Proposal for a Council Decision amending Decision 2006/144/EC on the Community strategic guidelines for rural development (programming period 2007 to 2013) {SEC(2008) 1885} {SEC(2008) 1886}
Date: 2008-05-20
Institutions: European Commission
Subjects: agricultural expenditure, aid to agriculture, common agricultural policy, environmental protection, financial year, fund (EU), reform of the CAP, rural development

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 20.5.2008 
COM(2008) 306 final 

2008/0103 (CNS) 
2008/0104 (CNS) 
2008/0105 (CNS) 
2008/0106 (CNS) 

Proposal for a 

COUNCIL REGULATION 

establishing common rules for direct support schemes for farmers under the common 
agricultural policy and establishing certain support schemes for farmers 

Proposal for a 

COUNCIL REGULATION 

on modifications to the common agricultural policy by amending Regulations (EC) 
No 320/2006, (EC) No 1234/2007, (EC) No 3/2008 and (EC) No […]/2008 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1698/2005 on support for rural development  
by the European Agricultural Fund for Rural Development (EAFRD) 

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Proposal for a 

COUNCIL DECISION 

amending Decision 2006/144/EC on the Community strategic guidelines  
for rural development (programming period 2007 to 2013) 

(presented by the Commission) 

{SEC(2008) 1885} 
{SEC(2008) 1886} 

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EXPLANATORY MEMORANDUM 

1. 

REASONS AND OBJECTIVES OF THE PROPOSAL 

The  main  objectives  set  out  for  the  Commission  Communication  "Preparing  the 
Health  Check  of  the  CAP  reform"  of  20  November  2007  were  to  assess  the 
implementation of the 2003 CAP reform, and to introduce those adjustments to the 
reform process that are deemed necessary in order to further simplify the policy, to 
allow  it  to  grasp  new  market  opportunities  and  to  prepare  it  for  facing  new 
challenges such as climate change, water management and bio-energy. 

In recent months, one of the above objectives, that of grasping market opportunities, 
has  taken  a  new  dimension  with  the  sharp  rise  in  the  price  of  many  agricultural 
commodities  to  exceptional  levels.  Their  steady  increase  in  2006  and  in  the  first 
semester  of  2007  had  already  supported  the  conclusions  drawn  in  the  November 
Communication  that  any  remaining  supply  controls  of  the  CAP  (namely,  dairy 
quotas and set-aside) should be removed. The combination of factors that led to these 
developments and the best response of the EU to this development are addressed in a 
separate Commission Communication. 

But the main conclusions of the November Health Check Communication about the 
assessment  of  the  most  recent  reforms  of  the  CAP  remain  valid.  These  reforms 
marked  a  new  phase  in  this  process  by  decoupling  the  majority  of  direct  payments 
via the Single  Payment  Scheme (SPS)  in 2003 for the sectors of arable crops, beef 
and  sheep,  and  dairy  and  in  2004  for  olive  oil,  cotton  and  tobacco.  As  part  of  the 
2003  reform,  Rural  Development  (RD)  policy  was  strengthened  with  additional 
funds  and  with  the  reform  of  its  policy  instruments  in  2005.  Finally,  the  reform 
process  continued  with  reforms  in  sugar  (2006)  and  fruit  and  vegetables  and  wine 
(2007). 

The above reforms reflect the significant shift in the orientation of the CAP, which is 
more capable today to meet its fundamental objectives. 

•  Producer support is to a large extent (90%) decoupled from production decisions, 
allowing EU farmers to make their choices in response to market signals, to rely 
on  their  farm  potential  and  their  preferences  when  adapting  to  changes  in  their 
economic environment. This is the most efficient way of providing farm income 
support. 

•  The  shift  away  from  product  support,  widely  viewed  as  an  origin  of  the  surplus 
problems  of  the  past,  and  the  reduction  of  EU  support  prices,  brought  EU 
agriculture  much  closer  to  world  markets,  improving  market  balances  and 
reducing the budgetary costs of intervention stocks or surplus disposal. 

•  The results of the reform process increased the competitiveness of EU agriculture, 
which, despite the decline of EU share in most commodity markets, became the 
largest agricultural exporter, of mainly high value products, while remaining the 
biggest agricultural importer in the world, remaining by far the largest market for 
developing countries. 

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•  The  CAP  increasingly  contributes  to  heading  off  the  risks  of  environmental 
degradation and to delivering many of the public goods that our societies expect 
since  producer  support  now  depends  on  the  respect  of  standards  relating  to  the 
environment,  food  safety  and  quality  and  animal  welfare  through  cross 
compliance. 

•  The  strengthened  rural  development  policy  supports  the  protection  of  the 
environment and rural landscapes and creates growth, jobs and innovation in rural 
areas,  especially  those  which  are  remote,  depopulated  or  heavily  dependent  on 
farming. 

The above developments indicate a CAP that is today fundamentally different from 
the one of the past. But the Communication "Preparing the Health Check of the CAP 
reform" also asserts that, "for the CAP to continue to be a policy of the present and of 
the future, it needs to be able to evaluate its instruments, to test whether they function 
as they should, to identify any adjustments needed to meet its stated objectives, and 
to be able to adapt to new challenges". 

In  line  with  the  indications  given  in  the  Communication,  the  Commission  has 
prepared legal proposals accompanied by an impact assessment report on the Health 
Check of the CAP taking on board the result of a wide consultation of stakeholders 
and the contributions from other European institutions. 

Legal proposals are related to three basic Regulations: 

–  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, 

–  Council  Regulation  (EC)  No  1234/2007  of  22  October  2007  establishing  a 
common  organisation  of  agricultural  markets  and  on  specific  provisions  for 
certain agricultural products (Single CMO Regulation), 

–  Council  Regulation  (EC)  No  1698/2005  of  20  September  2005  on  support  for 
rural development by the European Agricultural Fund for Rural Development. 

These  proposals,  without  constituting  a  fundamental  reform,  are  a  contribution  to 
future  developments  of  the  CAP  that  are  consistent  with  the  overall  goal  of  the 
Commission  and  the  requirements  of  the  Treaties  to  promote  a  sustainable  and 
market orientated agricultural sector. 

2. 

SINGLE PAYMENT SCHEME (SPS) AND SINGLE AREA PAYMENT SCHEME (SAPS) 

2.1. 

Simplification 

Better  regulation  and  simplification  are  one  of  the  Commission's  political  priorities 
for the period 2004–2009. The CAP started the most important path to simplification 
with its reform of 2003 by shifting most of direct payments for farmers to the Single 
Payment Scheme and with the adoption of the Single Common Market Organisation 
in 2007. 

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On  SPS,  experience  has  shown  that  it  has  contributed  to  reduce  the  administrative 
burden, to avoid unnecessary public expenditure, to improve public acceptance of the 
CAP and to improve competitiveness on the CAP. Nevertheless, steps towards more 
simplification  can  still  be  done,  especially  in  cross  compliance  and  in  the  existing 
partial coupled support. 

Cross compliance 

The 2003 CAP reform introduced cross compliance within the single farm payment. 
This means that such payments are subject to environmental, food safety, and animal 
welfare legislation, as well as to the maintenance of the farm in good agricultural and 
environmental conditions. 

Practical  problems  in  the  implementation  of  cross  compliance  have  been  raised  by 
the  Member  States,  as  well  as  by  the  Commission  itself  through  its  audits  for  the 
clearance  of  accounts.  This  has  led  the  Commission  to  examine  the  scope  of  cross 
compliance in order to simplify and improve its targeting. In particular, the proposals 
aim  at  withdrawing  certain  Statutory  Mandatory  Requirements  that  are  considered 
not  relevant  or  linked  to  farmer  responsibility,  and  to  introduce  into  Good 
Agricultural  Environmental  Conditions  requirements  that  retain  the  environmental 
benefits from set aside and address issues of water management. 

Partially coupled support 

In 2003 CAP reform, some Member States considered that full decoupling could lead 
to  several  risks  such  as  the  abandonment  of  production,  the  lack  of  raw  material 
supply  for  processing  industries,  or  to  social  and  environmental  problems  in  areas 
with  few  economic  alternatives.  This  was  the  reason  why  it  was  decided  to  retain 
certain levels of coupled support in some sectors. 

The  experience  with  decoupling  shows  that  in  general  this  move  did  not  imply 
dramatic  changes  in  the  production  structure  at  the  EU  level  and  that  it  has  led 
farmers to produce what the market demands in a more sustainable way. It has also 
to be stressed that keeping two systems in parallel (coupled and decoupled support) 
has  not  contributed  to  simplification  for  national  and  regional  administrations  in 
Member States. 

Given  this,  it  is  proposed  to  align  them  with  the  2003  CAP  reform  principles  by 
removing  the  remaining  coupled  support  and  shifting  them  to  the  Single  Payment 
Scheme. Nevertheless, an exception is done with suckler cows, sheep and goatmeat 
premia. In these cases it is proposed to allow Member States to maintain the coupled 
support (as it exists currently) in order to sustain economic activity in regions where 
other economic alternatives are few or do not exist. 

Other issues related to simplification 

The proposal also includes other measures focused on providing more simplification 
to the SPS. In particular, more flexibility has been added to the use of the national 
reserve  and  to  the  transfer  of  payment  entitlements,  to  the  choice  of  modifying  the 
entitlements and to payment dates. The abolition of the set-aside entitlements is also 
proposed. 

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2.2.  Moving towards a more flat rate of decoupled support 

The  2003  reform  introduced  the  decoupled  farm  support  as  the  key  element  of  the 
CAP. The main objective was providing a direct payment system that allows farmers 
to be market oriented, as simple as possible from an administrative point of view and 
compatible  with  WTO.  Two  basic  models  were  provided  to  Member  States  to 
implement the scheme: the historic and the regional: 

–  historic  model:  in  this  model  payment  entitlements  are  based  on  individual 

historic reference amounts per farmer; 

–  regional model: in this model flat-rate payment entitlements are based on amounts 

received by farmers in a region in the reference period. 

The current legislation does not allow Member States to change their decision on the 
implementation  of  the  SPS  model.  However,  experience  has  shown  that  certain 
adjustments  in  the  existing  schemes  are  necessary  or  desirable.  For  example,  the 
differences in support levels resulting from implementation of the historic model will 
become  difficult  to  justify  in  the  future  as  reference  periods  for  payments  become 
more distant. 

On  the  other  hand,  the  regional  model  provides  more  equitable  support  to  farmers, 
despite some initial redistribution of support. 

This  is  the  reason  why  the  Commission  has  proposed  allowing  Member  States  to 
adjust  their  SPS  model  by  moving  gradually  towards  flatter  payment  rates  per 
entitlement  to  render  the  SPS  more  effective,  efficient  and  simple.  In  parallel,  the 
proposals include a series of simplification measures in the implementation of SPS. 

2.3. 

Extending SAPS 

The Single Area Payment Scheme was introduced as a previous step to the inclusion 
in the SPS in the Member States who joined the EU as from 1 May 2004 to facilitate 
their  adjustment  to  the  EU  because  of  their  specific  agricultural  situation.  As  a 
transitional system, SAPS was designed to assist the integration of EU-10 and EU-2 
in a smooth manner, given the very significant differences between the level of their 
general and rural economies and those in the EU-15. 

Member States applying SAPS have to move into the SPS in 2011 (2012 for Bulgaria 
and  Romania).  It  seems  appropriate  to  allow  those  Member  States  to  extend  SAPS 
until  2013  This  option  is  in  line  with  the  decision  taken  for  EU-15  Member  States 
because  they  are  allowed  to  review  their  SPS  implementation  and  opt  to  move 
towards a more flat-rate model. 

2.4. 

Revised Article 69 of Regulation (EC) No 1782/2003 

Based on Article 69 of Regulation (EC) No 1782/2003 on direct support schemes for 
farmers,  Member  States  applying  SPS  may  retain  by  sector  up  to  10%  of  their 
national  budget  ceilings  for  direct  payments  in  the  sector  concerned  for  measures 
related  to  the  protection  or  enhancement  of  the  environment  or  for  improving  the 
quality and marketing of agricultural products. 

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To allow more flexibility in Member State responses to the needs stemming from the 
overall orientation of the CAP, it is proposed that Article 69 be broadened: 

–  the restriction that linear reductions are taken from and staying in the same sector 

is removed; 

–  measures  to  address  disadvantages  for  farmers  in  certain  regions  specialising  in 

the dairy, beef, sheep and goatmeat and rice sectors are covered; 

–  it also allows the possibility to use the retained amounts to top up entitlements in 

areas subject to restructuring and/or development programs; 

–  support for some risk management measures – crop insurance schemes for natural 
disasters  and  mutual  funds  for  animal  diseases  –  is  also  provided  under  certain 
conditions; 

–  measures,  which  do  not  with  certainty  meet  the  conditions  of  the  WTO  Green 

Box, should be limited to 2,5% of the ceilings; 

–   finally,  Member  States  applying  SAPS  will  also  be  allowed  to  apply  this 

provision. 

2.5.  Modulation 

Modulation  is  a  means  of  budgetary  transfer  by  which  a  percentage  reduction  is 
applied to farmer direct payments (Pillar I) and the budgetary resources released are 
reassigned to rural development (Pillar II) measures. 

With  the  2003  Reform,  compulsory  modulation  for  all  EU-15  Member  states  was 
agreed, starting in 2005 with a rate of 3% and increasing to 4% in 2006 and to 5% 
from  2007  onwards.  A  EUR 5 000  franchise  was  also  introduced,  below  which  no 
reduction of direct payments is applied. 

The  Communication  "Preparing  the  Health  Check  of  the  CAP  reform"  identified  a 
number of new and ongoing challenges facing the CAP such as climate change, risk 
management,  bio-energy,  water  management  and  biodiversity  and  considers  the 
RD policy as one of the possibilities to deal with these changes. 

The  measures  available  under  RD  are  already  providing  various  alternatives  to 
address the new challenges and MS have included related measures already in their 
RD  Programs  for  the  period  2007–2013.  Nevertheless,  first  experiences  with  the 
financial up-take of RD resources in 2007 suggest that Member States have budget 
needs beyond their financial possibilities. 

To allow Member States to support the increasing needs to meet new challenges via 
the  set  of  measures  proposed  under  RD,  it  is  proposed  to  increase  compulsory 
modulation by 8% and to add an additional progressive element under a new system 
which is based on the following principles: 

–  all  new  receipts  from  modulation  stay  within  the  Member  State  that  generates 

them; 

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–  in EU-15, basic modulation, applying to all payments above €5 000, increases by 
2%  annually  from  2009  until  it  reaches  an  additional  8%  (on  top  of  the  current 
5%) in 2012; 

–  a progressive element is introduced; whereby payments are reduced by additional 
steps of 3% in successive thresholds a new system for the financial management 
of direct aids, establishing net global ceilings per Member State, is proposed; 

–  The  table  below  shows  the  total  modulation  percentages  to  be  applied  (existing 

and additional, respectively): 

Thresholds 

1 to 5 000 

2009 

0 

2010 

0 

2011 

0 

2012 

0 

5 000 to 99 999 

5% + 2% 

5% + 4% 

5% + 6% 

5% + 8% 

100 000 to 199 999 

5% + 5% 

5% + 7% 

5% + 9% 

5% + 11% 

200 000 to 299 999 

5% + 8% 

5% + 10% 

5% + 12% 

5% + 14% 

above 300 000 

5% + 11% 

5% + 13% 

5% + 15% 

5% + 17% 

–  EU-10  become  also  eligible  for  modulation  in  2012,  with  a  basic  rate  of  3% 
(instead of 13%). Bulgaria and Romania are exempted, in relation to the phasing-
in of direct payments. 

2.6. 

Payments limitations 

46,6% of the total direct payment beneficiaries in the EU-25 receive less than €500. 
This  number  essentially  includes  small  farmers,  but  it  also  includes  in  certain 
Member States recipients whose value of payment is below the administrative cost of 
managing it. 

In order to simplify and reduce the costs of administration of direct payments, it is 
proposed that Member States shall either apply a minimum amount of payments of 
€250  or  apply  a  minimum  size  of  eligible  ar ea  per  holding  of  at  least  1  hectare  or 
apply both. Nevertheless, special provision is made for those Member States whose 
agricultural sector is mainly composed of very small holdings. 

3. 

SINGLE COMMON MARKET ORGANISATION 

3.1. 

Intervention market mechanisms 

Based on analysis, the Commission has concluded that market supply control should 
not  serve  to  slow  down  the  ability  of  EU  farmers  to  respond  to  market  signals  but 
they should be turned into a real safety net. To do so, it is proposed to simplify and 
harmonise  the  current  provisions  on  public  intervention  via  the  extension  of  a 
tendering system. 

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In the cereal sector, it is proposed to introduce tendering for bread wheat, while for 
feed  grains,  the  same  model  as  for  maize  (reduce  quantitative  ceiling  at  zero)  will 
apply. For durum wheat, taking into account current and expected market conditions, 
it is proposed to abolish intervention. For the same reasons, for rice and pig meat it is 
also proposed to abolish intervention. Tendering provisions for butter and skimmed 
milk powder will also apply. 

3.2. 

Abolition of set aside 

Based on the market outlook situation and the implementation of SPS, it is proposed 
to abolish set aside as an instrument of supply control. However, under the proposals 
for  cross  compliance  and  RD,  Member  States  are  given  the  appropriate  tools  to 
ensure that the present environmental benefits of set aside can be retained. 

3.3. 

Transition to the end of the milk quota 

In 1984, quotas were introduced as a response to overproduction. The current market 
outlook situation indicates that the conditions for which milk quotas were introduced 
in 1984 are no longer relevant. Since milk quotas expire in 2015, it is appropriate to 
help the sector with gradual transitional measures to adapt to a market without quotas 
post 2015. To allow a "soft landing" of the milk sector to the end of quotas, a gradual 
annual increase is proposed. 

In  general  terms,  the  phasing-out  of  milk  quotas  would  expand  production,  lower 
prices and increase the competitiveness of the sector. Nevertheless, there are certain 
regions,  especially  but  not  exclusively  mountainous  regions,  which  are  expected  to 
face difficulties in keeping a minimum level of production. Those problems can be 
addressed  by  applying  specific  measures  through  Article  68  of  the  Regulation  on 
direct support schemes. 

3.4. 

Dairy sector specific aids 

The abolition of the private storage aid for cheese and the disposal aid for butter for 
pastry and ice cream and for direct consumption is proposed. These schemes are no 
longer needed to support the market and should therefore be abolished. 

For  other  products  as  the  private  storage  aid  for  butter,  the  skimmed  milk  powder 
feeding  stuff  and  the  aid  for  casein  production,  for  which  an  obligatory  aid  is 
provided  by  the  current  regulation,  it  has  been  proposed  to  make  such  a  support 
optional  for  the  Commission  to  decide  if  it  should  be  applied  when  the  market 
situations requires it. 

3.5. 

Other support regimes 

In a series of small support schemes, it is proposed to decouple and shift them to the 
SPS  because  it  would  contribute  to  improve  competitiveness  and  to  provide  them 
with more simplification. For hemp, protein crops, and nuts the transition to the SPS 
can take place without a transition period. For rice, dried fodder, starch potatoes and 
long fibre flax, a transitional period for the shifting to full decoupling is proposed in 
order  to  help  farmers  and  processing  industries  to  be  adapted  gradually  to  the  new 
support  scheme.  It  is  also  proposed  to  abolish  the  energy  crop  scheme  based  on 
current very strong demand for bio-energy. 

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4. 

NEW CHALLENGES AND RURAL DEVELOPMENT POLICY 

With the ceiling for the overall CAP budget fixed until 2013, additional funding for 
rural  development  can  only  be  realised  through  an  increase  in  compulsory 
modulation. 

The  additional  funding  is  needed  to  reinforce  the  efforts  with  regard  to  the  EU 
priorities  in  the  field  of  climate  change,  renewable  energy,  water  management  and 
biodiversity. 

•  Climate and energy have moved to the top of the agenda, as the EU is taking the 
lead to build a global low carbon economy. In March 2007, EU leaders endorsed 
Commission  proposals  to  cut  CO2  emissions  by  at  least  20%  by  2020  (30%  if 
global  targets  can  be  agreed  on)  and  to  set  a  binding  20%  target  for  the  use  of 
renewable energy sources, including a 10% share of biofuels in petrol and diesel 
consumption.  Agriculture  and  forestry  can  make  an  important  contribution  in 
providing  the  feed  stocks  for  bio-energy,  in  carbon  sequestration  and  in  further 
reducing GHG emissions. 

•  The  EU's  objectives  with  regard  to  water  policy  are  laid  down  in  the  Water 
Framework Directive, which will start to reach full implementation in the period 
2010–2012. Agriculture and forestry as a main user of water and water resources 
have  a  major  role  to  play  in  sustainable  water  management  both  in  terms  of 
quantity and of quality. Water management will be an increasingly important part 
of the adaptation strategy to deal with already unavoidable climate change. 

•  Member States have committed themselves to halt biodiversity decline by 2010, a 
target  which  increasingly  seems  unlikely  to  be  met.  A  large  part  of  Europe's 
biological  diversity  is  dependent  on  agriculture  and  forestry  and  the  efforts  to 
protect  biodiversity  will  have  to  be  increased,  particularly  in  the  light  of  the 
expected adverse effects of climate change and increasing water demand. 

Member  States  are encouraged to make full  use of the  additional funding available 
for  the  2010–2013  period  and  to  adapt  their  strategies  and  programmes  in 
consequence.  In  particular  support  for  investments  under  axis  1  can  be  targeted 
towards  energy,  water  and  other  input  saving  machinery  and  equipment  and  to 
production  of  (feed  stocks  for)  renewable  energy  for  on  and  off  farm  use.  Under 
axis 2  the  agri-environment  measure  and  the  forestry  measures  can  be  used  in 
particular for biodiversity, water management and climate change mitigation actions. 
Under axis 3 and 4 local scale renewable energy projects can be supported. 

In this context the 7th Research Framework Programme will contribute to addressing 
the new challenges and provide valuable support to innovations in the farming sector 
and to policy targeting. 

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5. 

BUDGETARY IMPACT 

Since the 2003 CAP reform and as applicable from 2007 budget year, the CAP has 
an in-built mechanism of financial discipline if expected expenditure runs the risk of 
exceeding the financial ceiling for market expenditure and direct aids. The proposal 
does not change the principles established with the 2003 reform and as amended with 
the accession of EU-12 on the application of this mechanism. Most CAP support is 
now fixed and the market outlook has significantly improved since 2003. As a result, 
the  risk  that  the  financial  discipline  is  applied  (i.e.  reduction  in  direct  aids)  has 
diminished compared to previous expectations. 

Proposals for modulation in the Single Payment Scheme and Rural Development are 
by  design  neutral  with  the  respect  to  the  EU  budget,  as  it  is  a  simple  compulsory 
transfer between the second and the first pillar of the CAP. For national budget the 
increased  modulation  could  lead  to  additional  national  expenditure  in  view  of  the 
necessary  co-financing  needed  in  Rural  Development.  This  would  mean  that  some 
Member  States  have  the  possibility  of  returning  to  the  (higher)  level  of  national 
expenditure  originally  foreseen  before  the  decision  on  the  Financial  Framework 
2007–2013.  As  regards  the  transfer  of  measures  into  the  Single  Payment  Scheme 
there could be moderate financial consequences for the EU-budget, but most of the 
transfers are also budgetary neutral. 

With  respect  to  market  measures,  the  recent  increase  in  world  prices  has  led  to  a 
clear improvement  of  prospects  with respect  to  expectations  when  the  2003  reform 
was  decided.  The  reform  of  maize  intervention  has  since  then  resolved  part  of  the 
previously expected problems in cereals market, and the present proposals on cereals 
intervention improve further the situation. Some additional expenditure towards the 
end of the present financial framework is relatively small. In dairy the impact is more 
one of the timing of expenditure (before or after 2013). 

The  expiry  of  the  dairy  quota  will  bring  additional  pressure  in  butter  under  all 
options. The present proposal, by initiating a gradual process of a quota phasing-out, 
is overall more beneficial not just for the sector, but also for long-term developments 
of  the  CAP.  However,  the  need  for  some  limited  additional  expenditure  on  butter 
exports cannot be excluded. Whether this materialises will depend on factors that are 
at this stage unknown (DDA Agreement, world market developments). Therefore the 
present proposals include a review clause in 2012 that would allow developments in 
dairy  markets  to  be  assessed  to  determine  if  additional  measures  will  be  needed  to 
avoid  any  increase  in  the  budget.  Some  savings  are  foreseen  as  a  consequence  of 
abolition  of  existing  measures.  However,  the  biggest  budgetary  effect  of  the  soft-
landing on the milk quota is a loss of budgetary revenue due to the foreseen decrease 
in milk levy. 

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2008/0103 (CNS) 

Proposal for a 

COUNCIL REGULATION 

establishing common rules for direct support schemes for farmers under the common 
agricultural policy and establishing certain support schemes for farmers 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Articles 36, 37 and 299(2) thereof, 

Having regard to the Act of Accession  of Greece, and in particular paragraph 6 of Protocol 
No 4 thereto on cotton1, 

Having regard to the proposal from the Commission2, 

Having regard to the opinion of the European Parliament3, 

Having regard to the opinion of the European Economic and Social Committee4, 

Having regard to the opinion of the Committee of the Regions5, 

Whereas: 

(1) 

Experience drawn from the implementation of 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 2529/20016  shows  that  certain 
elements of the support mechanism need to be adjusted. In particular the decoupling of 
direct support should be extended and the functioning of the Single Payment Scheme 
should be simplified. It should also be noted that Regulation (EC) No 1782/2003 has 
been  substantially  amended  since  its  entry  into  force.  In  the  light  of  these 
developments and in the interest of clarity it should be repealed and replaced by a new 
Regulation. 

1 

2 
3 
4 
5 
6 

OJ L 291, 19.11.1979, p. 174. Protocol as last amended by Regulation (EC) No 1050/2001 (OJ L 148, 
1.6.2001, p. 1).  
OJ C […], […], p. […]. 
OJ C […], […], p. […]. 
OJ C […], […], p. […]. 
OJ C […], […], p. […]. 
OJ L 270, 21.10.2003, p. 1. Regulation as last amended by (insert reference to wine). 

EN 

12 

   EN 

                                                 
(2) 

(3) 

(4) 

(5) 

(6) 

(7) 

Regulation  (EC)  No 1782/2003  established  the  principle  that  farmers  who  do  not 
comply  with  certain  requirements  in  the  areas  of  public,  animal  and  plant  health, 
environment and animal welfare shall be subject to reductions of or the exclusion from 
direct support. This «cross-compliance» system forms an integral part of Community 
support  under  direct  payments  and  should  therefore  be  maintained.  However, 
experience  has  shown  that  a  number  of  the  requirements  under  the  scope  of  cross 
compliance  are  not  sufficiently  relevant  to  the  farming  activity  or  the  farm  land  or 
concern national authorities rather than farmers. It is therefore appropriate to adjust the 
scope of cross compliance. 

Furthermore, in order to avoid the abandonment of agricultural land and ensure that it 
is  maintained  in  good  agricultural  and  environmental  condition,  Regulation  (EC) 
No 1782/2003 established a Community framework within which Member States adopt 
standards  taking  account of the specific characteristics of the areas concerned, including 
soil  and  climatic  conditions  and  existing  farming  systems  (land  use,  crop  rotation, 
farming  practices)  and  farm  structures.  The  abolition  of  compulsory  set  aside  within 
the  single  payment  scheme  may  in  certain  cases  have  adverse  effects  for  the 
environment,  in  particular  as  regards  certain  landscape  features.  It  is  therefore 
appropriate  to  reinforce  the  existing  Community  provisions  aiming  at  protecting, 
where appropriate, specified landscape features. 

Protection  and  management  of  water  in  the  context  of  the  agricultural  activity  has 
increasingly  become  a  problem  in  certain  areas.  It  is  therefore  appropriate  to  also 
reinforce the existing Community framework for good agricultural and environmental 
condition with the aim to protect water against pollution and run-off and to manage the 
use of water. 

Since permanent pasture has a positive environmental effect, it is appropriate to apply 
measures  to  encourage  the  maintenance  of  existing  permanent  pasture  to  avoid  its 
massive conversion into arable land. 

In  order  to  achieve  a  better  balance  between  policy  tools  designed  to  promote 
sustainable agriculture and those designed to promote rural development, a system of 
compulsory  progressive  reduction  of  direct  payments  (“modulation”)  was  introduced 
by  Regulation  (EC)  No 1782/2003.  This  system  should  be  maintained  including  the 
exemption of payments up to EUR 5 000 from its application. 

The savings made through the modulation mechanism introduced by Regulation (EC) 
No 1782/2003 are used to finance measures under the rural development policy. Since 
the adoption of that regulation the agricultural sector has been faced with a number of 
new and demanding challenges such as climate change, the increasing importance of 
bio-energy,  as  well  as  the  need  for  a  better  water  management  and  a  more  effective 
protection of biodiversity. The European Community, as party to the Kyoto Protocol7, 
has been called to adapt its policies in the light of the climate change considerations. 
Furthermore, following serious problems related to water scarcity and droughts, water 
management  issues  should  be  further  addressed8.  Protecting  biodiversity  remains  a 
major challenge and while important progress has been made, the achievement of the 

7 
8 

Council Decision 2002/358/EC (OJ L 130, 15.5.2002, p. 1). 
Council Conclusions, Luxembourg, 30.10.2007, 13888/07. 

EN 

13 

   EN 

                                                 
European  Community's  biodiversity  target  for  2010  will  require  additional  efforts9. 
The  Community  acknowledges  the  need  to  tackle  these  new  challenges  in  the 
framework  of  its  policies.  In  the  area  of  agriculture,  rural  development  programs 
adopted  under  Council  Regulation  (EC)  No 1698/2006  of  20  September  2005  on 
support  for  rural  development  by  the  European  Agricultural  Fund  for  Rural 
Development  (EAFRD)10  are  an  appropriate  tool  to  deal  with  them.  To  enable 
Member  States  to  revise  their  rural  development  programmes  accordingly  without 
being  required  to  reduce  their  current  rural  development  activities  in  other  areas, 
additional funding needs to be made available. However, the financial perspectives for 
the  period  2007  to  2013  do  not  provide  for  the  financial  means  to  reinforce  the 
Community's  rural  development  policy  as  necessary.  Under  these  circumstances  it  is 
appropriate to mobilise a large part of the financial resources needed by providing for 
a gradual increase of the reduction of direct payments through modulation. 

The  distribution  of  direct  income  support  among  farmers  is  characterised  by  the 
allocation  of  a  large  share  of  payments  to  a  rather  limited  number  of  large 
beneficiaries.  It  is  clear  that  larger  beneficiaries  do  not  require  the  same  level  of 
unitary  support  for  the  objective  of  income  support  to  be  efficiently  attained. 
Moreover, the potential to adapt makes it easier to larger beneficiaries to operate with 
lower  levels  of  unitary  support.  It  therefore  seems  equitable  to  expect  farmers  with 
high  amounts  of  support  to  make  a  particular  contribution  to  the  financing  of  rural 
development measures addressing new challenges. Therefore, it appears appropriate to 
establish  a  mechanism  providing  for  an  increased  reduction  of  the  highest  payments 
the  proceeds  of  which  should  also  be  used  to  deal  with  new  challenges  in  the 
framework of rural development. To ensure the proportionality of this mechanism the 
additional  reductions  should  increase  progressively  according  to  the  amounts  of  the 
payments concerned. 

(8) 

(9) 

The particular geographical situation of the outermost regions as well as its insularity, 
small  area  and  mountainous  terrain  and  climate  impose  additional  burdens  to  their 
agricultural  sectors.  In  order  to  mitigate  such  burdens  and  constrains  it  seems 
appropriate  to  derogate  from  the  obligation  to  apply  the  modulation  reduction  to 
farmers in the outermost regions. 

(10)  The increased rates of compulsory modulation need to be taken into account by those 
Member  States  that  opted  for  applying  a  system  of  voluntary  modulation.  Council 
Regulation  (EC)  No 378/2007  of  27  March  2007  laying  down  rules  for  voluntary 
modulation  of  direct  payments  provided  for  in  Regulation  (EC)  No 1782/2003 
establishing common rules for direct support schemes under the common agricultural 
policy  and  establishing  certain  support  schemes  for  farmers11  should  be  amended 
accordingly. 

9 
10 

11 

Council Conclusion, Brussels, 18.12.2006, 16164/06. 
OJ L 277, 21.10.2005, p. 1. Regulation as last amended by Regulation (EC) No 2012/2006 (OJ L 384, 
29.12.2006, p. 8). 
O.J L 95, 5.4.2007, p. 1. 

EN 

14 

   EN 

                                                 
(11)  The  amounts  resulting  from  the  application  of  5  percentage  points  corresponding  to 
modulation  reductions  fixed  in  Regulation  (EC)  No 1782/2003  should  be  allocated 
between Member States according to objective criteria. However, it is appropriate to 
establish that a certain percentage of the amounts should remain in the Member States 
where they have been generated. In view of the structural adjustments resulting from 
the abolition of rye intervention, it is appropriate to provide for specific measures for 
certain  rye  production  regions  financed  with  part  of  the  amounts  generated  by 
modulation. However, the amounts raised by the application of any further modulation 
reduction  should  be  made  available  to  the  Member  States  where  they  have  been 
generated. 

(12) 

In  order  to  facilitate  the  functioning  of  modulation,  notably  with  regard  to  the 
procedures  for  granting  direct  payments  to  farmers,  and  the  transfers  to  the  rural 
development programs, it is appropriate to fix net ceilings per Member State that limit 
the  payments  to  be  made  to  farmers  after  the  application  of  modulation.  Council 
Regulation  (EC)  No 1290/2005  of  21  June  2005  on  the  financing  of  the  common 
agricultural policy 12 should be amended accordingly. 

(13)  Farmers  in  the  new  Member  States  receive  direct  payments  following  a  phasing-in 
mechanism.  In  order  to  achieve  the  proper  balance  between  policy  tools  designed  to 
promote sustainable agriculture and those designed to promote rural development, the 
system of modulation should not be applied to farmers in the new Member States until the 
level of direct payments applicable in those Member States is equal to the level applicable 
in the other Member States. 

(14)  Modulation should not reduce the net amount paid to a farmer in a new Member State 
below the amount to be paid to an equivalent farmer in the other Member States. Once 
modulation  becomes  applicable  to  farmers  in  the  new  Member  States  the  rate  of 
reduction  should,  therefore,  be  limited  to  the  difference  between  the  level  under  the 
phasing-in  schedule  and  the  level  in  the  other  Member  States  after  the  application  of 
modulation.  Moreover,  farmers  in  new  Member  States  who  are  subject  to  modulation 
should no longer benefit from complementary national direct payments to avoid that their 
support level exceeds the level in the other Member States. 

(15)  With a view to ensuring that the amounts for the financing of the common agricultural 
policy respect the annual ceilings set in the financial perspectives, it is appropriate to 
provide for a financial mechanism to adjust, where necessary, the direct payments. An 
adjustment  of  direct  support  should  be  fixed  when  the  forecasts  indicate  that  the 
subheading  2,  with  a  security  margin  of  EUR  300  million,  is  exceeded  in  a  given 
budget year. Taking into account the levels of direct payments for farmers in the new 
Member States as a result of phasing-in, it should be provided that in the framework of 
the application of the phasing-in mechanism to all direct payments granted in the new 
Member  States,  the  instrument  of  financial  discipline  should  not  apply  in  the  new 
Member States until the level of direct payments applicable in the new Member States 
is  at  least  equal  to  the  level  applicable  in  the  Member  States  other  than  the  new 
Member States. 

12 

OJ L 209, 11.8.2005, p. 1. Regulation as last amended by Regulation (EC) No 1437/2007 (OJ L 322, 
7.12.2007, p. 1). 

EN 

15 

   EN 

                                                 
(16) 

In order to help farmers to meet the standards of modern, high-quality agriculture, it is 
necessary  that  Member  States  operate  a  comprehensive  system  offering  advice  to 
commercial  farms.  The  farm  advisory  system  should  help  farmers  to  become  more 
aware  of  material  flows  and  on-farm  processes  relating  to  the  environment,  food 
safety,  animal  health  and  welfare  without  in  any  way  affecting  their  obligation  and 
responsibility to respect those standards. 

(17)  Member States have, in accordance with Article 9 of Regulation (EC) No 1290/2005, 
to take the measures necessary to satisfy themselves that transactions financed by the 
European  Agricultural  Guarantee  Fund  (EAGF)  are  actually  carried  out  and  are 
executed  correctly,  and  prevent  and  deal  with  irregularities.  To  this  end  they  shall 
operate an integrated administration and control system for direct payments. In order 
to improve effectiveness and control of Community support the Member States should 
be  authorised  to  avail  themselves  of  the  integrated  system  also  in  the  case  of 
Community schemes not covered by this Regulation. 

(18)  The main elements of the integrated administration and control system should be laid 
down,  and  in  particular,  the  provisions  concerning  a  computerised  data  base,  an 
identification  system  for  agricultural  parcels,  aid  applications  from  farmers,  a 
harmonised  control  system  and,  in  the  single  payment  scheme,  a  system  for  the 
identification and recording of payment entitlements. 

(19)  The management of small amounts is a burdensome task for the competent authorities 
of the Member States. To avoid excessive administrative burden it is appropriate for 
Member States to refrain from granting direct payments where the payment would be 
lower than the Community average support for one hectare or the eligible area of the 
holding  for  which  support  is  claimed  would  relate  to  less  than  one  hectare.  Special 
provision  should  be  made  for  those  Member  States  whose  farm  structure  differs 
significantly  from  the  average  Community  one.  Member  States  should  be  given 
discretion to opt for the implementation of one of the two criteria taking account of the 
particularities  of  the  structures  of  their  agricultural  economies.  As  special  payment 
entitlements  were  allocated  to  farmers  with  so-called  "landless"  holdings  the 
application of the hectare-based threshold would be ineffective. Such farmers should 
therefore be subject to the averages support-based minimum amount. 

(20)  The  experience  with  the  application  of  the  single  payment  scheme  shows  that 
decoupled income support was in a number of cases granted to beneficiaries other than 
natural  persons  whose  business  purpose  is  not  or  only  marginally  targeted  at 
exercising an agricultural activity. To prevent agricultural income support from being 
allocated to such companies and firms, and  to ensure that the  Community support is 
entirely  used  to  ensure  a  fair  standard  of  living  to  the  agricultural  community,  it  is 
appropriate to empower Member States, where such allocation occurs, to refrain from 
granting them direct payments under this Regulation. 

(21)  Payments  provided  for  under  Community  support  schemes  should  be  made  by  the 
competent  national  authorities  to  beneficiaries  in  full,  subject  to  any  reductions 
provided for in this Regulation, and within prescribed periods. In order to render the 
management  of  direct  payments  more  flexible,  Member  States  should  be  allowed  to 
pay direct payments in two instalments per year. 

EN 

16 

   EN 

(22)  The support schemes under the common agricultural policy provide for direct income 
support  in  particular  with  a  view  to  ensuring  a  fair  standard  of  living  for  the 
agricultural  community.  This  objective  is  closely  related  to  the  maintenance  of  rural 
areas.  In  order  to  avoid  misallocations  of  Community  funds,  no  support  payments 
should  be  made  to  farmers  who  have  artificially  created  the  conditions  required  to 
obtain such payments. 

(23) 

In order to achieve the objectives of the common agricultural policy, common support 
schemes have to be adapted to changing developments, if necessary within short time 
limits.  Beneficiaries  cannot, 
therefore,  rely  on  support  conditions  remaining 
unchanged and should be prepared for a possible review of schemes in particular in the 
light of economic developments or the budgetary situation. 

(24)  Regulation  (EC)  No 1782/2003  established  a  single  payment  scheme  that  combined 
the  existing  various  support  mechanisms  into  a  single  scheme  of  de-coupled  direct 
payments.  Experience  with  the  application  of  the  single  payment  scheme  shows  that 
certain of its elements can be simplified to the benefit of farmers and administrations. 
Furthermore,  given  that  the  single  payment  scheme  has  in  the  meantime  been 
implemented by all Member States that were required to do so, a number of provisions 
that  were  linked  to  its  initial  implementation  have  become  obsolete  and  should 
therefore be adjusted. In this context, a significant under use of payment entitlements 
has been detected in some cases. To avoid such situation and taking into account that 
farmers  are  already  familiar  with  the  functioning  of  the  single  payment  scheme,  the 
period initially fixed for reverting unused payment entitlements to the national reserve 
should be reduced to two years. 

