Commission Regulation (EC) No 1535/2007 of 20 December 2007 on the application of Articles 87 and 88 of the EC Treaty to de minimis aid in the sector of agricultural production
Date: 2007-12-20
Institutions: European Commission
Subjects: State aid, agricultural production, agro-industry, aid to agriculture, control of State aid, production aid

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COMMISSION REGULATION (EC) No 1535/2007

of 20 December 2007
on the application of Articles 87 and 88 of the EC Treaty to de minimis aid in the sector of
agricultural production

THE COMMISSION OF THE EUROPEAN COMMUNITIES,

(3)

Having regard to the Treaty
Community,

establishing the European

Having regard to Council Regulation (EC) No 994/98 of 7 May
1998 on the application of Articles 92 and 93 of the Treaty
establishing the European Community to certain categories of
horizontal State aid (1), and in particular Article 2(1) thereof,

Having published a draft of this Regulation (2),

Having consulted the Advisory Committee on State aid,

Whereas:

(1)

(2)

Regulation (EC) No 994/98 empowers the Commission
to set out in a regulation a ceiling below which aid
measures are considered not to meet all the criteria of
Article 87(1) of the Treaty and therefore do not fall
under the notification procedure provided for in Article
88(3) of the Treaty.

The Commission has applied Articles 87 and 88 of the
Treaty and in particular clarified, in numerous decisions,
the notion of aid within the meaning of Article 87(1) of
the Treaty. It has also stated its policy with regard to a de
minimis ceiling under which Article 87(1) of the Treaty
can be considered not to apply, firstly in its communi-
cation on de minimis aid (3) and then in Commission
Regulation (EC) No 69/2001 of 12 January 2001 on
the application of Articles 87 and 88 of the EC Treaty
to de minimis aid (4), replaced on 1 January 2007 by
Commission Regulation (EC) No 1998/2006 of 15
December 2006 on the application of Articles 87 and
88 of the Treaty to de minimis aid (5). In view of the
special rules which apply in the agriculture sector and
of the risks that even low levels of aid could fulfil the
the Treaty in that sector,
criteria of Article 87(1) of
Regulation (EC) No 69/2001 excludes the agriculture
sector from its scope. Regulation (EC) No 1998/2006
also excludes the sector of agricultural production from
its scope.

(1) OJ L 142, 14.5.1998, p. 1.
(2) OJ C 151, 5.7.2007, p. 16.
(3) OJ C 68, 6.3.1996, p. 9.
(4) OJ L 10, 13.1.2001, p. 30.
(5) OJ L 379, 28.12.2006, p. 5.

However, since the experience gained over the years has
shown that the very small amounts of aid granted in the
the criteria of
agriculture sector may also not meet
Article 87(1) of the Treaty where certain conditions are
met, the Commission laid down rules allowing the grant
of de minimis aid in that sector in Commission Regulation
(EC) No 1860/2004 of 6 October 2004 on the appli-
cation of Articles 87 and 88 of the EC Treaty to de
minimis aid in the agriculture sector (6). That Regulation,
by virtue of which the total amount of de minimis aid
granted to one and the same undertaking is regarded as
not meeting all the criteria of Article 87(1) of the Treaty
where it does not exceed EUR 3 000 per beneficiary over
any period of three years or a cumulative amount laid
down for each Member State representing 0,3 % of
annual output
in the agriculture sector, covers both
primary production and the processing and marketing
of agricultural products.

Given the similarities between activities in the processing
and marketing of agricultural products on the one hand
and industrial activities on the other, activities in the
processing and marketing of agricultural products were
included in the scope of Regulation (EC) No 1998/2006,
which governs de minimis aid for industrial activities. As a
result, those activities were excluded from the scope of
Regulation (EC) No 1860/2004. For the sake of clarity,
Regulation (EC) No 1860/2004 should be repealed and
replaced by a new Regulation applicable only to the
agricultural production sector.

light of

experience,

the Commission’s
In the
the
maximum amount of aid of EUR 3 000 per beneficiary
over a period of three years may be increased to EUR
7 500 and the ceiling of 0,3 % of annual output in the
agriculture sector may be increased to 0,75 % without
trade between Member States being affected, without
there being any distortion or threat of distortion of
competition, and without aid being granted within
those limits falling under Article 87(1) of the Treaty,
provided that certain conditions are met. This increase
will also help to reduce the administrative burden. The
years to take into account are the fiscal years as used by
the undertaking in the Member State concerned. The
reference period of three years should be assessed on a
rolling basis so that, for each new grant of de minimis aid,
the total amount of de minimis aid granted in the fiscal
year concerned, as well as during the previous two fiscal
years, needs to be determined. It should not be possible

(4)

(5)

(6) OJ L 325, 28.10.2004, p. 4. Regulation as last amended by Regu-

lation (EC) No 875/2007 (OJ L 193, 25.7.2007, p. 6).

