows:

(a)

the land under permanent pasture shall be the land
under permanent pasture declared by the farmers in
the land under permanent pasture
2004, plus
declared in 2005 in accordance with Article 14(1)
of this Regulation and that has not been declared
for any use other than grassland in 2004, unless
the farmer can demonstrate that such land was not
under permanent pasture in 2004.

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Areas declared in 2005 as land under permanent
in 2004 were eligible for the
pasture and that
arable crops area payment
in accordance with
Article 1(3) of Regulation (EC) No 1251/1999
shall be discounted.

Land yet to be afforested in accordance with the
third subparagraph of Article 5(2) of Regulation
(EC) No 1782/2003 shall be discounted.

(b) the total agricultural area shall be the total agri-
cultural area declared by the farmers in 2005.

For the new Member States that have applied in
6.
respect of
the year 2004 the single area payment
scheme referred to in Article 143b of Regulation (EC)
No 1782/2003, the reference ratio shall be established
as follows:

(a)

the land under permanent pasture shall be the land
under permanent pasture declared by the farmers in
2005 in accordance with Article 14(1) of this Regu-
lation;

(b) the total agricultural area shall be the total agri-
cultural area declared by the farmers in 2005.’;

3. Article 4 is amended as follows:

(a)

in paragraph 1, the following subparagraph is added:

‘If the authorisation referred to in the first subparagraph
is subject to the condition that an area of land shall be
established as permanent pasture, such land shall, as of
the first day of conversion, be considered as permanent
pasture by way of derogation from the definition laid
down in Article 2(2). Those areas shall be used to grow
grasses or other herbaceous forage for the five conse-
cutive years following the date of conversion.’;

(b) paragraph 2 is amended as follows:

(i) the

second subparagraph is

replaced by

the

following:

‘This obligation shall, in 2005, apply with regard to
land converted into land for other uses since the
relevant date under the first subparagraph of Article
5(2) of Regulation (EC) No 1782/2003. From 1
that obligation shall apply with
January 2006,
regard to land thus converted since the date of
the start of
the 24-month period preceding the
last date at which the single applications had to
the latest
be submitted at
in accordance with
this Regulation in the Member
Article 11(2) of
State concerned.’;

(ii) the following sentence is added to the fifth sub-

paragraph:

‘Those areas shall be used to grow grasses or other
herbaceous forage for the five consecutive years
following the date of their conversion.’;

4. the first subparagraph of Article 11(2) is replaced by the

following:

‘The single application shall be submitted by a date to be
fixed by the Member States which shall not be later than
15 May. However, Estonia, Latvia, Lithuania, Finland and
Sweden may fix a later date which shall not be later than
15 June.’;

5.

in Article 13, the following paragraph is added:

‘9.
In the case of an application for the additional hops
aid provided for in Article 68a of Regulation (EC) No
1782/2003, the single application shall contain an indi-
cation of the respective areas.’;

6. Article 14 is amended as follows:

(a)

in Paragraph 1, the following subparagraph is inserted
after the first subparagraph:

‘Moreover, in the case where a Member State makes use
of the option under Article 68a of Regulation (EC) No
1782/2003 to make a payment to recognised producer
that
groups referred to in the second paragraph of
Article the farmer shall declare his agricultural parcels
used for the cultivation of hops also under a separate
heading in the single application form. In that case the
farmer shall also indicate in the single application form
his membership in the producer group concerned.’;

(b) the following paragraph is inserted after paragraph 1:

‘1a
If, for a given year, a farmer does not declare all
the areas referred to in paragraph 1 and the difference
between the overall area declared in the single appli-
cation on the one hand and the area declared plus the
overall area of the parcels not declared, on the other, is
more than 3 % of the area declared, the overall amount
of direct payments payable to that farmer for that year
shall be reduced by up to 3 % depending on the
severity of the omission.’;

7. Article 15(2) is replaced by the following:

‘2. Without prejudice to the dates fixed by Estonia,
Latvia, Lithuania, Finland or Sweden for the submission
of
the single application in accordance with the first
subparagraph of Article 11(2), amendments made in
this Article shall be
accordance with paragraph 1 of
notified to the competent authority in writing by 31 May
of the calendar year concerned at the latest, except in the
case of Estonia, Latvia, Lithuania, Finland and Sweden
where they shall be notified by 15 June of the calendar
year concerned at the latest.’;

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8. the following Chapter is inserted after Article 15:

‘CHAPTER Ia

AID APPLICATIONS FOR HOPS PAYMENTS BY
RECOGNISED PRODUCER GROUPS

Article 15a

Aid application

An aid application of producer groups applying for aid in
accordance with Article 171 of Commission Regulation
information
(EC) No 1973/2004 (*)
shall
the aid, and in
necessary to establish eligibility for
particular:

contain all

(a)

the identity of the producer group;

(b) particulars permitting identification of the agricultural

parcels concerned;

(c) a statement by the producer group that it is aware of

the conditions pertaining to the aid in question.

The producer group may only declare agricultural parcels
used for the cultivation of hops and which were declared,
in the same calendar year, by the members of the producer
group in accordance with the second subparagraph of
Article 14(1) of this Regulation.