(25)  The main elements of the single payment scheme should be maintained. In particular 
the  fixing  of  national  ceilings  should  ensure  that  the  total  level  of  support  and 
entitlements does not exceed current budgetary constraints. Member States should also 
operate  a  national  reserve  that  may  be  used  to  facilitate  the  participation  of  new 
farmers in the scheme or to take account of specific needs in certain regions. Rules on 
transfer and use of payment entitlements should be laid down to avoid the speculative 
transfer  and  accumulation  of  payment  entitlements  without  a  corresponding 
agricultural basis. 

(26)  The  progressive  integration  of  new  sectors  in  the  single  payment  scheme  makes  it 
necessary to review the definition of the land eligible to benefit from the scheme or for 
the  activation  of  payment  entitlements.  However,  provision  should  be  made  for 
excluding support for areas cultivated with fruit and vegetables in case Member States 
have  opted  for  a  deferred  integration  of  this  sector  in  the  single  payment  scheme. 
Besides,  specific  measures  should  be  laid  down  for  hemp  to  prevent  the  granting  of 
support for illegal crops. 

(27)  Compulsory  set  aside  of  arable  land  was  introduced  as  a  supply  control  mechanism. 
Market  developments  in  the  arable  crops  sector  together  with  the  introduction  of 
decoupled  aids  no  longer  justify  the  need  for  maintaining  this  instrument,  which 
therefore  should  be  abolished.  Set-aside  entitlements  established  in  accordance  with 
Articles 53 and 63(2) of Regulation (EC) No 1782/2003 shall therefore be activated on 
hectares subject to the same eligibility conditions that any other entitlement. 

EN 

17 

   EN 

(28)  Further to the integration of formerly coupled market support into the single payment 
scheme, the value of payment entitlements was, in those Member States opting for a 
historic implementation, based on the individual level of past support. With a growing 
number  of  years  elapsing  since  the  introduction  of  the  single  payment  scheme  and 
following the successive integration of further sectors into the single payment scheme, 
it  becomes  increasingly  harder  to  justify  the  legitimacy  of  significant  individual 
differences in the support level which are only based on past support. For this reason 
Member States that chose the historic implementation model should be allowed under 
certain  conditions  to  review  the  allocated  payment  entitlements  with  a  view  to 
approximating  their  unit  value  while  respecting  the  general  principles  of  community 
law  and  the  objectives  of  the  Common  Agricultural  Policy.  In  this  context  Member 
States may take into account the specificities of geographical areas when fixing closer 
values.  The  levelling  of  payment  entitlements  should  take  place  during  an  adequate 
transition period and within a limited range of reductions in order to allow farmers to 
reasonably adapt to the changing levels of support. 

(29)  Under  the  2003  reform  Member  States  had  the  option  to  apply  the  single  payment 
scheme by way of historic or regional implementation. Since then Member States have 
had  the  opportunity  to  evaluate  the  effects  of  their  choices  as  regards  both  their 
economic  and  administrative  appropriateness.  Member  States  should  therefore  be 
given the opportunity to review their initial choice in the light of their experience. For 
this  reason,  in  addition  to  the  possibility  of  levelling  the  value  of  payment 
entitlements,  Member  States  that  applied  the  historic  model  should  be  authorised  to 
change  over  to  the  regional  model.  Furthermore,  Member  States  that  chose  to  apply 
the regional model should be given the option to review their decisions under certain 
conditions with the aim to approximate the value of payment entitlements according to 
pre-established  steps,  while  respecting  the  general  principles  of  community  law  and 
the  objectives  of  the  Common  Agricultural  Policy.  Such  changes  should  take  place 
during an adequate transition period and within a limited range of reductions in order 
to allow farmers to reasonably adapt to changing levels of support 

(30)  Regulation (EC) No 1782/2003, while introducing a decoupled single payment scheme 
allowed  Member  States  to  exclude  certain  payments  from  that  scheme.  At  the  same 
time Article 64(3) of that Regulation provided for the revision of the options provided 
for in Sections 2 and 3 of Chapter 5 of its Title III, in the light of market and structural 
developments.  An  analysis  of  the  relevant  experience  shows  that  decoupling 
introduces flexibility in the choice of producers, enabling them to take their production 
decisions on the basis of profitability and market response. This is particularly the case 
for  the  arable  crops,  hops  and  seeds  sectors,  and  to  a  certain  extent,  also  the  beef 
sector. Therefore, the partially coupled payments in these sectors should be integrated 
into  the  single  payment  scheme.  In  order  for  farmers  in  the  beef  sector  to  gradually 
adjust to the new support arrangements provision should be made for a phasing-in of 
the  integration  of  the  special  premium  for  male  animals  and  the  slaughter  premium. 
Since  the  partially  coupled  payments  in  the  fruit  and  vegetable  sectors  were  only 
recently introduced, and only as a transitional measure, no review of such schemes is 
necessary. 

EN 

18 

   EN 

(31)  However,  as  regards  the  suckler  cow  and  sheep  and  goat  sector  it  appears  that 
maintaining a minimum level of agricultural production may still be necessary for the 
agricultural economies in certain regions and, in particular, where farmers cannot have 
recourse  to  other  economic  alternatives.  Against  this  background,  Member  States 
should have the option to maintain coupled support at the current level or, for suckler 
cows, at a lower level. In that case, special provision should be made for the respect of 
the  identification  and  registration  requirements  provided  for  by  Regulation  (EC) 
No 1760/2000  of  the  European  Parliament  and  of  the  Council13  and  Council 
Regulation  (EC) No 21/200414, in particular with a view to secure the traceability of 
animals. 

(32)  Member  States  should  be  allowed  to  use  up  to  10%  of  their  ceilings  for  granting 
specific support in clearly defined cases. Such support should allow Member States to 
address  environmental  issues  and  improve  the  quality  and  marketing  of  agricultural 
products. Specific support should also be available to buffer the consequences of the 
phasing-out  of  milk  quotas  and  the  decoupling  of  support  in  particularly  sensitive 
sectors. Given the growing  importance  of an effective management of risks Member 
States  should  be  given  the  option  to  financially  contribute  to  the  premiums  farmers 
pay for crop insurance as well as to the financing of financial compensation of certain 
economic  losses  in  case  of  animal  or  plant  diseases.  With  a  view  to  respect  the 
Community’s  international  obligations  the  resources  that  could  be  used  for  any 
coupled  support  measures  should  be  limited  at  an  appropriate  level.  The  conditions 
applicable to the financial contributions to crop insurance and animal or plant disease 
related compensation should be established accordingly. 

(33)  Direct payments under the single payment scheme were based on reference amounts of 
direct payments that were received in the past or on regionalised per hectare amounts. 
Farmers  in  the  new  Member  States  did  not  receive  Community  direct  payments  and 
had  no  historical  references  for  the  calendar  years  2000,  2001  and  2002.  Therefore, 
provision  was  made  under  Regulation  (EC)  No 1782/2003  for  the  single  payment 
scheme  in  the  new  Member  States  to  be  based  on  regionalised  per  hectare  amounts. 
Several  years  after  the  accession  of  the  new  Member  States  to  the  Community, 
however,  the  use  of  reference  periods  could  be  considered  for  those  new  Member 
States that did not yet move to the single payment scheme. With a view to facilitating 
the transition to the single payment scheme and, in particular, to avoiding speculative 
applications  it  is  therefore  appropriate  to  authorise  the  new  Member  States  to  take 
account  of  the  areas  for  which  historically  support  under  the  single  area  payment 
scheme  was  granted  for  the  calculation  of  the  payment  entitlements  under  the  single 
payment scheme. 

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

(35)  The new Member States should have the same possibilities as the other Member States 

to partially implement the single payment scheme. 

13 
14 

OJ L 204, 11.8.2000, p. 1.  
OJ L 5, 9.1.2004, p. 8.  

EN 

19 

   EN 

                                                 
(36)  The de-coupling of direct support and the introduction of the single payment scheme 
were  essential  elements  in  the  process  of  reforming  the  common  agricultural  policy. 
However several reasons called in 2003 for maintaining specific support for a number 
of  crops.  Experience  gained  through  the  implementation  of  Regulation  (EC) 
No 1782/2003  together  with  the  evolution  of  the  market  situation  indicates  that 
schemes  that  were  kept  outside  the  single  payment  scheme  in  2003  can  now  be 
integrated  into  that  scheme  to  promote  a  more  market-oriented  and  sustainable 
agriculture. This is the case in particular for the olive oil sector, where only marginal 
coupling  was  applied.  It  is  also  the  case  for  the  durum  wheat,  protein  crops,  rice, 
potato  starch,  and  nuts  payments,  where  the  decreasing  effectiveness  of  remaining 
coupled  payments,  supports  the  decoupling  option.  In  the  case  of  flax  it  is  also 
appropriate to abolish the support for processing and to integrate the relevant amounts 
into the single payment scheme. As regards rice, dried fodder, potato starch and flax a 
transitional  period  should  be  provided  for  in  order  to  ensure  their  shift  to  decoupled 
support  to  be  as  smooth  as  possible.  As  regards  nuts,  Member  States  should  be 
allowed  to  continue  to  pay  the  national  part  of  the  aid  in  a  coupled  way  in  order  to 
cushion the effects of decoupling. 

(37)  As a consequence of the integration of new schemes into the single payment scheme, 
provision  should  be  made  for  the  calculation  of  the  new  level  of  individual  income 
support  under  that  scheme.  In  the  case  of  nuts,  potato  starch,  flax  and  dried  fodder, 
such increase should be granted on the basis of the support farmers received in most 
recent  years.  However,  in  the  case  of  the  integration  of  payments  that  were  so  far 
partially  excluded  from  the  single  payment  scheme,  Member  states  should  be  given 
the option to use the original reference periods. 

(38)  Regulation  (EC)  No  1782/2003  established  specific  support  for  energy  crops  with  a 
view  to  assisting  the  sector  to  develop.  Due  to  the  recent  developments  in  the  bio-
energy  sector  and,  in  particular,  to  the  strong  demand  for  such  products  on 
international  markets  and  the  introduction  of  binding  targets  for  the  share  of  bio-
energy  in  total  fuel  by  2020  there  is  no  longer  sufficient  reason  to  grant  specific 
support for energy crops. 

(39)  On the occasion of the integration of the cotton sector into the single payment scheme, 
it  was  deemed  necessary  that  part  of  the support  should  continue  to  be  linked  to  the 
cultivation of cotton through a crop specific payment per eligible hectare to avoid the 
risk of production disruption to the regions of cotton production. This choice should be 
maintained in accordance with the objectives, set out in Protocol 4 on cotton annexed 
to the Act of Accession of Greece. 

(40)  To buffer the effects of the restructuring process in Member States which have granted 
the  restructuring  aid  provided  for  in  Council  Regulation  (EC)  No 320/2006  of 
20 February  2006  establishing  a  temporary  scheme  for  the  restructuring  of  the  sugar 
industry in the Community15 sugar beet and cane producers should be granted an aid 
for a maximum of five consecutive years. 

(41)  The  Act  of  Accession  of  the  Czech  Republic,  Estonia,  Cyprus,  Latvia,  Lithuania, 
Hungary, Malta, Poland, Slovenia and Slovakia and the Act of Accession of Bulgaria 

15 

OJ L 58, 28.2.2006, p. 42, Regulation as last amended by Regulation (EC) No 1261/2007 (OJ L 283, 
27.10.2007, p. 8). 

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20 

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and Romania provided that the farmers in the new Member States will receive direct 
payments, following a phasing-in mechanism. 

(42)  Furthermore,  those  Acts  of  Accession  provided  for  a  transitional  simplified  support 
mechanism for granting direct payments in the new Member States based on area. The 
main  elements  of  that  mechanism  should  be  laid  down.  The  single  area  payment 
scheme has proved to be an efficient and simple system of granting income support to 
farmers.  For  the  sake  of  simplification  it  is  appropriate  to  allow  the  new  Member 
States to continue applying it until the end of year 2013. 

(43)  Further to the reform of the sugar and fruit and vegetable sectors and their integration 
into the single payment scheme, Member States that opted for applying the single area 
payment scheme should be enabled to grant income support to growers of sugar beet, 
cane and chicory and producers of certain fruit and vegetable in the form of separate 
payments.  Likewise,  the  same  Member  States  should  be  allowed  to  pay  separate 
specific support under similar conditions as applicable to the other Member States. 

(44)  As a consequence of the phasing in of direct payments in the new Member States the 
Acts  of  Accession  provided  for  a  framework  to  allow  new  Member  States  to  pay 
complementary national direct payments. The  conditions  for  granting  such  payments 
should be laid down. 

(45) 

(46) 

In  the  initial  allocation  of  payment  entitlements  by  the  Member  States  certain  errors 
led to particularly high payments for farmer. This non-compliance has normally to be 
followed up by financial correction until corrective measures are taken. However, for 
Member  States,  taking  into  account  the  time  elapsed  from  the  first  allocation  of 
entitlements,  the adoption  of  the necessary correction  would lead  to disproportionate 
legal and administrative constraints. It is therefore appropriate in the interest of legal 
certainty to regularise the allocation of such payments. 

In accordance with Article 70(1) of Regulation (EC) No 1782/2003, Spain, France and 
Portugal  decided  to  exclude  from  the  single  payment  scheme  the  direct  payments 
made  in  the  French  overseas  departments,  the  Azores  and  Madeira  and  the  Canary 
Islands and grant them under the conditions established in Title IV of that Regulation. 
Some  of  the  aids  provided  for  in  that  Title  have  been  completely  integrated  into  the 
single  payment  scheme.  For  the  sake  of  simplification  and  to  take  into  account  the 
specific circumstances of the outermost regions, it seems appropriate to manage such 
aid within the support programmes established by Regulation (EC) No 247/2006. To 
this end the relevant funds should be transferred from the national ceilings for direct 
payments  to  the  financial  amount  set  out  in  Article  23(2)  of  that  Regulation. 
Regulating (EC) No 247/2006 should be amended accordingly. 

(47) 

It is appropriate to provide that provisions of this Regulation, which could give rise to 
behaviour  of  a  Member  State  possibly  constitutive  of  a  State  aid,  should,  save  as 
otherwise provided, be excluded from the application of the state aid rules given that 
the provisions concerned contain appropriate conditions for the granting of support, or 
foresee  the  adoption  of  such  conditions  by  the  Commission,  to  prevent  undue 
distortion of competition. 

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(48)  The measures necessary for the implementation of this Regulation should be adopted 
in accordance with Council Decision 1999/468/EC16 of 28 June 1999 laying down the 
procedures for the exercise of implementing powers conferred on the Commission, 

(49)  Regulation (EC) No 1782/2003 should be repealed. 

(50)  Member States should be given sufficient time to implement the provisions allowing 
further decoupling of direct payments and those allowing them to review the decisions 
adopted  in  the  context  of  the  2003  reform.  For  this  reason  the  relevant  provisions 
should only apply from 2010. Regulation (EC) No 1782/2003 should therefore apply 
during the year 2009 for those aid schemes that will only be integrated into the single 
payment scheme from 2010, 

HAS ADOPTED THIS REGULATION: 

TITLE I 
SCOPE AND DEFINITIONS 

Article 1 
Scope 

This Regulation establishes: 

(a) 

(b) 

(c) 

(d) 

common rules on direct payments; 

an income support scheme for farmers (hereinafter referred to as the "single payment 
scheme"); 

a  transitional  simplified  income  support  scheme  for  farmers  in  the  new  Member 
States (hereinafter referred to as the «single area payment scheme»); 

support schemes for farmers producing rice, starch potatoes, cotton, sugar, fruit and 
vegetables, sheep meat and goat meat and beef and veal; 

(e) 

a framework for the complementing of direct payments by new Member States. 

Article 2 
Definitions 

For the purposes of this Regulation, the following definitions shall apply: 

(a) 

"farmer"  means  a  natural  or  legal  person,  or  a  group  of  natural  or  legal  persons, 
whatever legal status is granted to the group and its members by national law, whose 
holding  is  situated  within  Community  territory,  as  referred  to  in  Article 299  of  the 
Treaty, and who exercises an agricultural activity; 

16 

OJ L 184, 17.7.1999, p. 23. Decision as last amended by Decision 2006/512/EC (OJ L 200, 22.7.2006, 
p. 11). 

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(b) 

(c) 

(d) 

(e) 

(f) 

(g) 

(h) 

"holding"  means  all  the  production  units  managed  by  a  farmer  situated  within  the 
territory of the same Member State; 

"agricultural  activity"  means  the  production,  rearing  or  growing  of  agricultural 
products  including  harvesting,  milking,  breeding  animals  and  keeping  animals  for 
farming  purposes,  or  maintaining  the  land  in  good  agricultural  and  environmental 
condition as established under Article 6 to this Regulation; 

"direct  payment"  means  a  payment  granted  directly  to  farmers  under  a  support 
scheme listed in Annex I to this Regulation; 

"payments  in  a  given  calendar  year"  or  "payments  in  the  representative  period" 
means the payments granted or to be granted in respect of the year/years concerned, 
including all payments in respect of other periods starting in that calendar year/years; 

"agricultural products" means the products listed in Annex I to the Treaty, including 
cotton, but with the exception of fishery products; 

“new Member States” means Bulgaria, the Czech Republic, Estonia, Cyprus, Latvia, 
Lithuania, Hungary, Malta, Poland, Romania, Slovenia and Slovakia; 

"agricultural  area"  means  any  area  taken  up  by  arable  land,  permanent  pasture  and 
permanent crops. 

Article 3 (ex-32) 
Financing of direct payments 

The support schemes listed in Annex I to this Regulation shall be financed in accordance with 
Article 3(1)(c) of Regulation (EC) No 1290/2005. 

TITLE II 
GENERAL PROVISIONS ON DIRECT PAYMENTS 

CHAPTER 1 
CROSS COMPLIANCE 

Article 4 
Main requirements 

1. 

2. 

A  farmer  receiving  direct  payments  shall  respect  the  statutory  management 
requirements  listed  in  Annex  II,  and  the  good  agricultural  and  environmental 
condition established under Article 6. 

The  competent  national  authority  shall  provide  the  farmer  with  the  list  of  statutory 
management requirements and good  agricultural and environmental condition  to be 
respected. 

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23 

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Article 5 
Statutory management requirements 

1. 

The  statutory  management  requirements  listed  in  Annex  II  shall  be  established  by 
Community legislation in the following areas: 

(a) 

public, animal and plant health, 

(b) 

environment, 

(c) 

animal welfare. 

2. 

1. 

2. 

The acts referred to in Annex II shall apply within the framework of this Regulation 
in  the  version  as  amended  from  time  to  time  and,  in  case  of  Directives,  as 
implemented by the Member States. 

Article 6 
Good agricultural and environmental condition 

Member  States  shall  ensure  that  all  agricultural  land,  especially  land  which  is  no 
longer  used  for  production  purposes,  is  maintained  in  good  agricultural  and 
environmental  condition.  Member  States  shall  define,  at  national  or  regional  level, 
minimum  requirements  for  good  agricultural  and  environmental  condition  on  the 
basis  of  the  framework  set  up  in  Annex  III,  taking  into  account  the  specific 
characteristics of the areas concerned, including soil and climatic condition, existing 
farming systems, land use, crop rotation, farming practices, and farm structures. 

Member States other than the new Member States shall ensure that land which was 
under permanent pasture at the date provided for the area aid applications for 2003 is 
maintained under permanent pasture. The new Member States shall ensure that land 
which was under permanent pasture on 1 May 2004 is maintained under permanent 
pasture.  However,  Bulgaria  and  Romania  shall  ensure  that  land  which  was  under 
permanent pasture on 1 January 2007 is maintained under permanent pasture. 

However  a  Member  State  may,  in  duly  justified  circumstances,  derogate  from  the 
first subparagraph, provided that it takes action to prevent any significant decrease in 
its total permanent pasture area. 

The  first  subparagraph  shall  not  apply  to  land  under  permanent  pasture  to  be 
afforested,  if  such  afforestation  is  compatible  with  the  environment  and  with  the 
exclusion of plantations of Christmas trees and fast growing species cultivated in the 
short term. 

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24 

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CHAPTER 2 
MODULATION AND FINANCIAL DISCIPLINE 

Article 7 
Modulation 

1. 

Any  amount  of  direct  payments  to  be  granted  in  a  given  calendar  year  to  a  farmer 
that exceeds EUR 5 000 shall be reduced for each year until 2012 by the following 
percentages: 

(a) 

2009: 7%, 

(b)  2010: 9%, 

(c) 

2011: 11%, 

(d)  2012: 13%. 

2. 

The reductions referred to in paragraph 1 shall be increased for the: 

(a) 

amounts between EUR 100 000 and 199 999, by 3 percentage points, 

(b) 

amounts between EUR 200 000 and 299 999, by 6 percentage points, 

(c) 

amounts of EUR 300 000 or more, by 9 percentage points. 

3. 

1. 

Paragraphs  1  and  2  shall  not  apply  to  direct  payments  granted  to  farmers  in  the 
French overseas departments, in the Azores and Madeira, in the Canary and Aegean 
islands. 

Article 8 
Net ceilings 

Without prejudice to Article 11, the total net amounts of direct payments which may 
be  granted  in  a  Member  State  in  respect  of  a  calendar  year  after  application  of 
Articles 7 and 10 of this Regulation and Article 1 of Regulation (EC) No 378/2007 
shall not be higher than the ceilings set out in Annex IV to this Regulation. Where 
necessary,  Member  States  shall  proceed  to  a  linear  reduction  of  direct  payments  in 
order to respect the ceilings set out in that Annex IV. 

2. 

The Commission, in accordance with the procedure referred to in Article 128(2) shall 
review the ceilings set out in Annex IV in order to take account of: 

(a)  modifications  to  maximum  amounts  that  may  be  granted  in  accordance  with 

the direct payments, 

(b)  modifications  to  the  voluntary  modulation  referred  to  in  Regulation  (EC) 

No 378/2007, 

(c) 

structural changes of the holdings. 

EN 

25 

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1. 

2. 

3 

4. 

1. 

Article 9 
Amounts resulting from modulation 

The amounts resulting from application of the reductions provided for in Article 7, in 
any Member State other than the new Member States, shall be available as additional 
Community  support  for  measures  under  rural  development  programming  financed 
under the European Agricultural Fund for Rural Development (EAFRD) as specified 
in  Regulation  (EC)  No 1698/2005,  according  to  the  conditions  set  out  in  the 
following paragraphs 

The amounts corresponding to the reduction by 5 percentage points shall be allocated 
to  the  Member  States  concerned  in  accordance  with  the  procedure  referred  to  in 
Article 128(2) on the basis of the following criteria: 

(a) 

agricultural area, 

(b) 

agricultural employment, 

(c) 

gross domestic product (GDP) per capita in purchasing power. 

However,  any  Member  State  concerned  shall  receive  at  least  80%  of  the  total 
amounts which modulation has generated in that Member State. 

By way of derogation from the second subparagraph of paragraph 2, if in a Member 
State  the  proportion  of  rye  as  part  of  its  total  cereal  production  exceeded  5%  on 
average  during  the  period  2000–2002  and  its  proportion  of  the  total  Community 
production of rye exceeded 50% during the same period, at least 90% of the amounts 
which the modulation generated in the Member State concerned shall be reallocated 
to that Member State, until 2013 included. 

In such a case, without prejudice to the possibility provided for by Article 58, at least 
10%  of  the  amount  allocated  to  the  Member  State  concerned  shall  be  available  for 
measures referred to in paragraph 2 of this Article in rye producing regions. 

For  the  purpose  of  this  paragraph,  "cereal"  means  the  products  listed  in  point I  of 
Annex V. 

The remaining amount resulting from the application of Article 7(1) and the amounts 
resulting from the application of Article 7(2) shall be allocated to the Member State 
where  the  corresponding  amounts  have  been  generated,  in  accordance  with  the 
procedure  referred  to  in  Article 128(2).  They  shall  be  used  in  accordance  with 
Article 69(5a) of Regulation (EC) No 1698/2005. 

Article 10 
Special rules for modulation in the new Member States 

Article 7 shall only apply to farmers in a new Member State in any given calendar 
year if the level of direct payments applicable in that Member State for that calendar 
year under Article 110 is no less than the level in Member States other than the new 
Member States, taking into account any reductions applied under Article 7(1). 

EN 

26 

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2. 

3. 

4. 

1. 

2. 

3. 

If  Article  7  applies  to  farmers  in  a  new  Member  State,  the  percentage  applicable 
under  Article  7(1)  shall  be  limited  to  the  difference  between  the  level  of  direct 
payments  applicable  to  it  under  Article  110  and  the  level  in  Member  States  other 
than  the  new  Member  States,  taking  into  account  any  reductions  applied  under 
Article 7(1). 

Where reductions referred to in Article 7 apply to farmers in a new Member State no 
complementary national direct payments as referred to in Article 120 shall be granted 
to the farmer concerned. 

Any amount resulting from the application of Article 7(1) and (2) shall be allocated 
to the new Member State where the corresponding amounts have been generated in 
accordance  with  the  procedure  referred  to  in  Article  128(2).  They  shall  be  used  in 
accordance with Article 69(5a) of Regulation (EC) No 1698/2005. 

Article 11 
Financial discipline 

An  adjustment  of  the  direct  payments  shall  be  fixed  when  the  forecasts  for  the 
financing  of  the  aforementioned  measures  under  heading  2  of  Annex  I  of  the  Inter 
Institutional  Agreement17  on  budgetary  discipline  and  sound  financial  management 
for a given budget year, increased by the amounts given in Articles 122 and 123 of 
this Regulation and before application of modulation provided for in Article 7 and 10 
of this Regulation and Article 1(1) of Regulation (EC) No 378/2007, indicate that the 
abovementioned  annual  ceiling,  taking  into  account  a  margin  of  EUR  300 million 
below that ceiling, will be exceeded. 

The  Council,  on  a  Commission's  proposal  presented  not  later  than  31 March  of  the 
calendar  year  in  respect  of  which  the  adjustments  referred  to  in  paragraph 1  apply, 
shall  fix  these  adjustments  at  latest  by  30 June  of  the  calendar  year  in  respect  of 
which the adjustments apply. 

In  the  framework  of  the  application  of  the  schedule  of  increments  provided  for  in 
Article 110  to  all  direct  payments  granted  in  the  new  Member  States,  paragraph 1 
shall not apply to the new Member States until the beginning of the calendar year, in 
respect of which the level of direct payments applicable in the new Member States is 
at  least  equal  to  the  then  applicable  level  of  such  payments  in  the  Member  States 
other than the new Member States. 

17 

OJ C 139, 14.16.2006, p.1.  

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27 

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CHAPTER 3 
FARM ADVISORY SYSTEM 

Article 12 
Farm advisory system 

1. 

2. 

1. 

2. 

Member  States  shall  operate  a  system  of  advising  farmers  on  land  and  farm 
management (hereinafter referred to as the "farm advisory system") operated by one 
or more designated authorities or by private bodies. 

The advisory activity shall cover at least the statutory management requirements and 
the good agricultural and environmental condition referred to in Chapter 1. 

Article 13 
Conditions 

Farmers may participate in the farm advisory system on a voluntary basis. 

Member States shall give priority to the farmers who receive more that EUR 15 000 
of direct payments per year. 

Article 14 
Obligations of approved private bodies and designated authorities 

Without  prejudice  to  national  legislation  concerning  public  access  to  documents,  Member 
States shall ensure that private bodies and designated authorities referred to in Article 12 do 
not disclose personal or individual information and data they obtain in their advisory activity 
to persons other than the farmer managing the holding concerned, except any irregularity or 
infringement  found  during  their  activity  which  is  covered  by  an  obligation  laid  down  in 
Community  or  national  law  to  inform  a  public  authority,  in  particular  in  case  of  criminal 
offences. 

Article 15 
Review 

By 31 December 2010 at the latest, the Commission shall submit a report on the application of 
the farm advisory system, accompanied, if necessary, by appropriate proposals with a view of 
rendering it compulsory. 

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28 

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CHAPTER 4 
INTEGRATED ADMINISTRATION AND CONTROL SYSTEM 

Article 16 
Scope 

Each Member State shall set up and operate an integrated administration and control system, 
hereinafter referred to as the "integrated system". 

The integrated system shall apply to the support schemes listed in Annex I. 

To the extent necessary, it shall also apply to the administration and control of the rules laid 
down in Chapters 1 and 2. 

Article 17 
Elements of the integrated system 

1. 

The integrated system shall comprise the following elements: 

(a) 

a computerised data base; 

(b) 

an identification system for agricultural parcels; 

(c) 

a  system  for  the  identification  and  registration  of  payment  entitlements  as 
referred to in Article 20: 

(d) 

aid applications; 

(e) 

an integrated control system; 

(f) 

a  single  system  to  record  the  identity  of  each  farmer  who  submits  an  aid 
application. 

2. 

3. 

Where  Articles  55  and  56  of  this  Regulation  apply,  the  integrated  system  shall 
incorporate  a  system  for  the  identification  and  registration  of  animals  set  up  in 
accordance, with Regulation (EC) No 1760/2000 of the European Parliament and of 
the Council and Council Regulation (EC) No 21/2004. 

Where  appropriate  the  identification  system  for  agricultural  parcels  may  include  a 
geographical information system for olive cultivation. 

Article 18 
Computerised data base 

1. 

The  computerised  data  base  shall  record,  for  each  agricultural  holding,  the  data 
obtained from aid applications. 

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29 

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This data base shall, in particular, allow direct and immediate consultation, through 
the  competent  authority  of  the  Member  State,  of  the  data  relating  to  the  calendar 
and/or marketing years starting from the year 2000. 

2. 

The Member States may set up decentralised data bases on condition that these, and 
the  administrative  procedures  for  recording  and  accessing  data,  are  designed 
homogeneously  throughout  the  territory  of  the  Member  State  and  are  compatible 
with one another in order to allow cross-checks. 

Article 19 
Identification system for agricultural parcels 

The identification system for agricultural parcels shall be established on the basis of maps or 
land registry documents or other cartographic references. Use shall be made of computerised 
geographical 
including  preferably  aerial  or  spatial 
orthoimagery,  with  a  homogenous  standard  guaranteeing  accuracy  at  least  equivalent  to 
cartography at a scale of 1:10000. 

information  system 

techniques 

Article20 
System for the identification and registration of payment entitlements 

1. 

2. 

The system for the identification and registration of payment entitlements shall be set 
up  allowing  verification  of  entitlements  and  cross-checks  with  the  aid  applications 
and the identification system for agricultural parcels. 

This  system  shall  allow  direct  and  immediate  consultation,  through  the  competent 
authority  of  the  Member  State,  of  the  data  relating  to  at  least  the  previous  three 
consecutive calendar and/or marketing years. 

Article 21 
Aid applications 

1. 

Each year, a farmer shall submit an application for direct payments indicating, where 
applicable: 

(a) 

all agricultural parcels of the holding, and where the Member State is applying 
Article 17(3), the number of olive trees and their positioning in the parcel, 

(b) 

the number and amount of payment entitlements declared for activation, 

(c) 

any other information provided for by this Regulation or by the Member State 
concerned. 

2. 

A Member State may decide that the aid application needs to contain only changes 
with respect to the aid application submitted the previous year. A Member State shall 
distribute pre-printed forms based on the areas determined in the previous year and 
supply graphic material indicating the location of those areas and, where appropriate, 
the positioning of olive trees. 

EN 

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3. 

A  Member  State  may  decide  that  a  single  aid  application  shall  cover  several  or  all 
support schemes listed in Annex I or other support schemes 

Article 22 
Control of eligibility conditions 

1. 

2. 

Member  States  shall  carry  out  administrative  controls  on  the  aid  applications  to 
verify the eligibility conditions for the aid. 

Administrative controls shall be supplemented by a system of on-the-spot checks to 
verify  eligibility  for  the  aid.  For  this  purpose,  Member  States  shall  draw  up  a 
sampling plan of agricultural holdings. 

Member  States  may  use  remote  sensing  and  Global  Navigation  Satellite  System 
(GNSS)  techniques  as  a  mean  to  carry  out  on-the-spot  controls  on  agricultural 
parcels. 

3. 

Each  Member  State  shall  designate  an  authority  responsible  for  coordinating  the 
controls provided for in this chapter. 

Where the Member State provides for the delegation of some aspects of the work to 
be  carried  out  under  this  chapter  to  specialised  agencies  or  firms,  the  designated 
authority shall retain control over, and responsibility for, that work. 

1. 

2. 

1. 

2. 

Article 23 
Reductions and exclusions in case of non-compliance with eligibility rules 

Without prejudice to reductions and exclusions provided for in Article 25, where it is 
found that the farmer does not comply with the eligibility conditions relevant to the 
granting  of  the  aid  as  provided  for  in  this  Regulation,  the  payment  or  part  of  the 
payment  granted  or  to  be  granted  for  which  the  conditions  of  eligibility  have  been 
meet shall be subject to reductions and exclusions to be laid down in accordance with 
the procedure referred to in Article 128(2). 

The  percentage  of  reduction  shall  be  graduated  according  to  the  severity,  extent, 
permanence  and  repetition  of  the  non-compliance  found  and  may  go  as  far  as  total 
exclusion from one or several aid schemes for one or more calendar years. 

Article 24 
Controls on cross compliance 

Member  States  shall  carry  out  on-the-spot-checks  to  verify  whether  the  farmer 
complies with the obligations referred to in Chapter 1. 

Member States may make use of their existing administration and control systems to 
ensure  compliance  with 
the  statutory  management  requirements  and  good 
agricultural and environmental condition referred to in Chapter 1. 

These systems, and notably the system for identification and registration of animals 
set up in accordance Regulations (EC) No 1760/2000 and (EC) No 21/2004, shall be 

EN 

31 

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1. 

2. 

3. 

compatible  with  the  integrated  system,  as  provided  for  in  Article 28(1)  of  this 
Regulation. 

Article 25 
Reduction or exclusion from payments in case of non compliance  
with cross-compliance rules 

the  statutory  management 

Where 
requirements  or  good  agricultural  and 
environmental conditions are not complied with at any time in a given calendar year 
(hereinafter 'the calendar year concerned'), and the non-compliance in question is the 
result of an act or omission directly attributable to the farmer who submitted the aid 
application in the calendar year concerned, the total amount of direct payments to be 
granted, after application of Articles 7, 10 and 11 to that farmer shall be reduced or 
excluded in accordance with the detailed rules laid down in Article 26. 

The first subparagraph shall also apply where, the non-compliance in question is the 
result of an act or omission directly attributable to the person to whom or from whom 
the agricultural land was transferred. 

For the purpose of this paragraph "transfer" means any type of transaction whereby 
the agricultural land ceases to be at the disposal of the transferor. 

The reductions or exclusions referred to in paragraph 1 shall only apply if the non-
compliance relates to: 

(a) 

an agricultural activity, or 

(b) 

the agricultural area of the holding. 

Notwithstanding paragraph 1 and in accordance with the conditions laid down in the 
detailed rules referred to in Article 26(1), Member States may decide not to apply a 
reduction  or  exclusion  amounting  to  EUR 100  or  less  per  farmer  and  per  calendar 
year,  and  which  includes  any  reduction  or  exclusion  applied  to  payments  under 
Article 51(1) of Regulation (EC) No 1698/2005. 

Where  a  Member  State  decides  to  make  use  of  the  option  provided  for  in  the  first 
subparagraph,  in  the  following  year  the  competent  authority  shall  take  the  actions 
required  to  ensure  that  the  farmer  remedies  the  findings  of  non-compliance 
concerned.  The  finding  and  the  remedial  action  to  be  taken  shall  be  notified  to  the 
farmer. 

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Article 26 
Detailed rules on reductions and exclusion in case of non compliance 
 with cross-compliance rules 

Detailed rules for the reductions and exclusions referred to in Article 25 shall be laid 
down in accordance with the procedure referred to in Article 128(2). In this context, 
account shall be taken of the severity, extent, permanence and repetition of the non-
compliance  found  as  well  as  of  the  criteria  set  out  in  paragraphs  2,  3  and  4  of  this 
Article. 

In case of negligence, the percentage of reduction shall not exceed 5% and, in case of 
repeated non-compliance, 15%. 

In duly justified cases Member States may decide that no reduction shall be applied 
where, given its severity, extent and permanence, a case of non-compliance is to be 
considered as minor. Cases of non-compliance which constitute a direct risk to public 
or animal health shall however not be considered as minor. 

Unless  the  farmer  has  taken  immediate  remedial  action  putting  an  end  to  the 
non-compliance  found,  the  competent  authority  shall  take  the  actions  required  that 
may,  where  appropriate,  be  limited  to  an  administrative  control,  to  ensure  that  the 
farmer  remedies  the  findings  of  non-compliance  concerned.  The  finding  of  minor 
non-compliance and the remedial action to be taken shall be notified to the farmer. 

In  case  of  intentional  non-compliance,  the  percentage  of  reduction  shall  not  in 
principle be less than 20% and may go as far as total exclusion from one or several 
aid schemes and apply for one or more calendar years. 

In any case, the total amount of reductions and exclusions for one calendar year shall 
not be more than the total amount referred to in Article 25(1). 

1. 

2. 

3. 

4. 

Article 27 
Amounts resulting from cross compliance 

The  amounts  resulting  from  the  application  of  the  reductions  and  exclusions  in  case  of  non 
compliance with Chapter 1 shall be credited to the EAGF. Member States may retain 25% of 
those amounts. 

Article 28 
Compatibility with the integrated system 

1. 

For the purpose of applying the support schemes listed in Annex VI, Member States 
shall ensure that the administration and control procedures applied to these schemes 
are compatible with the integrated system in the following respects: 

(a) 

the computerised data base; 

(b) 

the identification systems for agricultural parcels; 

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2. 

1. 

2. 

3. 

(c) 

administrative checks. 

To  this  end,  these  systems  shall  be  set  up  so  as  to  allow,  without  any  problems  or 
conflicts, a common functioning of, or the exchange of data between, them. 

Member  States  may,  for  the  purposes  of  applying  Community  or  national  support 
schemes other than those listed in Annex VI, incorporate in their administration and 
control procedures one or more components of the integrated system. 

Article 29 
Information and control 

The Commission shall be kept regularly informed of the application of the integrated 
system. 

It shall organise exchanges of views on this subject with the Member States. 

In accordance with Article 37 of Regulation (EC) No 1290/2005, after informing the 
competent  authorities  concerned  in  good  time,  authorised  representatives  appointed 
by the Commission may carry out: 

(a) 

any examination or control relating to the measures taken in order to establish 
and to implement the integrated system, 

(b) 

controls at the specialised agencies and firms referred to in Article 22(3). 

to 

the  responsibilities  of 

Without  prejudice 
the 
implementation and application of the integrated system, the Commission may seek 
the assistance of specialised bodies or persons in order to facilitate the establishment, 
monitoring  and  utilisation  of  the  integrated  system,  in  particular  with  a  view  to 
providing  the  competent  authorities  of  the  Member  States  with  technical  advice, 
should they request it. 

the  Member  States  for 

CHAPTER 5 
OTHER GENERAL PROVISIONS 

Article 30 
Minimum requirements for receiving direct payments 

1. 

Member States shall not grant direct payments to a farmer in one the following cases: 

(a)  where  the  total  amount  of  direct  payments  claimed  or  due  to  be  granted  in  a 

given calendar year does not exceed EUR 250, or 

(b)  where the eligible area of the holding for which direct payments are claimed or 
due  to  be  granted  does  not  exceed  one  hectare.  However,  Cyprus  may  set  a 
minimum eligible area of 0.3 hectares and Malta of 0.1 hectares. 

However,  farmers  holding  special  entitlements  referred  to  in  Article 45(1)  shall  be 
subject to the condition referred to in point (a). 

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2. 

1. 

2. 

3. 

4. 

Member  States  may  decide  in  an  objective  and  non-discriminatory  manner  not  to 
grant  direct  payments  to  companies  or  firms  within  the  meaning  of  the  second 
paragraph  of  Article 48  of  the  Treaty  whose  principal  company's  objects  do  not 
consist of exercising an agricultural activity. 

Article 31 
Payment 

Save as otherwise provided for in this Regulation, payments under support schemes 
listed in Annex I shall be made in full to the beneficiaries. 

Payments  shall  be  made  up  to  twice  a  year  within  the  period  from  1  December  to 
30 June of the following calendar year. 

Payments  under  support  schemes  listed  in  Annex  I  shall  not  be  made  before  the 
controls with regard to eligibility conditions, to be carried out by the Member State 
pursuant to Article 22, have been finalised. 