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(6)

(7)

(8)

(9)

for aid measures exceeding the ceiling of EUR 7 500 to
be broken down into a number of smaller parts in order
to bring such parts within the scope of this Regulation.

This Regulation should not apply to export aid or aid
favouring domestic over imported products. In particular,
it should not apply to aid financing the establishment
and operation of a distribution network in other
countries. Aid towards the cost of participating in trade
fairs, or of studies or consultancy services needed for the
launch of a new product or an existing product on a new
market does not normally constitute export aid.

The Court of Justice of the European Communities has
established that, once the Community has legislated for
the establishment of a common organisation of
the
market in a given sector of agriculture, Member States
are under an obligation to refrain from taking any
measure which might undermine or create exceptions
to it (1). For this reason,
this Regulation should not
apply to aid whose amount is laid down on the basis
of price or quantity of products purchased or put on the
market.

For the sake of transparency, equal treatment and the
correct application of the de minimis ceiling, all Member
States should apply the same method of calculation. In
order to facilitate this calculation, aid amounts not taking
the form of a grant should be converted into their gross
grant equivalent. Calculation of the grant equivalent of
forms of transparent aid other than grants or aid payable
in several instalments requires the use of market interest
rates prevailing at the time of granting such aid. With a
view to a uniform, transparent and simple application of
the State aid rules, the market rates for the purposes of
this Regulation should be deemed to be the reference
rates periodically fixed by the Commission on the basis
of objective criteria and published in the Official Journal of
the European Union or on the Internet. It may, however,
be necessary to add additional basis points on top of the
floor rate in view of the securities provided or the risk
associated with the beneficiary.

Again for the purposes of transparency, equal treatment
and the correct application of the de minimis ceiling, this
Regulation should apply only to de minimis aid which is
‘Transparent aid’ should be taken to mean
transparent.
is possible to calculate precisely in
aid for which it
advance the gross grant equivalent without the need to
undertake a risk assessment. Such precise calculation can,
for instance, be made as regards grants,
interest rate
subsidies and capped tax exemptions. Aid in the form
of soft loans should be considered to be transparent de
minimis aid when the gross grant equivalent has been

calculated on the basis of market interest rates prevailing
at the time of grant. Aid in the form of capital injections
should not be considered to be transparent de minimis aid
unless the total amount of the public capital injection is
lower than the de minimis ceiling per beneficiary. Aid in
the form of risk capital measures as referred to in the
Community guidelines on State aid to promote risk
capital
investments in small and medium-sized enter-
prises (2) should not be considered to be transparent de
minimis aid unless the risk capital scheme concerned
provides capital only up to the de minimis ceiling per
beneficiary.

(10)

It is necessary to provide legal certainty for guarantee
schemes which do not have the potential
to affect
trade and distort competition and in respect of which
sufficient data is available to assess any potential effects
reliably. This Regulation should therefore set a guarantee-
specific ceiling based on the guaranteed amount of the
underlying loan. This specific ceiling should be set on the
the amount of State aid
basis of an assessment of
included in guarantee schemes covering loans in favour
of viable undertakings. It should therefore not apply to
ad hoc individual aid granted outside of the scope of a
guarantee scheme or to guarantees on underlying trans-
actions not constituting a loan, such as guarantees on
equity transactions. The
ceiling should be
determined on the basis of the fact that taking account
of a cap rate (net default rate) of 13 %, representing a
worst case scenario for guarantee
in the
Community, a guarantee amounting to EUR 56 250
can be considered as having a gross grant equivalent
identical to the de minimis ceiling of EUR 7 500. Only
guarantees covering up to 80 % of the underlying loan
should be covered by this specific ceiling. A methodology
approved by the Commission following notification on
the basis of a Commission Regulation on State aid may
also be used by the Member States to calculate the gross
grant equivalent of the guarantee, if the approved meth-
odology explicitly addresses the type of guarantees and
the type of underlying transactions concerned in the
context of applying this Regulation.

schemes

specific

(11)

This Regulation should not apply to undertakings in
difficulty within the meaning of
the Community
guidelines on State aid for rescuing and restructuring
firms in difficulty (3) given the difficulties linked to deter-
mining the gross grant equivalent of aid granted to this
type of undertaking.