The Member States may simplify the application procedure
by sending to the producer group a pre-printed application
form listing all the parcels declared for that purpose by
their respective members in accordance with the second
subparagraph of Article 14(1) of this Regulation.

___________
(*) OJ L 345, 20.11.2004, p. 1.’;

9.

in Article 20, the following paragraph is added:

‘The first paragraph shall also apply with regard to appli-
cations by farmers
scheme in
accordance with Article 34(2) of Regulation (EC) No
1782/2003.’;

to the single payment

10. the following Article is inserted after Article 21:

‘Article 21a

Late submission of an application to the single
payment scheme

1. Without prejudice to cases of force majeure and excep-
tional circumstances referred to in the first subparagraph of
Article 34(3) of Regulation (EC) No 1782/2003 and by
way of derogation from Article 21 of this Regulation, in
the first year of
the single payment
scheme in accordance with Title III of Regulation (EC) No

the application of

in the Member Stat concerned, an
1782/2003, where,
application for the allocation of entitlements in accordance
with Article 34(3) of that Regulation and the single appli-
cation for that year have to be submitted together by the
farmer and where the farmer submits those applications
after the relevant time limit, a 4 % reduction per working
day shall be applied to the amounts to be paid in that year
in respect of the payment entitlements to be allocated to
the farmer.

If such delay exceeds 25 calendar days, the application shall
be considered inadmissible and no payment entitlements
shall be allocated to the farmer.

2. Where,
in the Member State concerned, the appli-
cation to the single payment scheme and the single appli-
cation have to be submitted independently from each other,
Article 21 shall apply with regard to the submission of the
single application.

In that case, without prejudice to cases of force majeure and
exceptional circumstances referred to in the first sub-
paragraph of Article 34(3) of Regulation (EC) No
1782/2003,
the submission of an application to the
single payment scheme in accordance with that Article
after the relevant time limit shall lead to a 3 % reduction
per working day in the amounts to be paid in the first year
of the application of the single payment scheme in respect
of the payment entitlements to be allocated to the farmer.

If the delay exceeds 25 calendar days, the application shall
be considered inadmissible and no payment entitlements
shall be allocated to the farmer.’;

11. the following point is added to Article 24(1):

‘(h) between the agricultural parcels declared by producer
the corre-
groups in accordance with Article 15a,
sponding parcels declared by the members of
the
producer group in accordance with the second sub-
paragraph of Article 14(1), and the reference parcels
as contained in the identification system for agricultural
parcels to verify the eligibility for the aid.’;

12. the following point is added to Article 26(2):

‘(e) 5 % of all farmers whose agricultural parcels are being
declared by a producer group applying for hops
payments in accordance with Article 15a.’;

13.

in Article 33 the following paragraph is added:

‘5.
Crops of hemp grown for fibre must continue to be
cultivated under normal growing conditions in accordance
with local practice for at least 10 days from the date of the
end of flowering so that the checks provided for in para-
graphs 1, 2 and 3 can be made.

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However, the Member States may authorise hemp grown
for fibre to be harvested after flowering has begun but
before the end of
the 10-day period after the end of
flowering, provided the inspectors indicate which represen-
tative parts of each plot concerned must continue to be
cultivated for at
following the end of
flowering for inspection purposes, in accordance with the
method laid down in Annex I.’;

least 10 days

14. after Article 33, the following subsection is inserted:

‘SUB-SECTION IIA

reduction as set out in paragraph 1 shall be applied
individually to each non-compliance.

However, a non-compliance with a standard which also
constitutes a requirement shall be considered to be one
non-compliance.

The resulting percentages of reductions shall be added
together. However, the maximum reduction shall not
exceed 5 % of
referred to in
the overall amount
paragraph 1.’;

ON-THE-SPOT CHECKS OF AID APPLICATIONS FOR HOPS
PAYMENTS BY RECOGNISED PRODUCER GROUPS

(b) the third subparagraph of paragraph 4 is replaced by

the following:

Article 33a

Elements of the on-the-spot-checks

The on-the-spot checks referred to in Article 26(2)(e) shall
be carried out by way of application of the provisions of
Article 29, Article 30(1),
the first and second subpara-
graphs of Article 30(2), Article 30(4) and Article 32
mutatis mutandis.