By  way  of  derogation  from  paragraph  2  of  this  Article  and  in  accordance  with  the 
procedure referred to in Article 128(2), the Commission may: 

(a) 

provide for advances; 

(b) 

authorise the Member States, subject to the budgetary situation, to pay prior to 
1 December advances in regions where, due to exceptional conditions, farmers 
face severe financial difficulties: 

(i) 

of up to 50% of the payments, 

or 

(ii)  of  up  to  80%  of  the  payments  in  case  advances  have  already  been 

provided for. 

Article 32 
Circumvention clause 

Without prejudice to any specific provisions in individual support schemes, no payment shall 
be made in favour of beneficiaries for whom it is established that they artificially created the 
conditions  required  for  obtaining  such  payments  with  a  view  to  obtaining  an  advantage 
contrary to the objectives of that support scheme. 

Article 33 
Review 

Support  schemes  listed  in  Annex  I  shall  apply  without  prejudice  to  possible  review  at  any 
moment in the light of economic developments and the budgetary situation. 

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TITLE III 
SINGLE PAYMENT SCHEME 

CHAPTER 1 
GENERAL IMPLEMENTATION 

Article 34 
Payment entitlements 

1. 

(a) 

Support under the single payment scheme shall be available to farmers if they: 

hold payment entitlements which they have obtained in accordance with Regulation 
(EC) No 1782/2003; 

(b) 

obtain payment entitlements under this Regulation: 

(i) 

by transfer, 

(ii) 

from the national reserve, 

(iii)  pursuant to Annex VII, 

(iv)  pursuant to Article 68(4)(c) and to the third subparagraph of Article 65(2). 

For the purpose of this title, farmers holding payment entitlements shall mean farmers 

2. 
having been allocated or definitively transferred payment entitlements. 

Article 35 
Activation of payment entitlements per eligible hectare 

1. 

Support under the single payment scheme shall be granted to farmers upon activation 
of a  payment  entitlement per eligible hectare.  Activated payment entitlements  shall 
give right to the payment of the amounts fixed therein. 

2. 

"Eligible hectare" shall mean 

(a) 

any  agricultural  area  of  the  holding,  including  the  areas  planted  with  short 
rotation  coppice  (CN  code  ex  0602 90 41),  that  is  used  for  an  agricultural 
activity  or,  in  case  areas  are  used  as  well  for  non  agricultural  activities, 
predominantly used for agricultural activities. The Commission, in accordance 
with  the  procedure  referred  to  in  Article  128(2)  of  this  Regulation,  shall  lay 
down detailed rules on the use for non agricultural activities to be allowed on 
eligible hectares. 

(b) 

any areas which have been eligible in 2007 and which 

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36 

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(i) 

(ii) 

do not comply anymore with the definition of eligible as a result of the 
implementation  of  Council  Directive  79/409/EEC18  and  of  Directive 
2000/60/EC of the European Parliament and of the Council19 or 

for  the  duration  of  the  relevant  scheme,  are  afforested  pursuant  to 
Article 31 of Council Regulation (EC) No 1257/1999 or to Article 43 of 
Regulation (EC) No 1698/2005. 

Hectares  shall  comply  with  the  eligibility  condition  at  any  time  during  a  calendar 
year. 

Article 36 
Declaration of eligible hectares 

1. 

The  farmer  shall  declare  the  parcels  corresponding  to  the  eligible  hectare 
accompanying  any  payment  entitlement.  Except  in  case  of  force  majeure  or 
exceptional  circumstances,  these  parcels  shall  be  at  the  farmer's  disposal  on  a  date 
fixed by the Member State which shall be no later than the date fixed in that Member 
State for amending the aid application. 

Force  majeure  or  exceptional  circumstances  shall  be  recognised  by  the  competent 
authority in cases such as, for example: 

(a) 

the death of the farmer; 

(b) 

long-term professional incapacity of the farmer; 

(c) 

a severe natural disaster gravely affecting the holding's agricultural land; 

(d) 

the accidental destruction of livestock buildings on the holding; 

(e) 

an epizootic affecting part or all of the farmer's livestock. 

2. 

Member States may, in duly justified circumstances, authorise the farmer to modify 
his declaration on condition that he respects the number of hectares corresponding to 
his payment entitlements and the conditions for granting the single payment for the 
area concerned. 

Article 37 
Modification of payment entitlements 

The payment entitlements per hectare shall not be modified save as otherwise provided. 

The  Commission,  in  accordance  with  the  procedure  referred  to  in  Article 128(2)  of  this 
Regulation,  shall  lay  down  detailed  rules  for  the  modification  of  payment  entitlements  in 
particular in case of fractions of entitlements. 

18 
19 

OJ L 103 du 25.4.1979, p. 1. 
OJ L 327 du 22.12.2000, p. 1. 

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Article 38 
Multiple claims 

The  area  corresponding  to  the  number  of  eligible  hectares  in  respect  of  which  a  single 
payment  application  is  submitted  may  be  the  subject  of  an  application  for  any  other  direct 
payment  as  well  as  for  any  other  aid  not  covered  by  this  Regulation,  save  as  otherwise 
provided. 

Article 39 
Use of land in case of the deferred integration of fruit and vegetables 

Where a Member State has made use of the option provided for in the second subparagraph of 
Article 51 of Regulation (EC) No 1782/2003 (hereinafter referred to as "deferred integration 
of the fruit and vegetable sector into the single payment scheme"), the parcels in the regions 
concerned by the decision, up to a date not later than 31 December 2010 may not be eligible if 
used for: 

(a) 

(b) 

(c) 

the production fruit and vegetables, 

the production of ware potatoes, and/or 

nurseries. 

In case of the deferred integration referred to in the first subparagraph, Member States may 
decide to allow secondary crops to be cultivated on the eligible hectares during a maximum 
period of three months starting each year on 15 August. However, at the request of a Member 
State,  this  date  may  be  modified  in  accordance  with  the  procedure  referred  to  in 
Article 128(2) for regions where cereals are normally harvested earlier for climatic reasons. 

Article 40 
Use of land for the production of hemp 

1. 

2. 

Areas used for the production of hemp shall only be eligible if the varieties used have 
a tetrahydrocannabinol content not exceeding 0,2%. Member States shall establish a 
system for verifying the tetrahydrocannabinol content of the crops grown on at least 
30% of the areas on hemp. However, if a Member State introduces a system of prior 
approval for such cultivation, the minimum shall be 20%. 

In  accordance  with  the  procedure  referred  to  in  Article  128(2),  the  granting  of 
payments shall be made subject to the use of certified seeds of certain varieties. 

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Article 41 
Ceiling 

1. 

For  each  Member  State,  the  total  value  of  all  payment  entitlements  shall  not  be 
higher than the national ceiling referred to in Annex VIII. 

In the case of allocation of payment entitlements to wine growers and taking account 
of  the  latest  data  made  available  to  it  by  the  Member  States  in  accordance  with 
[Articles  4a  and 92(6)]  of  Regulation  (EC)  No [the  wine  Regulation], 
the 
Commission shall, in accordance with the procedure referred to in Article 128(2) of 
this Regulation, adapt the national ceilings set out in Annex VIII to this Regulation. 
By 1 December of the year preceding the adaptation of the national ceilings Member 
States  shall  communicate  to  the  Commission  the  regional  average  of  the  value  of 
entitlements referred to in point B of Annex VII of this Regulation. 

Where necessary, a Member State shall proceed to a linear reduction of the value of 
entitlements in order to ensure respect of its ceiling. 

Article 42 
National reserve 

Member States shall operate a national reserve that contains the difference between 
the  ceiling  fixed  in  Annex VIII  and  the  total  value  of  all  allocated  payment 
entitlements. 

Member  States  may  use  the  national  reserve  to  grant,  in  priority  and  according  to 
objective criteria, payment entitlements to farmers who commence their agricultural 
activity and in such a way as to ensure equal treatment between farmers and to avoid 
market and competition distortions. 

Member States that do not apply Article 68(1)(c) may use the national reserve for the 
purpose of establishing, according to objective criteria and in such a way as to ensure 
equal  treatment  between  farmers  and  to  avoid  market  and  competition  distortions, 
payment  entitlements  for  farmers 
to  restructuring  and/or 
development  programs  relating  to  one  or  the  other  form  of  public  intervention  in 
order  to  avoid  abandoning  of  land  and/or  in  order  to  compensate  specific 
disadvantages for farmers in those areas. 

in  areas  subject 

2. 

1. 

2. 

3. 

4. 

In  application  of  this  article  Member  States  may  increase  the  unit  value  and/or  the 
number of entitlements allocated to farmers. 

Article 43 
Unused payment entitlements 

Any  payment  entitlement  which  has  not  been  activated  for  a  period  of  2  years  shall  be 
allocated  to  the  national  reserve,  except  in  case  of  force  majeure  and  exceptional 
circumstances within the meaning of Article 36(1). 

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Article 44 
Transfer of payment entitlements 

1. 

Payment  entitlements  may  only  be  transferred  to  another  farmer  established  within 
the same Member State except in case of transfer by actual or anticipated inheritance. 

2. 

3. 

1. 

2. 

However, even in the case of actual or anticipated inheritance, payment entitlements 
may  only  be  used  in  the  Member  State  where  the  payment  entitlements  were 
established. 

A  Member  State  may  decide  that  payment  entitlements  may  only  be  transferred  or 
used within one and the same region. 

Payment entitlements may be transferred by sale or any other definitive transfer with 
or  without  land.  In  contrast,  lease  or  similar  types  of  transactions  shall  be  allowed 
only  if  the  payment  entitlements  transferred  are  accompanied  by  the  transfer  of  an 
equivalent number of eligible hectares. 

In case of sale of payment entitlements, with or without land, Member  States may, 
acting in compliance with the general principles of Community law, decide that part 
of the payment entitlements sold revert to the national reserve or that their unit value 
is reduced in favour of the national reserve, according to criteria to be fixed by the 
Commission in accordance with the procedure referred to in Article 128(2). 

Article 45 
Conditions for special entitlements 

Save  as  otherwise  provided,  payment  entitlements  established  under  Section 2  of 
Chapter 3 of Title III and Article 71m of Regulation (EC) No 1782/2003, hereinafter 
referred  to  as  "special  entitlements",  shall  be  subject  to  the  conditions  set  up  in 
paragraphs 2 and 3 of this article. 

By way of derogation from Article 35(1) a farmer who has special entitlements shall 
be  authorised  by  the  Member  State  to  derogate  from  the  requirement  to  activate 
entitlements by an equivalent number of eligible hectares provided that he maintains 
at least 50% of the agricultural activity exercised in calendar years 2000, 2001 and 
2002 expressed in livestock units (LU). 

The condition referred to in the first subparagraph shall not apply to Malta 

The special entitlements shall not be modified. 

3. 

In case of a transfer of the special entitlements, the transferee shall not benefit from 
the derogation of paragraph 2 except in case of inheritance or anticipated inheritance. 

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Article 46 
Revision of payment entitlements 

In duly justified cases, Member States may decide, by 1 August 2009 at the latest, and acting 
in compliance with the general principles of Community law, to move as from 2010 towards 
approximating the value of payment entitlements established under Chapter I to IV of Title III 
of Regulation (EC) No 1782/2003. To this end payment entitlements may be made subject to 
progressive  modifications  according  to  at  least  three  pre-established  annual  steps  and 
objective and non-discriminatory criteria. 

The reduction of the value of any payment entitlement shall in none of these annual steps be 
more  than  50%  of  the  difference  between  its  starting  value  and  that  applicable  upon 
implementation of the final annual step. 

Member  States  may  decide  to  apply  the  preceding  subparagraphs  at  the  appropriate 
geographical level which shall be determined according to objective and non-discriminatory 
criteria  such  as  their  institutional  or  administrative  structure  and/or  the  regional  agricultural 
potential. 

CHAPTER 2 
REGIONAL AND PARTIAL IMPLEMENTATION 

SECTION 1 
REGIONAL IMPLEMENTATION 

Article 47 
Regional allocation of the ceiling referred to in Article 41 

1. 

2. 

A  Member  State  having  introduced  the  single  payment  scheme  in  accordance  with 
Chapters 1  to  4  of  Title III  of  Regulation  (EC)  No 1782/2003  may  decide,  by 
1 August  2009  at  the  latest,  to  apply  the  single  payment  scheme  from  2010  at 
regional level under the conditions laid down in this section. 

Member  States  shall  define  the  regions  according  to  objective  and  non.-
discriminatory  criteria  such  as  their  institutional  or  administrative  structure  and/or 
the regional agricultural potential. 

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

3. 

Member  States  shall  subdivide  the  ceiling  referred  to  in  Article  41  between  the 
regions according to objective and non-discriminatory criteria. 

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1. 

2. 

3. 

4. 

1. 

2. 

Article 48 
Regionalisation of the single payment scheme 

In duly justified cases, Member States may decide to divide no more than 50% of the 
regional ceiling established under Article 47 between all the farmers whose holdings 
are  located  in  the  region  concerned,  including  those  who  do  not  hold  payment 
entitlements.  

Farmers shall receive payment entitlements whose unit value shall be calculated by 
dividing  the  corresponding  part  of  the  regional  ceiling  established  under  Article 48 
by the number of eligible hectares, within the meaning of Article 35(2), established 
at regional level. 

The value of these payment entitlements shall be increased in cases where a farmer 
holds by 15 May 2010 payment entitlements governed by Chapters 1 to 4 of Title III 
of Regulation (EC) No 1782/2003. To this end, the regional unit value of each of his 
payment entitlements shall be increased by an amount calculated on the basis of the 
total  value  of  the  payment  entitlements  which  he  held  by  15 May 2010.  These 
increases  shall  be  calculated  within  the  limits  of  the  remaining  part  of  the  regional 
ceiling after application of paragraph 1 of this Article. 

The number of entitlements per farmer shall be equal to the number of hectares the 
farmer  declares  in  2010,  in  accordance  with  Article 35(2),  except  in  case  of  force 
majeure or exceptional circumstances within the meaning of Article 36(1). 

Payment entitlements held by farmers before the division referred to in paragraphs 1 
and  2  shall  be  cancelled  and  replaced  by  the  new  entitlements  referred  in 
paragraph 3. 

Article 49 
Revision of payment entitlements 

In  duly  justified  cases  Member  States  applying  Article  48  of  this  Regulation  may 
decide,  by  1  August  2009  at  the  latest,  and  acting  in  compliance  with  the  general 
principles  of  Community  law,  to  move  as  from  2011  towards  approximating  the 
value  of  payment  entitlements  established  under  this  section  or  under  Section 1  of 
Chapter 5 of Title III of Regulation (EC) No 1782/2003. To this end they may make 
such payment entitlements subject to progressive modifications according to at least 
two pre-established annual steps and objective and non-discriminatory criteria. 

In duly justified cases Member States having introduced the single payment scheme 
in  accordance  with  Section 1  of  Chapter  5  of  Title III  of  Regulation  (EC) 
No 1782/2003 may decide, by 1 August 2009 at the latest, and acting in compliance 
with  the  general  principles  of  Community  law,  to  move  as  from  2010  towards 
approximating  the  value  of  payment  entitlements  established  under  that  section  by 
making such payment entitlements subject to progressive modifications according to 
at  least  three  pre-established  annual  steps  and  objective  and  non-discriminatory 
criteria. 

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Subparagraph 1 shall apply without prejudice to the decisions taken by the Member 
States in application of Article 63(3) of Regulation (EC) No 1782/2003 

3. 

4. 

The  reduction  of  the  value  of  any  payment  entitlement  shall  in  none  of  the  annual 
steps referred to in paragraphs 1 and 2 be more than 50% of the difference between 
its starting value and that applicable upon implementation of the final annual step. 

Member  States  may  decide  to  apply  paragraphs  1,  2  and  3  at  the  appropriate 
geographical  level  which  shall  be  determined  according  to  objective  and  non-
discriminatory  criteria  such  as  their  institutional  and/or  administrative  structure  or 
the regional agricultural potential. 

Article 50  
Use of the land 

Where a Member State applying the deferred integration of the fruit and vegetable sector had 
made  use  of  the  derogation  provided  for  by  Article  60  of  Regulation  (EC)  No 1782/2003, 
farmers  may,  in  accordance  with  that  Article,  use  the  parcels  declared  in  accordance  with 
Article 36 of this Regulation for the production of fruit and vegetables and ware potatoes. 

Article 51 
Grassland 

In  case  of  application  of  Article  48,  Member  States  may,  according  to  objective  and  non-
discriminatory criteria, fix, within the regional ceiling or part of it, different per unit values of 
entitlements to be allocated to farmers referred to in Article 48(1). 

(a) 

(b) 

1. 

2. 

for  hectares  under  grassland  at  the  date  provided  for  the  area  aid  applications  for 
2008 and for any other eligible hectare, or alternatively, 

for  hectares  under  permanent  pasture  at  the  date  provided  for  the  area  aid 
applications for 2008 and for any other eligible hectare. 

Article 52 
Conditions for the entitlements established under this section 

Payment entitlements established in accordance with this section or with Section 1 of 
Chapter 5 of Title III of Regulation (EC) No 1782/2003, may only be transferred or 
used within the same region or between regions where  the entitlements per hectare 
are the same. 

Save as otherwise provided for in this Section, the other provisions of this title shall 
apply. 

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SECTION 2 
PARTIAL IMPLEMENTATION 

Article 53 
General provisions 

1. 

Any Member State having excluded the sheep and goat and beef payments from the 
single  payment  scheme  under  the  conditions  of  Articles  67  and  68  of  Regulation 
(EC)  No 1782/2003  may  decide  by  1  August  2009  to  continue  to  apply  the  single 
payment  scheme  from  2010  under  the  conditions  laid  down  in  this  section  and  in 
conformity  with  the  decision  taken  under  Article 64(1)  of  Regulation  (EC) 
No 1782/2003. However, Member States may decide to set the part of the component 
of their national ceiling to be used for additional payments to farmers in accordance 
with  Article 55(1)  of  this  Regulation  at  a  rate  lower  than  that  decided  under 
Article 64(1) of Regulation (EC) No 1782/2003. 

Where a Member State excluded some fruit and vegetable payments from the single 
payment  scheme  in  application  of  Article  68b  of  Regulation  (EC)  No 1782/2003  it 
shall apply the single payment scheme under the condition laid down in this section 
and  in  conformity  with  the  decision  taken  under  Article  68b(1)  and  (2)  of  that 
Regulation. 

2. 

According to the choice made by each Member State, the Commission shall fix, in 
accordance with the procedure referred to in Article 128(2), a ceiling for each of the 
direct payments referred to, respectively, in Articles 54, 55 and 56. 

This  ceiling  shall  be  equal  to  the  component  of  each  type  of  direct  payment  in  the 
national ceilings referred to in Article 41, multiplied by the percentages of reduction 
applied by Member States in accordance with Articles 54, 55 and 56. 

The  total  amount  of  the  fixed  ceilings  shall  be  deducted  from  the  national  ceilings 
referred  to  in  Article  41  in  accordance  with  the  procedure  referred  to  in 
Article 128(2). 

Article 54 
Sheep and goat payments 

Member  States  may  retain  up  to  50%  of  the  component  of  national  ceilings  referred  to  in 
Article 41  corresponding  to  the  sheep  and  goat  payments  listed  in  Annex VI  to  Regulation 
(EC) No 1782/2003 and shall make, on a yearly basis, an additional payment to farmers. 

The additional payment shall be granted to farmers rearing sheep and goats, under conditions 
provided for in Section 7 of Chapter 1 of Title IV of  this Regulation  and within the ceiling 
fixed in accordance with Article 53(2). 

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Article 55 
Beef and veal payments 

1. 

2. 

Member  States  that  in  accordance  with  Article  68(2)(a)(i)  of  Regulation  (EC) 
No 1782/2003 retained all or part of the component of national ceilings referred to in 
Article 41 of this Regulation corresponding to the suckler cow premium referred to 
in  Annex VI  to  Regulation  (EC)  No 1782/2003  shall  make,  on  a  yearly  basis,  an 
additional payment to farmers. 

The  additional  payment  shall  be  granted  for  maintaining  suckler  cows  under  the 
conditions provided for in Section 8 of Chapter 1 of Title IV of this Regulation and 
within the ceiling fixed in accordance with Article 53(2). 

In 2010 and 2011, Member States that in accordance with Article 68(1), 68(2)(a)(ii) 
or  68(2)(b)  of  Regulation  (EC)  No 1782/2003  retained  all  or  part  of  the  national 
ceilings referred to in Article 41 of this Regulation corresponding to the slaughtering 
premium  for  calves,  the  slaughtering  premium  for  animals  other  than  for  calves  or 
the special male premium may make an additional payment to farmer. The additional 
payments  shall  be  granted  on  slaughtering  of  calves,  on  slaughtering  of  bovine 
animals other than calves and for holding male bovine animals, under the conditions 
provided for in Section 8 of Chapter 1 of Title IV. The additional payment shall be 
made at 50% of the level applied under Article 68 of Regulation (EC) No 1782/2003 
and within the limit fixed in accordance with Article 53(2) of this Regulation. 

Article 56 
Transitional fruit and vegetables payments 

1. 

Member States shall retain until 31 December 2011 up to 50% of the component of 
national  ceilings  referred  to  in  Article  41  of  this  Regulation  corresponding  to 
tomatoes,  in  accordance  with  the  decision  that  they  took  in  application  of 
Article 68b(1) of Regulation (EC) No 1782/2003. 

In this case and within the limit of the ceiling fixed in accordance with Article 53(2) 
of  this  Regulation,  the  Member  State  concerned  shall  make,  on  a  yearly  basis,  an 
additional payment to farmers. 

The  additional  payment  shall  be  granted  to  farmers  producing  tomatoes  under  the 
conditions provided for in Section 5 of Chapter 1 of Title IV of this Regulation. 

2. 

Member  States  shall  retain,  in  accordance  with  the  decision  that  they  took  in 
application of Article 68b(2) of Regulation (EC) No 1782/2003: 

(a) 

until  31  December  2010  up  to  100%  of  the  component  of  national  ceilings 
referred  to  in  Article  41  of  this  Regulation  corresponding  to  the  fruit  and 
vegetable crops other than annual crops listed in the third subparagraph of this 
paragraph; and 

EN 

45 

   EN 

(b) 

from 1 January 2011 up to 31 December 2012 up to 75% of the component of 
national  ceilings  referred  to  in  Article 41  of  this  Regulation  corresponding  to 
fruit  and  vegetable  crops  other  than  annual  crops  listed  in  the  third 
subparagraph of this paragraph. 

In this case and within the limit of the ceiling fixed in accordance with Article 53(2), 
the Member State concerned shall make, on a yearly basis, an additional payment to 
farmers. 

The  additional  payment  shall  be  granted  to  farmers  producing  one  or  more  of  the 
following fruit and vegetables, as determined by the Member State concerned, under 
the conditions provided for in Section 5 of Chapter 1 of Title IV: 

(a) 

fresh figs, 

(b) 

fresh citrus fruits, 

(c) 

table grapes, 

(d)  pears, 

(e) 

peaches and nectarines, and 

(f) 

'd'Ente' plums. 

3. 

1. 

2. 

The component of national ceilings referred to in paragraphs 1 and 2 are those fixed 

in Annex IX. 

CHAPTER 3 
IMPLEMENTATION IN THE NEW MEMBER STATES 
HAVING APPLIED SINGLE AREA PAYMENT SCHEME 

Article 57 
Introduction of the Single Payment Scheme in Member States having applied  
the Single Area Payment Scheme 

Save as otherwise provided for in this chapter, the provisions of this title shall apply 
to the new Member States having applied the single area payment scheme provided 
for in Chapter 2 of Title V. 

Articles 42 and 45 and Section 1 of Chapter 2 shall not apply. 

Any new Member State having applied the single area payment scheme shall take the 
decisions  referred  to  in  Articles 53(1)  and  58(1)  by  1 August  of  the  year  preceding 
that in respect of which it will apply the single payment scheme for the first time. 

EN 

46 

   EN 

3. 

1. 

2. 

1. 

2. 

3. 

4. 

5. 

Any new Member State having applied the single area payment scheme may provide 
that,  in  addition  to  the  eligibility  conditions  established  in  Article 35(2),  «eligible 
hectare» shall mean any agricultural area of the holding which has been maintained 
in good agricultural condition at 30 June 2003, whether in production or not at that 
date. 

Article 58 
Application for support 

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

Except in case of force majeure and exceptional circumstances within the meaning of 
Article 36(1),  no  entitlements  shall  be  allocated  to  farmers  if  they  do  not  apply  for 
the  single  payment  scheme  by  15  May  of  the first  year of application of  the  single 
payment scheme. 

Article 59 
National reserve 

Each new Member State shall proceed to a linear percentage reduction of its national 
ceiling in order to constitute a national reserve. 

The new Member States shall use the national reserve for the purpose of allocating, 
according to objective and non-discriminatory criteria and in such a way as to ensure 
equal  treatment  between  farmers  and  to  avoid  market  and  competition  distortions, 
payment  entitlements  to  farmers  finding  themselves  in  a  special  situation,  to  be 
defined  by  the  Commission  in  accordance  with  the  procedure  referred  to  in 
Article 128(2). 

During the first year of application of the single payment scheme, the new Member 
States  may  use  the  national  reserve  for  the  purpose  of  allocating  payment 
entitlements,  according  to  objective  and  non-discriminatory  criteria  and  in  such  a 
way  as  to  ensure  equal  treatment  between  farmers  and  to  avoid  market  and 
competition distortions, to farmers in specific sectors, finding themselves in a special 
situation as a result of the transition to the single payment scheme. 

The new Member States may use the national reserve to grant payment entitlements 
to farmers who have commenced their agricultural activity after 1 January 2007 but 
without  receiving  any  direct  payment  in  2007,  according  to  objective  and  non-
discriminatory  criteria  and  in  such  a  way  as  to  ensure  equal  treatment  between 
farmers and to avoid market and competition distortions. 

New  Member  States  may  use  the  national  reserve  for  the  purpose  of  allocating, 
according  to  objective  criteria  and  in  such  a  way  as  to  ensure  equal  treatment 
between  farmers  and  to  avoid  market  and  competition  distortions,  entitlements  for 
farmers in areas subject to restructuring and/or development programmes relating to 
one  or  the  other  form  of  public  intervention  in  order  to  avoid  abandoning  of  land 
and/or in order to compensate specific disadvantages for farmers in those areas. 

EN 

47 

   EN 

6. 

7. 

1. 

2. 

3. 

1. 

2. 

3. 

For  the  purposes  of  application  of  paragraphs  2  to  5,  the  new  Member  States  may 
increase  the  unit  value  of  the  payment  entitlements  hold  by  the  farmer  concerned, 
within the limit of EUR 5 000, and/or may allocate new payment entitlements to the 
farmer concerned. 

The new Member States shall proceed to linear reductions of the entitlements where 
their national reserve is not sufficient. 

Article 60 
National ceiling referred to in Article 41 

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

The  new  Member  States  shall  define  the  regions  according  to  objective  and  non-
discriminatory criteria. 

Where  applicable,  each  new  Member  State  shall  subdivide  its  national  ceiling 
referred  to  in  Article 41  after  any  reduction  provided  for  in  Article  59  between  the 
regions according to objective and non-discriminatory criteria. 

Article 61 
Allocation of payment entitlements 

All farmers shall receive entitlements, whose unit value is calculated by dividing the 
ceiling referred to in Article 41 by the number of payment entitlements established at 
national level in accordance with paragraph 2 of this Article. 

The  number  of  entitlements  per  farmer  shall  be  equal  to  the  number  of  hectares 
he/she  declares  in  accordance  with  Article  36(1)  for  the  first  year  of  application  of 
the  single  payment  scheme,  except  in  case  of  force  majeure  or  exceptional 
circumstances within the meaning of Article 36(1). 

By  way  of  derogation  to  paragraph  2,  the  new  Member  States  may  decide  that  the 
number of entitlements per farmer shall be equal to the three-year average number of 
all  hectares  which  in  the  years  2005,  2006  and  2007  gave  right  to  the  single  area 
payment,  except  in  case  of  force  majeure  or  exceptional  circumstances  within  the 
meaning of Article 36(1). 

Article 62 
Grassland 

The new Member States may also, according to objective and non-discriminatory criteria, fix, 
within the regional ceiling or part of it, different per unit values of entitlements to be allocated 
to farmers referred to in Article 61(1): 

(a) 

(b) 

EN 

for  hectares  of  grassland  as  identified  on  30  June  2008  and  for  any  other  eligible 
hectare, or alternatively, 

for  hectares  of  permanent  pasture  as  identified  on  30  June  2008  and  for  any  other 
eligible hectare. 

48 

   EN 

Article 63 
Conditions for the entitlements 

1. 

2. 

3 

Entitlements  established  in  accordance  with  this  chapter  may  only  be  transferred 
within the same region or between regions where the entitlements per hectare are the 
same. 

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

Except  in  case  of  force  majeure  or  exceptional  circumstances  as  referred  to  in 
Article 36(1), a farmer may transfer his payment entitlements without land only after 
he  has  activated,  within  the  meaning  of  Article  35,  at  least  80%  of  his  payment 
entitlements during at least one calendar year or, after he has given up voluntarily to 
the national reserve all the payment entitlements he has not used in the first year of 
application of the single payment scheme. 

CHAPTER 4  
INTEGRATION OF COUPLED PAYMENTS  
INTO THE SINGLE PAYMENT SCHEME 

Article 64 
Integration of coupled support into the single payment scheme 

Member  States  shall  integrate  as  from  2010  the  support  available  under  coupled  support 
schemes  referred  to  in  points  I,  II,  and  III  of  Annex  X  into  the  single  payment  scheme  in 
accordance with the rules laid down in this chapter. 

Article 65 
Integration of coupled support excluded from the single payment scheme 

1. 

2. 

The amounts referred in Annex XI that were available for coupled support under the 
schemes referred under point I of Annex X shall be distributed by the Member States 
amongst the farmers in the sectors concerned in accordance with objective and non 
discriminatory  criteria  taking  account,  in  particular,  of  support  that  those  farmers 
received,  directly  or  indirectly,  under  the  relevant  support  schemes  during  one  or 
more years of the period 2005 to 2008. 

Member  States  shall  increase  the  value  of  the  payment  entitlements  hold  by  the 
farmers  concerned  on  the  basis  of  the  amounts  resulting  from  the  application  of 
paragraph 1. 

The  value  increase  per  payment  entitlement  per  farmer  shall  be  calculated  by 
dividing  the  amount  referred  to  in  the  preceding  subparagraph  by  the  number  of 
payment entitlements of each farmer concerned. 

EN 

49 

   EN 

However,  where  a  farmer  in  a  sector  concerned  does  not  hold  any  payment 
entitlement, he shall be allocated payment entitlements whose: 

(a) 

number shall be equal to the number of hectares he declares in accordance with 
Article 36(1)  in  respect  of  the  year  of  integration  of  the  coupled  support 
scheme into the single payment scheme, 

(b)  value  shall  be  established  by  dividing  the  amount  referred  to  in  the  first 

subparagraph by the number established in accordance with point (a). 

Article 66 
Integration of coupled support partially excluded from the single payment scheme 

The  amounts  that  were  available  for  coupled  support  under  the  schemes  referred  to  under 
point II  of  Annex X  shall  be  distributed  by  the  Member  States  amongst  the  farmers  in  the 
sectors  concerned  in  proportion  with  the  support  that  those  farmers  received  under  the 
relevant  support  schemes  during  the  period  2000  to  2002.  Member  States  may,  however, 
choose  a  more  recent  representative  period  in  accordance  with  objective  and  non 
discriminatory criteria. 

Member States shall increase the value of the payment entitlements of the farmers concerned 
or allocate payment entitlements in accordance with the provisions in Article 65(2). 

Article 67 
Optional integration of coupled support partially excluded from the single payment scheme 

Where  a  Member  State  does  not  take  the  decision  referred  to  in  the  first  subparagraph  of 
Article 53(1) the amounts that were available for coupled support under the schemes referred 
to  under  point  III  of  Annex  X  shall  be  integrated  into  the  single  payment  scheme  in 
accordance with the provisions set out in Article 66. 

CHAPTER 5  
SPECIFIC SUPPORT 

Article 68 
General rules 

1. 

Member  States  may  decide  by  1  August  2009  at  the  latest  to  use  from  2010  up  to 
10% of their national ceilings referred to in Article 41 to grant support to farmers: 

(a) 

for: 

(i) 

specific  types  of  farming  which  are  important  for  the  protection  or 
enhancement of the environment, 

(ii) 

for improving the quality of agricultural products, or 

(iii)  for improving the marketing of agricultural products; 

EN 

50 

   EN 

(b) 

(c) 

to address specific disadvantages affecting farmers in the dairy, beef, sheep and 
goatmeat  and  rice  sectors  in  economically  vulnerable  or  environmentally 
sensitive areas, 

in areas subject to restructuring and/or development programs in order to avoid 
abandoning  of  land  and/or  in  order  to  address  specific  disadvantages  for 
farmers in those areas, 

(d) 

in the form of contributions to crop insurance premiums in accordance with the 
conditions set out in Article 69, 

(e)  mutual  funds for  animal and plant diseases in accordance with the conditions 

set out in Article 70. 

2. 

Support for measures referred to in paragraph 1(a) may only be granted: 

(a) 

if 

(i) 

as  regards  support  for  the  specific  types  of  farming  referred  to  in  its 
point (i), it respects the requirements for agri-environment payments set 
out  in  the  first  subparagraph  of  Article 39(3)  of  Regulation  (EC) 
No 1698/2005, 

(ii) 

as  regards  support  for  improving  the  quality  of  agricultural  products 
referred to in its point (ii), it is consistent with Council Regulation (EC) 
No 509/2006,  Council  Regulation 
(EC)  No 510/2006,  Council 
Regulation  (EC)  No 834/200720  and  Chapter I  of  Title II  of  Part II  of 
Regulation (EC) No 1234/2007 and 

(iii)  as  regards  support  for  improving  the  marketing  of  agricultural  products 
referred to in its point (iii), it respects the criteria laid down in Articles 2 
to 5 of Council Regulation (EC) No 3/2008 and 

(b)  only for coverage of the additional costs actually incurred and income foregone 

in order to fulfil the objective concerned. 

3. 

Support for measures referred to in paragraph 1(b) may only be granted: 

(a) 

(b) 

upon full implementation of the single payment scheme in the sector concerned 
in accordance with Articles 54, 55 and 71. 

to  the  extent  necessary  to  create  an  incentive  to  maintain  current  levels  of 
production. 

4. 

Support under the measures referred to in paragraph 1(a), (b) and (e) shall be limited 
to 2.5% of the national ceilings referred to in Article 41 Member States may set sub-
limits per measure. 

5. 

Support for measures referred to: 

20 

OJ L 189, 20.7.2007, p. 1. 

EN 

51 

   EN 

                                                 
(a) 

in paragraph 1(a) and (d) shall take the form of annual additional payments, 

(b) 

(c) 

(d) 

in  paragraph  1(b)  shall  take  the  form  of  annual  additional  payments  such  us 
headage payments or grassland premia, 

in paragraph 1(c) shall take the form of an increase of the unit value and/or the 
number of the farmer's payment entitlements, 

in paragraph 1(e) shall take the form of compensation payments as specified in 
Article 70. 

The  transfer  of  payment  entitlements  with  increased  unit  values  and  of  additional 
payment  entitlements  referred  to  in  paragraph 5(c)  may  only  be  allowed  if  the 
transferred entitlements are accompanied by the transfer of an equivalent number of 
hectares. 

Support  for  measures  referred  to  in  paragraph  1  shall  be  consistent  with  other 
Community measures and policies. 

Member States shall raise the funds needed to cover the support referred to: 

(a) 

(b) 

in  paragraph  1(a),  (b),  (c)  and  (d)  by  proceeding  to  linear  reduction  of  the 
entitlements allocated to farmers and/or from the national reserve, 

in  paragraph  1(e)  by  proceeding,  if  necessary,  to  linear  reduction  of  one  or 
several  of  the  payments  to  be  made  to  the  beneficiaries  of  the  relevant 
payments  in  accordance  with  this  title  and  within  the  limits  set  out  in 
paragraphs 1 and 3. 

The  Commission,  in  accordance  with  the  procedure  referred  to  in  Article 128(2), 
shall  define  the  conditions  for  the  granting  of  the  support  referred  to  under  this 
section,  in  particular  with  a  view  to  ensure  consistency  with  other  Community 
measures and policies and to avoid cumulation of support. 

6. 

7. 

8. 

9. 

Article 69 
Crop insurance 

1. 

Member  States  may  grant  financial  contributions  to  premiums  for  crop  insurance 
against losses caused by adverse climatic events. 

For  the  purpose  of  this  article,  ‘adverse  climatic  event’  means  weather  conditions 
which can be assimilated to a natural disaster, such as frost, hail, ice, rain or drought 
and destroy more than 30% of the average of annual production of a given farmer in 
the preceding three-year period or a three-year average based on the preceding five-
year period, excluding the highest and lowest entry. 

2. 

The  financial  contribution  granted  per  farmer  shall  be  set  at  60%  of  the  insurance 
premium  due.  Member  States  may  decide  to  increase  the  financial  contribution  to 
70% taking account of the climatic situation or the situation of the sector concerned. 

EN 

52 

   EN 

3. 

4. 

5. 

6. 

7. 

1. 

Member  States  may  limit  the  amount  of  premium  that  is  eligible  to  financial 
contribution by applying appropriate ceilings. 

Coverage by crop insurance shall only be available where the adverse climatic event 
has  been  formally  recognised  as  such  by  the  competent  authority  of  the  Member 
State concerned. 

Insurance  payments  shall  compensate  for  not  more  than  the  total  cost  of  replacing 
losses referred to in paragraph 1 and shall not require or specify the type or quantity 
of future production. 

Any financial contribution shall be paid directly to the farmer concerned. 

Member  States'  expenditure  for  the  granting  of  financial  contributions  shall  be  co-
financed  by  the  Community  from  the  funds  referred to in Article 68(1) at a rate of 
40%  of  the  eligible  amounts  of  insurance  premium  set  in  accordance  with 
paragraph 2 of this Article. 

The  first  subparagraph  shall  not  prejudice  any  powers  of  Member  States  to  cover 
their  participation  in  the  financing  of  the  financial  contributions  in  full  or  in  part 
through obligatory systems of collective responsibility in the sectors concerned. 

The financial contribution shall not constitute a barrier to the operation of the internal 
market  for  insurance  services.  The  financial  contribution  shall  not  be  limited  to 
insurance  provided  by  a  single  insurance  company  or  group  of  companies,  or  be 
made  subject  to  the  condition  that  the  insurance  contract  be  taken  out  with  a 
company established in the Member State concerned. 

Article 70 
Mutual funds for animal and plant diseases 

Member  States  may  provide  for  financial  compensation  to  be  paid  to  farmers  for 
economic  losses  caused  by  the  outbreak  of  animal  or  plant  disease  by  way  of 
financial contributions to mutual funds. 

2. 

For the purpose of this Article: 

(a) 

(b) 

'mutual  fund'  shall  mean  a  system  accredited  by  the  Member  State  in 
accordance  with  national  law  for  affiliated  farmers  to  insure  themselves,  by 
granting compensation payments to such farmers affected by economic losses 
caused by the outbreak of animal or plant disease; 

'economic  losses'  shall  mean  any  additional  cost  incurred  by  a  farmer  as  a 
result of exceptional measures taken by the farmer with the objective to reduce 
supply on the market concerned or any substantial loss of production. Costs for 
which  compensation  may  be  granted  in  accordance  with  other  Community 
provisions  and  those  resulting  from  the  application  of  any  other  health  and 
veterinary  or  phytosanitary  measures  shall  not  be  considered  as  economic 
losses. 

EN 

53 

   EN 

3. 

The mutual funds shall pay the financial compensation directly to affiliated farmers 
who are affected by economic losses. 

The source of the financial compensation paid by the mutual funds shall come from: 

(a) 

capital stock contributed to the funds by affiliated farmers, and/or 

(b) 

loans taken out by the funds on commercial terms. 

Any initial capital stock shall not be contributed by public funds. 

4. 

The financial contributions referred to in paragraph 1 may relate to: 

(a) 

(b) 

(c) 

the  administrative  costs  of  setting  up  the  mutual  fund,  spread  across  a 
maximum of three years, 

the  repayment  of  the  capital  and  interest  on  commercial  loans  taken  by  the 
mutual fund for the purpose of paying financial compensation to farmers, 

the  amounts  paid  by  the  mutual  fund  from  its  capital  stock  as  financial 
compensation to farmers. 

The  minimum  and  maximum  duration  of  the commercial loans eligible to financial 
contribution  shall  be  fixed  by  the  Commission  in  accordance  with  the  procedure 
referred to in Article 128(2). 