(12)

In accordance with the principles governing aid falling
within Article 87(1) of the Treaty, de minimis aid should
be considered to be granted at the moment the right to
receive the aid is conferred on the undertaking under the
applicable national legal regime.

(1) Judgment of 19 September 2002 in Case C-113/00 Spain v

Commission [2002] ECR I-7601, paragraph 73.

(2) OJ C 194, 18.8.2006, p. 2.
(3) OJ C 244, 1.10.2004, p. 2.

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(13)

(14)

(15)

(16)

(17)

In order to avoid circumvention of maximum aid inten-
sities laid down in different Community instruments, it
should not be possible for de minimis aid to be cumulated
with State aid in respect of the same eligible costs if such
cumulation would result in an aid intensity exceeding
that
laid down by Community rules in the specific
circumstances of each case.

This Regulation does not exclude the possibility that a
measure adopted by a Member State might not be
considered to be State aid within the meaning of
Article 87(1) of the Treaty on a basis other than this
Regulation, for instance in the case of capital injections
or guarantees, because such measure has been decided in
conformity with the principle of private
investors
operating in normal market-economy conditions.

The Commission must ensure that State aid rules are
complied with, and in particular that aid granted under
the de minimis rules meets the conditions thereof.
In
accordance with the cooperation principle laid down in
Article 10 of the Treaty, Member States should facilitate
the achievement of this task by establishing the necessary
machinery to ensure that the total amount of aid granted
under the de minimis rule does not exceed either the
ceiling of EUR 7 500 per beneficiary or the overall
ceilings established by the Commission on the basis of
the value of agricultural output. To that end, when
granting de minimis aid,
should
inform the undertaking concerned of
the amount of
aid granted and of its de minimis character, by referring
to this Regulation. Moreover, prior to granting such aid
the Member State should obtain from the undertaking a
declaration about other de minimis aid received during the
current fiscal year and the two previous fiscal years and
carefully check that the new aid does not make the total
amount of de minimis aid received exceed the applicable
ceilings. Alternatively, compliance with the ceilings may
also be ensured by means of a central register. In the case
of guarantee schemes set up by the European Investment
Fund, the latter may establish a list of beneficiaries and
require Member States to inform the beneficiaries of the
de minimis aid received.

the Member States

HAS ADOPTED THIS REGULATION:

Article 1

Scope

This Regulation applies to aid granted to undertakings in the
agricultural production sector, with the exception of:

(a) aid the amount of which is fixed on the basis of price or

quantity of products put on the market;

(b) aid to export-related activities, namely aid directly linked to
the quantities exported, to the establishment and operation
of a distribution network or to other current expenditure
linked to the export activity;

(c) aid contingent on the use of domestic over imported goods;

(d) aid granted to undertakings in difficulty.

Article 2

Definitions

For the purpose of this Regulation:

1.

‘undertakings in the sector of agricultural production’ means
undertakings active in the primary production of agricultural
products;

2.

‘agricultural products’ means the products listed in Annex I
to the Treaty, except
fisheries and acquaculture products
covered by Council Regulation (EC) No 104/2000 (1).

Article 3

De minimis aid

Regulation (EC) No 1860/2004 was initially due to
expire on 31 December 2008. Since this Regulation
has to enter into force before that date, the consequences
of that as regards its applicability to aid granted to under-
takings in the agricultural production sector under Regu-
lation (EC) No 1860/2004 should be clarified.

1.
Aid measures shall be deemed not to meet all the criteria
of Article 87(1) of the Treaty and shall therefore not fall under
the notification requirement of Article 88(3) of
the Treaty
where they fulfil the conditions laid down in paragraphs 2 to
7 of this Article.

the frequency with which it

the Commission’s experience and in
In the light of
is generally
particular
the period of
necessary to revise State aid policy,
validity of
this Regulation should be limited. Should
this Regulation expire without having been extended,
Member States should have an adjustment period of six
months with regard to de minimis aid covered by it,

The total de minimis aid granted to any one undertaking
2.
shall not exceed EUR 7 500 over any period of three fiscal
years. This ceiling shall apply irrespective of the form of the
aid or the objective pursued. The period shall be determined by
reference to the fiscal years used by the undertaking in the
Member State concerned.