Those on-the-spot
the
conditions, as provided for in Article 171 of Regulation
(EC) No 1973/2004, are respected.’;

verify whether

checks

shall

the

that

same non-compliance

the Paying Agency shall

‘Once the maximum percentage of 15 % has been
inform the farmer
reached,
if
concerned
is
determined again,
it shall be considered that he has
acted intentionally within the meaning of Article 67.
determined
Where
thereafter, the percentage reduction to be applied shall
be fixed by multiplying the result of the previous multi-
plication, where applicable, before the limitation to
15 % as provided for
the
second subparagraph has been applied, by a factor of
three.’;

in the last sentence of

further non-compliance

is

a

15.

in Article 49(1), the following points are added:

(c) the following paragraph is added:

‘(g) areas for the purposes of

the Single Area Payment
scheme in accordance with Article 143b of Regulation
(EC) No 1782/2003;

(h) areas declared by producer groups in accordance with

Article 15a of this Regulation.’;

16. Article 50(6) is replaced by the following:

‘6.
The calculation of the maximum eligible area for the
payments to farmers applying for the arable crop area
payment in accordance with Chapter 10 of Title IV of
Regulation (EC) No 1782/2003 shall be made on the
basis of the area of set-aside land determined and on a
pro
each crop concerned. However,
in relation to
payments to arable crop producers shall,
the area of set-aside land determined, only be reduced to
the level corresponding to the area which would be needed
to produce 92 tonnes of cereal, in accordance with Article
107(7) of Regulation (EC) No 1782/2003.’;

rata basis

for

17. Article 66 is amended as follows:

(a) paragraph 3 is replaced by the following:

repeated

non-compliance,

‘5.
In the case where a repeated non-compliance is
determined together with another non-compliance or
resulting
another
percentage
together.
Without prejudice
third subparagraph of
paragraph 4, the maximum reduction shall, however,
not exceed 15 % of the overall amount referred to in
paragraph 1.’;

the
added

reductions

to the

shall

be

18. Article 71(2) is amended as follows:

(a) Point (a) is replaced by the following:

‘(a) firstly,

any reductions due

to modulation in
accordance with Article 10 of Regulation (EC) No
1782/2003 and, as the case may be, in accordance
with
No
Commission
1655/2004 (*) shall be applied;

Regulation

(EC)

___________
(*) OJ L 298, 23.9.2004, p. 3.’;

(b) points (c) and (d) are replaced by the following:

‘3. Where more than one non-compliance with
regard to different areas of cross-compliance have
been determined, the procedure for the fixing of the

‘(c) thirdly, the resulting amount shall serve as the basis
for the calculation of any reductions to be applied
because of late submissions on the basis of Articles
21 and 21a of this Regulation;

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(d) fourthly, the resulting amount shall serve as the
basis to calculate the reduction to be applied in
accordance with Article 14(1a) of this Regulation;

(e) fifthly, the resulting amount shall be reduced by any
reductions provided for in Chapter II of Title IV of
this Regulation.’;

19. The following Article is inserted after Article 73:

‘Article 73a

Recovery of undue entitlements

after payment

entitlements have

1. Where,
been
allocated to farmers in accordance with Regulation (EC)
No 795/2004, it is established that certain payment enti-
tlements have been allocated unduly, the farmer concerned
shall give up the unduly allocated entitlements to the
national reserve referred to in Article 42 of Regulation
(EC) No 1782/2003.

In the case that the farmer concerned, meanwhile, trans-
ferred payment entitlements to other farmers, the trans-
ferees shall also be bound by the obligation provided for
in the first subparagraph in proportion to the number of
payment entitlements which have been transferred to them
if
the farmer to whom the payment entitlements had
initially been allocated does not have a sufficient number
of payment entitlements at his disposal.

The entitlements allocated unduly shall be deemed not to
have been allocated ab initio.

after payment

entitlements have

2. Where,
been
allocated to farmers in accordance with Regulation (EC)
the value of
No 795/2004,
the
is established that
it
payment entitlements is too high,
that value shall be
adjusted accordingly. That adjustment shall also be carried
out
in respect of payment entitlements which have,
meanwhile, been transferred to other farmers. The value
of the reduction shall be allocated to the national reserve
referred to in Article 42 of Regulation (EC) No 1782/2003.

The payment entitlements shall be deemed as having been
allocated ab
resulting from the
adjustment.

the value

initio

at

3. Where a farmer has transferred any payment enti-
tlements without respecting the second subparagraph of
Article 46(2) of Regulation (EC) No 1782/2003,
the
situation shall be established as if the transfer had not
taken place.

Undue amounts paid shall be recovered in accordance

4.
with Article 73.’;

Article 2

Regulation (EC) No 796/2004 is corrected as follows:

1.

2.

in Article 13(8), point (d), the date ‘31 May’ is replaced by
‘15 June’;

in the second sentence of the second subparagraph of Article
21(2), the terms ‘Article 14(2)’ are replaced by ‘Article 15(2)’;

3. Article 65(2) is replaced by the following:

the non-compliance in question,

‘2.
For the purposes of applying Article 6(1) of Regulation
(EC) No 1782/2003, an action or omission shall be directly
farmer who committed the
attributable to the individual
non-compliance and who, at the time of the determination
the
of
holding,
the animal
the production
concerned. Where the holding,
unit or the animal concerned was transferred to a farmer
after the non-compliance had started to occur, the transferee
shall equally be held liable where he maintained the non-
compliance, provided he could have reasonably detected and
terminated that non-compliance.’

the production unit or

is in charge of

the area,

the area,

Article 3

This Regulation shall enter into force on the day of its publi-
cation in the Official Journal of the European Union.

It shall apply from 1 January 2005.

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

Done at Brussels, 11 February 2005.

For the Commission

Mariann FISCHER BOEL
Member of the Commission