Where financial compensation is paid by the fund in accordance with point (c) of the 
first subparagraph, the public financial contribution shall follow the same rhythm as 
the one scheduled for a commercial loan of minimum duration. 

Any financial contribution shall not exceed 60% of the cost referred to in paragraph 
4. Member States may decide to increase their financial contribution to 70% taking 
account  of the  situation of the  sector  concerned. Any cost not covered by financial 
contributions shall be borne by the affiliated farmers. 

Member States may limit the costs that are eligible for the financial contribution by 
applying: 

(a) 

ceilings per fund, 

(b) 

appropriate per unit ceilings. 

Member States' expenditure on the financial contributions shall be co-financed by the 
Community  from  the  funds  referred  to  in  Article 68(1)  at  a  rate  of  40%  of  the 
amounts eligible under paragraph 4. 

The  first  subparagraph  shall  not  prejudice  any  powers  of  Member  States  to  cover 
their  participation  in  the  financing  of  the  financial  contributions  in  full  or  in  part 
through obligatory systems of collective responsibility in the sectors concerned. 

Member States shall define the rules for the constitution and the management of the 
mutual funds, notably for the granting of compensation payments to farmers in case 
of crisis, or for the administration and control of these rules. 

5. 

6. 

7. 

EN 

54 

   EN 

8. 

Member  States  shall  submit  to  the  Commission  an  annual  report  on  the 
implementation of this Article. The form, content, timing and deadlines of the report 
shall be laid down by the Commission in accordance with the procedure referred to 
in Article 128(2). 

TITLE IV 
OTHER AID SCHEMES 

CHAPTER 1 
COMMUNITY AID SCHEMES 

SECTION 1 
CROP SPECIFIC PAYMENT FOR RICE 

Article 71 
Scope 

For  the  years  2009,  2010,  and  2011  aid  shall  be  granted  to  farmers  producing  rice,  falling 
within CN code 1006 10 under the conditions laid down in this section. 

Article 72 
Conditions and amount of the aid 

1. 

The aid shall be granted per hectare of land sown under rice and where the crop is 
maintained until at least the beginning of flowering under normal growth conditions. 

However,  crops  grown  on  areas  which  are  fully  sown  and  which  are  cultivated  in 
accordance with local standards, but which do not attain the stage of flowering as a 
result of exceptional weather conditions recognised by the Member State concerned, 
shall remain eligible for aid provided that the areas in question are not used for any 
other purpose up to this growing stage. 

2. 

The  amount  of  the  aid  shall  be  as  follows,  according  to  the  yields  in  the  Member 
States concerned: 

EN 

55 

   EN 

Bulgaria 

Greece 

Spain 

France 

Italy 

Hungary 

Portugal 

Romania 

EUR/ha 

2010 and 2011 

172,627 

280,5 

238,125 

205,875 

226,5 

116,25 

226,875 

63,037 

2009  

345,255 

561,00 

476,25 

411,75 

453,00 

232,50 

453,75 

126,075 

Article 73 
Areas 

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

– 

– 

– 

– 

– 

– 

– 

– 

Bulgaria: 4 166 ha, 

Greece: 20 333 ha, 

Spain: 104 973 ha, 

France:: 19 050 ha, 

Italy: 219 588 ha, 

Hungary: 3 222 ha, 

Portugal: 24 667 ha, 

Romania: 500 ha. 

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

Article 74 
Overrun of the areas 

1. 

2. 

Where in a Member State the area given over to rice in a given year exceeds the base 
area  indicated  in  Article  73,  the  area  per  farmer  for  which  aid  is  claimed  shall  be 
reduced proportionately in that year. 

When  a  Member  State  subdivides  its  base  area  or  areas  in  sub-base  areas,  the 
reduction  provided  for  in  paragraph  1  shall  apply  only  to  the  farmers  in  sub-base 
areas where their limit have been exceeded. This reduction shall be made when, in 
the  Member  State  concerned,  the  areas  in  sub-base  areas,  which  have  not  reached 
their limits, have been redistributed to sub-base areas in which those limits have been 
exceeded. 

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SECTION 2 
AID FOR STARCH POTATO 

Article 75 
Amount of the aid 

Aid shall be established for farmers producing potatoes intended for the manufacture of potato 
starch. The amount of the payment applies to the quantity of potatoes needed for making one 
tonne of starch. It shall be: 

(a) 

(b) 

EUR 66,32 for marketing years 2009/2010 and 2010/2011; 

EUR 33,16 for marketing years 2011/2012 and 2012/2013. 

The amount shall be adjusted according to the starch content of the potatoes. 

Article 76 
Conditions 

The  aid  shall  be  paid  only  in  respect  of  the  quantity  of  potatoes  covered  by  a  cultivation 
contract between the potato producer and the starch manufacturer within the limit of the quota 
allocated  to  such  undertaking,  as  referred  to  in  Article 84a(2)  of  Council  Regulation  (EC) 
No 1234/200721. 

SECTION 3 
CROP SPECIFIC PAYMENT FOR COTTON 

Article 77 
Scope 

Aid shall be granted to farmers producing cotton falling within CN code  5201 00  under the 
conditions laid down in this section. 

Article 78 
Conditions 

1. 

2. 

The aid shall be granted per hectare of eligible area of cotton. In order to be eligible, 
the  area  shall  be  located  on  agricultural  land  authorised  by  the  Member  State  for 
cotton  production,  sown  under  authorised  varieties  and  actually  harvested  under 
normal growing conditions. 

The  aid  referred  to  in  Article 77  shall  be  paid  for  cotton  of  sound  and  fair 
merchantable quality. 

Member States shall authorise the land and the varieties as referred to in paragraph 1 
in  accordance  with  detailed  rules  and  conditions  adopted  in  accordance  with  the 
procedure referred to in Article 128(2). 

21 

OJ L 299, 16.11.2007, p. 1. 

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57 

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Article 79 
Base areas and amounts 

1. 

The national base areas are hereby established as follows: 

– 

– 

– 

– 

Bulgaria: 10 237 ha, 

Greece: 370 000 ha, 

Spain: 70 000 ha, 

Portugal: 360 ha. 

2. 

The amount of the aid per eligible hectare shall be as follows: 

3. 

4. 

1. 

– 

– 

– 

– 

Bulgaria: EUR 263, 

Greece:  EUR 594  for  300 000  hectares  and  EUR 342,85  for  the  remaining 
70 000 hectares, 

Spain: EUR 1 039, 

Portugal: EUR 556. 

If the eligible area of cotton in a given Member State and in a given year exceeds the 
base  area  laid  down  in  paragraph 1,  the  aid  referred  to  in  paragraph 2  for  that 
Member State shall be reduced proportionately to the overrun of the base area. 

However,  for  Greece  the  proportionate  reduction  shall  be  applied  in  respect  of  the 
amount  of  the  aid  fixed  for  the  part  of  the  national  base  area  composed  of  the 
70 000 hectares in order to respect the global amount of EUR 202,2 million. 

Detailed rules for the implementation of this Article shall be adopted in accordance 
with the procedure referred to in Article 128(2) 

Article 80 
Approved inter-branch organisations 

For the purpose of this section, an "approved inter-branch organisation" shall mean a 
legal entity made up of farmers producing cotton and at least one ginner, carrying out 
activities such as: 

– 

– 

– 

– 

– 

helping to coordinate better the way cotton is placed on the market, particularly 
through research studies and market surveys, 

drawing up standard forms of contract compatible with Community rules, 

orientating production towards products that are better adapted to market needs 
and  consumer  demand,  particularly  in  aspects  of  quality  and  consumer 
protection, 

updating methods and means to improve product quality, 

developing  marketing  strategies  to  promote  cotton  via  quality  certification 
schemes. 

EN 

58 

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2. 

1. 

2. 

1. 

2. 

The Member State in whose territory the ginners are established shall approve inter-
branch  organisations  that  respect  criteria  to  be  adopted  in  accordance  with  the 
procedure referred to in Article 128(2). 

Article 81 
Payment of aid 

Farmers shall be granted the aid per eligible hectare pursuant to Article 79. 

Farmers who are members of an approved inter-branch organisation shall be granted 
an aid, per eligible hectare within the base area laid down in Article 79(1), increased 
by an amount of EUR 3. 

SECTION 4 
AID FOR SUGAR BEET AND CANE PRODUCERS 

Article 82 
Scope 

In Member States which have granted the restructuring aid provided for in Article 3 
of  Regulation  (EC)  No 320/2006  for  at  least  50%  of  the  sugar  quota  fixed  on 
20 February  2006  in  Annex  III  to  Council  Regulation  (EC)  No 318/200622, 
Community aid shall be granted to sugar beet and cane producers. 

The  aid  shall  be  granted  for  a  maximum  of  five  consecutive  years  as  from  the 
marketing  year  in  which  the  threshold  of  50%  referred  to  in  paragraph 1  has  been 
reached but no later than for the marketing year 2013/2014. 

Article 83 
Conditions 

The aid shall be granted in respect of the quantity of quota sugar obtained from sugar beet or 
cane  delivered  under  contracts  concluded  in  accordance  with  Article 50  of  Regulation  (EC) 
No 1234/2007. 

Article 84 
Amount of the aid 

The aid shall be expressed per tonne of white sugar of standard quality. The amount of the aid 
shall be equal to half of the amount obtained by dividing the amount of the ceiling referred to 
in Annex XII to this Regulation for the Member State concerned for the corresponding year 
by  the  total  of  the  sugar  and  inulin  syrup  quota  fixed  on  20  February  2006  in  Annex III  to 
Regulation (EC) No 318/2006. 

Articles  110  and  120  of  this  Regulation  shall  not  apply  to  the  aid  for  sugar  beet  and  cane 
producers. 

22 

OJ L 58, 28.2.2006, p. 1. 

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SECTION 5 
TRANSITIONAL FRUIT AND VEGETABLES PAYMENTS 

Article 85 
Transitional area aids 

In  the  case  of  application  of  Article  56(1)  or  Article  117(1),  during  the  period 
referred  to  in  that  provisions,  a  transitional  area  aid  may  be  granted,  under  the 
conditions  laid  down  in  this  section,  to  farmers  producing  tomatoes  which  are 
supplied for processing. 

In  the  case  of  application  of  Article  56(2)  or  Article  117(2),  during  the  period 
referred  to  in  those  provisions,  a  transitional  area  aid  may  be  granted,  under  the 
conditions  laid  down  in  this  section,  to  farmers  producing  one  or  more  of  the  fruit 
and  vegetable  products  listed  in  the  third  subparagraph  of  Article  56(2),  as 
determined by the Member States, which are supplied for processing. 

Article 86 
Amount of the aid and eligibility 

Member  States  shall  fix  the  aid  per  hectare  on  which  tomatoes  and  each  fruit  and 
vegetable  product  listed  in  the  third  subparagraph  of  Article 56(2)  is  grown  on  the 
basis of objective and non-discriminatory criteria. 

The total amount of payments shall in no case exceed the ceiling fixed in accordance 
with Article 53(2) or Article 117. 

The aid shall be granted only in respect  of areas whose production is covered by a 
contract for processing into one of the products listed in Article 1(1)(j) of Regulation 
(EC) No 1234/2007. 

Member States may make the granting of Community aid subject to further objective 
and  non-discriminatory  criteria,  including  being  conditional  on  farmers  being 
members of a producer organisation or producer group recognised respectively under 
Article 125b or Article 125d Regulation (EC) No 1234/2007. 

SECTION 6 
TRANSITIONAL SOFT FRUIT PAYMENT 

Article 87 
Soft fruit payment 

A transitional area aid shall apply during the period ending on 31 December 2012 in 
respect  of  strawberries  falling  within  CN  code  0810 10 00  and  raspberries  falling 
within CN code 0810 20 10 which are supplied for processing. 

The aid shall be granted only in respect  of areas whose production is covered  by a 
contract for processing into one of the products listed in Article 1(1)(j) of Regulation 
(EC) No 1234/2007. 

1. 

2. 

1. 

2. 

3. 

4. 

1. 

2. 

3. 

The Community aid paid shall be EUR 230/ha. 

EN 

60 

   EN 

4. 

5. 

Member States may pay a national aid in addition to the Community aid. The total 
amount of Community and national aid paid shall not exceed EUR 400/ha. 

The aid shall be paid only in respect of maximum national guaranteed areas allocated 
to Member States as follows: 

Member State 

National guaranteed area 
(hectares) 

Bulgaria 

Hungary 

Latvia 

Lithuania 

Poland 

2 400 

1 700 

400 

600 

48 000 

If  the  eligible  area  in  a  given  Member  State  and  in  a  given  year  exceeds  the 
maximum  national  guaranteed  area,  the  aid  amount  referred  to  in  paragraph 3  shall 
be reduced proportionately to the overrun of the maximum national guaranteed area. 

6. 

Articles 110 and 120 shall not apply to the transitional soft fruit payment. 

SECTION 7 
SHEEP AND GOAT PREMIUMS 

Article 88 
Scope of application 

In case of application of Article 54, Member States shall grant, on a yearly basis, premiums or 
additional payments to farmers rearing sheep and goats under the conditions provided for in 
this section save as otherwise provided. 

Article 89 
Definitions 

For the purposes of this section the following definitions shall apply: 

(a) 

(b) 

"ewe"  shall  mean  any  female  of  the  ovine  species  having  lambed  at  least  once  or 
aged at least one year; 

"she-goat" shall mean any female of the caprine species having kidded at least once 
or aged at least one year. 

Article 90 
Ewe and goat premium 

1. 

A farmer keeping ewes on his holding may qualify, on application for a premium for 
maintaining ewes (ewe premium). 

EN 

61 

   EN 

2. 

A  farmer  keeping  she-goats  on  his  holding  may  qualify,  on  application  for  a 
premium for maintaining she-goats (goat premium). This premium shall be granted 
to farmers in specific areas where the production meets the following two criteria: 

(a) 

goat rearing is mainly directed towards the production of goatmeat; 

(b)  goat and sheep rearing techniques are similar in nature. 

3. 

4. 

A  list  of  such  areas  shall  be  established  following  the  procedure  referred  to  in 
Article 128(2). 

The  ewe  premium  and  the  goat  premium  shall  be  granted  in  the  form  of  an  annual 
payment  per  eligible  animal  per  calendar  year  and  per  farmer  within  the  limits  of 
individual  ceilings.  The  minimum  number  of  animals  in  respect  of  which  an 
application for a premium is lodged shall be determined by the Member State. This 
minimum shall not be less than 10 or greater than 50. 

Per  ewe,  the  amount  of  the  premium  shall  be  EUR 21.  However  for  farmers 
marketing sheep's milk or products based on sheep's milk the premium per ewe shall 
be EUR 6,8. 

5. 

Per she-goat the amount of the premium shall be EUR 6,8. 

Article 91 
Supplementary premium 

1. 

A  supplementary  premium  shall  be  paid  to  farmers  in  areas  where  sheep  and  goat 
production  constitutes  a  traditional  activity  or  contributes  significantly  to  the  rural 
economy.  Member  States  shall  define  these  areas.  In  any  event  the  supplementary 
premium shall only be granted to a farmer whose holding has at least 50% of its area 
used  for  agriculture  situated  in  less-favoured  areas  defined  pursuant  to  Regulation 
(EC) No 1257/1999. 

2. 

The  supplementary  premium  shall  also  be  granted  to  a  farmer  practising 
transhumance provided that: 

(a) 

(b) 

at least 90% of the animals for which the premium is applied are grazed for at 
least  90  consecutive  days  in  an  eligible  area  established  in  accordance  with 
paragraph 1, and 

the seat of the holding is situated in a well-defined geographical area for which 
it has been established by the Member State that transhumance is a traditional 
practice  of  sheep  and/or  goat  rearing  and  that  these  animal  movements  are 
necessary  owing  to  the  absence  of  forage  in  sufficient  quantity  during  the 
transhumance period. 

3. 

The  amount  of  the  supplementary  premium  shall  be  set  at  EUR  7  per  ewe  and  per 
she-goat. The supplementary premium shall be granted under the same conditions as 
those laid down for the grant of the ewe and goat premium. 

EN 

62 

   EN 

Article 92 
Common rules on premiums 

Premiums  shall  be  paid  to  recipient  farmers  on  the  basis  of  the  number  of  ewes 
and/or  she-goats  kept  on  their  holding  over  a  minimum  period  to  be  determined  in 
accordance with the procedure referred to in Article 128(2). 

To  qualify  for  the  premiums  an  animal  shall  be  identified  and  registered  in 
accordance with Regulation (EC) No 21/2004. 

Article 93 
Individual limits 

On 1 January 2009 the individual ceiling per farmer referred to in Article 90(3), shall 
be  equal  to  the  number  of  premium  rights  which  he  held  on  31 December  2008  in 
accordance with the relevant Community rules. 

Member States shall take the necessary measures to ensure that the sum of premium 
rights on their territory does not exceed the national ceilings set out in paragraph 4 
and that the national reserves referred to in Article 96 may be maintained. 

After  the  end  of  the  period  of  application  of  the  single  area  payment  scheme  in 
accordance  with  Article  111  and  where  Article  54  is  applied,  the  allocation  of  the 
individual ceilings to producers and the setting up of the national reserve referred to 
in Article 95 shall take place no later than the end of the first year of the application 
of the single payment scheme. 

Premium rights, which have been withdrawn pursuant to the measure taken pursuant 
to paragraph 2 shall be cancelled. 

The following ceilings shall apply: 

1. 

2. 

1. 

2. 

3. 

4. 

EN 

63 

   EN 

Member State 

Rights (x 1000) 

Bulgaria 

Czech Republic 

Denmark 

Estonia 

Spain 

France 

Cyprus 

Latvia 

Lithuania 

Hungary 

Poland 

Portugal 

Romania 

Slovenia 

Slovakia 

Finland 

Total 

2 058,483 

66,733 

104 

48 

19 580 

7 842 

472,401 

18,437 

17,304 

1 146 

335,88 

2 690 

5 880,620 

84,909 

305,756 

80 

40 730,523 

Article 94  
Transfer of premium rights 

1. 

2. 

When  a  farmer  sells  or  otherwise  transfers  his  holding,  he  may  transfer  all  his 
premium rights to the person who takes over his holding. 

A  farmer  may  also  transfer, in  whole or  in  part, his rights to other farmers without 
transferring his holding. 

In  the  case  of  a  transfer  of  rights  without  transfer  of  the  holding,  a  part  of  the 
premium  rights  transferred,  not  exceeding  15%,  shall  be  surrendered,  without 
compensation  to  the  national  reserve  of  the  Member  State  where  his  holding  is 
situated for redistribution free of charge. 

Member States may acquire premium rights from farmers who agree, on a voluntary 
basis,  to  surrender  their  rights,  in  whole  or  in  part.  In  this  case  payments  for  the 
acquisition of such rights may be made to such farmers from national budgets. 

By way of derogation from paragraph 1 and in duly justified circumstances, Member 
States  may  provide  that  in  the  case  of  a  sale  or  other  transfer  of  the  holding,  the 
transfer of rights is carried out by the intermediary of the national reserve. 

EN 

64 

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3. 

4. 

1. 

2. 

3. 

Member  States  may  take  the  necessary  measures  to  avoid  premium  rights  being 
moved  away  from  sensitive  zones  or  regions  where  sheep  production  is  especially 
important for the local economy. 

Member  States  may  authorise,  before  a  date  that  they  shall  determine,  temporary 
transfers of that part of the premium rights, which are not intended to be used by the 
farmer who holds them. 

Article 95 
National reserve 

Each Member State shall maintain a national reserve of premium rights. 

Any  premium  rights  withdrawn  pursuant  to  Article 94(2)  or  other  Community 
provisions shall be added to the national reserve. 

Member  States  may  allocate  premium  rights  to  farmers,  within  the  limits  of  their 
national  reserves.  When  making  the  allocation  they  shall  give  precedence  in 
particular to newcomers, young farmers or other priority farmers. 

Article 96 
Ceilings 

The  sum  of  the  amounts  of  each premium claimed shall not exceed the limit of the ceiling, 
fixed by the Commission pursuant to Article 53(2). 

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

SECTION 8 
BEEF AND VEAL PAYMENTS 

Article 97 
Scope of application 

In case of application of Article 55, Member States shall grant, under the conditions set out in 
this  section,  save  as  otherwise  provided,  the  additional  payment  or  payments  chosen  by  the 
Member State concerned according to that article. 

For the purposes of this section: 

Article 98 
Definitions 

(a) 

"region" shall mean a Member State or a region within a Member State, at the option 
of the Member State concerned, 

(b) 

"bull" shall mean an uncastrated male bovine animal, 

EN 

65 

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(c) 

(d) 

(e) 

1. 

"steer" shall mean a castrated male bovine animal, 

"suckler" cow shall mean a cow belonging to a meat breed or born of a cross with a 
meat breed, and belonging to a herd intended for rearing calves for meat production, 

"heifer" shall mean a female bovine animal from the age of eight months which has 
not yet calved. 

Article 99 
Special premium 

A  farmer  holding  male  bovine  animals  on  his  holding  may  qualify,  on  application, 
for  a  special  premium.  It  shall  be  granted  in  the  form  of  an  annual  premium  per 
calendar year and per holding within the limits of regional ceilings for not more than 
90 animals for each of the age brackets referred to in paragraph 2. 

2. 

The special premium shall be granted no more than: 

(a) 

once in the life of each bull from the age of nine months, or 

(b) 

twice in the life of each steer: 

(i) 

the first time at the age of nine months, 

(ii) 

the second time after it has reached the age of 21 months. 

3. 

To qualify for the special premium: 

(a) 

(b) 

any animal covered by an application shall be held by the farmer for fattening 
for a period to be determined, 

each  animal  shall  be  covered  until  slaughter  or  until  export  by  an  animal 
passport  referred  to  in  Article  6  of  Regulation  (EC)  No  1760/2000  of  the 
European Parliament and of the Council containing all relevant information on 
its premium status or, if not available, an equivalent administrative document. 

4. 

When in a given region the total number of bulls from the age of nine months and of 
steers from nine months to 20 months of age, for which an application has been made 
and  which  satisfy  the  conditions  for  granting  the  special  premium  exceeds  the 
regional ceiling referred to in paragraph 8, the number of all eligible animals under 
paragraph 2(a)  and  (b)  per  farmer  for  the  year  in  question  shall  be  reduced 
proportionately. 

Within  the  meaning  of  this  Article,  "regional  ceiling"  shall  mean  the  number  of 
animals  entitled  to  benefit,  in  a  region  and  per  calendar  year,  from  the  special 
premium. 

EN 

66 

   EN 

5. 

By way of derogation from paragraphs 1 and 4, Member States may: 

(a) 

on the basis of objective criteria that are part of a rural development policy and 
only  on  the  condition  that  they  take  into  account  environmental  as  well  as 
employment  aspects,  change  or  waive  the  headage  limit  of  90 animals  per 
holding and age bracket, and, 

(b)  where exercising this power, decide to apply paragraph 4 in such a way as to 
reach  the  level  of  reductions  required  to  comply  with  the  applicable  regional 
ceiling,  without  applying  such  reductions  to  small  farmers  who,  in  respect  of 
the year in question, did not submit special premium applications for more than 
a minimum number of animals determined by the Member State concerned. 

6. 

Member States may decide to grant the special premium at the time of slaughter. In 
this case, for bulls the age criterion referred to in paragraph 2(a) shall be replaced by 
a minimum carcass weight of 185 kg. 

The premium shall be paid or passed back to the farmers. 

7. 

The amount of the special premium shall be set at: 

(a)  EUR 210 per eligible bull; 

(b)  EUR 150 per eligible steer and age bracket. 

8. 

The following regional ceilings shall apply: 

Member State 

Regional ceiling 

Bulgaria 

Czech Republic 

Denmark 

Germany 

Estonia 

Cyprus 

Latvia 

Lithuania 

Poland 

Romania 

Slovenia 

Slovakia 

Finland 

Sweden 

90 343 

244 349 

277 110 

1 782 700 

18 800 

12 000 

70 200 

150 000 

926 000 

452 000 

92 276 

78 348 

250 000 

250 000 

EN 

67 

   EN 

Article 100 
Suckler cow premium 

1. 

A  farmer  keeping  suckler  cows  on  his  holding  may  qualify,  on  application,  for  a 
premium for maintaining suckler cows (suckler cow premium). It shall be granted in 
the form of an annual premium per calendar year and per farmer within the limits of 
individual ceilings. 

2. 

The suckler cow premium shall be granted to any farmer: 

(a) 

not supplying milk or milk products from his farm for 12 months from the day 
on which the application is lodged. 

The supply of milk or milk products directly from the holding to the consumer 
shall not, however, prevent grant of the premium; 

(b) 

supplying milk or milk products whose total individual quota as referred to in 
Article 67 of Regulation (EC) No 1234/2007 does not exceed 120 000 kg. 

However Member States may decide on the basis of objective and not discriminatory 
criteria,  which  they  determine,  to  change  or  waive  the  quantitative  limit,  provided 
that the farmer keeps, for at least six consecutive months from the day on which the 
application is lodged a number of suckler cows at least equal to 60% and of heifers at 
most equal to 40% of the number for which the premium was requested. 

For the purposes of determining the number of eligible animals under points (a) and 
(b) of the first paragraph, whether cows belong to a suckler herd or to a dairy herd 
shall  be  established  on  the  basis  of  the  beneficiary's  individual  quota  for  milk 
available  on  the  holding  on  31 March  of  the  calendar  year  concerned,  expressed  in 
tonnes and the average milk yield. 

The  farmers'  entitlement  to  the  premium  shall  be  limited  by  the  application  of  an 
individual ceiling as defined in Article 101. 

Per eligible animal, the amount of the premium shall be set at EUR 200. 

Member  States  may  grant  an  additional  national  suckler  cow  premium,  up  to  a 
maximum of EUR 50 per animal, provided that no discrimination is caused between 
stockfarmers in the Member State concerned. 

In respect of holdings located in a region as defined in Articles 5 and 8 of Council 
Regulation  (EC)  No 1083/200623,  the  first  EUR 24,15  per  animal  of  this  additional 
premium shall be financed by the EAFRD. 

In  respect  of  holdings  located  throughout  the  territory  of  a  Member  State,  if  in  the 
Member State concerned the cattle population has a high proportion of suckler cows, 
representing  at  least  30%  of  the  total  number  of  cows,  and  if  at  least  30%  of  male 
bovine  animals  slaughtered  belong  to  conformation  classes  S  and  E,  the  EAFRD 
shall finance the additional premium in total. Any overshoot of these percentages is 

3. 

4. 

5. 

23 

OJ L 210, 31.7.2006, as amended by Regulation (EC) No 1989/2006. 

EN 

68 

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established on the basis of the average of the two years preceding that for which the 
premium is granted. 

For the purposes of this Article, only heifers belonging to a meat breed or born of a 
cross with a meat breed and belonging to a herd intended for rearing calves for meat 
production shall be taken into account. 

Article 101 
Individual ceiling for suckler cow 

An  aid  shall  be  granted  to  each  farmer  of  suckler  cows  within  the  limit  of  the 
individual  ceilings  which  have  been  established  in  application  of  Article 126(2)  of 
Regulation (EC) No 1782/2003. 

Member States shall take the necessary measures to ensure that the sum of premium 
rights on their territory does not exceed the national ceilings set out in paragraph 5 
and that the national reserves referred to in Article 103 may be maintained. 

After  the  end  of  the  period  of  application  of  the  single  area  payment  scheme  in 
accordance with Article 111 and where Article 55(1) is applied, the allocation of the 
individual ceilings to producers and the setting up of the national reserve referred to 
in Article 103 shall take place no later than the end of the first year of the application 
of the single payment scheme. 

Where  the  adjustment  referred  to  in  paragraph  2  requires  a  reduction  of  individual 
ceilings held by farmers, it shall be carried out without compensatory payment and 
decided on the basis of objective criteria, including, in particular: 

(a) 

(b) 

(c) 

(d) 

the  rate  at  which  farmers  have  used  their  individual  ceilings  during  the  three 
reference years prior to the year 2000, 

the implementation of an investment or extensification programme in the beef 
and veal sector, 

particular  natural  circumstances  or  the  application  of  penalties,  resulting  in  a 
non-payment  or a reduced  payment  of  the premium for at least one reference 
year, 

additional exceptional circumstances having the effect that the payments made 
for  at  least  one  reference  year  do  not  correspond  to  the  actual  situation  as 
established during the previous years. 

Premium rights which have been withdrawn pursuant to the measure provided for in 
paragraph 2 shall be abolished. 

The following national ceilings shall apply: 

6. 

1. 

2. 

3. 

4. 

5. 

EN 

69 

   EN 

Member State 

National ceiling 

Belgium 

Bulgaria 

Czech Republic 

Estonia 

Spain 

France 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Austria 

Poland 

Portugal 

Romania 

Slovenia 

Slovakia 

394 253 

16 019 

90 300 

13 416 

1 441 539 

3 779 866 

500 

19 368 

47 232 

117 000 

454 

375 000 

325 581 

416 539 

150 000 

86 384 

28 080 

United Kingdom 

1 699 511 

Article 102 
Transfer of suckler cow premium rights 

1. 

When a farmer sells or otherwise transfers his holding, he may transfer all his suckler 
cow premium rights to the person who takes over his holding. He may also transfer, 
in whole or in part, his rights to other farmers without transferring his holding. 

In the case of transfer of premium rights without transfer of the holding a part of the 
transferred  rights,  which  shall  not  exceed  15%,  shall  be  returned  without 
compensatory  payment  to  the  national  reserve  of  the  Member  State  where  the 
holding is situated for redistribution free of charge. 

2. 

The Member States: 

(a) 

shall take the necessary measures to prevent premium rights being transferred 
outside sensitive areas or regions where beef and veal production is particularly 
important for the local economy; 

(b)  may provide either that the transfer of rights without transfer of the holding is 
carried  out  directly  between  farmers  or  that  it  is  carried  out  through  the 
intermediary of the national reserve. 

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3. 

1. 

2. 

3. 

1. 

2. 

1. 

Member States may authorise, before a date to be determined, temporary transfers of 
part of the premium rights which are not intended to be used by the farmer who holds 
them. 

Article 103 
National reserve of suckler cow premium rights 

Each Member State shall maintain a national reserve of suckler cow premium rights. 

Any  premium  rights  withdrawn  pursuant  to  second  subparagraph  of  paragraph 1  of 
Article 102  or  other  Community  provisions  shall  be  added  to  the  national  reserve, 
without prejudice to Article 101(4). 

The Member States shall use their national reserves for allocating, within the limits 
of  those  reserves,  premium  rights  in  particular  to  newcomers,  young  farmers  and 
other priority farmers. 

Article 104 
Heifers 

By way of derogation from Article 100(3) of this Regulation, Member States where 
more  than  60%  of  suckler  cows  and  heifers  are  kept  in  mountain  areas  within  the 
meaning of Article 50 of Regulation (EC) No 1698/2005 may decide to manage the 
granting  of  the  suckler  cow  premium  for  heifers  separately  from  that  for  suckler 
cows within the limits of a separate national ceiling to be set up by the Member State 
concerned. 

Such  separate  national  ceiling  shall  not  exceed  40%  of  the  national  ceiling  of  the 
Member  State  concerned  set  out  in  Article 101(5).  That  national  ceiling  shall  be 
reduced by an amount equal to the separate national ceiling. When in a Member State 
exercising the power provided for in this paragraph, the total number of heifers, for 
which  an  application  has  been  made,  and  which  satisfy  the  conditions  for  granting 
the  suckler  cow  premium,  exceeds  the  separate  national  ceiling,  the  number  of 
eligible heifers per farmer for the year in question shall be reduced proportionately. 

For the purpose of this Article, only heifers belonging to a meat breed or born of a 
cross with a meat breed shall be taken into account. 

Article 105 
Slaughter premium 

A farmer keeping  bovine animals on his holding  may  qualify,  on  application,  for  a 
slaughter premium. It shall be granted on slaughter of eligible animals or their export 
to a third country and within national ceilings to be determined. 

The following shall be eligible for the slaughter premium: 

(a) 

bulls, steers, cows and heifers from the age of eight months, 

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(b) 

calves of more than one and less than eight months old and of carcass weight 
up to 185 kg, 

The  animals  listed  in  the  second  subparagraph  shall  be  eligible  for  the  slaughter 
premium provided they have been held by the farmer for a period to be determined. 

2. 

The amount of the premium shall be set at: 

(a)  EUR 80 per eligible animal as specified under paragraph 1(a); 

(b)  EUR 50 per eligible animal as specified under paragraph 1(b). 

3. 

The  national  ceilings  referred  to  in  paragraph  1  shall  be  established  per  Member 
State  and  separately  for  both  groups  of  animals  as  specified  in  (a)  and  (b)  of  the 
second subparagraph thereof. Each ceiling shall be equal to the number of animals of 
each  of  these  two  groups  which  in  1995  were  slaughtered  in  the  Member  State 
concerned to which are added those animals exported to third countries, according to 
Eurostat  data  or  any  other  published  official  statistical  information  for  that  year 
accepted by the Commission. 

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

Bulls, steers, cows and heifers 

Calves more than 1 and less 
than 8 months old and of 
carcass weight up to 185 kg 

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

22 191 

483 382 

107 813 

21 000 

124 320 

367 484 

141 559 

6 002 

1 815 430 

1 148 000 

161 137 

204 062 

101 542 

27 380 

30 000 

— 

53 280 

244 200 

94 439 

17 

839 518 

85 000 

35 852 

62 841 

4. 

When in a given Member State the total number of animals, for which an application 
has been made in respect of one of the two groups of animals specified in point (a) or 
(b) of the second subparagraph of paragraph 1, and which satisfy the conditions for 
granting the slaughter premium exceeds the national ceiling laid down for that group, 
the  number  of  all  eligible  animals  under  that  group  per  farmer  for  the  year  in 
question shall be reduced proportionately. 

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Article 106 
Common rules on premiums 

To qualify for direct payments under this section, an animal shall be identified and registered 
in accordance with Regulation (EC) No 1760/2000. 

Nevertheless, an animal shall be deemed as eligible to the payment where the information on 
previous movements of animals laid down in the second indent of Article 7(1) of Regulation 
(EC) No 1760/2000 has been reported to the competent authority at the time of the beginning 
of the retention period of the animal. 

Article 107 
Ceilings 

The sum of the amounts of each direct payment claimed under this section shall not exceed 
the ceiling fixed by the Commission in accordance with Article 53(2). 

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

Article 108 
Substances prohibited under Directive 96/22/EC 

1. 

2. 

Where  residues  of  substances  prohibited  under  Council  Directive  96/22/EC24,  or 
residues of substances authorised under the aforementioned act but used illegally, are 
detected  pursuant  to  the  relevant  provisions  of  Council  Directive  96/23/EC25,  in  an 
animal  belonging  to  the  bovine  herd  of  a  farmer,  or  where  a  non-authorised 
substance or product, or a substance or product authorised under Directive 96/22/EC 
but  held  illegally  is  found  on  the  farmer's  holding  in  any  form,  the  farmer  shall  be 
excluded,  for  the  calendar  year  of  that  discovery,  from  receiving  the  amounts 
provided for under this section. 

In  the  event  of  a  repeated  infringement,  the  length  of  the  exclusion  period  may, 
according  to  the  seriousness  of  the  offence,  be  extended  to  five  years  as  from  the 
year in which the repeated infringement was discovered. 

In  the  event  of  obstruction  on  the  part  of  the  owner  or  holder  of  the  animals  when 
inspections  are  being  carried  out  and  when  the  samples  are  being  taken  which  are 
necessary  for  the  application  if  national  residue-monitoring  plans  or  when  the 
investigations  and  checks  provided  for  under  Directive  96/23/EC  are  being  carried 
out, the penalties provided for in paragraph 1 of this Article shall apply. 

24 
25 

OJ L 125, 23.5.1996, p. 3. 
OJ L 125, 23.5.1996, p. 10. 

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CHAPTER 2 
NATIONAL AIDS 

Article 109 
National aid for nuts 

1. 

Member States may grant national aid, up to a maximum of EUR 120,75 per hectare 
per year to farmer producing the following products. 

(a) 

almonds falling within CN codes 0802 11 and 0802 12, 

(b)  hazelnuts or filberts falling within CN codes 0802 21 and 0802 22, 

(c)  walnuts falling within CN codes 0802 31 and 0802 32, 

(d)  pistachios falling within CN codes 0802 50, 

(e) 

locust beans falling within CN codes 1212 10 10. 

2. 

The national aid may be paid only for a maximum area of: 

Member State 

Maximum area (ha) 

Belgium 

Bulgaria 

Germany 

Greece 

Spain 

France 

Italy 

Cyprus 

Luxembourg 

Hungary 

Netherlands 

Austria 

Poland 

Portugal 

Romania 

Slovenia 

Slovakia 

United Kingdom 

100 

11 984 

1 500 

41 100 

568 200 

17 300 

130 100 

5 100 

100 

2 900 

100 

100 

4 200 

41 300 

1 645 

300 

3 100 

100 

3. 

Member States may make the granting of national aid conditional on farmers being 
members  of  a  producer  organisation  recognised  under  Article  125b  of  Regulation 
(EC) No 1234/2007. 

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TITLE V 
IMPLEMENTATION OF DIRECT PAYMENTS  
IN THE NEW MEMBER STATES 

CHAPTER 1 
GENERAL PROVISIONS 

Article 110 
Introduction of direct payments 

In the new Member States, except Bulgaria and Romania, direct payments shall be introduced 
in accordance with the following schedule of increments expressed as a percentage of the then 
applicable level of such payments in the Member States other than the new Member States: 

– 

– 

– 

– 

– 

60% in 2009, 

70% in 2010, 

80% in 2011, 

90% in 2012, 

100% as from 2013. 

For  Bulgaria  and  Romania  direct  payments  shall  be  introduced  in  accordance  with  the 
following  schedule  of  increments  expressed  as  a  percentage  of  the  then  applicable  level  of 
such payments in the Member States other than the new Member States: 

– 

– 

– 

– 

– 

– 

– 

– 

1. 

35% in 2009, 

40% in 2010, 

50% in 2011, 

60% in 2012, 

70% in 2013, 

80% in 2014, 

90% in 2015, 

100% as from 2016. 

CHAPTER 2 
SINGLE AREA PAYMENT SCHEME 

Article 111 
Single Area Payment scheme 

The  new  Members  states  having  decided  to  replace  the  direct  payments,  with  the 
exception of the transitional soft fruit payment established in Section 6 of Chapter 1 
of Title IV of this Regulation, with a single area payment scheme shall grant aid to 
farmers in accordance with this article. 

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2. 

3. 

4. 

The single area payment shall be made once a year. It shall be calculated by dividing 
the  annual  financial  envelope  established  in  accordance  with  Article 112  by  the 
agricultural  area  of  each  new  Member  State  established  in  accordance  with 
Article 113. 

For any new Member State the single area payment scheme shall be available until 
31 December  2013.  New  Member  States  shall  notify  the  Commission  of  their 
intention to terminate the application of the scheme by 1 August of the last year of 
application. 

After  the  end  of  the  period  of  application  of  the  single  area  payment  scheme,  the 
direct  payments  shall  be  applied  in  accordance  with  the  relevant  Community  rules 
and on the basis of the quantitative parameters, such as base area, premium ceilings 
and Maximum Guaranteed Quantities (MGQ), specified in the Acts of Accession for 
each direct payment and subsequent Community legislation. The percentage rates set 
out in Article 110 of this Regulation for the relevant years shall subsequently apply. 

Article 112 
Annual financial envelope 

1. 

For  any  new  Member  State,  the  Commission  shall  establish  an  annual  financial 
envelope as the sum of the funds that would be available in respect of the calendar 
year concerned for granting direct payments in the new Member State. 

The  annual  financial  envelope  shall  be  established  according  to  the  relevant 
Community rules and on the basis of the quantitative parameters, such as base areas, 
premium ceilings and Maximum Guaranteed Quantities (MGQ), specified in the Acts 
of Accession and subsequent Community legislation for each direct payment. 

The  annual  financial  envelope  shall  be  adjusted  using  the  relevant  percentage 
specified  in  Article  110  for  the  gradual  introduction  of  direct  payments,  except  for 
the  amounts  available  in  accordance  with  Annex XII  or  in  accordance  with  the 
differential  between  these  amounts  or  the  amounts  corresponding  to  the  fruit  and 
vegetable sector and those actually applied as referred to in Article 118(1). 

Where in a given year the single area payments in a new Member State would exceed 
its annual financial envelope, the national amount per hectare applicable in that new 
Member  State  shall  be  reduced  proportionately  by  application  of  a  reduction 
coefficient. 