(1) OJ L 17, 21.1.2000, p. 22.

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Where the total amount of aid granted for an aid measure
exceeds the ceiling referred to in the first subparagraph, none
of that amount — not even the fraction not exceeding the
ceiling — may benefit from this Regulation. In such cases no
aid may be claimed for the measure under this Regulation,
either at the time aid is granted or subsequently.

The cumulative amount of de minimis aid granted per
3.
Member State to undertakings in the agricultural production
sector over any period of three fiscal years shall not exceed
the value set out in the Annex hereto.

4.
The ceilings referred to in paragraphs 2 and 3 shall be
expressed as a grant. All figures used shall be gross, that is,
before any deduction of tax or other charges. Where aid is
awarded in a form other than a grant, the aid amount to be
taken into account shall be the gross grant equivalent of the aid.

5.
Aid payable in several instalments shall be discounted to
its value at the moment of its being granted. The interest rate to
be used for discounting purposes and to calculate the gross
grant equivalent shall be the reference rate applicable at the
time of grant.

This Regulation shall apply only to aid in respect of which
6.
it is possible to calculate precisely the gross grant equivalent of
the aid ex ante without need to undertake a risk assessment
(transparent aid). In particular:

(a) aid in the form of loans shall be considered transparent aid
where the gross grant equivalent has been calculated on the
basis of market interest rates prevailing at the time of the
grant.

(b) aid in the form of capital injections shall not be considered
transparent aid unless the total amount of the public capital
injection does not exceed the de minimis ceiling.

(c) aid in the form of risk capital measures shall not be
considered transparent aid unless the risk capital scheme
concerned only provides capital to each undertaking up to
the de minimis ceiling.

guarantee shall be deemed to correspond to the same
proportion of the ceiling laid down in paragraph 2. The
guarantee shall not exceed 80 % of the underlying loan.

Guarantee schemes are also considered as
schemes if the following conditions are met:

transparent aid

(i) before they are implemented, the method used to calculate
the gross grant equivalent contained in the guarantee for the
purpose of applying this Regulation was approved by the
Commission in the form of an adopted Commission Regu-
lation on State aid;

(ii) the approved method explicitly addresses

the type of
guarantees and the type of underlying transactions at
stake in the context of applying this Regulation.

De minimis aid shall not be cumulated with State aid in
7.
respect of the same eligible costs if such cumulation would
result
laid down by
Community rules in the specific circumstances of each case.

in an aid intensity exceeding that

Article 4

Monitoring
1. Where a Member State intends to grant de minimis aid to
an undertaking, it shall inform that undertaking in writing of
the prospective amount of the aid (expressed as gross grant
its de minimis character, making express
equivalent) and of
reference to this Regulation and citing its title and publication
reference in the Official Journal of the European Union. Where de
minimis aid is granted to several undertakings on the basis of a
scheme and different amounts of aid are granted to those
undertakings,
the Member State concerned may choose to
fulfil this obligation by informing the undertakings of a fixed
sum corresponding to the maximum aid amount to be granted
under the scheme. In such case, the fixed sum shall be used for
determining whether the ceiling laid down in Article 3(2) is
met. Prior to granting the aid, the Member State shall also
obtain a declaration from the undertaking concerned,
in
written or electronic form, about any other de minimis aid
received during the previous two fiscal years and the current
fiscal year.

(d) individual aid provided under a guarantee scheme to under-
takings which are not undertakings in difficulty shall be
treated as transparent de minimis aid when the guaranteed
part of the underlying loan provided under such scheme
does not exceed EUR 56 250 per undertaking. If the guar-
anteed part of the underlying loan only accounts for a given
proportion of this ceiling, the gross grant equivalent of that

The Member State shall obtain a declaration from each ben-
eficiary demonstrating that the amount of aid received by it
does not exceed the ceiling laid down in Article 3(2). Where
that ceiling is exceeded,
the Member State concerned shall
ensure that
the aid measure leading to the ceiling being
exceeded is notified to the Commission or recovered from the
beneficiary.