Article 113 
Area under the single area payment scheme 

The agricultural area of a new Member State under the single area payment scheme 
shall be the part of its utilised agricultural area which has been maintained in good 
agricultural condition at 30 June 2003, whether in production or not at that date, and, 
where appropriate, adjusted in accordance with the objective and non-discriminatory 
criteria to be set by that new Member State after approval by the Commission. 

2. 

1. 

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2. 

3. 

4 

For  the  purposes  of  this  Title  «utilised  agricultural  area»  shall  mean  the  total  area 
taken up by arable land, permanent grassland, permanent crops and kitchen gardens 
as established by the Commission for its statistical purposes. 

However,  for  Bulgaria  and  Romania,  the  agricultural  area  under  the  single  area 
payment scheme shall be the part of its utilised agricultural area which is maintained 
in  good  agricultural  condition,  whether  in  production  or  not,  where  appropriate 
adjusted in accordance with the objective and non-discriminatory criteria to be set by 
Bulgaria or Romania after approval by the Commission. 

For  the  purpose  of  granting  payments  under  the  single  area  payment  scheme,  all 
agricultural parcels corresponding to the criteria provided for in paragraph 1, as well 
as agricultural parcels planted with short rotation coppice (CN code ex 0602 90 41) 
which have been maintained in good agricultural condition as at 30 June 2003 shall 
be  eligible.  However,  for  Bulgaria  and  Romania,  all  agricultural  parcels 
corresponding  to  the  criteria  provided  for  in  paragraph  1,  as  well  as  agricultural 
parcels  planted  with  short  rotation  coppice  (CN  code  ex  0602 90 41),  shall  be 
eligible. 

Except in case of force majeure or exceptional circumstances, the parcels referred to 
in  the  first  subparagraph  must  be  at  the  farmer's  disposal  on  the  date  fixed  by  the 
Member  State  which  shall  be  no  later  than the  date  fixed  in  that  Member  State  for 
amendment of the aid application. 

The minimum size of eligible area per holding for which payments may be requested 
shall  be  0,3 ha.  However,  any  new  Member  State  may  decide,  on  the  basis  of 
objective criteria and after approval by the Commission, to set the minimum size at a 
higher level not exceeding 1 ha. 

There  shall  be  no  obligation  to  produce  or  to  employ  the  factors  of  production. 
However, farmers may use the land referred to in paragraph 4 of this Article for any 
agricultural  purpose.  In  the  case  of  production  of  hemp  falling  within  CN  code 
5302 10 00, Article 42(1) shall apply. 

Any land benefiting from payments under the single area payment scheme shall be 
maintained  in  good  agricultural  and  environmental  conditions  in  accordance  with 
Article 6. 

Any farmer receiving support under the single area payment scheme shall respect the 
statutory  management  requirements  referred  to  in  Annex II  according  to  the 
following timetable: 

(a) 

(b) 

requirements  referred 
1 January 2009; 

to 

in  point  A  of  Annex  II  shall  apply  from 

requirements  referred  to  in  points  B  and  C  of  Annex  II  shall  apply  from 
1 January 2011; 

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However, for Bulgaria and Romania, the application of Articles 4, 5, 25, 26 and 27 
shall  be  optional  until  31 December 2011  insofar  as  those  provisions  relate  to 
statutory  management  requirements.  As  from  1 January 2012  a  farmer  receiving 
payments under the single area payment scheme in those Member States shall respect 
the  statutory  management  requirements  referred  to  in  Annex II  according  to  the 
following timetable: 

(a) 

(b) 

requirements  referred 
1 January 2012; 

to 

in  point  A  of  Annex II  shall  apply  from 

requirements  referred  to  in  points  B  and  C  of  Annex II  shall  apply  from 
1 January 2014; 

5. 

The  application  of  the  single  area  payment  scheme  shall  not  in  any  way  affect  the 
obligation  of  any  new  Member  State  with  regard  to  the  implementation  of 
Community rules on the identification and registration of animals as provided for by 
Regulation (EC) No 1760/2000 and Regulation (EC) No 21/2004. 

Article 114 
Communication 

New  Member  States  shall  inform  the  Commission  in  detail  of  the  measures  taken  to 
implement this chapter and in particular the measures taken pursuant to Article 112(2). 

CHAPTER 3 
SEPARATE PAYMENTS AND SPECIFIC SUPPORT 

Article 115 
Separate sugar payment 

1. 

2. 

3. 

Where a new Member State, other than Bulgaria and Romania, has made use of the 
option provided for by Article 143ba of Regulation (EC) No 1782/2003 it shall grant 
in respect of the years 2009 and 2010 a  separate  sugar payment to farmers eligible 
under the single area payment scheme. Bulgaria and Romania shall grant it also for 
2011. It shall be granted on the basis of the criteria adopted by the relevant Member 
states in 2006 and 2007. 

The separate sugar payment shall be granted within the limits of the ceilings set out 
in Annex XII. 

By  way  of  derogation  from  paragraph  2,  each  new  Member  State  concerned  may 
decide  by  31  March  of  the  year  in  respect  of  which  the  separate  sugar  payment  is 
granted and on the basis of objective criteria to apply for the separate sugar payment 
a  ceiling  lower  than  that  listed  in  Annex XII.  Where  the  sum  of  the  amounts 
determined in accordance with paragraph 1 exceeds the ceiling  decided by  the new 
Member  State  concerned,  the  annual  amount  to  be  granted  to  the  farmers  shall  be 
reduced proportionally. 

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1. 

2. 

1. 

Article 116  
Separate fruit and vegetables payment 

Where a new Member State has made use of the option provided for in Article 143bb 
of  Regulation  (EC)  No 1782/2003,  it  shall  grant  a  separate  fruit  and  vegetables 
payment to farmers eligible under the single area payment scheme. It shall be granted 
in accordance with the criteria adopted by the Member State in 2007. 

The  separate  fruit  and  vegetables  payment  shall  be  granted  within  the  limits  of  the 
component  of  the  national  ceiling  referred  to  in  Article 41  of  this  Regulation 
corresponding to fruit and vegetables or at a lower ceiling where new Member State 
made  use  of  the  option  provided  for  in  Article 143bb(3)  of  Regulation  (EC) 
No 1782/2003. 

Article 117 
Separate transitional fruit and vegetables payment 

Where  a  new  Member  State  has  made  use  of  the  option  provided  for  in 
Article 143bc(1) of Regulation (EC) No 1782/2003 it shall retain up to 31 December 
2011 up to 50% of the component of national ceilings referred to in Article 41 of this 
Regulation  corresponding  to  tomatoes  falling  within  CN  code  0702 00 00  in 
accordance with its decision of 2007. 

In this case and within the limit of the ceiling fixed in accordance with the procedure 
referred  to  in  Article 128(2)  of  this  Regulation,  the  Member  State  concerned  shall 
make, on a yearly basis, an additional payment to farmers. 

The  additional  payment  shall  be  granted  to  farmers  producing  tomatoes  under  the 
conditions provided for in Section 5 of Chapter 1 of Title IV of this Regulation. 

2. 

Where  a  new  Member  State  has  made  use  of  the  option  provided  for  in 
Article 143bc(2)  of  Regulation  (EC)  No 1782/2003  shall  retain,  in  accordance  with 
its decision of 2007: 

(a) 

(b) 

up  to  31  December  2010  up  to  100%  of  the  component  of  national  ceilings 
referred  to  in  Article  41  of  this  Regulation  corresponding  to  the  fruit  and 
vegetable  crops  other  than  annual  crops  listed  in  the  third  subparagraph  of 
Article 56(2) of this Regulation; 

from 1 January 2011 up to 31 December 2012 up to 75% of the component of 
national  ceilings  referred  to  in  Article 41  of  this  Regulation  corresponding  to 
fruit  and  vegetable  crops  other  than  annual  crops  listed  in  the  third 
subparagraph of Article 56(2) of this Regulation. 

In this case and within the limit of the ceiling fixed in accordance with the procedure 
referred  to  in  Article 128(2)  of  this  Regulation,  the  Member  State  concerned  shall 
make, on a yearly basis, an additional payment to farmers. 

The  additional  payment  shall  be  granted  to  farmers  producing  one  or  more  of  the 
fruit and vegetables products, as determined by the Member State concerned, listed 
in the third subparagraph of Article 56(2) of this Regulation. 

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1. 

2. 

3. 

1. 

2. 

3. 

Article 118 
Common provisions for the separate payments 

The funds made available for granting the payment referred to in Articles 115, 116 
and  117  shall  not  be  included  in  the  annual  financial  envelope  referred  to  in 
Article 112(1).  However,  in  case  of  application  of  Article 115(3)  the  differential 
between the ceiling listed in Annex XII and that actually applied shall be included in 
the annual financial envelope referred to in Article 112(1). 

Articles  110  and  120  shall  not  apply  to  the  separate  payments  referred  to  in 
Articles 115, 116 and 117. 

In  the  case  of  actual  or  anticipated  inheritance,  the  separate  sugar  payment  and  the 
separate  fruit  and  vegetables  payment  referred  to  in  Articles 115  and  116 
respectively  shall  be  granted  to  the  farmer  who  inherited  the  holding,  under  the 
condition that this farmer is eligible under the single area payment scheme. 

Article 119 
Specific support 

The  new  Member  States  applying  the  single  area  payment  scheme  may  decide  by 
1 August 2009 at the latest and with effect as from the calendar year 2010 to use up 
to 10% of their national ceilings referred to in Article 41 to grant support to farmers 
as set out in points (a), (b), (c), (d) and (e) of Article 68(1) and in accordance with 
Article 68(2) to (9), and Articles 69 and 70. 

By way of derogation from point (b) in Article 68(5), support for measures referred 
to in point (c) of  Article 68(1) shall take the form  of an increase of  the per  hectare 
amounts granted under the single area payment scheme. 

The amounts referred to in paragraph 1 shall be set by the Commission in accordance 
with the procedure referred to in Article 128(2). 

These amounts shall be deducted from the annual financial envelopes referred to in 
Article 112(1) of the new Member States concerned. 

CHAPTER 4 
COMPLEMENTARY NATIONAL DIRECT PAYMENTS AND 
DIRECT PAYMENTS 

Article 120 
Complementary national direct payments and direct payments 

1. 

2. 

For the purposes of this Article: «CAP-like national scheme» shall mean any national 
direct payment scheme applicable prior to the date of accession of the new Member 
States  under  which  the  support  was  granted  to  farmers  in  respect  of  production 
covered by one of the direct payments. 

The  new  Member  States  shall  have  the  possibility,  subject  to  authorisation  by  the 
Commission, of complementing any direct payments up to: 

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(a)  with  regard  to  all  direct  payments  up  to  30  percentage  points  above  the 
applicable  level  referred  to  in  Article  110  in  the  relevant  year.  As  far  as 
Bulgaria  and  Romania  are  concerned,  the  following  shall  apply:  65%  of  the 
level of direct payments in the Community as constituted on 30 April 2004 in 
2009  and  from  2010  up  to  30  percentage  points  above  the  applicable  level 
referred  to  in  the  second  paragraph  of  Article 110  in  the  relevant  year. 
However, the Czech Republic may complement direct payments in the potato 
starch  sector  up  to  100%  of  the  level  applicable  in  the  Member  States  other 
than the new Member States. However, for the direct payments referred to in 
Chapter 7  of  Title IV  of  Regulation  (EC)  No 1782/2003  Member  States  may 
complement the direct payments up to 100%. As far as Bulgaria and Romania 
are  concerned,  the  following  maximum  rates  shall  apply:  95%  in  2009  and 
100% as from 2010; 

or 

(b) 

(i)  with regard to direct payments other than the single payment scheme, the 
total  level  of  direct  support  the  farmer  would  have  been  entitled  to 
receive, on a product by product basis, in the new Member State in the 
calendar  year  2003  under  a  CAP-like  national  scheme  increased  by 
10 percentage points. However for Lithuania the reference year shall be 
the  calendar  year  2002.  For  Bulgaria  and  Romania  the  reference  year 
shall  be  the  calendar  year  2006.  For  Slovenia  the  increase  shall  be 
25 percentage points; 

(ii)  with  regard  to  the  single  payment  scheme  the  total  amount  of 
complementary  national  direct  aid  which  may  be  granted  by  a  new 
Member  State  in  respect  of  a  given  year  shall  be  limited  by  a  specific 
financial  envelope.  This  envelope  shall  be  equal  to  the  difference 
between: 

– 

the total amount of CAP-like national direct support that would be 
available  in  the  relevant  new  Member  State  in  respect  of  the 
calendar year 2003 or, in the case of Lithuania, of the calendar year 
2002,  each  time  increased  by  10  percentage  points.  However,  for 
Bulgaria and Romania the reference year shall be the calendar year 
2006. For Slovenia the increase shall be 25 percentage points, and 

– 

the national ceiling of that new Member State listed in Annex VIII 
adjusted, where appropriate, in accordance with Articles 53(2). 

For  the  purpose  of  calculating  the  total  amount  referred  to  in  the  first  indent 
above, the national direct payments and/or its components corresponding to the 
Community  direct  payments  and/or  its  components  which  were  taken  into 
account  for  calculating  the  effective  ceiling  of  the  new  Member  State 
concerned in accordance with Articles 41 and 53(2) . 

For each direct payment concerned a new Member State may choose to apply 
either option (a) or (b) above. 

The total direct support the farmer may be granted in the new Member States 
after accession under the relevant direct payment including all complementary 

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national direct payments shall not exceed the level of direct support the farmer 
would  be  entitled  to  receive  under  the  corresponding  direct  payment  then 
applicable  to  the  Member  States  in  the  Member  States  other  than  the  new 
Member States. 

3. 

Cyprus may complement direct aid paid to a farmer under any direct payments listed 
in  Annex  I  up  to  the  total  level  of  support  the  farmer  would  have  been  entitled  to 
receive in Cyprus in 2001. 

4. 

5. 

The Cypriot authorities shall ensure that the total direct support the farmer is granted 
after  accession  in  Cyprus  under  the  relevant  direct  payment  including  all 
complementary  national  direct  payments  in  no  case  exceeds  the  level  of  direct 
support  the  farmer  would  be  entitled  to  receive  under  that  direct  payment  in  the 
relevant year in the Member States other than the new Member States. 

The  total  amounts  of  complementary  national  aid  to  be  granted  shall  be  those 
indicated in Annex XIII. 

The  complementary  national  aid  to  be  granted  shall  be  subject  to  any  adjustments 
which  may  be  rendered  necessary  by  developments  in  the  common  agricultural 
policy. 

The paragraphs 2 and 5 shall not apply to Cyprus. 

If  a  new  Member  State  decides  to  apply  the  single  area  payment  scheme,  that  new 
Member  State  may  grant  complementary  national  direct  aid  under  the  conditions 
referred to in paragraphs 5 and 8. 

The total amount of complementary national aid granted in that year when applying 
the single area payment scheme may be limited by a specific financial envelope per 
(sub)sector  provided  that  such  a  (sub)sector  specific  financial  envelope  may  only 
relate to: 

– 

– 

the direct payments combined to the single payment scheme, and/or 

one  or  more  of  the  direct  payments  that  may  be  subject  to  partial 
implementation as referred to in Article 53(2). This envelope shall be equal to 
the difference between: 

– 

– 

the total amount of support per (sub)sector resulting from the application 
of the points (a) or (b) of paragraph 2, as appropriate, and 

the total amount of direct support that would be available in the relevant 
new Member State for the same (sub)sector in the year concerned under 
the single area payment scheme. 

6. 

The  new  Member  State  may  decide  on  the  basis  of  objective  criteria  and  after 
authorisation by the Commission, on the amounts of complementary national aid to 
be granted. 

7. 

The authorisation by the Commission shall: 

– 

where point (b) of paragraph 2 applies, specify the relevant CAP-like national 
direct payment schemes, 

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– 

– 

define the level up to which the complementary national aid may be paid, the 
rate of the complementary national aid and, where appropriate, the conditions 
for the granting thereof, 

be  granted  subject  to  any  adjustments  which  may  be  rendered  necessary  by 
developments in the common agricultural policy. 

8. 

No  complementary  national  payments  or  aid  shall  be  granted  for  agricultural 
activities in respect of which direct payments are not foreseen Member States other 
than the new Member States. 

Article 121 
State aid in Cyprus 

Cyprus may, in addition to the complementary national direct payments, grant transitional and 
digressive national aid until the end of 2010. This State aid shall be granted in a form similar 
to Community aid, such as decoupled payments. 

Taking into account the nature and amount of national support granted in 2001, Cyprus may 
grant State aid to the (sub)sectors listed in Annex XIV and up to the amounts specified in that 
Annex. 

The  State  aid  to  be  granted  shall  be  subject  to  any  adjustments  which  may  be  rendered 
necessary by developments in the common agricultural policy. Should such adjustments prove 
necessary, the amount of the aid or the conditions for the granting thereof shall be amended 
on the basis of a decision by the Commission. 

Cyprus shall submit an annual report to the Commission on the implementation of the State 
aid measures, indicating the aid forms and amounts per (sub)sector. 

EN 

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TITLE VI 
FINANCIAL TRANSFERS 

Article 122 
Financial transfer for restructuring in the cotton regions 

An amount of EUR 22 million, shall be available per calendar year as additional Community 
support  for  measures  in  cotton  producing  regions  under  rural  development  programming 
financed under the EAFRD. 

Article 123 
Financial transfer for restructuring in the tobacco regions 

As  from  budget  year  2011,  an  amount  of  EUR  484  million  shall  be  available  as  additional 
Community  support  for  measures  in  tobacco  producing  regions  under  rural  development 
programming  financed  under  the  EAFRD,  for  those  Member  States  in  which  the  tobacco 
producers received aid in accordance with Council Regulation (EC) No 2075/9226 during the 
years 2000, 2001 and 2002. 

TITLE VII 
IMPLEMENTING, TRANSITIONAL  
AND FINAL RULES 

CHAPTER 1 
IMPLEMENTING PROVISIONS 

Article 124 
Confirmation of payment entitlements 

1. 

2. 

3. 

Payment  entitlements  allocated  to  farmers  before  1  January  2009  shall  be  deemed 
legal and regular as from 1 January 2010. 

Paragraph 1 shall not apply to payment entitlements allocated to farmers on the basis 
of factually incorrect applications. 

Paragraph 1 shall not prejudice the Commission's power to take decisions referred to 
in  Article 31  of  Regulation  (EC)  No 1290/2005  in  relation  to  expenditure  incurred 
for payments granted in respect of any calendar year up to 2009 included. 

26 

OJ L 215, 30.7.1992, p. 70. 

EN 

84 

   EN 

                                                 
Article 125 
Application to the outermost regions 

Titles  III  and  IV  shall  not  apply  in  the  French  overseas  departments,  in  the  Azores  and 
Madeira and in the Canary Islands. 

Article 126 
State aid 

By  way  of  derogation  from  Article  180  of  Regulation  (EC)  No 1234/2007  and  Article 3  of 
Regulation  (EC)  No 1184/200627,  Articles 87,  88  and 89  of  the  Treaty  shall  not  apply  to 
payments  made  under  Articles  42,  59,  68  to  70,  87(4),  100(5),  109,  and  119  to  121  by 
Member States in conformity with this Regulation. 

Article 127 
Transmission of information to the Commission 

Member States shall inform the Commission in detail of the measures taken to implement this 
Regulation  and,  in  particular,  those  relating  to  Articles  6,  12,  42,  46,  47,  68,  69,  70,  59,  60 
and 119. 

Article 128 
Management Committee for Direct Payments 

The  Commission  shall  be  assisted  by  the  Management  Committee  for  Direct 
Payments,  consisting  of  representatives  of  the  Member  States  and  chaired  by  a 
representative of the Commission. 

to 
Where 
Decision 1999/468/EC shall apply. 

is  made 

reference 

this  paragraph,  Articles  4  and  7  of 

1. 

2. 

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

3. 

The Committee shall adopt its Rules of Procedure. 

Article 129 
Implementing Rules 

In accordance with the procedure referred to in Article 128(2), detailed rules shall be adopted 
for the implementation of this Regulation. They shall include in particular: 

(a) 

(b) 

detailed rules related to the establishment of a farm advisory system; 

detailed rules related to the criteria for the allocation of amounts made available by 
the application of modulation; 

27 

OJ L 214, 4.8.2006, p. 7. 

EN 

85 

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(c) 

(d) 

(e) 

(f) 

(g) 

(h) 

(i) 

(j) 

(k) 

(l) 

detailed rules related to the granting of aids provided for in this Regulation, including 
eligibility  conditions,  dates  of  application  and  payment  and  control  provisions  as 
well  as  checking  and  establishing  entitlement  to  the  aids  including  any  necessary 
exchange of data with the Member States, and the establishment of the overrun of the 
base  areas  or  maximum  guaranteed  areas  as  well  as  detailed  rules  concerning  the 
fixing  of  the  retention  period,  the  withdrawal  and  reallocation  of  unused  premium 
rights established under Sections 7 and 8 of Chapter 1 of Title IV; 

with regard to the single payment scheme, detailed rules relating in particular to the 
establishment  of  national  reserve,  the  transfer  of  entitlements,  the  definition  of 
permanent  crops,  permanent  pastures,  and  grassland,  the  options  provided  for  in 
Chapters 2 and 3 of Title III and the integration of coupled payments provided for in 
Chapter 4 of Title III; 

detailed rules relating to the implementation of the provisions in Title V; 

detailed  implementing  rules  relating  to  the  inclusion  of  fruit  and  vegetables,  ware 
potatoes  and  nurseries  support  into  the  single  payment  scheme,  including  the 
application  procedure  in  the  first  year  of  implementation,  and  relating  to  the 
payments referred to in Section 5 and 6 of Chapter 1 of Title IV; 

detailed  rules  relating  to  the  inclusion  of  wine  support  into  the  single  payment 
scheme,  including  the  application  procedure  in  the  first  year  of  implementation,  in 
accordance with Regulation (EC) No [the wine Regulation]"; 

with  regard  to  hemp,  detailed  rules  relating  to  the  specific  control  measures  and 
methods for determining tetrahydrocannabinol levels; 

such  amendments  to  Annex  I  as  may  become  necessary  taking  into  account  the 
criteria set out in Article 1; 

such amendments to Annexes V, VI and VII as may become necessary, taking into 
account in particular new Community legislation 

the  basic  features  of  the  identification  system  for  agricultural  parcels  and  their 
definition; 

any amendments which may be made to the aid application and exemption from the 
requirement to submit an aid application; 

(m) 

rules on the minimum amount of information to be included in the aid applications; 

(n) 

(o) 

(q) 

rules on the administrative and on-the-spot checks and the checks by remote sensing; 

rules on the application of reductions and exclusions from payments in case of non-
compliance with the obligations referred to in Articles 4 and 24, including cases of 
non-application of reductions and exclusions; 

such  amendments  to  Annex  V  as  may  become  necessary  taking  into  account  the 
criteria set out in Article 28; 

(r) 

communications between the Member States and the Commission; 

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(s) 

measures  which  are  both  necessary  and  duly  justified  to  resolve,  in  an  emergency, 
practical and specific problems, in particular those related to the implementation of 
Chapter 4 of Title II and Chapters 2 and 3 of Title III; such measures may derogate 
from certain parts of this Regulation, but only to the extent that, and for such a period 
as, is strictly necessary; 

(t) 

with regard to cotton, detailed rules in respect of: 

(i) 

the calculation of the reduction of the aid provided for in Article 80(3); 

(ii) 

the  approved  inter-branch  organisations,  in  particular  their  financing  and  a 
control and sanction system. 

CHAPTER 2 
TRANSITIONAL AND FINAL PROVISIONS 

Article 130 
Amendment of Regulation (EC) No 1290/2005 

1. 

In Article 12 paragraph 2 is replaced by the following: 

"2.  The  Commission  shall  set  the  amounts  which,  pursuant  to  Articles  9,  10(4), 
123  and  124  of  Council  Regulation  (EC)  xxx/2008*[this  regulation)],  and 
Article 4(1)  of  Council  Regulation  (EC)  No 378/2007,  are  made  available  to 
the EAFRD. 

2 

Article 18(3) is replaced by the following: 

"3.  National ceilings for direct payments referred to in Article 8(2) of Regulation 
(EC)  No XXX/2008  [this  regulation)],  corrected  by  the  adjustments  laid  down  in 
Article 11(1) of that Regulation, shall be deemed to be financial ceilings in euro. 

* 

OJ L ………" 

Article 131 
Amendment of Regulation (EC) No 247/2006 

Regulation (EC) No 247/2006 is amended as follows: 

(1) 

in Article 23, paragraph 2 is replaced by the following: 

"2.  The Community shall finance the measures provided for in Titles II and III of 

this Regulation up to an annual maximum as follows: 

EN 

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Financial 
year 2007 

Financial 
year 2008 

Financial 
year 2009 

Financial year 
2010 and further 

million EUR

French overseas departments 

Azores and Madeira 

Canary Islands 

126.6 

77.9 

127.3 

262.6 

86.98 

268.4 

269.4 

86.7 

268.4 

276.05 

106.21 

268.42 

(2) 

the following Article 24b is inserted: 

"Article 24b 

1. 

2. 

By  15  February  2009  at  the  latest,  Member  States  shall  submit  to  the 
Commission  the  draft  amendments  to  their  overall  programme  to  reflect  the 
changes introduced in Article 23(2). 

The Commission shall evaluate the amendments proposed and decide on their 
approval  within  four  months  of  their  submission  at  the  latest  in  accordance 
with the procedure referred to in Article 26(2)." 

Article 132 
Amendment of Regulation (EC) No 378/2007 

Regulation (EC) No 378/2007 is amended as follows: 

(1) 

Article 1 is amended as follows: 

(a)  Paragraph 3 is replaced by the following: 

"3.  Reductions  under  voluntary  modulation  shall  be  made  on  the  same  basis  of 
calculation  as  that  applicable  to  modulation  pursuant  to  Article  7  of  Council 
Regulation (EC) No XXX/2008* (this regulation) 

* 

OJ L ………" 

(b)  The following paragraph 5 is added: 

"5.  The  modulation  rates  applicable  to  a  farmer  resulting  from  the  application  of 
Article  7  of  Regulation  (EC)  No XXX/2008  (this  regulation)  minus  5  percentage 
points shall be deducted from the rate of voluntary modulation applied by Member 
States  in  application  of  paragraph  4  of  this  Article.  Both  the  percentage  to  be 
deducted and the final voluntary modulation rate shall be equal to or higher than 0. 

(2) 

in Article 3(1), point (a) is replaced by the following: 

"(a)  by  derogation  from  Article  1(3)  of  this  Regulation,  to  apply  the  reductions 
under  modulation  on  the  basis  of  calculation  applicable  to  modulation  pursuant  to 
Article 7 of Regulation (EC) No xx/2008, without taking into account the exclusion 
of EUR 5 000 provided for in paragraph 1 of that Article ; and/or". 

EN 

88 

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Article 133 
Repeals 

1. 

Regulation (EC) No 1782/2003 is hereby repealed. 

However,  Articles  66,  67,  68,  68a,  69,  70(1)(a)  and  Chapters 1  (durum  wheat)  2, 
(protein crop premium), 4 (area payment for nuts), 8, (energy crops), 9 (seed aid), 10 
(arable crops area payment), 10b (aid for olive groves), 10c (Tobacco aid) and 10d 
(hops area payment) of Title IV of that Regulation shall continue to apply for 2009. 

2. 

References made to the repealed Regulation shall be construed as being made to this 
Regulation  and  shall  be  read  in  accordance  with  the  correlation  table  set  out  in 
Annex XV. 

Article 134 
Transitional rules 

The  Commission  may  adopt  the  measures  required  to  facilitate  the  transition  from  the 
arrangements  provided  for  in  Regulation  (EC)  No 1782/2003  to  those  established  by  this 
Regulation. 

Article 135 
Transitional arrangements for new Member States 

Where transitional measures are necessary in order to facilitate, for the new Member States, 
the transition from the single area payment scheme to the single payment scheme and other 
aid  schemes  referred  to  in  Titles  III  and  IV,  such  measures  shall  be  adopted  in  accordance 
with the procedure laid down in Article 128(2). 

Article 136 
Entry into force and application 

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

It shall apply from 1 January 2009. 

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

Done at Brussels, 

For the Council 
The President 

EN 

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ANNEX I 

List of support schemes  

Sector 

Legal base 

Notes 

Single payment 

Title III of this Regulation 

Decoupled payment  

Single 
scheme 

area 

payment 

Title  V,  Chapter  2  of 
Regulation 

this 

Decoupled  payment  replacing  all 
the 
direct  payments  listed  in  this  Annex, 
except separate payments 

Protein crops 

Rice 

Nuts 

Energy crops 

Starch potatoes 

Seeds 

Arable crops 

Title IV, Chapter 2 of Regulation 
(EC) No 1782/2003∗ 

Area payment 

Title  IV,  Chapter  2  of 
Regulation 

this 

Area payment 

Title IV, Chapter 4 of Regulation 
(EC) No 1782/2003∗ 

Area payment 

Title IV, Chapter 5 of Regulation 
(EC) No 1782/2003∗ 

Area payment 

Title IV, Chapter 1, Section 5 of 
this Regulation 

Production aid 

Title IV, Chapter 9 of Regulation 
(EC) No 1782/2003 

Production aid 

IV,  Chapter 
Title 
Regulation (EC) No 1782/2003  

10 

of 

Sheepmeat and goatmeat 

Beef and veal 

Title IV, Chapter 1, Section 7 of 
this Regulation  

Title IV, Chapter 1, Section 8 of 
this Regulation  

Specific support  

Chapter  5  of  Title  III  of  this 
Regulation  

Area payment,  

Ewe and she-goat premium,  

Special  premium,  suckler  cow  premium 
(including  when  paid  for  heifers  and 
including  the  additional  national  suckler 
cow  premium  when  part-financed), 
slaughter premium,  

Olive oil 

Silkworms 

Tobacco 

Hops 

beet, 

cane 
used  
the  production  of 

Sugar 
and chicory 
for 
sugar or inulin syrup 

Title 
IV,  Chapter  10b  of 
Regulation (EC) No 1782/2003∗ 

Area aid 

Article  1  of  Regulation  (EEC) 
No 845/72 

Aid to encourage rearing 

Title 
IV,  Chapter  10c  of 
Regulation (EC) No 1782/2003∗ 

Production aid 

IV,  Chapter  10d  of 
Title 
Regulation (EC) No 1782/2003*  

Area aid 

Title  V,  Article 116  of 
Regulation 

this 

Decoupled Payments 

Sugar  beet  and cane  used 
the  production  of 
for 
sugar 

Title  IV,  Chapter  1  Section  4  of 
this Regulation 

Production aid 

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Fruit 
delivered for processing 

vegetables 

and 

Strawberries and 
raspberries delivered for 
processing 

Title  IV,  Chapter  1  Section  5  of 
this Regulation 

Transitional 
payments 

fruit 

and 

vegetables 

Title  IV,  Chapter  1  Section  6  of 
this regulation  

Transitional soft fruit payment 

Fruit and vegetables 

Article 116 

Separate fruit and vegetables payment 

Posei 

Aegean islands 

Cotton 

Title III of Council Regulation 
(EC) No 247/2006  

Direct 
payments 
established in the programmes 

under  measures 

Chapter III of Council 
Regulation (EC) No 1405/2006 

Direct 
payments 
established in the programmes 

under  measures 

Title IV, Chapter 1, Section 4 of 
this Regulation 

Area payment 

∗ 

Only for year 2009. 

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Statutory management requirements referred to in Articles 4 and 5 

ANNEX II 

Environment 

Council  Directive  79/409/EEC  of  2  April  1979 on  the conservation of 
wild birds (OJ L 103, 25.4.1979, p. 1) 

Council Directive 80/68/EEC of 17 December 1979 on the protection of 
groundwater  against  pollution  caused  by  certain  dangerous  substances 
(OJ L 20, 26.1.1980, p. 43) 

Articles  3(1)  and  3(2)(b), 
4(1),  (2),  (4),  5(a),  (b)  and 
(d) 

Articles 4 and 5 

Council Directive 86/278/EEC of 12 June 1986 on the protection of the 
environment, and in particular of the soil, when sewage sludge is used 
in agriculture (OJ L 181, 4.7.1986, p. 6) 

Article 3 

Council  Directive  91/676/EEC  of  12  December  1991  concerning  the 
protection  of  waters  against  pollution  caused  by  nitrates  from 
agricultural sources (OJ L 375, 31.12.1991, p. 1) 

Articles 4 and 5 

Council  Directive  92/43/EEC  of  21  May  1992  on  the  conservation  of 
natural habitats and of wild flora and fauna (OJ L 206, 22.7.1992, p. 7) 

Articles 6 and 13(1)(a) 

A. 

1. 

2. 

3. 

4. 

5. 

Public and animal health 

Identification and registration of animals 

6. 

7. 

8. 

B. 

9. 

10. 

11. 

Council Directive 92/102/EEC of 27 November 1992 on identification 
and registration of animals (OJ L 355, 5.12.1992, p. 32) 

Articles 3, 4 and 5 

Regulation  (EC)  No 1760/2000  of the  European  Parliament  and of  the 
Council of 17 July 2000 establishing a system for the identification and 
registration  of  bovine  animals  and  regarding  the  labelling  of  beef  and 
beef  products  and  repealing  Council  Regulation  (EC)  No 820/97  (OJ 
L 204, 11.8.2000, p. 1) 

Council Regulation (EC) No 21/2004 of 17 December 2003 establishing 
a  system  for  the  identification  and  registration  of  ovine  and  caprine 
animals  and  amending  Regulation  (EC)  No 1782/2003  and  Directives 
92/102/EEC and 64/432/EEC (OJ L 5, 9.1.2004, p. 8). 

Articles 4 and 7 

Articles 3, 4 and 5 

Public, animal and plant health 

Council Directive 91/414/EEC of 15 July 1991 concerning the placing 
of plant protection products on the market (OJ L 230, 19.8.1991, p. 1) 

Article 3 

Council  Directive  96/22/EC  of  29  April  1996  concerning 
the 
prohibition  on  the  use  in  stockfarming  of  certain  substances  having  a 
hormonal  or  thyrostatic  action  and  of  beta-agonists,  and  repealing 
Directives  81/602/EEC,  88/146/EEC  and  88/299/EEC  (OJ  L 125, 
23.5.1996, p. 3) 

Regulation  (EC)  No 178/2002  of  the  European  Parliament  and  of  the 
Council  of  28  January  2002  laying  down  the  general  principles  and 
requirements  of  food  law,  establishing  the  European  Food  Safety 
Authority  and  laying  down  procedures  in  matters  of  food  safety  (OJ 
L 31, 1.2.2002, p. 1) 

Articles 3, 4, 5 and 7 

Articles 14, 15, 17(1), 18, 19 
and 20 

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12. 

Regulation  (EC)  No 999/2001  of  the  European  Parliament  and  of  the 
Council of 22 May 2001 laying down rules for the prevention, control 
and  eradication  of  certain  transmissible  spongiform  encephalopathies 
(OJ L 147, 31.5.2001, p. 1) 

Articles 7, 11, 12, 13 and 15 

Notification of diseases 

13. 

14. 

15. 

C. 

16. 

17. 

18. 

Council  Directive  85/511/EEC  of  18  November  1985  introducing 
Community  measures  for  the  control  of  foot-and-mouth  disease  (OJ 
L 315, 26.11.1985, p. 11) 

Article 3 

Council  Directive  92/119/EEC  of  17  December  1992  introducing 
general Community measures for the control of certain animal diseases 
and  specific  measures  relating  to  swine  vesicular  disease  (OJ  L 62, 
15.3.1993, p. 69) 

Article 3 

Council  Directive  2000/75/EC  of  20  November  2000  laying  down 
specific  provisions  for  the  control  and  eradication  of  bluetongue  (OJ 
L 327, 22.12.2000, p. 74) 

Article 3 

Animal welfare 

Council  Directive  91/629/EEC  of  19  November  1991  laying  down 
minimum standards for the protection of calves (OJ L 340, 11.12.1991, 
p. 28) 

Articles 3 and 4 

Council  Directive  91/630/EEC  of  19  November  1991  laying  down 
minimum  standards  for  the  protection  of  pigs  (OJ  L 340,  11.12.1991, 
p. 33) 

Articles 3 and 4(1) 

Council Directive 98/58/EC of 20 July 1998 concerning the protection 
of animals kept for farming purposes (OJ L 221, 8.8.1998, p. 23) 

Article 4 

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Good agricultural and environmental condition referred to in Article 6 

ANNEX III 

Issue 

Standards 

Soil erosion: 

– Minimum soil cover 

Protect soil through appropriate measures 

–  Minimum  land  management  reflecting  site-specific 
conditions 

– Retain terraces 

Soil organic matter: 

– Standards for crop rotations where applicable 

Maintain soil organic matter levels through 
appropriate practices 

– Arable stubble management 

Soil structure: 

– Appropriate machinery use 

Maintain soil structure through appropriate measures 

Minimum level of maintenance: 

Ensure  a  minimum  level  of  maintenance  and  avoid 
the deterioration of habitats 

–  Minimum  livestock  stocking  rates  or/and  appropriate 
regimes 

– Protection of permanent pasture 

–  Retention  of  landscape  features,  including,  where 
appropiate, hedges, ponds, ditches trees in line, in group 
or isolated and field margins, 

–  where  appropriate,  prohibition  of  the  grubbing  up  of 
olive trees 

– Avoiding the encroachment of unwanted vegetation on 
agricultural land 

–  Maintenance  of  olive  groves  and  vines  in  good 
vegetative condition 

Protection and management of water: 

– Establishment of buffer strips along water courses, 

Protect  water  against  pollution  and  run-off,  and 
manage the use of water 

– respect of authorisation procedures for using water for 
irrigation. 

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ANNEX IV 
Net National ceilings referred to in Article 8 

million EUR 

Calendar year 

Belgium 

Czech Republic 

Denmark 

Germany 

Estonia 

Ireland 

Greece 

Spain 

France 

Italy 

Cyprus 

Latvia 

Lithuania 

Luxembourg 

Hungary 

Malta 

Netherlands 

Austria 

Poland 

Portugal 

Slovenia 

Slovakia 

Finland 

Sweden 

2009 

583,2 

985,9 

5 467,4 

1 283,1 

2 567,3 

5 171,3 

8 218,5 

4 323,6 

2010 

570,9 

965,3 

5 339,2 

1 264,0 

2 365,5 

5 043,4 

8 021,2 

4 103,7 

2011 

563,1 

954,6 

5 269,3 

1 247,1 

2 348,9 

5 019,1 

7 930,7 

4 073,2 

35,2 

34,5 

34,0 

841,5 

727,7 

827,0 

718,2 

829,4 

712,1 

635,8 

623,0 

622,6 

550,0 

731,7 

541,2 

719,9 

536,0 

710,6 

2012 

553,9 

773,0 

937,8 

5 178,0 

88,9 

1 230,0 

2 324,1 

4 953,5 

7 796,2 

4 023,3 

48,2 

130,5 

337,9 

33,4 

1 150,9 

4,6 

815,9 

704,9 

2 730,5 

622,6 

129,4 

335,9 

529,8 

699,8 

United Kingdom 

3 373,0 

3 340,4 

3 335,8 

3 334,9 

EN 

95 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ANNEX V 

List of cereals referred to in Article 9(3) 

CN code 

Description 

I. 

Cereals 

1001 10 00 

Durum wheat 

1001 90 

1002 00 00 

1003 00 

1004 00 00 

1005 

1007 00 

1008 

Other wheat and meslin other than durum wheat 

Rye 

Barley 

Oats 

Maize 

Grain sorghum 

Buckwheat, millet and canary seed; other cereals 

0709 90 60 

Sweet corn 

II. 

Oilseeds 

1201 00 

Soya beans 

ex 1205 00 

Rape seed 

ex 1206 00 10 

Sunflower seed 

III. 

Protein crops 

0713 10 

0713 50 

Peas 

Field beans 

ex 1209 29 50 

Sweet lupins 

IV. 

Flax 

ex 1204 00 

Linseed (Linum usitatissimum L.) 

ex 5301 10 00 

Flax, raw or retted, grown for fibre (Linum usitatissimum L.) 

V. 

Hemp 

ex 5302 10 00 

Hemp, raw or retted, grown for fibre (Cannabis sativa L.) 