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The Member State shall only grant de minimis aid after
2.
having checked that it will not raise the total amount of de
minimis aid received during the period covering the fiscal year
concerned and the two previous years to a level above the
ceiling laid down in Article 3(2) and (3).

(b) in the case of de minimis aid schemes, for 10 years from the
date on which the last individual aid was granted under the
scheme in question.

3. Where a Member State has set up a central register of de
minimis aid containing complete information on all de minimis
aid falling within the scope of this Regulation granted by any
authority within that Member State, the second subparagraph of
paragraph 1 shall not apply once the register covers a period of
at least three years.

6.
On a written request, the Member States shall provide the
Commission, within a period of 20 working days, or such
longer period as may be fixed in the request, with all
the
the Commission considers necessary for
information that
assessing whether the conditions of this Regulation have been
met, in particular the total amount of de minimis aid granted to
a given undertaking and to the agricultural sector of
the
Member State concerned.

4. Where an aid is granted by a Member State on the basis
of a guarantee scheme providing a guarantee which is financed
from the EU budget under mandate through the European
Investment Fund,
the first subparagraph of paragraph 1 of
this Article may cease to apply.

In such cases, the following monitoring system shall apply:

(a)

information that

the European Investment Fund shall establish, on a yearly
basis, on the basis of
inter-
mediaries must provide to the EIF, a list of beneficiaries
of aid and of the gross grant equivalent received by each
of them. The European Investment Fund shall send this
information to the Member State concerned and to the
Commission;

financial

(b) the Member State concerned shall send that information to
the final beneficiaries of the aid within three months of
receipt of such information;

(c)

the Member State concerned shall obtain a declaration from
the overall de minimis aid it has
each beneficiary that
received does not exceed the de minimis ceiling. Where
that ceiling is exceeded, the Member State concerned shall
ensure that the aid measure leading to the ceiling being
exceeded is notified to the Commission or recovered from
the beneficiary.

5. Member States shall record and compile all the infor-
mation regarding the application of
this Regulation. Such
records shall contain all information necessary to demonstrate
that the conditions of this Regulation have been complied with.

The information referred to in the first subparagraph shall be
kept:

Article 5

Repeal

Regulation (EC) No 1860/2004 is repealed with effect from 1
January 2008.

Article 6

Transitional provisions

This Regulation shall apply to aid granted before 1
1.
January 2008 to undertakings in the sector of agricultural
the conditions
production, provided that such aid fulfils all
laid down in Articles 1 to 4, except
the reference
for
requirement clearly set out in this Regulation in the first sub-
paragraph of Article 4(1). Any aid which does not fulfil those
conditions shall be assessed by the Commission in accordance
with the relevant frameworks, guidelines, communications and
notices.

Any de minimis aid granted between 1 January 2005 and
2.
six months after entry into force of this Regulation, which fulfils
the conditions of Regulation (EC) No 1860/2004 applicable to
the sector of agricultural production until the date of entry into
force of this Regulation, shall be deemed not to meet all the
criteria of Article 87(1) of the Treaty and shall therefore be
exempt from the notification requirement of Article 88(3) of
the Treaty.

At the end of the period of validity of this Regulation, de
3.
minimis aid which fulfils the conditions of this Regulation may
continue to be applied under the conditions laid down in this
Regulation for a further period of six months.

Article 7

Entry into force and period of validity

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

(a)

in the case of individual de minimis aid, for 10 years from
the date on which the aid is granted;

It shall apply from 1 January 2008 to 31 December 2013.

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

Done at Brussels, 20 December 2007.

For the Commission

Mariann FISCHER BOEL
Member of the Commission

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ANNEX

Maximum cumulative amounts of de minimis aid granted per Member State to undertakings in the agricultural production
sector as referred to in Article 3(3):

(EUR)

BE

BG

CZ

DK

DE

EE

IE

EL

ES

FR

IT

CY

LV

LT

LU

HU

MT

NL

AT

PL

PT

RO

SL

SK

FI

SE

UK

51 532 500

23 115 000

26 257 500

59 445 000

297 840 000

3 502 500

40 282 500

75 382 500

274 672 500

438 337 500

320 505 000

4 327 500

5 550 000

11 572 500

1 777 500

44 497 500

870 000

165 322 500

40 350 000

119 542 500

47 782 500

98 685 000

8 167 500

11 962 500

26 752 500

30 217 500

152 842 500