EN 

96 

   EN 

 
ANNEX VI 

Compatible support schemes referred to in Article 28 

Sector 

Legal base 

Less-favoured 
environmental restrictions  

areas 

and 

areas  with 

Articles  13(a),  14(1)  and 
indents  of 
Article 14(2), 15, 17 to 20, 51(3) and 55(4) of Regulation 
(EC) No 1257/1999 

the  first 

two 

Measures  targeting  the  sustainable  use  of 
agricultural land through: 

natural  handicap  payments  to  farmers  in 
mountain areas 

payments 
handicaps, other than mountain areas 

farmers 

in  areas  with 

to 

Article 36(a) (i) of Regulation (EC) No 1698/2005 

Article 36(a) (ii) of Regulation (EC) No 1698/2005 

Natura  2000  payments  and  payments 
linked to Directive 2000/60/EC 

Article 36(a)(iii) of Regulation (EC) No 1698/2005 

agri-environment payments 

Article 36(a)(iv) of Regulation (EC) No 1698/2005 

Measures  targeting  the  sustainable  use  of 
forestry land through: 

first afforestation of agricultural land 

Article 36(b)(i) of Regulation (EC) No 1698/2005 

Natura 2000 payments 

Article 36(b)(iv) of Regulation (EC) No 1698/2005 

forest-environment payments 

Article 36(b)(v) of Regulation (EC) No 1698/2005 

Wine 

Article 117 of (wine regulation) 

EN 

97 

   EN 

 
 
 
A. 

1. 

2. 

3. 

4. 

5. 

Fruit and vegetables, ware potatoes and nurseries 

ANNEX VII 

Farmers  shall  receive  a  payment  entitlement  per  hectare  which  is  calculated  by 
dividing the reference amount referred in paragraph 2 by the number of hectares as 
calculated in accordance with paragraph 3. 

Member States shall determine the amount to be included in the reference amount of 
each farmer on the basis of objective and non discriminatory criteria such as: 

– 

– 

– 

the amount of market support received, directly or indirectly, by the farmer in 
respect of fruit and vegetables, ware potatoes and nurseries, 

the area used to produce fruit and vegetables, ware potatoes and nurseries, 

the amount of fruit and vegetables produced, ware potatoes and nurseries, 

in respect of a representative period which could be different for each product, of one 
or more marketing years starting from the marketing year ending in 2001 and, in case 
of the Member States which acceded to the European Union on 1 May 2004 or after 
that date, from the marketing year ending in 2004, up to the marketing year ending in 
2007. 

The application of the criteria in this point may be varied between different fruit and 
vegetable  products,  ware  potatoes  and  nurseries,  if  duly  justified  on  an  objective 
basis. On the same basis, Member States may decide not to determine the amounts to 
be  included  in  the  reference  amount  and  the  applicable  hectares  under  this  point 
before the end of a transitional three year period ending on 31 December 2010. 

Member  States  shall  calculate  the  applicable  hectares  on  the  basis  of  objective  and 
non-discriminatory criteria such as the areas referred to in the second indent of the 
first paragraph of point 2. 

For the purposes of this Regulation, “fruit and vegetables” shall mean the products 
listed  in  Article 1(1)(i)  and  (j)  of  Regulation  (EC)  No 1234/2007,  and  “ware 
potatoes”  shall  mean  potatoes  of  CN  code  0701  other  than  those  intended  for  the 
manufacture of potato starch for which aid is granted under Article 93. 

A farmer whose production was adversely affected during the representative period 
referred to in paragraph 2 by a case of force majeure or exceptional circumstances (as 
referred to in Article 36(1) occurring before or during that reference period shall be 
entitled to request that the reference amount referred to paragraph 2 be calculated on 
the basis of the calendar year or years in the representative period not affected by the 
case of force majeure or exceptional circumstances. 

If  the  whole  reference  period  was  affected  by  the  case  of  force  majeure  or 
exceptional circumstances, the Member State shall calculate the reference amount on 
the  basis  of  the  closest  marketing  year  prior  to  the  representative  period  chosen  in 
accordance with paragraph 3. In this case, paragraph 1 shall apply mutatis mutandis. 

EN 

98 

   EN 

6. 

A case of force majeure or exceptional circumstances, with relevant evidence to the 
satisfaction of the competent authority, shall be notified by the farmer concerned in 
writing to the authority within a deadline to be fixed by each Member State. 

B.  Wine (grubbing-up) 

Farmers  who  participate  in  the  grubbing-up  scheme  laid  down  in  Chapter III  of  Title V  of 
Regulation  (EC)  No  [the  wine  regulation]  shall  be  allocated,  in  the  year  following  the 
grubbing  up,  payment  entitlements  equal  to  the  number  of  hectares  for  which  they  have 
received a grubbing-up premium.. 

The  unit  value  of  these  payment  entitlements  shall  be  equal  to  the  regional  average  of  the 
value  of  the  entitlements  of  the  corresponding  region.  However,  the  unit  value  shall  in  any 
case not exceed EUR 350/ha. 

C.  Wine (transfer from support programmes) 

Where Member States choose to provide support in accordance with Article 4a of Regulation 
(EC) No [the wine regulation], they shall establish a reference amount of each farmer as well 
as the applicable hectares: 

– 

– 

– 

on the basis of objective and non-discriminatory criteria; 

in  respect  of  a  representative  reference  period  of  one  or  more  wine  years  starting 
from the wine year 2005/2006; However, the reference criteria used to establish the 
reference  amount  and  applicable  hectares  shall  not  be  based  on  a  reference  period 
including  wine  years  after  the  wine  year  2007/2008  where  the  transfer  in  support 
programmes  concerns  compensation  to  farmers  who  have  heretofore  received 
support for potable alcohol distillation or have been the economic beneficiaries of the 
support for the use of concentrated grape must to enrich wine under Regulation (EC) 
No [the wine regulation].”; 

in  conformity  with  the  overall  available  amount  for  this  measure  referred  to  in 
Article 6(e) of Regulation (EC) No [the wine regulation].” 

Farmers shall receive a payment entitlement per hectare which is calculated by dividing the 
reference amount referred by the number of applicable hectares. 

EN 

99 

   EN 

ANNEX VIII 

National ceilings referred to in Article 41 

Table 1 

Member State 

2009 

2010 

2011 

2012 

2013 

2014 

2015 

614 179 
1 030 478 
5 770 254 
1 342 268 
2 367 713 
4 838 512 
8 404 502 
4 143 175 
37 051 
853 090 
745 561 
589 723 
566 801 
763 082 
3 985 834 

611 901 
1 031 321 
5 781 666 
1 340 737 
2 209 591 
5 070 413 
8 444 468 
4 277 633 
37 084 
853 169 
747 298 
600 296 
565 823 
765 229 
3 986 361 

613 281 
1 043 421 
5 826 537 
1 340 869 
2 210 829 
5 114 250 
8 500 503 
4 320 238 
37 084 
886 966 
750 019 
600 370 
568 799 
768 853 
3 987 844 

613 281 
1 043 421 
5 826 537 
1 340 869 
2 216 533 
5 139 246 
8 504 425 
4 369 974 
37 084 
886 966 
750 019 
605 967 
568 799 
768 853 
3 987 844 

614 661 
1 048 999 
5 848 330 
1 340 869 
2 216 533 
5 139 316 
8 518 804 
4 369 974 
37 084 
904 272 
751 616 
605 972 
570 583 
770 916 
3 987 849 

614 661 
1 048 999 
5 848 330 
1 340 869 
2 216 533 
5 139 316 
8 518 804 
4 369 974 
37 084 
904 272 
751 616 
605 972 
570 583 
770 916 
3 987 849 

614 661 
1 048 999 
5 848 330 
1 340 869 
2 216 533 
5 139 316 
8 518 804 
4 369 974 
37 084 
904 272 
751 616 
605 972 
570 583 
770 916 
3 987 849 

Belgium  
Denmark  
Germany  
Ireland  
Greece  
Spain  
France  
Italy  
Luxembourg 
Netherlands  
Austria  
Portugal  
Finland  
Sweden  
United Kingdom  

Table 2∗ 

Member State 

2009 

2010 

2011 

2012 

2013 

2014 

2015 

Bulgaria 
Czech Republic 
Estonia 
Cyprus 
Latvia 
Lithuania 
Hungary 
Malta 
Poland 
Romania 
Slovenia 
Slovakia 

287 399 
559 622 
60 500 
31 670 
90 016 
230 560 
807 366 
3 434 
1 877 107 
623 399 
87 942 
240 014 

328 997 
647 080 
70 769 
38 845 
104 025 
268 746 
935 912 
3 851 
2 164 285 
713 207 
102 047 
277 779 

409 587 
735 801 
80 910 
43 730 
118 258 
305 964 
1 064 312 
4 268 
2 456 894 
891 072 
116 077 
314 692 

490 705 
821 779 
91 034 
48 615 
132 193 
342 881 
1 191 526 
4 685 
2 742 771 
1 068 953 
130 107 
351 377 

571 467 
909 164 
101 171 
53 499 
146 355 
380 064 
1 318 542 
5 102 
3 033 549 
1 246 821 
144 236 
388 191 

652 228 
909 164 
101 171 
53 499 
146 355 
380 064 
1 318 542 
5 102 
3 033 549 
1 424 684 
144 236 
388 191 

732 986 
909 164 
101 171 
53 499 
146 355 
380 064 
1 318 542 
5 102 
3 033 549 
1 602 550 
144 236 
388 191 

(EUR 1000) 

2016 and 
subsequent 
years 

614 661 
1 048 999 
5 848 330 
1 340 869 
2 216 533 
5 139 316 
8 518 804 
4 369 974 
37 084 
904 272 
751 616 
605 972 
570 583 
770 916 
3 987 849 

(EUR 1000) 
2016 and 
subsequent 
years 

813 746 
909 164 
101 171 
53 499 
146 355 
380 064 
1 318 542 
5 102 
3 033 549 
1 780 414 
144 236 
388 191 

∗ 

Ceilings calculated taking account of the schedule of increments provided for under Article 110. 

EN 

100 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The  component  of  national  ceilings  referred  to  in  Article  56(1)  corresponding  to  tomatoes 
shall be as follows: 

ANNEX IX 

Member State 

Bulgaria 

Czech Republic 

Greece 

Spain 

France 

Italy 

Cyprus 

Malta 

Hungary 

Romania 

Poland 

Portugal 

Slovakia 

Amount 
(€ million per calendar year) 

5,394 

0,414 

35,733 

56,233 

8,033 

183,967 

0,274 

0,932 

4,512 

1,738 

6,715 

33,333 

1,018 

The  component  of  national  ceilings  referred  to  in  Article  56(2)  corresponding  to  fruit  and 
vegetable crops other than annual crops shall be as follows: 

Member State 

Amount 
(€ million per calendar year) 

Bulgaria 

Czech Republic 

Greece 

Spain 

France 

Italy 

Cyprus 

Hungary 

Romania 

Portugal 

Slovakia 

0,851 

0,063 

153,833 

110,633 

44,033 

131,700 

4,856 
4,919 
4,982 
5,045 

0,244 

0,025 

2,900 

0,007 

in 2009: 
in 2010: 
in 2011: 
in 2012: 

EN 

101 

   EN 

Integration of coupled support into the single payment scheme 

ANNEX X 

From 2010, the Specific quality premium for durum wheat provided for in Chapter 1 
of Title IV of Regulation (EC) No 1782/2003; 

from  2010,  the  protein  crop  premium  provided  for  in  Chapter  2  of  Title IV  of 
Regulation (EC) No 1782/2003; 

from 2010 the crop specific payment for rice provided for in Chapter III of Title IV 
of  Regulation  (EC)  No 1782/2003  and  Section  1  of  Chapter  1  of  Title  IV  of  this 
Regulation, in accordance with the time schedule provided for in Article 72(2) of this 
Regulation; 

from  2010,  the  area  payment  for  nuts  provided  for  in  Chapter  4  of  Title  IV  of 
Regulation (EC) No 1782/2003; 

from  2011  the  aid  for  processing  dried  fodder  provided  for  in  Subsection  I  of 
Section I of Chapter IV of Title I of Part II of Regulation (EC) No 1234/2007; 

from 2011 the aid for processing flax grown for fibre in Subsection II of Section I of 
Chapter IV of Title I of Part II of Regulation (EC) No 1234/2007, in accordance with 
the time schedule provided for in that subsection; 

from  2011  the  potato  starch  premium  provided  for  in  Article  [95a]  of  Regulation 
(EC) No 1234/2004 and, in accordance with the time schedule of Article 75 of this 
Regulation, the aid for starch potato provided in that Article. 

I. 

– 

– 

– 

– 

– 

– 

– 

II. 

From 2010 where a Member State granted the: 

– 

– 

– 

– 

seed aid provided for in Chapter 9 of Title IV of Regulation (EC) No 1782/2003; 

arable crops area payment provided for in Chapter 10 of Title IV of Regulation (EC) 
No 1782/2003; 

aid  for  olive  groves  provided  for  in  Chapter  10b  of  Title  IV  of  Regulation  (EC) 
No 1782/2003; 

hops  area  aid  provided  for  in  Chapter  10d  of  Title  IV  of  Regulation  (EC) 
No 1782/2003, 

in  accordance  with  the  time  schedule  provided  for  in  Article  55,  beef  and  veal  payments, 
except suckler cow premium. 

III. 

From 2010, where a Member States does not take the decision referred to in Article 53(1) of 
this Regulation: 

– 

– 

the  sheep  and  goat  payments  referred  to  in  Article  67  of  Regulation  (EC) 
No 1782/2003; 

the  beef  and  veal  payments  referred  to  in  Article  68  of  Regulation  (EC) 
No 1782/2003. 

EN 

102 

   EN 

ANNEX XI 

Integration of coupled support – Article 65 

Dried fodder 

Member State 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

0 

2 779 

8 475 

132 

1 238 

43 725 

35 752 

22 605 

0 

2 779 

8 475 

132 

1 238 

43 725 

35 752 

22 605 

0 

2 779 

8 475 

132 

1238 

43 725 

35 752 

22 605 

0 

2 779 

8 475 

132 

1 238 

43 725 

35 752 

22 605 

0 

2 779 

8 475 

132 

1 238 

43 725 

35 752 

22 605 

0 

2 779 

8 475 

132 

1 238 

43 725 

35 752 

22 605 

5 202 

5 202 

5 202 

5 202 

5 202 

5 202 

64 

69 

10 

180 

1 478 

64 

69 

10 

180 

1 478 

64 

69 

10 

180 

1 478 

64 

69 

10 

180 

1 478 

64 

69 

10 

180 

1 478 

64 

69 

10 

180 

1 478 

922 

922 

922 

922 

922 

922 

21 

1 421 

21 

1 421 

21 

1 421 

21 

1 421 

21 

1 421 

21 

1 421 

147 

147 

147 

147 

147 

147 

91 

91 

91 

91 

91 

91 

EN 

103 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Durum wheat quality premium 

Member State 

2010 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

20 301 

22 372 

8 320 

42 457 

20 301 

22 372 

8 320 

42 457 

20 301 

22 372 

8 320 

42 457 

20 301 

22 372 

8 320 

42 457 

20 301 

22 372 

8 320 

42 457 

20 301 

22 372 

8 320 

42 457 

20 301 

22 372 

8 320 

42 457 

280 

80 

280 

80 

280 

80 

280 

80 

280 

80 

280 

80 

280 

80 

349 

436 

523 

610 

698 

785 

872 

173 

198 

223 

247 

247 

247 

247 

70 

80 

90 

100 

100 

100 

100 

EN 

104 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Protein Crops 

Member State 

2010 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

84 

843 

84 

843 

84 

843 

84 

843 

84 

843 

84 

843 

84 

843 

7 231 

7 231 

7 231 

7 231 

7 231 

7 231 

7 231 

216 

242 

10 905 

17 635 

5 009 

21 

67 

216 

242 

10 905 

17 635 

5 009 

21 

67 

216 

242 

10 905 

17 635 

5 009 

21 

67 

216 

242 

10 905 

17 635 

5 009 

21 

67 

2 051 

2 051 

2 051 

2 051 

214 

303 

2 147 

10 500 

160 

1 858 

169 

17 

109 

1 486 

1 369 

0 

1 723 

911 

63 

1 003 

214 

303 

2 147 

10 500 

201 

2 123 

194 

19 

124 

1 698 

1 565 

0 

1 970 

1 139 

72 

1 146 

214 

303 

2 147 

10 500 

241 

2 389 

218 

22 

140 

1 911 

1 760 

0 

2 216 

1 367 

81 

1 290 

214 

303 

2 147 

10 500 

281 

2 654 

242 

24 

155 

2 123 

1 956 

0 

2 462 

1 595 

90 

1 433 

216 

242 

10 905 

17 635 

5 009 

21 

67 

2051 

214 

303 

2147 

10500 

321 

2654 

242 

24 

155 

2123 

1956 

0 

2462 

1822 

90 

1433 

216 

242 

10905 

17635 

5009 

21 

67 

2051 

214 

303 

2147 

10500 

361 

2654 

242 

24 

155 

2123 

1956 

0 

2462 

2050 

90 

1433 

216 

242 

10 905 

17 635 

5 009 

21 

67 

2 051 

214 

303 

2 147 

10 500 

401 

2 654 

242 

24 

155 

2 123 

1 956 

0 

2 462 

2 278 

90 

1433 

EN 

105 

   EN 

 
Rice 

Member State 

2010 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

5 703 

24 997 

3 922 

49 737 

5 703 

24 997 

3 922 

49 737 

11 407 

49 993 

7 844 

99 473 

11 407 

49 993 

7 844 

99 473 

11 407 

49 993 

7 844 

99 473 

11 407 

49 993 

7 844 

99 473 

11 407 

49 993 

7 844 

99 473 

5 596 

5 596 

11 193 

11 193 

11 193 

11 193 

11 193 

288 

360 

863 

1 007 

1 151 

1 294 

1 438 

262 

300 

674 

749 

749 

749 

749 

13 

16 

38 

44 

50 

57 

63 

EN 

106 

   EN 

 
 
 
 
 
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
 
Nuts 

Member State 

2010 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

12 

12 

12 

12 

12 

12 

12 

181 

181 

181 

181 

181 

181 

181 

4 963 

68 610 

2 089 

15 710 

12 

12 

12 

4 963 

68 610 

2 089 

15 710 

12 

12 

12 

4 963 

68 610 

2 089 

15 710 

12 

12 

12 

4 963 

68 610 

2 089 

15 710 

12 

12 

12 

4 963 

68 610 

2 089 

15 710 

12 

12 

12 

4 963 

68 610 

2 089 

15 710 

12 

12 

12 

4 963 

68 610 

2 089 

15 710 

12 

12 

12 

4 987 

4 987 

4 987 

4 987 

4 987 

4 987 

4 987 

12 

579 

12 

724 

12 

868 

12 

1 013 

12 

1 158 

12 

1 302 

12 

1 447 

431 

493 

554 

616 

616 

616 

616 

245 

355 

79 

25 

262 

280 

406 

99 

29 

299 

315 

456 

119 

33 

337 

350 

507 

139 

36 

374 

350 

507 

159 

36 

374 

350 

507 

179 

36 

374 

350 

507 

199 

36 

374 

EN 

107 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Long fibre flax 

Member State 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

1 380 

1 380

2 760

2 760

2 760 

2 760

30 

30

5 

5

60

10

60

10

60 

10 

60

10

5 580 

5 580

11 160

11 160

11 160 

11 160

480 

480

960

960

960 

960

15 

5 

20 

5 

5 

1 

192 

3 

36 

226 

92 

4 

7 

15

5

20

5

5

1

192

3

36

226

92

4

7

30

10

40

10

10

3

385

6

72

453

185

8

15

30

10

40

10

10

3

385

6

72

453

185

8

15

30 

10 

40 

10 

10 

3 

385 

6 

72 

453 

185 

8 

15 

30

10

40

10

10

3

385

6

72

453

185

8

15

EN 

108 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Potato starch processing aid 

Member State 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

3 743 

14 603 

3 743

14 603

3 743

14 603

3 743

3 743 

14 603

14 603 

3 743

14 603

43 

5 904 

43

5 904

43

5 904

43

43 

5 904

5 904 

43

5 904

11 290 

1 061 

11 290

1 061

11 290

1 061

11 290

11 290 

1 061

1 061 

1 183 

1 381 

1 183

1 381

1 183

1 381

1 183

1 381

1 183 

1 381 

749 

6 

129 

27 

749

6

129

27

749

6

129

27

749

6

129

27

749 

6 

129 

27 

11 290

1 061

1 183

1 381

749

6

129

27

3 226 

3 226

3 226

3 226

3 226 

3 226

16 

16

16

16

16 

16

EN 

109 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Potato starch aid for growers 

Member State 

2011 

2012 

2013 

2014 

2015 

(EUR 1000)

2016 and 
subsequent 
years 

Belgium  

Denmark  

Germany  

Ireland  

Greece  

Spain  

France  

Italy  

Luxembourg 

Netherlands  

Austria  

Portugal  

Finland  

Sweden  

United Kingdom  

Bulgaria 

Czech Republic 

Estonia 

Cyprus 

Latvia 

Lithuania 

Hungary 

Malta 

Poland 

Romania 

Slovenia 

Slovakia 

Olive Oil 

Member 
State 

Spain  

Cyprus 

5 578 

21 763 

5 578

21 763

11 156

43 526

11 156

43 526

11 156 

43 526 

11 156

43 526

64 

8 799 

64

129

129

129 

129

8 799

17 598

17 598

17 598 

17 598

16 825 

1 581 

16 825

1 581

33 651

3 163

33 651

3 163

33 651 

3 163 

33 651

3 163

1 763 

2 058 

1 763

2 058

3 527

4 116

3 527

4 116

3 527 

4 116 

3 527

4 116

893 

7 

153 

32 

1 005

7

172

36

2 232

17

383

80

2 232

17

383

80

2 232 

17 

383 

80 

2 232

17

383

80

3 846 

4 327

9 615

9 615

9 615 

9 615

19 

22

48

48

48 

48

2010 

2011 

2012 

2013 

2014 

2015 

103 140 

103 140 

103 140

103 140

103 140

103 140 

2 051 

2 344 

2 637

2 930

2 930

2 930 

(EUR 1000)

2016 and 
subsequent 
years 

103 140

2 930

EN 

110 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ceilings for the calculation of the aid amount referred in Article 84 (sugar) 

ANNEX XII 

Member State 

2006 

2007 

2008 

2009 

2010 

2011 

2012 

2013 

2014 

2015 

Belgium 

Bulgaria 

Czech Republic 

Denmark 

Germany 

Greece 

Spain 

France 

Ireland 

Italy 

Latvia 

Lithuania 

Hungary 

Netherlands 

Austria 

Poland 

Portugal 

Romania 

Slovenia 

Slovakia 

Finland 

Sweden 

United Kingdom 

47 429 

60 968 

74 508 

81 752 

81 752 

81 752 

81 752 

81 752 

81 752 

81 752 

— 

27 851 

19 314 

84 

34 319 

25 296 

121 

40 786 

31 278 

154 

44 245 

34 478 

176 

44 245 

34 478 

220 

44 245 

34 478 

264 

44 245 

34 478 

308 

44 245 

34 478 

352 

44 245 

34 478 

396 

44 245 

34 478 

154 974 

203 607 

252 240 

278 254 

278 254 

278 254 

278 254 

278 254 

278 254 

278 254 

278 254 

17 941 

60 272 

22 455 

74 447 

26 969 

88 621 

29 384 

96 203 

29 384 

96 203 

29 384 

96 203 

29 384 

96 203 

29 384 

96 203 

29 384 

96 203 

29 384 

96 203 

152 441 

199 709 

246 976 

272 259 

272 259 

272 259 

272 259 

272 259 

272 259 

272 259 

11 259 

79 862 

4 219 

6 547 

26 105 

41 743 

18 971 

99 135 

3 940 

— 

2 284 

11 813 

8 255 

20 809 

64 340 

14 092 

16 925 

18 441 

18 441 

18 441 

18 441 

18 441 

18 441 

18 441 

102 006 

124 149 

135 994 

135 994 

135 994 

135 994 

135 994 

135 994 

135 994 

5 164 

8 012 

31 986 

54 272 

24 487 

6 110 

9 476 

37 865 

66 803 

30 004 

6 616 

10 260 

41 010 

73 504 

32 955 

6 616 

10 260 

41 010 

73 504 

32 955 

6 616 

10 260 

41 010 

73 504 

32 955 

6 616 

10 260 

41 010 

73 504 

32 955 

6 616 

10 260 

41 010 

73 504 

32 955 

6 616 

10 260 

41 010 

73 504 

32 955 

6 616 

10 260 

41 010 

73 504 

32 955 

122 906 

146 677 

159 392 

159 392 

159 392 

159 392 

159 392 

159 392 

159 392 

159 392 

4 931 

1 930 

2 858 

14 762 

10 332 

26 045 

80 528 

5 922 

2 781 

3 433 

17 712 

12 409 

31 281 

96 717 

6 452 

3 536 

3 740 

19 289 

13 520 

34 082 

6 452 

4 041 

3 740 

19 289 

13 520 

34 082 

6 452 

5 051 

3 740 

19 289 

13 520 

34 082 

6 452 

6 062 

3 740 

19 289 

13 520 

34 082 

6 452 

7 072 

3 740 

19 289 

13 520 

34 082 

6 452 

8 082 

3 740 

19 289 

13 520 

34 082 

6 452 

9 093 

3 740 

19 289 

13 520 

34 082 

6 452 

10 103 

3 740 

19 289 

13 520 

34 082 

105 376 

105 376 

105 376 

105 376 

105 376 

105 376 

105 376 

105 376 

(EUR '000) 

2016 and 
subsequent 
years 

81 752 

440 

44 245 

34 478 

29 384 

96 203 

272 259 

18 441 

135 994 

6 616 

10 260 

41 010 

73 504 

32 955 

EN 

111 

EN 

 
  
Table 1 

Cyprus: Complementary national direct payments where the normal schemes 

for direct payments apply 

ANNEX XIII 

Schedule of increments 

Sector 

Arable crops 
(durum wheat excluded) 

Durum wheat 

Grain legumes 

Milk and dairy 

Beef 

60% 

2009 

70% 

2010 

80% 

2011 

90% 

2012 

4 220 705 

3 165 529 

2 110 353 

1 055 176 

1 162 157 

16 362 

871 618 

12 272 

1 422 379 

1 066 784 

1 843 578 

1 382 684 

581 078 

290 539 

8 181 

711 190 

921 789 

4 091 

355 595 

460 895 

Sheep and goat 

4 409 113 

3 306 835 

2 204 556 

1 102 278 

Olive oil 

Tobacco 

Bananas 

Dried grapes 

Almonds 

3 174 000 

2 380 500 

1 587 000 

417 340 

313 005 

1 755 000 

1 316 250 

208 670 

877 500 

0 

0 

0 

0 

0 

0 

793 500 

104 335 

0 

0 

0 

Total 

1 842 0634 

13 815 476 

9 210 317 

4 166 409 

Complementary national direct payments under Single Payment Scheme: 

The total amount of complementary national direct payments that may be granted under the Single Payment Scheme shall be equal to the sum of 
the sectoral ceilings referred to in this table relating to the sectors that are covered by the Single Payment Scheme to the extent that the support in 
these sectors is decoupled. 

Table 2 

Cyprus: Complementary national direct payments where the single area 

payment scheme for direct payments applies 

Sector 

2009 

2010 

2011 

2012 

Arable crops (durum 
wheat excluded) 

Durum wheat 

Grain legumes 

Milk and dairy 

Beef 

0 

0 

0 

0 

1 795 543 

1 572 955 

1 350 367  

1 127 779 

0 

3 456 448 

4 608 945 

0 

3 438 488 

4 608 945 

0 

3 420 448 

4 608 945 

0 

3 402 448 

4 608 945 

Sheep and goat 

10 724 282 

10 670 282 

10 616 282 

10 562 282 

Olive oil 

Dried grapes 

Bananas 

Tobacco 

5 547 000 

156 332 

4 323 820 

1 038 575 

5 115 000 

149 600 

4 312 300 

1 035 875 

4 683 000 

142 868 

4 300 780 

1 033 175 

4 251 000 

136 136 

4 289 260 

1 030 475 

Total 

31 650 945 

30 903 405 

30 155 865 

29 408 325 

EN 

112 

   EN 

 
ANNEX XIV 

STATE AID CYPRUS 

Sector 

Cereals (durum wheat excluded) 

Milk and dairy 

Beef 

Sheep and goats 

Pig sector 

Poultry and eggs 

Wine 

Olive oil 

Table grapes 

Processed tomatoes 

Bananas 

Deciduous fruit including stone fruit 

Total 

2009 

2 263 018 

562 189 

64 887 

1 027 917 

2 732 606 

1 142 374 

4 307 990 

2 088 857 

1 058 897 

117 458 

127 286 

2 774 230 

18 267 707 

2010 

1 131 509 

281 094 

0 

513 958 

1 366 303 

571 187 

2 153 995 

1 044 429 

529 448 

58 729 

63 643 

1 387 115 

9 101 410 

EN 

113 

   EN 

 
 
ANNEX XV 

Correlation table 

Regulation (EC) No 1782/2003 

This regulation 

Article 1 

Article 2 

Article 3 

Article 4 

Article 5 

Article 6 

Article 7 

Article 8 

Article 9 

Article 10(1) 

Article 10(2) 

Article 10(3) 

Article 10(4) 

– 

Article 11 

Article 12 

– 

Article 12a(1) 

Article 12a(2) 

Article 13 

Article 14 

Article 15 

Article 16 

Article 17 

Article 18 

Article 19 

Article 20 

Article 21 

Article 22 

Article 23 

Article 24 

Article 25 

Article 26 

Article 27 

Article 1 

Article 2 

Article 4 

Article 5 

Article 6 

Article 25 

Article 26 

– 

Article 27 

Article 7 

Article 9(1) 

Article 9(2) 

Article 9(3) 

Article 9(4) 

Article 11(1) and (2) 

– 

Article 8 

Article 10 

Article 11(3) 

Article 12 

Article 13 

Article 14 

Article 15 

Article 16 

Article 17 

Article 18 

Article 19 

Article 20 

Article 21 

Article 22 

Article 23 

Article 24 

Article 28 

Article 29 

EN 

114 

   EN 

 
– 

Article 28 

Article 29 

Article 30 

Article 31 

Article 32 

Article 33 

Article 34 

Article 35 

Article 36 

Article 37 

Article 38 

Article 39 

Article 40 (1) to (3) 

Article 40 (4) 

Article 40(5) 

Article 41 

Article 42  

Article 43 

Article 44 

Article 45 

Article 46 

Article 47 

Article 48 

Article 49 

Article 50 

Article 51, first subparagraph 

Article 51, second subparagraph 

Article 52 

Article 53 

Article 54 

Article 55 

Article 56 

Article 57 

– 

Article 58 

Article 59 

Article 30 

Article 31 

Article 32 

Article 33 

– 

Article 3 

Article 34 

– 

Article 38 

– 

Annex VII 

– 

– 

Annex VII, Point A (4) to (6) 

Article 36(1) second subparagraph 

– 

Article 41 

Article 42 

Annex VII 

Article 35 

Article 43 

Article 44 

– 

– 

Article 45 

– 

– 

Article 39 

Article 40 

– 

– 

– 

– 

– 

Article 46 

Article 47 

Article 48 

EN 

115 

   EN 

 
Article 60 

Article 61 

Article 62 

Article 63(1) 

Article 63(2) 

Article 63(3) 

Article 63(4) 

Article 64 

Article 65 

Article 66 

Article 67 

Article 68 

Article 68a 

Article 68b 

Article 69 

Article 70 

Article 71 

Article 71a 

Article 71b 

Article 71c 

Article 71d 

Article 71e 

Article 71f 

Article 71g 

Article 71h 

Article 71i 

Article 71j 

Article 71k 

Article 71l 

Article 71m 

– 

– 

– 

– 

– 

– 

– 

Article 50 

Article 51 

– 

Article 52(1) 

– 

Article 49 

Article 52(2) 

Article 53 

– 

– 

Article 54 

Article 55 

Article 56 

– 

– 

– 

Article 57 

Article 58 

– 

Article 59 

Article 60 

Article 61 

– 

Article 62 

– 

– 

Article 63 

– 

– 

Article 64 

Article 65 

Article 66 

Article 67 

Article 68 

Article 69 

Article 70 

EN 

116 

   EN 

 
 
Article 72 

Article 73 

Article 74 

Article 75 

Article 76 

Article 77 

Article 78 

Article 79 

Article 80 

Article 81 

Article 82 

Article 83 

Article 84 

Article 85 

Article 86 

Article 87  

Article 88 

Article 89 

Article 90 

Article 91 

Article 92 

Article 93 

Article 94 

Article 95 

Article 96 

Article 97 

Article 98  

Article 99 

Article 100 

Article 101  

Article 102 

Article 103 

Article 104 

Article 105 

Article 106 

Article 107 

Article 108 

EN 

– 

– 

– 

– 

– 

– 

– 

Article 71 

Article 72 

Article 73 

Article 74 

– 

– 

– 

– 

Article 109 

– 

– 

– 

– 

– 

Article 75 

Article 76 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

117 

   EN 

 
Article 109 

Article 110 

Article 110a 

Article 110b 

Article 110c 

Article 110d 

Article 110e 

Article 110f 

Article 110g 

Article 110h 

Article 110i 

Article 110j 

Article 110k 

Article 110l 

Article 110m 

Article 110n 

Article 110o 

Article 110p 

Article 110q 

Article 110r 

Article 110s 

Article 110t 

Article 110u 

Article 110v 

Article 111 

Article 112 

Article 113 

Article 114 

Article 115 

Article 116 

Article 117 

Article 118 

Article 119 

Article 120  

Article 121 

Article 122 

Article 123 

– 

– 

Article 77 

Article 78 

Article 79 

Article 80 

Article 81 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

– 

Article 82 

Article 83 

Article 84 

Article 85 

Article 86 

Article 87 

Article 88 

Article 89 

Article 90 

Article 91 

Article 92 

Article 93 

Article 94 

Article 95 

– 

Article 96 

Article 97 

Article 98 

Article 99 

EN 

118 

   EN 

 
Article 124 

Article 125 

Article 126 

Article 127 

Article 128 

Article 129 

Article 130 

Article 131 

Article 132 

Article 133 

Article 134 

Article 135 

Article 136 

Article 136a 

Article 137 

Article 138 

Article 139 

Article 140 

Article 141 

Article 142 

Article 143 

Article 143a 

Article 143b(1)(2)(9) and (10) 

Article 143b(3) and (7) 

Article 143b(4)(5) and (6) 

Article 143b(13) 

Article 143ba(1) to (3) 

Article 143ba(3a) 

Article 143ba (4) to (6) 

Article 143bb(1) and (2) 

Article 143bb(3) 

Article 143bb(4) to (6) 

Article 143bc(1) and (2) 

Article 143bc(3) and (4) 

– 

Article 143c(1) to (8) 

Article 143c(9) 

– 

Article 100 

Article 101 

Article 102 

Article 103  

Article 104 

Article 105 

– 

– 

– 

– 

– 

– 

– 

– 

Article 106 

Article 107 

Article 108 

– 

– 

– 

Article 110 

Article 111 

Article 112 

Article 113 

Article 114 

Article 115 

– 

Article 118 

Article 116 

– 

Article 118 

Article 117 

Article 118(1) and (2) 

Article 119 

Article 120 

Article 121 

EN 

119 

   EN 

 
Article 143c(10) 

Article 143d 

Article 143e 

– 

– 

– 

Article 144 

Article 145 

Article 146 

Article 147 

Article 148 

Article 149 

Article 150 

Article 151 

Article 152 

– 

– 

– 

Article 153 

Article 154 

Article 154a 

Article 155 

Article 155a 

Article 156 

– 

Article 122 

Article 123 

Article 124 

Article 125 

Article 126 

Article 128 

Article 129 

Article 127 

– 

– 

– 

– 

– 

– 

Article 130 

Article 131 

Article 132 

Article 133 

– 

Article 135 

Article 134 

– 

Article 136 

EN 

120 

   EN 

 
 
2008/0104 (CNS) 

Proposal for a 

COUNCIL REGULATION 

on modifications to the common agricultural policy by amending Regulations (EC) 
No 320/2006, (EC) No 1234/2007, (EC) No 3/2008 and (EC) No […]/2008 

THE COUNCIL OF THE EUROPEAN UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 
Articles 36 and 37 thereof, 

Having regard to the proposal from the Commission28, 

Having regard to the opinion of the European Parliament29, 

Having regard to the opinion of the European Economic and Social Committee30, 

Having regard to the opinion of the Committee of the Regions31, 

Whereas: 

(1) 

The  CAP  reforms  agreed  in  2003/2004  included  provisions  on  reports  intended  to 
gauge  their  effectiveness,  and  in  particular  to  appraise  their  impact  with  respect  to 
their objectives and to analyse their effects on the relevant markets. In this context, the 
Commission  presented  a  Communication  to  the  European  Parliament  and  Council 
entitled "Preparing for the 'Health Check'" on 20 November 2007 which was discussed 
by  those  institutions.  Taking  into  account  that  Communication  and  the  subsequent 
discussions of the main elements of it communication by the European Parliament, the 
Council,  the  Economic  and  Social  Committee  and  the  Committee  of  the  Regions  as 
well  as  numerous  contributions  received  from  public  consultation,  appropriate 
proposals should be made. 

(2) 

The  provisions  of  the  common  agricultural  policy  concerning  public  intervention 
should be simplified and streamlined by the extension of tendering in order to achieve 
a harmonised approach. 

28 
29 
30 
31 

OJ C …, …, p. …. 
OJ C …, …, p. …. 
OJ C …, …, p. …. 
OJ C …, …, p. …. 

EN 

121 

   EN 

 
                                                 
(3) 

(4) 

(5) 

(6) 

(7) 

In  respect  of  cereals  the  system  should  be  modified  to  ensure  competitiveness  and 
market orientation for the sector while keeping the role of intervention as a safety net 
in case of market disruptions and facilitating farmers' response to market conditions. 
The Council Conclusions on the reform of the intervention system for maize provided 
for  a  review  of  the  whole  cereals  intervention  system  in  the  context  of  the  Health 
Check,  based  on  an  analysis  which  indicated  a  certain  risk  for  additional  barley 
intervention  if  prices  were  low.  The  present  outlook  for  cereals  has  however  since 
changed  significantly,  and  is  characterised  by  a  favourable  world  market  price 
environment driven by expanding world demand and low global cereal stocks. Within 
this context, setting intervention levels to zero for other feed grains in the same time 
frame  as  the  maize  reform  would  allow  for  intervention  without  having  negative 
implications for the cereals market as a whole. The outlook for the cereals sector also 
applies  for  durum  wheat,  meaning  that  buying  into  intervention  could  be  abolished 
since  it  has  lost  its  relevance  with  market  prices  always  significantly  above  the 
intervention  price.  Since  intervention  for  cereals  is  to  be  a  safety  net  rather  than  an 
element which influences price formation, the differences in harvesting periods across 
Member  States,  which  effectively  start  the  marketing  campaigns,  are  not  longer 
relevant  since  the  system  will  no  longer  provide  for  prices  reflecting  intervention 
levels plus monthly increments. In the interests of simplification the dates for cereals 
intervention should therefore be harmonised across the Community. 

Since the 2003 reform, the competitiveness of the rice sector has increased, with stable 
production,  falling  stocks  in  the  view  of  increasing  demand  both  in  the  Community 
and on the world market, with the expected price significantly above the intervention 
price. Therefore providing for buying into intervention for rice is no longer necessary 
and so should be abolished. 

Pigmeat production and consumption are projected to increase over the medium term, 
though at a slower pace than in the past decade, due to the competition from poultry 
meat and higher feed prices. Pig prices are expected to remain significantly above the 
intervention  price.  Buying  into  intervention  has  not  been  used  for  many  years  for 
pigmeat  and  in  the  light  of  the  market  situation  and  its  perspectives,  should  be 
abolished. 

The  abolition  of  intervention  for  these  products  may  safely  be  carried  out  in  2009 
since the current market situation and perspectives suggest that intervention would not, 
in any case, be applicable for them in 2009. 

The medium-term outlook for the dairy sector is characterised by continued increase in 
Community demand for high value added products, a substantial expansion in global 
demand  for  dairy  commodities,  driven  by  income  and  population  growth  in  many 
regions of the world, and by changes in consumer preferences towards dairy products. 

EN 

122 

   EN 

 
(8) 

Constrained by the milk quota ceilings, total Community milk production is projected 
to  follow  a  gradual,  though  modest  decline  over  the  medium  term  as  continued 
restructuring in the Member States which were not members of the Community before 
the  2004  enlargement  would  lead  to  a  decline  in  subsistence  milk  production,  while 
production growth remains limited due to the existence of quotas. At the same time the 
rate of milk delivered to dairies for processing is foreseen to continue expanding over 
the  projection  period.  In  the  light  of  strong  internal  and  external  demand,  the  milk 
quota  system  is  hence  now  restricting  production  expansion,  as  opposed  to  the 
situation  when  quotas  were  introduced  as  a  response  to  overproduction.  In  such  a 
market  situation,  quotas  reduce  market  orientation  because  they  distort  farmers' 
response to price signals, and prevent efficiency gains in the sector by slowing down 
restructuring.  They  are  scheduled  to  end  in  2015,  in  order  to  effect  the  appropriate 
adjustments by degrees. In this perspective, the phasing-out of dairy quotas by annual 
increases  as  provided  for  in  Annex  I  to  this  Regulation  (of  1%  per  marketing  year 
from  2009/10  to  2013/14)  would  allow  for  a  smooth  transition  by  avoiding  an 
excessive adjustment after the end of quotas. 

(9) 

The cheese market is steadily expanding with increased demand from inside as well as 
from outside the Community. In general, therefore, prices for cheeses have for some 
time  remained  at  firm  levels  which  have  not  significantly  been  influenced  by  the 
reduction  of  the  institutional  prices  for  the  bulk  products  (butter  and  powder).  From 
both  an  economic  and  market  management  point  of  view  the  permanent  and  the 
optional aid for private storage of a high value, market driven product like cheese is no 
longer justified and should be abolished. 

(10)  Aid for private storage of butter is not widely used. Nevertheless due to the seasonal 
pattern of milk production in the Community there will always be a seasonal pattern of 
butter  production.  Therefore,  temporary  pressure  on  the  butter  market  may  occur 
which could be alleviated by seasonal storage. The decision should, however, be taken 
by the Commission based on sound market analysis rather than an obligation to open 
the scheme every year and so the scheme should become optional. 

(11) 

In  the  context  of  the  dairy  reform  and  the  current  market  situation  the  aids  for 
skimmed  milk  powder  used  as  animal  feed  and  skimmed  milk  for  casein  production 
are not currently needed at all times. However, should surpluses of milk products build 
up or be likely to occur creating or likely to create a serious imbalance in the market, 
they could still play a role. The decision should, however, be taken by the Commission 
based  on  sound  market  analysis  rather  than  an  obligation  to  open  the  scheme  every 
year  and  so  the  schemes  should  become  optional.  If  applied,  the  fixing  of  the  aid 
should be done in advance or by tender. 

(12)  Disposal aids for butter for pastry and ice cream and for direct consumption have been 
reduced in line with the reduction of the intervention price for butter as from 2004 and 
have  consequently  been  zero  before  tenders  were  suspended  due  to  the  favourable 
market situation. Disposal aid schemes are no longer needed to support the market at 
intervention price level and should therefore be abolished. 

EN 

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(13)  As  was  the  case  in  the  common  agricultural  policy  reform  of  2003,  to  enhance  the 
competitiveness of Community agriculture and to promote more market-oriented and 
sustainable agriculture, it is necessary to continue the shift from production support to 
producer  support  by  abolishing  the  existing  aids  in  Council  Regulation  (EC) 
No 1234/2007 of 22 October 2007 establishing a common organisation of agricultural 
markets  and  on  specific  provisions  for  certain  agricultural  products  (single  CMO 
Regulation)32 for dried fodder, flax, hemp and potato starch and integrating support for 
these products into the system of decoupled income support for each farm. As was the 
case  for  the  2003  CAP  reform,  while  decoupling  aid  paid  to  farmers  will  leave  the 
actual  amounts  paid  unchanged,  it  will  significantly  increase  the  effectiveness  of  the 
income aid. 

(14)  The Council decided in 2000 to phase out the aid for short flax and hemp fibre. This 
decision  was  implemented  with  effect  from  the  2009/10  marketing  year  by  the 
amendments made to the single CMO by Regulation (EC) No 247/200833, as was the 
phasing out of the additional processing aid for processors of flax grown in traditional 
areas.  Aid  for  long  flax  fibre  should  be  decoupled.  However  in  order  to  allow  the 
industry to adapt, half of the shift to the single payment scheme should take place in 
2011 and the remaining part in 2013. 

(15)  The  dried  fodder  regime  was  reformed  in  2003,  when  part  of  the  aid  was  given  to 
producers and decoupled. In the context of the overall orientation of the Health Check 
towards  more  market  orientation,  and  the  present  outlook  in  feed  markets,  the 
transition  to  full  decoupling  for  the  entire  sector  should  therefore  be  completed  by 
decoupling  the  remaining  aid  to  the  industry.  It  should  be  possible  to  mitigate  the 
effects  of ending the  payment of  aid  to processors by appropriate  adjustments  in the 
price  paid  to  producers  of  the  raw  materials,  who  will  themselves  be  receiving 
increased  direct  aid  entitlements  as  a  result  of  decoupling.  The  ending  of  the  aid  to 
processors  is  also  justified  in  the  light  of  the  market  situation  and  perspectives  for 
protein crops as a whole. Given the fact that the sector has already been restructuring 
since  the  2003  reform  and  the  particular  negative  environmental  impact  that  the 
production of dehydrated fodder has recently been found to generate, the aid should be 
decoupled although a short transitional period of two years should be provided for to 
allow the sector to adjust. 

(16)  The  system  set  out  in  Council  Regulation  (EC)  No  1868/94  of  27  July  1994 
establishing  a  quota  system  in  relation  to  the  production  of  potato  starch34  will  no 
longer be required once the related aids set out in Article [...][aid for starch potato] of 
Council  Regulation  (EC)  No  […]/2008  [new  direct  payments  Regulation]  of  [....] 
[establishing common rules for direct support schemes under the common agricultural 
policy  and  establishing  certain  support  schemes  for  farmers]35,  are  abolished.  Aid  to 
producers was partially decoupled in 2003, and this aid should now be fully decoupled 
although a short transitional period of two years is required to allow farmers to adapt 

32 

33 
34 

35 

OJ  L 299,  16.11.2007, p.  1. Regulation  as last  amended by  Regulation (EC) No […]/2008 (OJ  L ....., 
p. …). 
OJ L 76, 19.3.2008, p. 1. 
OJ  L  197,  30.7.1994,  p.  4.  Regulation  as  last  amended  by  Regulation  (EC)  No 671/2007  (OJ  L 156, 
16.6.2007, p. 1). 
OJ L …, …, p. …. 

EN 

124 

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their  supply  commitments  the  potato  starch  aid  scheme.  The  related  minimum  price 
should also therefore be prolonged for two years. Beyond that date, the quota scheme 
related to the direct payment should removed in 2013 in parallel with the full inclusion 
of that direct payment into the single payment scheme. This process of decoupling this 
direct aid requires a longer adjustment period to allow the industry to adapt to the new 
market environment. In the mean time the provisions concerned should be integrated, 
as is the case for other aids and quota schemes, into Regulation (EC) No 1234/2007. 

(17)  Developments  in  domestic  and  international  cereal  and  starch  markets  render  the 
starch production refund no longer pertinent with respect to its initial objectives, and 
should therefore be abolished. The market situation and perspectives are such that the 
aid has been set at zero for some time and this would be expected to continue, so that 
rapid abolition may be effected without negative effects for the sector. 

(18)  The provisions on exceptional market support measures related to animal diseases are 
to  be  dealt  with  in  a  horizontal  provision  on  risk  management,  and  so  should  be 
deleted from Regulation (EC) No 1234/2007. 

(19)  Producer  organisations  can  serve  a  useful  role  in  grouping  supply  in  sectors  where 
there  is  an  imbalance  in  concentration  of  producers  and  purchasers.  Member  States 
should therefore be able to recognise producer organisations in all sectors. 

(20) 

the  financing  of 

In  the  interests  of  legal  certainty  and  simplicity  it  is  appropriate  to  clarify  and 
harmonise the provisions which provide for the non-application of Articles 87, 88 and 
89  of  the  Treaty  to  payments  made  by  Member  States  in  conformity  with  this 
Regulation or Council Regulations (EC) No 247/2006 of 30 January 2006 laying down 
specific  measures  for  agriculture  in  the  outermost  regions  of  the  Union36,  (EC) 
No 320/2006  of  20  February  2006  establishing  a  temporary  scheme  for  the 
restructuring of the sugar industry in the Community and amending Regulation (EC) 
the  common  agricultural  policy37,  (EC) 
No 1290/2005  on 
No 1405/2006 of 18 September 2006 laying down specific measures for agriculture in 
favour of the smaller Aegean islands and amending Regulation (EC) No 1782/200338, 
(EC)  No 3/2008  of  17  December  2007  on  information  provision  and  promotion 
measures for agricultural products on the internal market and in third countries39 and40, 
and Regulation (EC) No […]/2008 [new wine CMO]41. In this context, the provisions 
of  those  Regulations  which  otherwise  would  or  might,  under  certain  circumstances, 
fall within the notion of state aid in the sense of Article 87(1) of the Treaty should be 
excluded from the application of the state aid rules. The provisions concerned contain 
appropriate  conditions  for  the  granting  of  support  to  prevent  undue  distortion  of 
competition. 

36 

37 

38 
39 
40 
41 

OJ  L  42,  14.2.2006,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC)  No 1276/2007  (OJ  L 284, 
30.10.2007, p. 11). 
OJ  L  58,  28.2.2006,  p.  42.  Regulation  as  amended  by  Regulation  (EC)  No 1261/2007  (OJ  L 283, 
27.10.2007, p. 8). 
OJ L 265, 26.9.2006, p. 1. 
OJ L 3, 5.1.2008, p. 1. 
OJ L […], […], p. […]. 
OJ L […], […], p. […]. 

EN 

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(21)  Regulations  (EC)  No  247/2006,  320/2006,  (EC)  No  1405/2006,  (EC)  No 1234/2007, 
(EC)  No 3/2008  and  (EC)  No  […]/2008[new  wine  CMO]  should  therefore  be 
amended accordingly. 

(22)  The following acts are obsolete and therefore, in the interests of legal certainty, should 
be  repealed:  Council  Regulations  (EEC)  No 1883/78  of  2  August  1978  laying  down 
general rules for the financing of interventions by the European Agricultural Guidance 
and  Guarantee  Fund,  Guarantee  Section42,  (EEC)  No 1254/89  of  3 May  1989  fixing, 
for the 1989/90 marketing year, inter alia, certain sugar prices and the standard quality 
of  beet43,  (EEC)  No 2247/89  of  24  July  1989  on  an  emergency  measure  for  the  free 
supply of certain agricultural products to Poland44, (EEC) No 2055/93 of 19 July 1993 
allocating  a  special  reference  quantity  to  certain  producers  of  milk  and  milk 
products45, (EC) No 2596/97 of 18 December 1997 extending the period provided for 
in Article 149(1) of the Act of Accession of Austria, Finland and Sweden46, and (EC) 
No 1182/2005 of 18 July 2005 adopting autonomous and transitional measures to open 
a  Community  tariff  quota  for  the  import  of  live  bovine  animals  originating  in 
Switzerland47. 

(23)  This  Regulation  should,  as  a  general  rule,  apply  from  1  January  2009.  However,  in 
order  to  ensure  that  the  new  provisions  of  this  Regulation  do  not  interfere  with  the 
certain aids payable for the 2008/2009 or 2009/2010 marketing years, a later date of 
application should be provided for in respect of those provisions directly affecting the 
operation  of  schemes  in  sectors  for  which  marketing  years  are  foreseen.  This 
Regulation  should  therefore  only  apply,  in  such  cases,  as  from  the  start  of  the 
2009/2010 or 2010/2011 marketing years, 

HAS ADOPTED THIS REGULATION: 

Article 1 
Amendment to Regulation (EC) No 247/2006 

Article 16 of Regulation (EC) No 247/2006 is amended as follows: 

(1) 

(2) 

42 

43 

44 
45 
46 

47 

The second subparagraph of paragraph 3 is deleted. 

The following paragraph is added: 

OJ  L  216,  5.8.1978,  p. 1.  Regulation  as  last  amended  by  Regulation  (EC)  No 734/2007  (OJ  L 169, 
29.6.2007, p. 5). 
OJ L 126, 9.5.1989, p. 1. Regulation as amended by Commission Regulation (EC) No 260/96 (OJ L 34, 
13.2.1996, p. 16). 
OJ L 216, 27.7.1989, p. 5. 
OJ L 187, 29.7.1993, p. 8. 
OJ L 351, 23.12.1997, p. 12. Regulation as last amended by Regulation (EC) No 1805/2003 (OJ L 265, 
16.10.2003, p. 5). 
OJ L 190, 22.7.2005, p. 1. 

EN 

126 

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"4.  Without  prejudice  to  paragraphs  1  and  2,  by  way  of  derogation  from 
Article 180  of  Regulation  (EC)  No  1234/2007(*)  and  Article 3  of  Regulation 
(EC) No 1184/2006(**), Articles 87, 88 and 89 of the Treaty shall not apply to 
payments made under Title III, paragraph 3 of this Article and Articles 17 and 
21 by Member States in conformity with this Regulation. 

(*)  OJ  L  299,  16.11.2007,  p.  1.  Regulation  as  last  amended  by  Regulation  (EC) 

No […]/2008. 

(**)  OJ L 214, 4.8.2006, p. 7." 

Article 2 
Amendment to Regulation (EC) No 320/2006 

Regulation (EC) No 320/2006 is amended as follows: 

(1) 

Article 6(6) is replaced by the following: 

"6.  Member  States  shall  not  grant  national  aid  in  respect  of  diversification 
measures provided for in this Article. However, if the ceilings referred to in the 
third  subparagraph  of  paragraph  4  were  to  permit  the  granting  of  an  aid  for 
diversification  of 100%,  the Member State concerned shall contribute at least 
20% of the eligible expenditure." 

(2) 

The following Article 13a is added: 

"Article 13a 
State aids 

Without  prejudice  to  Article  6(5),  by  way  of  derogation  from  Article  180  of 
Regulation (EC) No 1234/2007(*) and Article 3 of Regulation (EC) No 1184/2006(**), 
Articles  87,  88  and  89  of  the  Treaty  shall  not  apply  to  payments  made  under 
Articles 3, 6, 7, 8, 9 and 11 by Member States in conformity with this Regulation. 

(*)  OJ L 299, 16.11.2007, p. 1. Regulation as last amended by Regulation (EC) No […]/2008. 
(**)  OJ L 214, 4.8.2006, p. 7." 

Article 3 
Amendment to Regulation (EC) No 1405/2006 

The following paragraph is added to Article 11 of Regulation (EC) No 1405/2006: 

"3. 

Without prejudice  to  paragraphs 1 and2, by  way  of  derogation  from  Article  180  of 
Regulation (EC) No 1234/2007(*) and Article 3 of Regulation (EC) No 1184/2006(**), 
Articles 87,  88  and  89  of  the  Treaty  shall  not  apply  to  payments  made  under 
Articles 4 and 7 by Member States in conformity with this Regulation. 

(*)  OJ L 299, 16.11.2007, p. 1. Regulation as last amended by Regulation (EC) No […]/2008. 
(**)  OJ L 214, 4.8.2006, p. 7". 

EN 

127 

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Article 4 
Amendments to Regulation (EC) No 1234/2007 

Regulation (EC) No 1234/2007 is amended as follows: 

(1) 

(2) 

Point (b) of Article 8(1) is deleted. 

Article 10 is amended as follows: 

(a)  Paragraph 1 is amended as follows: 

(i) 

point (a) is replaced by the following: 

"(a)  common wheat, barley, maize and sorghum;" 

(ii)  point (b) is deleted; 

(b)  Paragraph 2 is deleted. 

(3) 

Subsection  II  of  Section  II  of  Chapter  I  of  Title  I  of  Part  II  is  replaced  by  the 
following: 

"SUBSECTION II 
OPENING AND SUSPENSION OF BUYING-IN 

Article 11 
Public intervention periods 

Public intervention shall be available: 

(a) 

for cereals, from 1 November to 31 May; 

(b) 

for sugar, throughout the marketing years 2008/2009 and 2009/2010; 

(c) 

for beef and veal, throughout any marketing year; 

(d) 

for butter and skimmed milk powder, from 1 March to 31 August. 

Article 12 
Opening of public intervention 

1.  During the periods referred to in Article 11, public intervention 

(a) 

(b) 

shall be open for cereals, sugar, butter and skimmed milk powder up to 
the intervention limits referred to in Article 13(1), 

shall be opened for beef by the Commission, without the assistance of the 
Committee referred to in Article 195(1), if the average market price for 
beef  over  a  representative  period  in  a  Member  State  or  in  a  region  of  a 
Member  State  recorded  on  the  basis  of  the  Community  scale  for  the 
classification  of  carcasses  provided  for  in  Article 42(1)  is  below 
EUR 1560/tonne. 

EN 

128 

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2. 

3. 

Public intervention for common wheat may be suspended by the Commission, 
without  the  assistance  of  the  Committee  referred  to  in  Article 195(1),  if  the 
price  for  wheat  with  a  minimum  protein  content  of  11%  'Rouen  delivered'  is 
higher than the reference price. 

It  shall  be  reopened  by  the  Commission,  without  the  assistance  of  the 
Committee  referred  to  in  Article 195(1),  if  the  conditions  provided  for  in  the 
first subparagraph of this paragraph no longer apply. 

Public  intervention  for  beef,  referred  to  in  point  (b)  of  paragraph  1,  shall  be 
closed by the Commission, without the assistance of the Committee referred to 
in Article 195(1), if, over a representative period, the conditions provided for in 
that point are no longer fulfilled. 

Article 13 
Intervention limits 

1. 

Buying into public intervention shall be carried out within the following limits: 

(a) 

(b) 

for  barley,  maize  and  sorghum,  0  tonnes  for  each  period  referred  to  in 
Article 11(a); 

for sugar, 600 000 tonnes, expressed in white sugar, for each marketing 
year; 

(c) 

for butter, 30 000 tonnes for each period referred to in Article 11(d); 

(d) 

for  skimmed  milk  powder  109 000  tonnes  for  each  period  referred  to 
Article 11(d). 

2. 

3. 

Sugar  stored  in  accordance  with  point  (b)  of  paragraph  1  during  a  marketing 
year shall not be subject to any of the other storage measures provided for in 
Articles 32, 52 and 63. 

By  way  of  derogation  from  paragraph  1,  for  the  products  referred  to  in  its 
points (a),  (c)  and  (d),  the  Commission  may  decide  to  continue  public 
intervention  beyond  the  amounts  referred  to  in  that  paragraph  if  the  market 
situation and, in particular, the development of market prices, so requires." 

(4) 

Subsection  III  of  Section  II  of  Chapter  I  of  Title  I  of  Part  II  is  replaced  by  the 
following: 

EN 

129 

   EN 

 
"SUBSECTION III 
INTERVENTION PRICES 

Article 18 
Intervention prices 

1. 

The  intervention  prices  and  the  quantities  accepted  for  intervention  for  the 
products referred to in Article 10(a), (d), (e) and (f) shall be determined by the 
Commission  by  means  of  tendering  procedures.  In  special  circumstances, 
tendering  procedures  may  be  restricted  to,  or  the  intervention  prices  and  the 
quantities  accepted  for  intervention  may  be  fixed  per,  Member  State  or  per 
region of a Member State on the basis of recorded average market prices. 

2. 

The intervention price determined in accordance with paragraph 1 shall not be 
higher: 

(a) 

for cereals, than the respective reference prices; 

(b) 

for beef, than the average market price recorded in a Member State or a 
region  of  a  Member  State  increased  by  an  amount  to  be  determined  by 
the Commission on the basis of objective criteria; 

(c) 

for butter, than 90% of the reference price; 

(d) 

for skimmed milk powder, than the reference price. 

3. 

The  intervention price for  sugar shall be 80% of  the  reference price fixed  for 
the  marketing  year  following  the  marketing  year  during  which  the  offer  is 
lodged.  However,  if  the  quality  of  the  sugar  offered  to  the  paying  agency 
differs from the standard quality defined in point B of Annex IV for which the 
reference  price  is  fixed,  the  intervention  price  shall  be  increased  or  reduced 
accordingly." 

Subsection I of Section III of Chapter I of Title I of Part II is deleted. 

Article 31 is amended as follows: 

(a)  Paragraph 1 is amended as follows: 

(i) 

after point (c) the following points are inserted: 

"(ca)  unsalted  butter  produced  from  cream  or  milk  in  an  approved 
undertaking of the Community of a minimum butterfat content, by 
weight, of 82%, a maximum milk solids non-fat content, by weight, 
of 2%, and a maximum water content, by weight, of 16%; 

(cb)  salted  butter  produced  from  cream  or  milk  in  an  approved 
undertaking of the Community of a minimum butterfat content, by 
weight,  of  80  %,  a  maximum  milk  solids  non-fat  content,  by 
weight, of 2%, a maximum water content, by weight, of 16 % and a 
maximum salt content, by weight, of 2%;" 

(5) 

(6) 

EN 

130 

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(ii)  point (e) is deleted; 

(b) 

In paragraph 2, the second subparagraph is deleted. 

(7) 

The following Article 34a is inserted: 

"Article 34a 
Conditions of granting for butter 

"1.  The  Commission  may  decide  to  grant  aid  for  private  storage  for  butter  in 
particular  if  developments  in  prices  and  stocks  of  the  products  indicate  a 
serious imbalance in the market which could be avoided or reduced by means 
of seasonal storage. 

2. 

The amount of aid shall be fixed by the Commission taking account of storage 
costs and the likely development in butter prices." 

(8) 

(9) 

Article 36 is deleted. 

Article 41(1) is replaced by the following: 

"1.  The  Commission  shall  designate  the  intervention  centres  in  the  cereals  sector 

and determine the conditions applying thereto. 

The Commission may designate intervention centres for each cereal." 

(10) 

Point (a) of Article 43 is replaced by the following: 

"(a) 

the requirements and conditions to be met by products to be bought into public 
intervention as referred to in Article 10 or for which aid for private storage is 
granted as referred to in Article 31, in particular with respect to quality, quality 
groups,  quality  grades,  categories,  quantities,  packaging  including  labelling, 
maximum  ages,  preservation,  the  stage  of  the  products  to  which  the 
intervention price relates, the duration of private storage;" 

(11) 

Article 44 is deleted. 

(12) 

Article 46 is amended as follows: 

(a)  Paragraph 1 is replaced by the following: 

"1.  For  the  exceptional  support  measures  referred  to  in  Article  45,  the 
Community  shall  provide  part-financing  equivalent  to  50%  of  the 
expenditure borne by Member States." 

(b)  Paragraph 3 is deleted. 

(13) 

Point (a) of Article 48 (1) is deleted. 

(14) 

Article 55 is replaced by the following: 

EN 

131 

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"Article 55 
Quota systems 

1.  A quota system shall apply to the following products: 

(a)  milk and other milk products within the meaning of points (a) and (b) of 

Article 65; 

(b) 

sugar, isoglucose and inulin syrup; 

(c)  potato starch which may benefit from Community aid. 

2.  As regards the quota systems referred to in points (a) and (b) of paragraph 1, if 
a producer exceeds the relevant quota and, with regard to sugar, does not make 
use of the surplus quantities as provided for in Article 61, a surplus levy shall 
be  payable  on  such  quantities  subject  to  the  conditions  set  out  in  Sections II 
and III." 

(15) 

The following Section IIIa is inserted in Chapter III of Title I of Part II: 

"SECTION IIIA 
POTATO STARCH QUOTAS 

Article 84a 
Potato starch quotas 

1. 

2. 

The  potato  starch  producing  Member  States  shall  be  allocated  quotas  for 
marketing  year  during  which  the  quota  scheme  applies  according  to 
Article 204(5) in accordance with Annex Xa. 

Each  producer  Member  State  referred  to  in  Annex  Xa  shall  allocate  its  quota 
among potato starch manufacturers for use in the marketing years concerned on 
the basis of the subquotas available to each manufacturer in 2006/2007. 

3.  An undertaking producing potato starch shall not conclude cultivation contracts 
with  potato  producers  for  a  quantity  of  potatoes  which  would  produce  a 
quantity of starch in excess of its quota as referred to in paragraph 2. 

4.  Any potato starch produced in excess of the quota as referred to in paragraph 2 
shall be exported, as such, from the Community before 1 January following the 
end of the marketing year in question. No export refund shall be paid in respect 
of it. 

5.  Notwithstanding paragraph 4, an undertaking producing potato starch may, in 
any marketing year, in addition to its quota for that year, utilise no more than 
5% of its quota relating to the following marketing year. In such case, the quota 
for the following marketing year shall be reduced accordingly. 

EN 

132 

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6. 

The  provisions  of  this  Section  shall  not  cover  production  of  potato  starch  by 
undertakings which are not subject to paragraph 2 and which purchase potatoes 
for  which  producers  do  not  benefit  from  the  payment  provided  for  in 
Article [...][aid for starch potato] of Regulation (EC) No […]/2008 [new direct 
payments Regulation]." 

(16) 

In Article 85, the following point (d) is added: 

"(d)  in  respect  of  Section  IIIa,  mergers,  changes  of  ownership  and 

the 

commencement or cessation of trading of undertakings." 

(17) 

Subsection I of Section I of Chapter IV of Title I of Part II is deleted. 

(18) 

In Article 91(1), the first subparagraph is replaced by the following: 

"Aid  for  processing  the  straw  of  long  flax  grown  for  fibre  shall  be  granted  for  the 
2009/10 to 2012/13 marketing years to authorised primary processors on the basis of 
the  quantity  of  fibre  actually  obtained  from  straw  for  which  a  contract  of  sale  has 
been concluded with a farmer." 

(19) 

Article 92(1) is replaced by the following: 

"1.  The amount of processing aid provided for in Article 91 shall be fixed for long 

flax fibre: 

(a)  EUR 200 for the 2009/10 and 2010/11 marketing years; and 

(b)  EUR 100 for the 2011/12 and 2012/13 marketing years;". 

(20) 

Paragraph 1 of Article 94 is replaced by the following: 

"1.  A  maximum  guaranteed  quantity  of  80 878  tonnes  for  each  of  the  marketing 
years 2009/10 to 2012/13 shall be established for long flax fibre in respect of 
which  aid  may  be  granted.  That  quantity  shall  be  apportioned  among  certain 
Member States as national guaranteed quantities in accordance with point A.I. 
of Annex XI." 

(21) 

The following subsection is inserted into Section I of Chapter IV of Title I of Part II: 

EN 

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"SUBSECTION III 
POTATO STARCH 

Article 95a 
Potato starch premium 

1.  A  premium  of  EUR  22,25  per  tonne  of  starch  produced  shall  be  paid  for  the 
2009/10 and 2010/11 marketing years to undertakings producing potato starch 
for  the  quantity  of  potato  starch  up  to  the  quota  limit  referred  to  in 
Article 84a(2),  provided  that  they  have  paid  to  potato  producers  a  minimum 
price for all the potatoes necessary to produce starch up to that quota limit. 

2. 

The minimum price for potatoes intended for the manufacture of potato starch 
shall be set at EUR 178,31 per tonne for the marketing years concerned. 

This price applies to the quantity of potatoes, delivered to the factory, which is 
needed for making one tonne of starch. 

The  minimum  price  shall  be  adjusted  according  to  the  starch  content  of  the 
potatoes. 

3. 

The  Commission  shall  adopt  the  detailed rules  for  the  implementation  of  this 
Subsection." 

(22) 

Article 96 is deleted. 

(23) 

Articles 99 and 100 are replaced by the following: 

"Article 99 
Aid for skimmed milk and skimmed milk powder for use as feedingstuffs 

1.  When  surpluses  of  milk  products  build  up  or  are  likely  to  occur  creating  or 
likely to create a serious imbalance in the market, the Commission may decide 
that  aid  shall  be  granted  for  Community-produced  skimmed  milk  and 
skimmed-milk  powder  intended  for  use  as  feedingstuffs,  according  to 
conditions and product standards to be determined by the Commission The aid 
may be fixed in advance or by means of tendering procedures. 

For  the  purposes  of  this  Article,  buttermilk  and  buttermilk  powder  shall  be 
regarded as skimmed milk and skimmed-milk powder. 

2.  Aid  amounts  shall  be  fixed  by  the  Commission  taking  into  account  the 
reference price fixed in point (e)(ii) of Article 8(1) for skimmed-milk powder, 
and  the  development  of  the  market  situation  as  regards  skimmed  milk  and 
skimmed-milk powder. 

EN 

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Article 100 
Aid for skimmed milk processed into casein and caseinates 

1.  When  surpluses  of  milk  products  build  up  or  are  likely  to  occur  creating  or 
likely to create a serious imbalance in the market, the Commission may decide 
that  aid  shall  be  granted  for  Community-produced  skimmed  milk  processed 
into  casein  and  caseinates,  according  to  conditions  and  product  standards  of 
such milk and the casein or caseinates produced from it to be determined by the 
Commission.  The  aid  may  be  fixed  in  advance  or  by  means  of  tendering 
procedures. 

2.  Aid shall be fixed by the Commission taking into account development of the 
market  situation  for  skimmed-milk  powder  and  the  reference  price  for 
skimmed-milk powder, fixed in point (e)(ii) of Article 8(1). 

The  aid  may  vary,  according  to  whether  the  skimmed  milk  is  processed  into 
casein or caseinates and according to the quality of those products." 

(24) 

Article 101 is deleted. 

(25) 

Paragraph 2 of Article 102 is replaced by the following: 

"2.  Member  States  may,  in  addition  to  Community  aid,  grant  national  aid  for 
supplying  the  products  referred  to  in  paragraph  1  to  pupils  in  educational 
establishments.  Member  States  may  finance  their  national  aid  by  means  of  a 
levy on the dairy sector or by any other contribution from the dairy sector." 

(26) 

Paragraph 2 of Article 103e is deleted. 

(27) 

Paragraph 2 of Article 105 is replaced by the following: 

"2.  Member  States  may  pay  specific  national  aids  for  the  protection  of  apiaries 
disadvantaged  by  structural  or  natural  conditions  or  under  economic 
development  programmes,  except  for  those  allocated  for  production  or  trade. 
These aids shall be notified to the Commission by Member States together with 
the  communication  of 
in  accordance  with 
Article 109." 

the  apiculture  programme 

(28) 

Article 119 is replaced by the following: 

"Article 119 
Use of casein and caseinates in the manufacture of cheese 

Where  aid  is  paid  under  Article  100,  the  Commission  may  make  the  use  of  casein 
and caseinates in the manufacture of cheese subject to prior authorisation which shall 
be  granted  only  if  such  use  is  a  necessary  condition  for  the  manufacture  of  the 
products." 

(29) 

The following paragraph is added to Article 122: 

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135 

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"Member States may also recognise producer organisations constituted by producers 
in any sector referred to in Article 1 except for the sectors referred to in point (a) of 
the first paragraph, on the conditions set out in points (b) and (c) of that paragraph." 

(30) 

Paragraph 1 of Article 124 is replaced by the following: 

"1.  Article 122 and paragraph 1 of Article 123 shall apply without prejudice to the 
recognition,  decided  by  Member  States  on  the  basis  of  national  law  and  in 
compliance  with  Community  law,  of  producer  organisations  or  interbranch 
organisations respectively, in any sector referred to in Article 1 except for the 
sectors  referred  to  in  point  (a)  of  the  first  paragraph  of  Article 122  and  in 
Article 123(1)." 

(31) 

Article 180 is replaced by the following: 

"Article 180 
Application of Articles 87, 88 and 89 of the Treaty 

Articles 87, 88 and 89 of the Treaty shall apply to the production of and trade in the 
products referred to in points (a) to (k) and points (m) to (u) of Article 1(1) and in 
Article 1(3) of this Regulation. 

However,  Articles  87,  88  and  89  of  the  Treaty  shall  not  apply  to  payments  made 
under  Articles  45,  46,  47,  48,  102,  103,  103a,  103b,  103e,  104,  105  and  182  by 
Member States in conformity with this Regulation." 

(32) 

In Article 184, the following point (5) is added: 

"(5)  before 30 June 2011 to the European Parliament and Council on the conditions 
for  smoothly  phasing  out  the  milk  quota  system,  including,  in  particular, 
possible further increases in quotas or possible reductions in the superlevy." 

(33) 

In Article 204, the following paragraph is added: 

"5.  As regards potato starch,  Chapter III of Title I of Part II shall apply until the 

end of the 2012/13 marketing year for potato starch." 

(34) 

Point 1 of Annex IX is replaced by the text in Annex I to this Regulation. 

(35) 

The text of Annex II to this Regulation is inserted as Annex Xa. 

(36) 

The text of Annex III to this Regulation is inserted in Annex XXII as point 20a. 

EN 

136 

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Article 5 
Amendment to Regulation (EC) No 3/2008 

Paragraph 6 of Article 13 of Regulation (EC) No 3/2008 is replaced by the following: 

"6. 

By  way  of  derogation  from  Article  180  of  Regulation  (EC)  No  1234/2007(*)  and 
Article 3 of Regulation (EC) No 1184/2006(**), Articles 87, 88 and 89 of the Treaty 
shall  not  apply  to  payments  made  by  Member  States,  including  their  financial 
participations,  nor  to  the  financial  participations  from  parafiscal  charges  or 
mandatory  contributions  of  Member  States  or  proposing  organisations  for 
programmes eligible for Community support under Article 36 of the Treaty, that the 
Commission has selected in accordance with Article 8(1) of this Regulation.". 

(*)  OJ L 299, 16.11.2007, p. 1. Regulation as last amended by Regulation (EC) No […]/2008. 
(**)  OJ L 214, 4.8.2006, p. 7." 

Article 6 
Amendment to Regulation (EC) No […]/2008 [wine CMO] 

Paragraph 2 of Article 127 of Regulation (EC) No […]/2008 is replaced by the following: 

"2. 

Without prejudice to Article 8(4), Articles 87, 88 and 89 of the Treaty shall not apply 
to payments made under Title II, Chapter III of Title V and Article 119 by Member 
States in conformity with this Regulation." 

1. 

Regulation (EC) No 1868/94 is repealed. 

Article 7 
Repeals 

References to the repealed Regulation shall be construed as references to Regulation 
(EC)  No 1234/2007  and  shall  be  read  in  accordance  with  the  respective  correlation 
table in Annex XXII to that Regulation. 

2. 

Regulations  (EEC)  No  1883/78,  (EEC)  No  1254/89,  (EEC)  No  2247/89  (EEC) 
No 2055/93, (EC) No 2596/97 and (EC) No 1182/2005 are repealed. 

Article 8 
Entry into force 

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

It shall apply from 1 January 2009. 

However: 

(a) 

Points 1 to 10 and 13 of Article 4 shall apply from: 

EN 

137 

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(i) 

1 March 2009 as regards the milk and milk products sector, 

(ii)  1 July 2009 as regards the cereals sector, 

(iii)  1 September 2009 as regards the rice sector, 

(iv)  1 October 2009 as regards the sugar sector; 

(b) 

Points 14, 15, 16, 18 to 24, 28, 33 and 35 of Article 4 and Article 7(1) shall apply 
from 1 July 2009; 

(c) 

Article 4(17) shall apply from 1 April 2011. 

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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"1. 

National quotas: quantities (tonnes) per twelve-month period per Member State 

ANNEX I 

Member State 

2008/09 

2009/10 

2010/11 

2011/12 

2012/13 

2013/14 

2014/15 

Belgium 

Bulgaria 

3 427 288.740 

3 461 561.627 

3 496 177.244 

3 531 139.016 

3 566 450.406 

3 602 114.910 

3 602 114.910 

998 580.000 

1 008 565.800 

1 018 651.458 

1 028 837.973 

1 039 126.352 

1 049 517.616 

1 049 517.616 

Czech Republic 

2 792 689.620 

2 820 616.516 

2 848 822.681 

2 877 310.908 

2 906 084.017 

2 935 144.857 

2 935 144.857 

Denmark 

Germany 

Estonia 

Ireland 

Greece 

Spain 

France 

Italy 

Cyprus 

Latvia 

Lithuania 

Luxembourg 

Hungary 

Malta 

4 612 619.520 

4 658 745.715 

4 705 333.172 

4 752 386.504 

4 799 910.369 

4 847 909.473 

4 847 909.473 

28 847 420.391 

29 135 894.595 

29 427 253.541 

29 721 526.076 

30 018 741.337 

30 318 928.750 

30 318 928.750 

659 295.360 

665 888.314 

672 547.197 

679 272.669 

686 065.395 

692 926.049 

692 926.049 

5 503 679.280 

5 558 716.073 

5 614 303.234 

5 670 446.266 

5 727 150.729 

5 784 422.236 

5 784 422.236 

836 923.260 

845 292.493 

853 745.418 

862 282.872 

870 905.700 

879 614.757 

879 614.757 

6 239 289.000 

6 301 681.890 

6 364 698.709 

6 428 345.696 

6 492 629.153 

6 557 555.445 

6 557 555.445 

25 091 321.700 

25 342 234.917 

25 595 657.266 

25 851 613.839 

26 110 129.977 

26 371 231.277 

26 371 231.277 

10 740 661.200 

10 848 067.812 

10 956 548.490 

11 066 113.975 

11 176 775.115 

11 288 542.866 

11 288 542.866 

148 104.000 

743 220.960 

149 585.040 

750 653.170 

151 080.890 

758 159.701 

152 591.699 

765 741.298 

154 117.616 

773 398.711 

155 658.792 

781 132.698 

155 658.792 

781 132.698 

1 738 935.780 

1 756 325.138 

1 773 888.389 

1 791 627.273 

1 809 543.546 

1 827 638.981 

1 827 638.981 

278 545.680 

281 331.137 

284 144.448 

286 985.893 

289 855.752 

292 754.310 

292 754.310 

2 029 861.200 

2 050 159.812 

2 070 661.410 

2 091 368.024 

2 112 281.704 

2 133 404.521 

2 133 404.521 

49 671.960 

50 168.680 

50 670.366 

51 177.070 

51 688.841 

52 205.729 

52 205.729 

Netherlands 

11 465 630.280 

11 580 286.583 

11 696 089.449 

11 813 050.343 

11 931 180.847 

12 050 492.655 

12 050 492.655 

Austria 

Poland 

Portugal 

Romania 

Slovenia 

Slovakia 

Finland 

Sweden 

2 847 478.469 

2 875 953.254 

2 904 712.786 

2 933 759.914 

2 963 097.513 

2 992 728.488 

2 992 728.488 

9 567 745.860 

9 663 423.319 

9 760 057.552 

9 857 658.127 

9 956 234.709 

10 055 797.056 

10 055 797.056 

1 987 521.000 

2 007 396.210 

2 027 470.172 

2 047 744.874 

2 068 222.323 

2 088 904.546 

2 088 904.546 

3 118 140.000 

3 149 321.400 

3 180 814.614 

3 212 622.760 

3 244 748.988 

3 277 196.478 

3 277 196.478 

588 170.760 

594 052.468 

599 992.992 

605 992.922 

612 052.851 

618 173.380 

618 173.380 

1 061 603.760 

1 072 219.798 

1 082 941.996 

1 093 771.416 

1 104 709.130 

1 115 756.221 

1 115 756.221 

2 491 930.710 

2 516 850.017 

2 542 018.517 

2 567 438.702 

2 593 113.089 

2 619 044.220 

2 619 044.220 

3 419 595.900 

3 453 791.859 

3 488 329.778 

3 523 213.075 

3 558 445.206 

3 594 029.658 

3 594 029.658 

United Kingdom 

15 125 168.940 

15 276 420.629 

15 429 184.836 

15 583 476.684 

15 739 311.451 

15 896 704.566 

15 896 704.566 

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139 

" 

EN 

 
  
ANNEX II 

"ANNEX Xa 

Potato starch quotas per marketing year, referred to in Article 84a 

Member State 

(tonnes) 

Czech Republic 

Denmark 

Germany 

Estonia 

Spain 

France 

Latvia 

Lithuania 

Netherlands 

Austria 

Poland 

Slovakia 

Finland 

Sweden 

33 660 

168 215 

656 298 

250 

1 943 

265 354 

5 778 

1 211 

507 403 

47 691 

144 985 

729 

53 178 

62 066 

TOTAL 

1 948 761 

" 

EN 

140 

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"20a.  Regulation (EEC) No 1868/94 

ANNEX III 

Regulation (EEC) No 1868/94 

This Regulation 

Article 1 

Article 55(1)(c) 

Article 2(1) and (2) first subparagraph 

Article 84a(1) and (2) 

Article 4 

Article 4a 

Article 5 

Article 6 

Article 7 

Article 8 

Article 84a(3) 

Article 95a(2) 

Article 95a(1) 

Article 84a(4) and (5) 

Article 84a(6) 

Articles 85(d) and 95a(3) 

" 

EN 

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2008/0105 (CNS) 

Proposal for a 

COUNCIL REGULATION 

amending Regulation (EC) No 1698/2005 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 36 and 37 thereof, 

Having regard to the proposal from the Commission48, 

Having regard to the opinion of the European Parliament49, 

Having regard to the opinion of the European Economic and Social Committee50, 

Having regard to the opinion of the Committee of the Regions51, 

Whereas: 

(1) 

(2) 

In  the  context  of  the  assessment  of  the  implementation  of  the  common  agricultural 
policy (CAP) reform of 2003, climate change, renewable energies, water management 
and biodiversity were identified as crucial new challenges for European agriculture. 

in 

The European Community is party to the Kyoto Protocol52. Article 2(1)(a)(iii) of the 
Kyoto  Protocol  calls  upon  parties  to  implement  and/or  further  elaborate  policies  and 
measures  in  accordance  with  its  national  circumstances,  such  as:  Promotion  of 
light  of  climate  change  considerations. 
sustainable  forms  of  agriculture 
Furthermore,  Article  10(b)(i)  obliges  parties  to  formulate,  implement,  publish  and 
regularly  update  national  and,  where  appropriate,  regional  programmes  containing 
measures to mitigate climate change and measures to facilitate adequate adaptation to 
climate change. Such programmes would, inter alia, concern agriculture and forestry. 
The  role  of  support  for  rural  development  should  be  further  strengthened  in  this 
context.  Strong  scientific  evidence  underlines  the  need  for  urgent  action.  The 
European Community is called to examine all possible ways to of reducing greenhouse 
gas (GHG) emissions. Although European agriculture has contributed more than other 
sectors  to  curbing  green  house  gas  emissions,  in  the  future  the  agriculture  sector  is 

48 
49 
50 
51 
52 

OJ C …, …, p. …. 
OJ C …, …, p. …. 
OJ C …, …, p. …. 
OJ C …, …, p. …. 
Council Decision 2002/358/EC (OJ L 130, 15.5.2002, p. 1). 

EN 

142 

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(3) 

(4) 

(5) 

(6) 

(7) 

(8) 

(9) 

called  to  step  up  its  emission  reduction  efforts  as  part  of  the  global  strategy  of  the 
European Community for combating climate change. 

Following serious problems related to water scarcity and droughts, water management 
issues,  including  water  quality,  should  be  further  addressed  in  the  relevant  CAP 
instruments53.  It  is  essential  for  European  agriculture  to  have  sustainable  water 
management,  in  order  to  improve  efficiency  as  regards  the  water  quantity  used  for 
agriculture  and  in  order  to  better  protect  the  quality  of  water.  In  the  context  of  the 
climatic changes expected, drought affected areas are likely to increase in extent and 
frequency. 

Halting biodiversity decline remains a major challenge, and climate change and water 
demand  increase  that  challenge.  While  important  progress  has  been  made,  the 
achievement  of  the  European  Community's  biodiversity  target  for  2010  will  require 
additional  efforts54.  European  agriculture  has  a  key  role  to  play  in  protecting 
biodiversity. 

It is important that operations related to these priorities are further strengthened in the 
rural development programmes approved in accordance with Council Regulation (EC) 
No 1698/200555. 

Given  the  importance  of  these  Community  priorities,  the  obligation  for  the  Member 
States to provide in rural development programmes for operations related to the new 
challenges should be set out. 

Article  10  of  Regulation  (EC)  No 1698/2005  provides  that,  with  a  view  to  taking 
account  of  major  changes  in  the  Community  priorities  in  particular,  the  Community 
strategic guidelines for rural development (programming period 2007 to 2013) adopted 
by  Council  Decision  2006/144/EC56  may  be  subject  to  review.  Therefore,  a  general 
obligation  for  the  Member  States  to  revise  the  national  strategy  plans  following  the 
review of the Community strategic guidelines should be set out in order to arrange the 
context for the programmes to be modified. 

It is necessary to fix a deadline for the introduction of the operations related to the new 
challenges into the rural development programmes in order to give a reasonable time 
to  Member  States  to  modify  their  rural  development  programmes  in  the  light  of  the 
revised Community strategic guidelines and national strategy plans. 

In  view  of  the  new  obligations,  the  requirements  on  the  content  of  the  rural 
development  programmes  should  be  adapted.  A  non-exhaustive  list  of  types  of 
operations  should  be  provided  in  order  to  help  the  Member  States  to  identify  the 
relevant operations related to the new challenges in the context of the legal framework 
for rural development. 

53 
54 
55 

56 

Council Conclusions, Luxembourg, 30.10.2007, 13888/07. 
Council Conclusion, Brussels, 18.12.2006, 16164/06. 
OJ  L  277,  21.10.2005,  p. 1.  Regulation  as  last  amended  by  Regulation  (EC)  No 146/2008  (OJ L 46, 
21.2.2008, p. 1). 
OJ L 55, 25.2.2006, p. 20. 

EN 

143 

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(10) 

(11) 

In order to provide additional incentives to beneficiaries for the uptake of operations 
related  to  the  new  priorities,  the  possibility  to  establish  higher  amounts  and  rates  of 
support for such operations should be given. 

In  accordance  with  Article  9(4)  and  Article  10(4)  of  Council  Regulation  (EC) 
No XXXX/XXXX  of  XX/XX/2008  [establishing  common  rules  for  direct  support 
schemes  under  the  common  agricultural  policy  and  establishing  certain  support 
schemes for farmers]57 financial resources raised by way of the additional modulation 
are to be used for rural development support. It is appropriate to ensure that an amount 
equal to those financial resources should be used to support operations related to the 
new challenges. 

(12)  Given  the  additional,  specific  and  binding  use  of  these  amounts  equal  to  those 
financial resources, the established balance between objectives of the support for rural 
development should not be affected. 

(13)  New rules on liability under cross compliance in the case of transfer of land during the 
calendar year concerned were introduced by Regulation (EC) No 146/2008 amending 
Regulation (EC) No 1782/2003 establishing common rules for direct support schemes 
under  the  common  agricultural  policy  and  establishing  certain  support  schemes  for 
farmers and Regulation (EC) No 1698/2005 on support for rural development by the 
European  Agricultural  Fund  for  Rural  Development  (EAFRD)58.  In  order  to  ensure 
consistency,  the  same  principles  should  be  provided  for  cross  compliance  in  rural 
development. 

(14)  For  the  sake  of  clarity  and  legal  certainty,  it  should  be  clarified  in  which  cases  a 
reduction or exclusion from payments resulting from the non respect of the mandatory 
requirements (cross compliance) shall not apply. 

(15)  Experience has shown the need to provide for a measure of tolerance for minor cases 
of non-compliance with the cross compliance requirements provided for in Article 51 
of Regulation (EC) No 1698/2005 whose severity, extent and permanence would not 
justify an immediate reduction of the rural development support to be granted. Such a 
measure  of  tolerance  should  nonetheless  include  an  appropriate  follow  up  by  the 
competent national authority until the non-compliance has been remedied. Moreover, 
applying  reductions  to  very  low  initial  amounts  of  direct  payments  may  prove 
burdensome in comparison to any deterrent effect to be gained. As a consequence, a 
suitable threshold should be defined, below which Member States may decide not to 
apply any reduction, provided that the actions to ensure that the farmer remedies the 
findings of non-compliance concerned are taken by the competent national authority. 

(16)  The role and the functions of the monitoring committee with regard to changes in the 

rural development programmes should be modified in order to increase its efficiency. 

(17) 

In  the  interest  of  legal  certainty  and  simplicity  it  is  appropriate  to  clarify  and 
harmonise the provisions which provide for the non-application of Articles 87, 88 and 
89 of the Treaty to payments made by Member States pursuant to and in conformity 
with this Regulation. 

57 
58 

OJ L […], […], p. […]. 
OJ L 46, 21.2.2008, p. 1. 

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144 

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(18)  Regulation (EC) No 1698/2005 should therefore be amended accordingly, 

HAS ADOPTED THIS REGULATION: 

Article 1 

Regulation (EC) No 1698/2005 is hereby amended as follows: 

(1) 

In Article 11(3), point (d) is replaced by the following: 

"(d)  a list of the rural development programmes implementing the national strategy 
plan,  an  indicative  EAFRD  allocation  for  each  programme,  including  the 
amounts provided for in Article 12(2) of Regulation (EC) No 1290/2005*, and 
a  separate  indication  of  the  amounts  provided  for  in  Article  69(5a)  of  this 
Regulation." 

* 

OJ L 209, 11.8.2005, p. 1.. 

(2) 

The following Article 12a is added at the end of Chapter II: 

"Article 12a  
Revision 

1. 

Each Member State shall revise, in accordance with the procedure referred to 
in  Article  12(1),  its  national  strategy  plan  following  the  review  of  the 
Community strategic guidelines as referred to in Article 10. 

2.  Member State shall send to the Commission a revised national strategy plan at 
the  latest  three  months  after  the  adoption  of  the  decision  on  the  Community 
strategic guidelines." 

(3) 

The following Article 16a is inserted: 

"Article 16a 
Specific operations related to certain priorities 

1. 

From 1 January 2010, Member States shall provide in their rural development 
programmes,  in  accordance  with  their  specific  needs,  for  types  of  operations 
having  the  following  priorities  as  described  in  the  Community  strategic 
guidelines and specified further in the national strategy plan: 

(a) 

climate change, 

(b) 

renewable energies, 

(c)  water management, 

(d)  biodiversity. 

EN 

145 

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Member  States  may  base  their  choice  on  the  indicative  list  of  types  of 
operations  set  out  in  Annex  II  of  this  Regulation  and/or  any  other  types  of 
operations provided that those operations are linked to the priorities referred to 
in  the  first  subparagraph  and  are  aimed  at  achieving  the  potential  effects 
specified in Annex II. 

2. 

From 1 January 2010, for types of operations referred to in paragraph 1, the aid 
intensity rates fixed in Annex I may be increased by 10 percentage points. 

3. 

From 1 January 2010, each rural development programme shall also include: 

(a) 

(b) 

the  list  of  types  of  operations  and  the  information  referred  to  in 
Article 16(c)  on  the  specific  types  of  operations  referred  to  in 
paragraph 1 of this Article; 

a  table  setting  out  for  the  period  from  1  January  2010  to  31  December 
2013 the total Community contribution for types of operations referred to 
in Article 69(5a)." 

(4) 

In Article 17 the following paragraph 3 is added: 

"3.  The  amounts  equal  to  those  resulting  from  the  application  of  the  compulsory 
modulation under Article 69(5a) shall not be taken into account in the EAFRD 
total contribution from which the minimum Community financial contribution 
per axis is calculated as provided for in paragraphs 1 and 2 of this Article." 

(5) 

In Article 51(1), the following subparagraphs are added: 

"The  first  and  second  subparagraph  shall  also  apply  where,  the  non-compliance  in 
question is the result of an act or omission directly attributable to the person to whom 
or from whom the land was transferred. 

For the purpose of this paragraph, the term "transfer" means any type of transaction 
whereby the land ceases to be at the disposal of the transferor. 

For  the  purpose  of  this  Article,  the  term  "whole  holding"  shall  not  include  non-
agricultural activities on a holding and non-agricultural areas for which no support in 
accordance with Articles 36(b)(i), (iv) and (v) of this Regulation is claimed." 

(6) 

Article 51, paragraph 2 is replaced by the following: 

"2.  The  reduction  or  cancellation  of  payments  referred  to  in  paragraph 1  shall 

apply subject to the following provisions: 

(a)  The  reduction  or  cancellation  shall  not  apply  for  standards  for  which  a 
period  of  grace  has  been  granted  in  accordance  with  Article 26(1)(b) 
during the period of grace. 

EN 

146 

   EN 

 
(b)  Pursuant  to  the  conditions  laid  down  in  the  detailed  rules  referred  to  in 
paragraph 4  of  this  Article,  Member  States  may  decide  not  to  apply  a 
reduction  or  cancellation  amounting  to  EUR 100  or  less  per  farmer  and 
per calendar year, and which includes any reduction or exclusion applied 
to direct payments under Article 25 of Regulation (EC) [No XXXX/2008 
(new Regulation on direct support schemes)].  

Where a Member State decides to make use of the option provided for in 
the first subparagraph, in the following year the competent authority shall 
take the actions required to ensure that the farmer remedies the findings 
of non-compliance concerned. The finding and the remedial action to be 
taken shall be notified to the beneficiary. 

(c) 

In  case  the  non-compliance  referred  to  in  paragraph  1  is  due  to 
negligence of the beneficiary and in duly justified cases, Member States 
may decide that  no reduction shall  be applied where, given its severity, 
extent and permanence, a case of non-compliance is to be considered as 
minor. Cases of non-compliance which constitute a direct risk to public 
or animal health shall however not be considered as minor. 

Unless  the  beneficiary  has  taken  immediate  remedial  action  putting  an 
end to the non-compliance found, the competent authority shall take the 
actions  required  that  may,  where  appropriate,  be  limited  to  an 
administrative  check,  to  ensure  that  the  farmer  remedies  the  findings  of 
non-compliance  concerned.  The  finding  of  minor  non-compliance  and 
the remedial action to be taken shall be notified to the beneficiary." 

(7) 

In Article 69 the following paragraphs 5a, 5b and 5c are inserted: 

"(5a) An  amount  equal  to  the  amounts  resulting  from  the  application  of  the 
compulsory  modulation  under  Articles  9(4)  and  10(4)  of  Regulation  (EC) 
[No XXXX/2008  (new  Regulation  on  direct  support  schemes)]  shall  be  spent 
by Member States in the period from 1 January 2010 to 31 December 2015 as 
Community  support  under  the  current  rural  development  programmes  for 
operations  of  the  types  referred  to  in Article  16a  of  this  Regulation  approved 
after 1 January 2010. 

(5b)  If  at  the  closure  of  the  programme,  the  total  amount  spent  on  the  operations 
referred to in paragraph 5a of this Article is lower than the amount referred to 
in Article 16a(3)(b), the difference shall be reimbursed by the Member State to 
the  Community  budget  up  to  the  amount  by  which  the  total  allocations 
available  for  operations  other  than  those  referred  to  in  Article 16a  have  been 
exceeded. 

(5c)  Amounts  referred  to  in  paragraph  5a  will  not  be  taken  into  account  for  the 

purpose of Article 25 of Regulation (EC) No 1290/2005." 

(8) 

In Article 78, point (f) is replaced by the following: 

"(f)  shall  consider  and  approve  any  substantial  proposals  for  changes  in  rural 

development programmes." 

EN 

147 

   EN 

 
 
 
(9) 

In Article 88(1), the second subparagraph is replaced by the following: 

"However, and without prejudice to Article 89 of this Regulation, Articles 87, 88 and 
89 of the Treaty shall not apply to payments made by Member States pursuant to and 
in conformity with this Regulation within the scope of Article 36 of the Treaty." 

(10) 

The Annex is amended as follows: 

(a)  The title is replaced by the following: 

"Annex I" 

(b)  The footnote "****" is replaced by the following: 

"**** These amounts may be increased for the types of operations mentioned in Article 16a of 
this Regulation and in other exceptional cases taking account of specific circumstances to be 
justified in the rural development programmes." 

(11) 

The  word  "Annex"  is  replaced  by  "Annex  I"  in  the  Annex  and  in  the  following 
Articles: 22(2), 23(6), 24(2), 26(2), 27(3), 28(2), 31(2), 32(2), 33, 34(3), 35(2), 37(3), 
38(2), 39(4), 40(3), 43(4), 44(4), 45(3), 46, 47(2), 88(2), 88(4), 88(6). 

(12) 

A  new  Annex  II,  the  text  of  which  is  set  out  in  the  Annex  to  this  Regulation,  is 
added. 

Article 2 

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

It shall apply from 1 January 2009. 

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

Done at Brussels, 

For the Council 
The President 

EN 

148 

   EN 

 
 
 
ANNEX 

"ANNEX II 

Indicative types of operations related to priorities referred to in Article 16a 

Priority: Climate change  

Types of operations 

Articles and measures 

Potential effects 

Improve  efficiency  of  nitrogen  fertiliser  use 
(for  ex.  reduced  use,  equipment,  precision 
agriculture), improvement of manure storage 

Article 26: modernisation 
of agricultural holdings 

Reduction of methane (CH4) and 
nitrous oxide (N2O) emissions 

Article 39: agri-
environment payments 

Improvement of energy efficiency 

Soil  management  practices  (for  ex.  tillage 
methods, 
crop 
crops, 
rotations) 

diversified 

catch 

Article 26: modernisation 
of agricultural holdings 

Reduction of carbon dioxide 
(CO2) emissions by saving 
energy. 

Article 39: agri-
environment payments 

Reduction of nitrous oxide 
(N2O); carbon sequestration.  

Land Use  change  (for  ex.  conversion of  arable 
land  to  pastures,  permanent  set  aside,  reduced 
use/ restoration of organic soils) 

Article 39: agri-
environment payments 

Reduction nitrous oxide (N2O); 
carbon sequestration.  

Extensification  of  livestock  (for  ex.  reduction 
stocking density, increase grazing) 

Article 39: agri-
environment payments 

Reduction of methane (CH4). 

Afforestation 

Forest fire prevention 

Articles 43 and 45: first 
afforestation of 
agricultural and non-
agricultural land 

Article 48: restoring 
forestry potential and 
introducing prevention 
actions 

Reduction  of  nitrous  oxide 
(N2O); carbon sequestration. 

Carbon  sequestration  in  forests 
and  avoid  carbon  dioxide  (CO2) 
emissions. 

Types of operations 

Articles and measures 

Potential effects 

Priority: Renewable energies 

Biogas production – anaerobic digestion plants 
using  animal  waste  (on  farm  and 
local 
production)  

Article 26: modernisation 
of agricultural holdings 

Article 53: diversification 
into non-agricultural 
activities 

Substitution  of 
reduction of methane (CH4)  

fossil 

fuel; 

Perennial  energy  crops  (short  rotation  coppice 
and herbaceous grasses) 

Article 26: modernisation 
of agricultural holdings 

fuels; 
Substitution  of 
carbon  sequestration;  reduction 
of nitrous oxide (N2O). 

fossil 

EN 

149 

   EN 

 
Processing  of  agricultural/forest  biomass  for 
renewable energy  

Installations/infrastructure 
energy using biomass  

for 

renewable 

Substitution of fossil fuels. 

Substitution of fossil fuels. 

Article 28: adding value 
to agricultural and 
forestry products 

Article 53: diversification 
into non-agricultural 
activities 

Article 54: support for 
business creation and 
development 

Article 56: basic services 
for the economy and rural 
population 

Priority: Water Management 

Types of operations 

Articles and measures 

Potential effects 

Water saving technologies, water storage 

Water saving production techniques  

Article 26: modernisation 
of agricultural holdings 

Improve 
the  capacity 
water more efficiently. 

to  use 

Wetland restoration 

Conversion of agricultural land into forest/agro-
forestry systems 

of 

Conservation 
high-value 
water  bodies;  protection  of 
quality water.  

Article 30: infrastructure  

Article 39: agri-
environment payments 

Article 41: non-
productive investments 

Article 43 and 45: first 
afforestation of 
agricultural and non-
agricultural land 

Development of semi-natural water bodies 

Article 57: conservation 
and upgrading of the rural 
heritage 

of 

Conservation 
high-value 
water  bodies;  protection  of 
quality water.  

Soil management practices (for ex. catch crops)  Article 39: agri-

environment payments 

Contributing  to  the  reduction  of 
losses of different compounds to 
water, including phosphor. 

EN 

150 

   EN 

 
Priority: Biodiversity 

Types of operations 

Articles and measures 

Potential effects 

No  application  of  fertilizer  and  pesticides  on 
high nature value agricultural land 

Article 39: agri-
environment payments  

Conserved 
species-rich 
vegetation  types,  protection  and 
maintenance of grasslands. 

Integrated and organic production 

Perennial field and riparian boundary strips 

Construction/management of biotopes/habitats 
within and outside Natura 2000 sites 

Land Use Change (extensive grassland 
management, conversion of cropland to pasture, 
long-term set aside) 

Management of high nature value perennials 

Conservation of genetic diversity  

Articles 38 and 46: Natura 
2000 payments 

Article 39: agri-
environment payments 

Article 41: non-
productive investments 

Article 47: forest-
environment payments 

Article 57: conservation 
and upgrading of the rural 
heritage 

Article 39: agri-
environment payments  

and 

birds 

other 
Protected 
wildlife  and  improved  biotope 
network; 
entry  of 
reduced 
harmful  substances  in  bordering 
habitats. 

Conserved genetic diversity. 

" 

EN 

151 

   EN 

 
2008/0106 (CNS) 

Proposal for a 

COUNCIL DECISION 

amending Decision 2006/144/EC on the Community strategic guidelines  
for rural development (programming period 2007 to 2013) 

THE COUNCIL OF THE EUROPEAN UNION, 

Having regard to the Treaty establishing the European Community, 

Having regard to Council Regulation (EC) No 1698/2005 of 20 September 2005 on support 
for rural development by the European Agricultural Fund for Rural Development (EAFRD)59, 
and in particular Articles 9 and 10 thereof, 

Having regard to the proposal from the Commission60, 

Having regard to the opinion of the European Parliament61, 

Whereas: 

(1) 

(2) 

(3) 

(4) 

59 

60 
61 
62 

The  Council  by  its  Decision  2006/144/EC62  adopted  the  Community  strategic 
guidelines  for  rural  development  (programming  period  2007  to  2013),  hereinafter 
"Community strategic guidelines". 

Article  10  of  Regulation  (EC)  No  1698/2005  provides  that  with  a  view  to  taking 
account  of  major  changes  in  the  Community  priorities  in  particular,  the  Community 
strategic guidelines may be subject to review. 

In  the  context  of  the  assessment  of  the  implementation  of  the  Common  Agricultural 
Policy  reform  of  2003  climate  change,  renewable  energies,  water  management  and 
biodiversity  were  identified  as  the  crucial  new  challenges.  The  objectives  related  to 
these priorities should be strengthened in the rural development programs approved in 
accordance with Regulation (EC) No 1698/2005. 

The  Community  strategic  guidelines  should  identify  the  areas  important  for  the 
realisation  of  the  revised  Community  priorities  related  to  climate  change,  renewable 
energies, water management and biodiversity. 

OJ  L  277,  21.10.2005,  p. 1.  Regulation  last  amended  by  Regulation  (EC)  No  146/2008  (OJ  L 46, 
21.2.2008, p. 1). 
OJ C …, …, p. …. 
OJ C …, …, p. …. 
OJ L 55, 25.2.2006, p. 20. 

EN 

152 

   EN 

 
                                                 
(5) 

On the basis of the review of the Community strategic guidelines, each Member State 
should revise its national strategy plan as the reference framework for the revision of 
rural development programmes. 

(6) 

The Community strategic guidelines should therefore be amended accordingly, 

HAS DECIDED AS FOLLOWS: 

Sole Article 

Council Decision of 20 February 2006 (2006/144/EC) is hereby amended as follows: 

In  the  Annex,  paragraphs  2.5  and  3.4a,  the  text  of  which  is  set  out  in  the  Annex  to  this 
Decision, are added. 

Done at Brussels,  

For the Council 
The President 

EN 

153 

   EN 

 
 
 
The  Community  strategic  guidelines  for  rural  development  (programming  period  2007  to 
2013), set out in the Annex to Decision 2006/144/EC, are amended as follows: 

ANNEX 

(1) 

In Part 2, the following point is added: 

"2.5  Meeting the new challenges 

As  part  of  the  review  of  the  reforms  introduced  in  2003,  also  the  balance  between 
expenditure for direct payments under the 1st pillar of the CAP and funding of rural 
development  policy  has  been  revisited.  With  the  overall  CAP  budget  fixed  until 
2013,  additional  funding  for  rural  development  can  only  be  realised  through  an 
increase in compulsory modulation. The additional funding is needed to reinforce the 
efforts  with  regard  to  the  EU  priorities  in  the  field  of  climate  change,  renewable 
energy, water management and biodiversity: 

•  Climate  and  energy  became  priorities,  as  the  EU  is  taking  the  lead  to  build  a 
global  low  carbon  economy.  In  March  2007,  the  European  Council  adopted 
conclusions63 to reduce CO2 emissions by at least 20% by 2020 (30% as part of an 
international agreement on global targets) and to set a binding 20% target for the 
use of renewable energy sources, including a 10% share of biofuels in petrol and 
diesel consumption. Agriculture and forestry can make an important contribution 
in providing the feed stocks for bio-energy, in carbon sequestration and in further 
reducing GHG emissions. 

•  The  EU's  objectives  with  regard  to  water  policy  are  laid  down  in  Directive 
2000/60/EC  of  the  European  Parliament  and  of  the  Council  of  23  October  2000 
establishing  a  framework  for  Community  action  in  the  field  of  water  policy64, 
which will start to reach full implementation in the period 2010–2012. Agriculture 
and forestry as main users of water and water resources have a major role to play 
in sustainable water management both in terms of quantity and of quality. Water 
management  will  be  an  increasingly  important  part  of  the  adaptation  strategy  to 
deal with already unavoidable climate change. 

•  Member States have committed themselves to halt biodiversity decline by 2010, a 
target  which  increasingly  seems  unlikely  to  be  met.  A  large  part  of  Europe's 
biological  diversity  is  dependent  on  agriculture  and  forestry  and  the  efforts  to 
protect  biodiversity  will  have  to  be  increased,  particularly  in  the  light  of  the 
expected adverse effects of climate change and increasing water demand." 

63 
64 

Council Conclusions, Brussels, 8/9 March 2007, 7224/1/07 REV 1. 
OJ L 327, 22.12.2000, p. 1. 

EN 

154 

   EN 

 
                                                 
(2) 

In Part 3, the following point 3.4a. is inserted: 

"3.4a. Addressing the new challenges 

Community strategic guideline 

Climate change, renewable energy, water management and biodiversity are crucial challenges 
for  Europe's  rural  areas,  agriculture  and  forestry.  As  part  of  the  EU  global  strategy  against 
climate  change,  agriculture  and  forestry  will  be  called  to  contribute  more  in  the  future  for 
curbing green house gas emissions and increasing carbon sequestration. Increasing production 
of renewable energy from agriculture and forestry biomass should also help to meet the new 
EU  targets  in  total  fuel  and  energy  consumption  by  2020.  More  sustainable  water 
management practices in agriculture will be essential to ensure sufficient quantity and quality 
of  water  for  the  future,  and  to  adapt  to  the  projected  climate  change  impacts  on  water 
resources. Furthermore, halting biodiversity decline remains a major challenge. Therefore, the 
additional resources which will be made available  as of 2010  by  an increase  in compulsory 
modulation should be devoted to reinforce the EU priorities in the above-mentioned fields. 

In  order  to  meet  these  priorities,  Member  States  are  encouraged  to  focus  support  on  key 
actions. Such key actions could include the following types of operations: 

(i) 

(ii) 

(iii) 

(iv) 

(v) 

In particular investment support under axis 1 can be targeted towards energy, water 
and  other  input  saving  machinery  and  equipment  as  well  as  to  the  production  of 
renewable  energy  for  on  farm  use.  In  the  agrifood  chain  and  forestry  sector 
investment support should help to develop innovative and more sustainable ways of 
biofuel processing. 

Under axis 2 the agri-environment measure and the forestry measures can be used in 
particular  for  enhancing  biodiversity  by  conserving  species-rich  vegetation  types, 
protection  and  maintenance  of  grassland  and  extensive  forms  of  agricultural 
production. Specific actions under axis 2, such as agri-environment or afforestation 
can also help to improve the capacity to better manage the available water resources 
in terms of quantity and protect them in terms of quality. Furthermore, certain agri-
environmental and forestry actions contribute to curbing emissions of nitrous oxide 
(N2O) and methane (CH4) and help to foster carbon sequestration. 

Under axis 3 and 4 local scale projects and cooperation for renewable energy projects 
can  be  supported  as  well  as  diversification  of  farmers  into  bioenergy  production. 
Conservation of natural heritage can help in protecting high nature value habitats and 
high-value water bodies. 

As all rural areas are being confronted with the climate change and renewable energy 
issues  Member  States  can  encourage  the  Leader  groups  to  pick  up  these  issues  in 
their  local  development  strategies  as  a  cross  cutting  theme.  The  groups  are  well 
placed  to  contribute  to  climate  change  adaptation  and  renewable  energy  solutions 
tailored to the local situation. 

As  a  general  principle  support  shall  be  targeted  to  types  of  operations  which  are 
coherent  with  the  objectives  and  provisions  established  in  Regulation  (EC) 
No 1698/2005 and which contribute generating positive potential effects in view of 
the new challenges such as specified in Annex II to that Regulation". 

EN 

155 

   EN 

 
FINANCIAL STATEMENT 

1. 

BUDGET HEADING (2008): 

APPROPRIATIONS (2008): 
(EUR million) 
p.m. 
4 032 
36 832 
12 927 

67 03 
05 02 
05 03 
05 04 
TITLE: 
Council  Regulation  establishing  common  rules  for  direct  support  schemes  under  the  common 
agricultural policy and establishing certain support schemes for farmers; 
Council Regulation on modifications to the common agricultural policy by amending Regulations (EC) 
No 320/2006, (EC) No 1234/2007, (EC) No 3/2008 and (EC) No […]/2008; 
Council Regulation amending Regulation (EC) No 1698/2005 on support for rural development by the 
European Agricultural Fund for Rural Development (EAFRD); 
Council  Decision  amending  Decision  2006/144/EC  on  the  Community  strategic  guidelines  for  rural 
development (programming period 2007 to 2013) 
LEGAL BASIS: 
Articles 36 and 37 of the Treaty 
AIMS: 
–  To make the adjustments necessary to simplify the common agricultural policy, 
– 
– 
FINANCIAL IMPLICATIONS 

to allow the CAP to seize new market opportunities and 
to address the new challenges of climate change, water management and bio-energy. 

2009 
(EUR million)
– 

2010 
(EUR million) 
–9 

2011 
(EUR million) 
–180 

2. 

3. 

4. 

5. 

5.0 

CHARGED TO THE EC BUDGET 

EXPENDITURE 
– 
(REFUNDS/INTERVENTIONS) 
– 
– 

NATIONAL AUTHORITIES 
OTHER 

5.1  REVENUE 

ASSIGNED REVENUE 

5.0.1  ESTIMATED EXPENDITURE 
5.1.1  ESTIMATED REVENUE 
5.2  METHOD OF CALCULATION: 

Please refer to the accompanying tables. 

– 

– 

2012 
(EUR million) 
–115 
–55 

– 

2013 
(EUR million) 
–124 
–110 

6.0  CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE 

RELEVANT CHAPTER OF THE CURRENT BUDGET? 

YES NO 

6.1  CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF 

THE CURRENT BUDGET? 

6.2  WILL A SUPPLEMENTARY BUDGET BE NECESSARY? 
6.3  WILL APPROPRIATIONS NEED TO BE ENTERED IN FUTURE BUDGETS? 
OBSERVATIONS: 
The annual net budgetary effect of the reform is limited (a saving of €14 million in 2013). The main budgetary 
effects are twofold: 
(i) an increase in the proportion of direct payments that will be completely decoupled from production; 
(ii) the transfer of an increasing annual amount (up to €2.0 billion in 2013) from ma rket measures and direct 
aids to rural development to address the new challenges mentioned above.  

YES NO 
YES NO 
YES NO 

EN 

156 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
CALCULATION OF THE NET FINANCIAL IMPACT BY BUDGET CHAPTER OF THE HEALTH CHECK PROPOSALS 

Budget year 

Revenue 
6703 (decrease of amount) 
Expenditure 
05 02 Markets 
05 03 Direct aids (before modulation) 
Net amount 05 02 and 05 03 before modulation 
05 03 Direct aids (transfer of modulation to rural development) 
05 04 Rural Development 

NET EXPENDITURE (05 02, 05 03, 05 04) 

NET BUDGETARY IMPACT INCLUDING ASSIGNED REVENUE (67 03, 05 02, 05 03, 05 04) 

2009 

2010 

2011 

2012 

2013 

0
0
0
0
0

0

0

–9
0
–6
–563
563

–9

–9

–55

–110 

–36
–144
–178
–977
977

–146
32
–115
–1427
1427

–155 
32 
–124 
–2022 
2022 

–180

–115

–124 

–180

–59

–14 

CALCULATION OF THE FINANCIAL IMPACT OF THE HEALTH CHECK PROPOSALS IN THE MILK SECTOR ON ASSIGNED REVENUE 

Budget year 

Legal base 

2009 

2010 

2011 

2012 

2013 

MILK SECTOR 
– Impact on the super levy following increases of dairy quota (decrease of amount) 

– 

– 

– 

–55,1 

–110,2 

CALCULATION OF THE FINANCIAL IMPACT OF THE HEALTH CHECK PROPOSALS IN THE MARKET SECTOR 

Mio € 

Budget year 

Legal base 

2009 

2010 

2011 

2012 

2013 

A. HC abolition of set aside and restricting intervention to wheat only 
Impact on export refunds for cereals 
Impact on intervention storage for cereals, including limiting intervention to wheat* 
B. Other measures 
Premium for potato starch 
Production refunds for starch 

Art. 10-13, Art. 18 

0,0 
0,0 

0,0 
23,7 

Art. 84a, 95a  
ex Art. 96 

0,0 
47,8 

0,0 

0,0 
78,3 

–43,4 
0,0 

0,0 
73,3 

–43,4 
0,0 

TOTAL 
29,9 
*  The HC scenario has been calculated with buying-in wheat at the full intervention price. However, with intervention based on tendering (HC proposal), this should be considered as a maximum 

47,8 

23,7 

34,9 

0,0 

impact. The magnitude of any reduction is not quantifiable at this stage. 

EN 

157 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
  
RICE SECTOR 
– Abolition of rice intervention 

FLAX AND HEMP 
– Transitory coupled aid 

DRIED FODDER 
– Abolition of market aid 

Art. 10 

R. 1234/2007 
Art. 92 to 94 

R. 1234/2007 
Art. 86 to 90 

– 

– 

– 

–4,2 

–8,1 

–52,3 

–145,2 

–145,2 

MILK SECTOR 
A. Measures made optional with possible budgetary impact: 
– Butter intervention: optional intervention by tender after purchase of 30 000 t by tender 
Art. 18 
– SMP intervention: optional interv. by tender after obligatory purchase of 109 000 t by tender  Art. 18 
Art. 34a 
– Private storage for butter is made optional as based on the market situation 
Art. 99  
– Aid for SMP as feeding stuff is made optional as based on the market situation 
– Aid for casein production is made optional as based on the market situation 
Art. 100  
B. Measures with budgetary impact: 
– Abolition of the disposal aid for butter 
– Abolition of the private storage aid for cheese 
C. Quota system (soft landing) 
– Impact on the export refunds (b)  

ex Art. 101 
ex Art. 28(b)  

TOTAL MILK AND MILK PRODUCTS 

PIGMEAT SECTOR 
– Abolition of pigmeat intervention 

ex Art. 17 

Abolition of Art. 44 of R. 1234/2007 (animal diseases) (a) 

ex Art. 44 

a 

(–18) 

(–18) 

(–18) 

(–18) 

–10,0 
–24,0 

–10,0 
–24,0 

–10,0 
–24,0 

–10,0 
–24,0 

1,6 

2,5 

2,3 

2,1 

–32,4 

–31,5 

–31,7 

–31,9 

– 

– 

– 

– 

– 

– 

– 

– 

(a)  With the proposal these measures will in the future be financed under the new Article 60 of the new regulation replacing Regulation (EC) No 1782/2003. 
(b)  assuming that the hypothesis retained for market balance will materialise. 

EN 

158 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CALCULATION OF THE FINANCIAL IMPACT OF THE HEALTH CHECK PROPOSALS IN THE DIRECT PAYMENTS SECTOR 

Budget year 

DIRECT PAYMENTS (before modulation) 

2008 

2009 

2010 

2011 

2012 

2013 

A. Impact of adding new measures in the direct payments and abolishing some existing direct payments 

B. Impact of decoupling in SPS existing coupled direct payments 

C. Impact of decoupling in SPS existing re-coupled direct payments previously excluded 

TOTAL DIRECT PAYMENTS (excluding effect of modulation) 

D. Transfer of modulation amount to Rural Development 

0,0 

0,0 

0,0 

0,0 

–90,0 

–54,1 

0,0 

–144,1 

563 

977 

85,8 

85,8 

–54,1 

–54,1 

0,0 

31,7 

1427 

0,0 

31,7 

2022 

Budget year 

Legal base 

2008 

2009 

2010 

2011 

2012 

2013 

INCLUSION OF NEW MEASURES IN DIRECT PAYMENTS (SPS/SAPS) AND ABOLITION OF EXISTING DIRECT PAYMENTS (before modulation) 

A. New measures included in the direct payments scheme (SPS or SAPS) 
Dried fodder 
Long Fibre flax 
Potato starch processing aid 
B. Abolition of existing direct payments scheme 
Energy crops 

C. Impact = A + B  

Title III 
Proposal 

ex Art. 88 

INCLUSION OF EXISTING COUPLED DIRECT PAYMENTS IN THE SPS/SAPS (before modulation) 

A. New measures included in the SPS or SAPS 
Protein crops 
Rice 
Nuts 
Potato starch aid to growers 
Aid to olive groves 
Specific quality premium for durum wheat 

EN 

Title III 
Proposal 

Total 

159 

124,3 
8,1 
43,4 

124,3 
8,1 
43,4 

–90,0 

–90,0 

–90,0 

–90,0 

85,8 

85,8 

0,0 

66,3 
90,5 
98,6 

105,2 
94,4 
455,0 

67,7 
90,6 
98,9 
63,4 
105,5 
94,5 
520,7 

69,1 
181,5 
99,3 
64,0 
105,8 
94,6 
614,3 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
 
 
 
 
  
 
 
 
 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
B. Abolition of the corresponding coupled direct aids 
Protein crops 
Rice 
Nuts 
Potato starch aid to growers 
Aid to olive groves 
Specific quality premium for durum wheat 

C. Impact = A + B 

Budget year 

Art. 76-78 
Art. 79-82 
Art. 83-87 
Art. 93-94 
Art. 110i 
Art. 72-75 
R. 1782/2003 

Total 

–86,6 
–90,5 
–98,6 

–105,2 
–128,2 
–509,1 
–54,1 

–88,0 
–90,6 
–98,9 
–63,4 
–105,5 
–128,3 
–574,8 
–54,1 

–89,4 
–181,5 
–99,3 
–64,0 
–105,8 
–128,4 
–668,4 
–54,1 

Legal base 

2008 

2009 

2010 

2011 

2012 

2013 

INCLUSION OF IN THE SPS OF EXISTING RECOUPLED DIRECT PAYMENTS FOLLOWING OPTIONAL EXCLUSIONS (before modulation) 

A. New measures included in the SPS 
Cop payments 
Durum wheat supplementary payment 
Special beef premium 
Slaughter premium adults 
Slaughter premium calves 
Seeds 
Hops 
B. Abolition of the corresponding re-coupled direct aids 
Cop payments 
Durum wheat supplementary payment 
Special beef premium 
Slaughter premium adults 
Slaughter premium calves 
Seeds 
Hops 

C. Impact = A + B 

Title III 

Art. 66 
Art. 68 
Art. 68 
Art. 68 
Art 70-1a 
Art. 68a 

1526,7 
56,8 
51,9 
118,3 
66,4 
30,9 
2,6 

1526,7 
56,8 
52,5 
118,3 
66,4 
30,9 
2,6 

1526,7 
56,8 
106,3 
236,6 
132,7 
30,9 
2,6 

  –1526,7  –1526,7  –1526,7 
–56,8 
–106,3 
–236,6 
–132,7 
–30,9 
–2,6 

–56,8 
–52,5 
–118,3 
–66,4 
–30,9 
–2,6 

–56,8 
–51,9 
–118,3 
–66,4 
–30,9 
–2,6 
0,0 

0,0 

0,0 

CALCULATION OF THE FINANCIAL IMPACT OF THE HEALTH CHECK PROPOSALS ON RURAL DEVELOPMENT 

Budget year 
amounts from increased compulsory modulation 
TOTAL 

2009 

2010 

2011 

2012 

0 

0 

563 

563 

977 

977 

1427 

1427 

Mio € 
2013 

2022 

2022 

EN 

160 

EN 

 
  
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
  
  
  
  
EN 

161 

EN